Guide to Conveyancing

1. What is Conveyancing?
2. Conveyancer's Actions on Receipt of Deed of Sale
3. Existing Bond on Property
4. The Role of the Municipality
5. Preparation of Preliminary Documents
6. Signature and Costs
7. Purchaser's Bond
8. Final Phase
9. How long does it take?

1. What is Conveyancing?

Conveyancing describes the legal procedure whereby ownership of immovable property is

changed (i.e. ownership is "conveyed" from the existing owner to the purchaser).

2. Conveyancer's Actions on Receipt of Deed of Sale

(i) It is self-explanatory that the Conveyancer in performing his duty will be guided by the
contents of the Agreement concluded between the buyer and the seller as recorded in the
Deed of Sale. The Conveyancer therefore, is compelled to "Bake the Cake" in accordance with
the "Recipe" prepared for us in advance.

(ii) On receipt of the Deed of Sale, the Conveyancer will immediately conduct a Deeds Office
search. This Search will reveal the following:

 The full Deeds Office description of the property being sold.

 The full details of the current registered owner.
 The full details of the bonds held over the property.
 The full details of any interdicts recorded against the property.

3. Existing Bond on Property

(i) The Conveyancer will simultaneously with the above, address a letter to the current
bondholder advising the bondholder of the fact that the property has been sold and calling
upon the bondholder to forward the Title Deed to the Conveyancer. He will simultaneously ask
the bondholder to advise the Conveyancer of the amount required to pay off the existing bond
on registration of transfer and request the bondholder to instruct his own attorneys to prepare
an appropriate Consent to Cancellation of the existing bond. This latter form will be prepared
by the bondholder's attorneys, signed by the bondholder and returned for purpose of
subsequent lodgement at the Deeds Office. As most financial institutions are unable to trace
the file in which the Title deed and Bond are retained without an account number, it is
important that the particulars of the bond account number be reflected in the information
section of the Deed of Sale.

(ii) The Conveyancing Attorney will in due course receive a response to his letter to the existing
bondholder. This letter would have enclosed the Title deed and would have stated the
amounts required by the bondholder on cancellation of the bond. Should the purchase price
be sufficient, the Conveyancing attorney will address a letter to the attorneys representing the
bondholder, promising payment of the amount required on date of registration at the Deeds
Office.

4. The Role of the Municipality

The Conveyancer will simultaneously write to the Municipal authority having jurisdiction over
the area in which the property is situated and will request from them the following
information/documentation:

(i) A Valuation Certificate in which the Municipal Valuation of the property is stated - this
document is required for purposes of obtaining a transfer duty receipt from the Receiver of
Revenue.

(ii) The amount which the Municipal Authority requires payment of as a prerequisite to issuing
a Rates Clearance Certificate - in terms of the Law, no transfer of any property may be
registered in the Deeds Office unless the relevant Municipal Authority has provided permission.
This permission is termed a 'Rates Clearance". It is important to note that in obtaining a Rates
Clearance, one is compelled (regardless of any arrangement the Seller might otherwise have
had with the Municipal Authority) to pay the full amount of rates payable on the property to
the end of the current rates year. Municipal Authorities furthermore demand various other
categories of payment in advance e.g. water and service charges. Part of the amount payable
to the Municipal Authority will be for the account of the Seller and part for the account of the
purchaser.

5. Preparation of Preliminary Documents

On receipt of the Deeds Office particulars and subject to all suspensive conditions having been
fulfilled, the Conveyancing attorney will proceed to prepare his "preliminary documentation".
These documents comprise the following:

(i) A Power of Attorney in terms of which the seller authorises the Conveyancing attorney to
act on his behalf and appear at the deeds Office for purposes of registering the transfer of
ownership at the end of the day. The document will have to be signed by the seller personally
or by somebody authorised in terms of a written Powers of Attorney to sign such document on
behalf of the Seller. It is therefore self-explanatory that if the Seller is going to be away during
the relevant period, the transfer will be delayed unless adequate arrangements are made
before his departure.

