Voetstoots: what buying as it stands really means

What voetstoots means

Voetstoots is an Afrikaans word that has long been part of South African contract law. It means the thing is sold as it stands: you buy the house, the bakkie or the forklift in the condition it is in, with whatever is wrong with it, seen or unseen.

It matters because of what the law gives a buyer without it. Under the common law, a seller is liable for latent defects: hidden faults that make the thing unfit, or partly unfit, for the purpose it was bought for. If one turns up, the buyer can generally claim to undo the sale and get the price back, or to have the price reduced. Lawyers call these the aedilitian remedies.

A voetstoots clause switches that liability off. In Odendaal v Ferraris (2008) the Supreme Court of Appeal accepted, as common ground between the parties, that the whole purpose of the clause is to exempt the seller from liability for defects the seller is not aware of. The clause in that case said the property was sold voetstoots, "there being no warranty against defects, latent or patent".

At our auctions, assets are sold voetstoots unless the conditions of sale expressly say otherwise for a specific lot. The rest of the process is on our buying on auction page.

Latent and patent defects

The definition the courts use comes from Holmdene Brickworks v Roberts Construction (1977), quoted again by the Supreme Court of Appeal in Odendaal. A defect is an abnormal quality or attribute that destroys or substantially impairs the usefulness of the thing for the purpose it was sold for, or is commonly used for. It is latent when it is not visible or discoverable on an inspection.

A patent defect is one a reasonable inspection would have shown you. As a general rule, a buyer who had the chance to inspect and still bought with patent defects has no claim against the seller, voetstoots clause or not. The clause does its real work on latent defects.

The defect must also have existed when the sale was concluded, not developed afterwards.

Treat the table as a guide, not a ruling: whether a defect is latent depends on the facts.

Not only bricks and engines: approvals, title and use

A defect does not have to be physical. In Odendaal the buyer found, after moving in, that a carport and an outbuilding lacked the approvals required under the National Building Regulations and Building Standards Act and the municipal regulations. The Supreme Court of Appeal held that the missing approval was a latent defect, and that a voetstoots clause ordinarily covers it. Because the buyer could not show the seller had deliberately hidden it, the problem stayed his.

The court drew one line: where the missing approval makes the property unfit for the purpose it was bought and sold for, the position can be different, as in an older case where a business sold as a restaurant could not lawfully be run as one.

The same judgment noted that in a sale of land "as it stands", the wording has been held wide enough to cover defects in the title to, or the area of, the property. The practical lesson is to check the paperwork as well as the walls.

When voetstoots does not protect the seller

A voetstoots clause is not a licence to hide things. The test comes from the Appellate Division in Van der Merwe v Meades, and the Supreme Court of Appeal restated it in Odendaal: to escape the clause, the buyer must show that the seller knew of the latent defect and did not disclose it, and that the seller deliberately concealed it with the intention to defraud.

• The burden is on the buyer. You must prove the defect existed at the time of the sale, that the seller knew of it, and that it was dishonestly concealed.
• Fraud is not lightly inferred. In Odendaal the buyer’s allegations were too vague, and he lost.
• Half-truths can count. The court added that a reckless half-truth, or knowing the facts but not revealing them because the seller has not bothered to consider their significance, may amount to fraud.

What concealment looked like in a real case

In Banda v Van der Spuy (2013), a thatch roof leaked before the house was sold. The sellers had it repaired, and an insurance assessor told the seller the work was not as he would have wished. The seller then undertook in writing to hand over a guarantee on the repair that, to his knowledge, had already expired. The roof kept leaking.

The Supreme Court of Appeal held that the sellers knew the defect had not been properly fixed and had concealed it, which cost them the protection of the voetstoots clause. They were ordered to pay R449,499 with interest, the reasonable cost of repairing the roof (Banda v Van der Spuy [2013] ZASCA 23). The court rejected the seller’s claim that he honestly believed the repair had worked, partly because he had avoided asking the people who could have told him otherwise. Deliberately not finding out is not the same as not knowing.

What was said before the sale

A fraudulent misrepresentation, like the false guarantee in Banda, gives the buyer a separate claim for damages. An innocent one is much weaker. In Odendaal the estate agent had assured the buyer the pool and buildings were faultless. The buyer did not even allege that the agent knew otherwise, so the court held that at best this was an innocent misrepresentation, which could not get past the voetstoots clause. The same judgment confirmed that an estate agent’s misrepresentation made in carrying out the mandate binds the seller, whether or not the seller knew it was made. If an assurance matters to you, get it in writing, and still check.

How the Consumer Protection Act fits in

It is often said that the Consumer Protection Act (CPA) ended voetstoots. At an auction, the Act’s main quality right does not apply, so voetstoots still does most of its old work. Other parts of the Act are not excluded for auctions in the same way, so if your question goes beyond section 55, ask an attorney.

The Act is aimed at business sellers

The CPA applies to transactions with a supplier acting in the ordinary course of business, and its definition of goods includes a legal interest in land, so it can reach property as well as movables. Where it applies, section 55 gives the consumer a right to goods of good quality, in good working order and free of defects, whether a defect was latent or patent. A business seller can sell goods in a stated condition. The suitability and quality rights in section 55(2)(a) and (b) fall away where the consumer was expressly told that the goods were offered in that specific condition and either expressly agreed to accept them that way or knowingly acted in a way consistent with accepting them (section 55(6)). That subsection does not lift the durability and standards rights in section 55(2)(c) and (d). A person selling their own home once is generally not acting in the ordinary course of business, so in most private sales voetstoots works as it always did.

