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Tuesday Dec 18, 2012

How to ensure no disputes arise over fixtures, fittings when selling

Disputes often arise between buyers and sellers concerning fixtures and fittings when these aren't listed in the sale agreement.

There are often certain items that sellers have installed and would like to remove from the property and take with them when they move.

"Sellers often ask agents whether they are allowed to do this and the answer is yes, provided that both parties are in agreement. Alternatively, if the agreement of sale excludes any specific item, the seller is entitled to remove it," says Adrian Goslett, chief executive of RE/MAX of Southern Africa.

The general rule when it comes to fixtures and fittings is that the buyer of a property receives the land, the permanent physical improvements - such as any buildings erected on the land - along with all items that are permanently attached to the improvements or buildings that are erected on the land.

"When disputes do occur, it is normally because the agreement of sale is vague and simply states the property is sold 'as is' or voetstoots and includes all upgrades, fixtures and fittings of a permanent nature. It's important to determine what is regarded as permanent, and to do this three questions must be asked," says Goslett. These are: What is the nature and purpose for which the item was attached? The item must be attached to the land or the structure erected on the land. It should be of a permanent nature or intended to always serve the land.

How and to which degree was the item attached? It should be sufficiently attached so as to become part of the land or structure. If removing the item will cause substantial damage to the structure, i t should be considered permanent.

What was the intention of the owner when attaching the item? If the intention of the owner was to permanently attach the item, then that should be taken into consideration.

Goslett says that generally if the item is bolted down, cemented, sown or planted and has taken root, it normally becomes permanent. He notes that some items such as wendy houses and pergolas or other similar structures can be contentious issues. If they are permanent structures that will remain on the property, the seller should provide plans to the buyer.

"It is very important that the sale of agreement between the buyer and seller covers all aspects of the transaction to ensure that nothing is left to interpretation by either party. There are some agreements that do not refer to fixtures and fittings at all, however, taking the time and care to ensure proper drafting of your agreement could save you possible frustration later on," says Goslett.

"Ensure that all aspects and agreements are in writing, do not rely on verbal communications and always create a paper trail. If a dispute does arise, the court will consider all the surrounding circumstance, facts and even the conduct of the seller.

"Therefore the seller should always be aware, whether or not his action may be creating a certain impression as to whether or not an item is included in the sale."

Goslett says sellers should prepare lists itemising exactly what is to be sold with their homes before listing properties with estate agents.

"The list should be incorporated into the mandate to sell so that the agent can point out to potential buyers any items that will be removed by the seller at a later stage," he says.

A basic clause concerning the fixtures and fittings should be included in the agreement of sale, otherwise referred to as the offer to purchase. The clause should be similar to the following:

The property is sold inclusive of all existing fixtures and fittings of a permanent nature, which the seller warrants are his/ her exclusive property, fully paid for and in working condition, including but not limited to: the existing garden, trees, shrubs, plants, curtain rails, rods, pelmets, fitted carpets, the light fittings, stove and/or oven, hanging mirrors, towel racks, shelves, as well as special tap fittings, removable kitchen units, tennis court net, fireplace grate/blower, fitted kitchen storage units, awnings, post box, burglar alarm system, doorbell/knocker, the television aerial and accessories (if applicable), pool filter, pump and all cleaning equipment including automatic pool cleaner (whether fixed or movable, if applicable), swimming pool equipment, inner and outer door keys.

"It's clear that the list could be endless and it is therefore important for sellers to consider exactly what they are intending to sell," Goslett says.

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