(ii) Declarations by Purchaser and seller to the Receiver of Revenue. As you are no doubt
aware, transfer duty is payable to the Receiver of Revenue arising from sales of immovable
property. This transfer duty is a percentage of the purchase price. The Receiver of Revenue is
therefore quite anxious to ensure that he is fully advised of the actual purchase price and that
such purchase price furthermore elates to a fair and market related price. The declarations
which the buyer and seller will therefore have to sign serve to conform all the above facts.
Should the purchaser and the seller therefore have reached some "private agreement" in terms
of which the purchase price as stated in the Deed of Sale is not a proper reflection of the
purchase price, then these declarations will serve to frustrate the endeavours of the parties as
stated above.

(iii) Affidavits to be signed by the purchaser and the seller, confirming there correct name,
identity numbers, marital status and solvency.

6. Signature and Costs

When these documents are ready, the parties will be contacted by the Conveyancing attorneys
with a view to arranging an appointment for the signature of the documents. On signature of
the documents, the Conveyancing attorneys will ask the purchaser to settle the transfer costs.
The account which the Conveyancer will present will comprise four elements being the
following:

(i) The Conveyancer's own fees plus VAT thereon.

(ii) The cost of the valuation certificate (See paragraph 4.2).

(iii) The transfer duty.

(iv) Deeds Office Fee.

It is important that the purchaser settle these costs at least one month before scheduled date of
transfer, as the Conveyancer is required to pay the transfer duty to the Receiver of Revenue
before one may approach the Deeds Office. The Conveyancer will simultaneously recover from
the purchaser his pro rata share of rates and taxes in order that a Rates clearance can also be
obtained. As soon as these costs have been paid, the Conveyancer will forward his cheque plus
supporting documentation to the Receiver of Revenue for the issue of a transfer duty receipt. A
cheque will simultaneously be sent to the Municipal Authority for purposes of the issue of a
Rates Clearance Certificate.

7. Purchaser's Bond

In the interim the Conveyancing attorney will receive notification from Attorneys instructed by
the financial institution who will be granting the purchaser a bond advising of their identity
and of the nature and extent of their instructions. The Conveyancing attorney will immediately
send to these "bond attorneys", a draft copy of the new title deed of the property. This
document is termed the "flysheet". This document enables the bond attorneys to determine the
description of the property which is to be bonded and furthermore to determine the full details
of the purchaser. The bond attorneys will then prepare their own documentation and arrange
for the purchaser to call at their offices to sign their papers and pay their costs.

8. Final Phase
When everybody is ready (the bond attorneys documents are signed, the bond cancellations
attorneys consent to cancellations in their possession and duly signed by the bond holder, the
transfer duty receipt and rates clearance have been received), the Conveyancing attorney will
contact all the other Attorneys involved and arrange simultaneously "lodgement" at the Deeds
Office. On the pre-arranged date all the Attorneys simultaneously hand their folders of paper
into the Deeds Office. These papers are then collated by the Deeds office and allocated to a
specific Examiner. The Deeds Office Examiner inspects all the documents, and if found to be on
order, approves the documents for registration. This procedure in the Deeds Office takes
approximately ten days. If any difficulties are discovered in any of the papers, the documents
are 'rejected". If the documents are approved for registration, the Conveyancing Attorney, after
ensuring that all the finances for the transaction have either been paid or alternatively secured,
will arrange with all the Attorneys concerned for the actual registration to take place. At the
moment of registration, ownership passes from the seller to the purchaser and the transaction
is complete.

9. How long does it take?

It is self-explanatory from the above that that it is very difficult to estimate precisely how long a
transfer should take from the time that the Conveyancing attorney receives his instructions. If
one is forced to make an estimate, then one can assume that if all the parties involved in the
transaction perform their functions timeously, that the entire transaction could be completed
within a period of six to eight weeks from the time of receipt of the initial Deed of Sale.

We thank you for making use of our services and should you require any further assistance, we
invite you to contact any of our Property Department Partners, namely

Fred Wille

Andrew Murray

Milton Koumbatis

Willie Knoetze

Francois Tradoux

Michael Ngubeni