Section 55 does not apply to auction goods

Section 55(1) is a single sentence: the section "does not apply to goods bought at an auction, as contemplated in section 45". So the CPA’s quality right does not follow a lot bought under the hammer, whoever the seller is. Section 56, the implied warranty of quality and its six-month return right, works by reference to the section 55 standards, and how it applies to auction goods is a question for an attorney.

What the regulations do give an auction buyer

The auction regulations give you a right that matters here. The auctioneer must allow a reasonable time and opportunity to inspect the goods before the auction starts, and may not charge for it (regulation 28(5)). The rules of auction may not exclude that right (regulation 21(9)). For motor vehicles, regulation 32 requires a notice on the vehicle throughout the viewing, covering among other things the VIN, the engine number and whether the odometer reading is guaranteed. Our rules of auction page explains the document that governs each auction and how to get a copy.

Voetstoots at an auction in practice

Three things about auction sales make voetstoots bite harder than in an ordinary private sale.

• The seller often knows little. Many lots come from deceased and insolvent estates, liquidations and business rescue, sold by an executor, trustee, liquidator or business rescue practitioner who never lived in the house or drove the truck, so expect little history. The fraud exception turns on what the seller knew, or deliberately avoided finding out, and on what the seller or the seller’s agent told you (more on estate auctions).
• The hammer makes the contract. Once your bid is accepted at the fall of the hammer, you are bound on the conditions of sale for that auction. Do not count on commissioning a report afterwards: your checks happen before you raise your hand.
• The paperwork sets the terms. The conditions of sale say whether anything is excluded from the voetstoots clause for a specific lot, when risk passes to you, and who arranges and pays for compliance certificates. Read the set for the lot you want.

Compliance certificates are a separate question

Voetstoots deals with the seller’s liability for defects, not with the certificates the law requires when property changes hands. The Electrical Installation Regulations, for example, do not allow a change of ownership on an electrical certificate of compliance older than two years (regulation 7). The conditions of sale say who obtains and pays for the certificates, and the conveyancer will tell you which ones the property needs. Find out before you bid.

How to protect yourself before you bid

Voetstoots moves the risk, and the homework, to you.

For property

1. Go to the viewing and see everything. Viewing times are published with each auction (see upcoming auctions). If a room, outbuilding or roof space is locked, ask for access. In Odendaal, water damage in a locked outbuilding counted against the buyer because he could have asked to see inside.
2. Take an expert. A building inspector, electrician, plumber or roofer will find in an hour what you would miss in a weekend.
3. Ask direct questions, in writing. Has the roof leaked? What has been repaired, by whom, and is there a guarantee? Are there approved plans for every structure? Any damp, cracks, sewer problems or insurance claims? Written answers are evidence later; false ones are what fraud claims are built on.
4. Compare the plans with what is built. Check any approved building plans against what is actually there, especially outbuildings, carports and enclosed patios.
5. Check the title. An attorney or conveyancer can search the deeds record and read the title deed for servitudes and restrictive conditions before you bid.
6. Read the conditions of sale and any report the seller makes available. If value or condition matters to your decision, use your own independent valuer or inspector.
7. Price the repairs into your limit. Work out what the property is worth to you after the work it needs and the costs of buying, and stop bidding there. Our guide to the costs of buying property on auction lists them.

For vehicles, plant and equipment

• Match the VIN and engine number on the vehicle with the registration papers.
• Start it if you are allowed to, and look underneath. Auction vehicles have often stood for months.
• For plant, check the hour meter and the service records, and run it under load if the viewing allows.
• Run a vehicle history check and confirm that any finance will be settled.

The vehicle auctions page and our guides to buying a vehicle on auction and plant and machinery auctions go further.

If you find a defect after the sale

Answer these questions honestly. Did the defect exist when the sale was concluded? Can you show that the seller knew about it and hid it? Or that the seller, or someone acting for the seller, told you something about it they knew was false? If the defect came later, or you can show neither, a claim is unlikely to get past the voetstoots clause. A defect you could have seen at the viewing is, as a general rule, your risk anyway. If you still think you have a case:

1. Record it. Photographs, dates, and a qualified person’s written report on the defect, how long it has probably been there and the cost to fix it.
2. Gather what you were told. The catalogue entry, emails, written answers to your questions, and any report or guarantee you were given.
3. Do not take matters into your own hands. In Odendaal the buyer told his bank to hold up the transfer while he argued about the defects. The Supreme Court of Appeal held that this was a repudiation of the sale, the seller was entitled to cancel, and he was ordered to vacate the house. Do not stop a payment or hold up transfer without an attorney’s advice.
4. See an attorney promptly. Under the Prescription Act (sections 11 and 12), most claims of this kind prescribe after three years, generally counted from when you knew, or could reasonably have known, the facts and who is liable.
5. Tell us. If you bought at one of our auctions, contact us with the lot number and what you have found.