Sale agreements concluded prior to the death of either party to a sale agreement and where transfer and registration has not taken place as yet, remains valid and enforceable however the death of either party will inevitably cause a delay with the transfer and registration of the property.

Consequences of the death of the Seller

Should the Seller pass away before registration, the Power of Attorney to pass transfer signed by the Seller in favour of the transferring attorneys becomes invalid, even if the matter has been lodged in the deeds office.

The matter will have to be withdrawn until an executor has been appointed by the Master of the High Court who needs to sign the necessary documents on behalf of the estate, including a Power of Attorney to pass transfer.

This power of attorney to pass transfer must then be endorsed by the Master of the High Court in terms of Section 42(2) of the Administration of Estates Act 66 of 1965.

The Master of the High Court will only endorse the Power of Attorney to pass transfer once it has satisfied itself that the requirements have been met and the necessary consents from the heirs have been obtained.

Consequences of the death of the Purchaser

The executor of the deceased estate would have to act on behalf of the estate and also sign the necessary documents to effect transfer. In some instances, there might be further complications for example when the Purchaser had bought the property with mortgage bond finance from a bank.

The possibility remains that the bank might withdraw the mortgage bond approval as there would no longer be an income to finance the bond after registration. In the event that the bond is not granted at the time of death, the agreement will lapse, as obtaining mortgage bond finance is a suspensive condition.

If the Purchaser entered into a cash transaction, the executor in the estate of the Purchaser would possibly be obliged to proceed with the transaction however the executor could also negotiate a mutual cancellation with the Seller due to the unforeseen circumstances.

It is important to note that it takes a very long time for the Master to appoint an executor for the estate of the deceased which will thus cause severe delays in the matter. This should be communicated with all parties involved.

РAlicia Marié Stieger
Attorney, Notary & Conveyancer