While the conveyancer’s primary duty is to facilitate the transfer of ownership of immovable property, a key question emerges: whose interests do they serve when the deal turns sour? The answer is not as clear as it seems.

Is there influence by the appointing party on the conveyancer

A conveyancer is required to act impartially, in accordance with the sale agreement and to generally observe legal professional ethics.

In South Africa, it is standard practice for the seller to appoint the conveyancer. This is not cast in stone as the parties may agree for the purchaser to nominate the conveyancer in the sale agreement.

It is a well-established principle that when a conveyancer accepts the appointment in terms of a sale agreement, they accept the appointment as an agent for (at least) the seller in the transaction and to fulfil the terms of the sale agreement.

In the case of Basson v Remini and Another [1992] (2) SA 322 (N), the High Court accepted the view that, by accepting the appointment as the conveyancer in the transaction between the seller and purchaser, the conveyancer becomes the agent of both parties.

In contrast, in Manna v Lotter and Another [2007] (4) SA 315 (C), the High Court found that the conveyancer appointed to attend to the transfer of the property was, in fact, the agent of the seller. Accordingly, any information received by the conveyancer or decision made by them was deemed to have been received or made by the seller as the principal.

Until the property is transferred to the purchaser, however, the conveyancer holds the purchase price on behalf of the purchaser. As confirmed in Basson, by accepting funds from the purchaser, the conveyancer also assumes a duty to act as the purchaser’s agent in relation to those funds. This dual role raises an important question: when a dispute arises between the parties, could the conveyancer’s position unfairly prejudice the rights and interests of one party over the other?

The conveyancer’s duty in a dispute

It is not uncommon for disputes to arise between parties before the transfer of immovable property.

As attorneys, conveyancers have the expertise to assist parties to a sale agreement in resolving disputes without the need for litigation. They can act as facilitators in negotiations and help structure settlements to reach an amicable resolution, which can save time and costs. However, parties should be mindful that if a dispute cannot be resolved amicably, the conveyancer’s role may be limited due to a potential conflict of interest.

When a dispute arises between the parties, the deposit or full purchase price may be held in trust by the conveyancer even though the transfer is no longer to take place due to the cancellation of the sale agreement.

While each case is fact dependant, South African courts have generally held that a conveyancer’s duty extends beyond the party who appointed them – they are responsible for ensuring that both the buyer’s and seller’s rights are protected in the transaction, regardless of which party appointed them.

For instance, in Johan Willem Bruwer and Another v Pocock and Bailey Incorporated and Another (H84/2006, 22/2009) [2009] ZAWCHC 167, the High Court concluded that the conveyancer held a legal duty to protect both the seller’s and the purchaser’s interests.

Similarly, in Heckroodt v Wall (A836/2014) [2016] ZAGPPHC 433, the High Court emphasised that conveyancers have a legal duty to act diligently and in the best interests of all parties involved in property transactions. Failure to fulfil this duty may result in a delictual liability claim against the conveyancer.

What is of paramount importance is that the conveyancer implements and gives effect to the clauses of the sale agreement, properly construed. For example, the sale agreement may provide for payment to the seller of monies in trust as agreed liquidated damages in the event that the sale agreement is cancelled as a result of a default by the purchaser. In this instance, the conveyancer will have to comply with the terms of the sale agreement.

Not only will a conveyancer be required to give effect to the clauses of the sale agreement (regardless of who appointed them), a conveyancer will also be required to give effect to an order of court regarding monies being held by them pursuant to the sale agreement, should the parties’ dispute reach court for resolution.

What does this mean for the purchaser?

A purchaser of immovable property remains protected by law, even if the seller appoints the conveyancer. A conveyancer must act fairly and ensure compliance with the sale agreement.

Conversely, for a seller of immovable property, the right to appoint a conveyancer does not allow undue influence over the process.

Protecting your interests in property transactions

A conveyancer plays a crucial role in facilitating property transactions and while they can assist in resolving disputes, their duties are ultimately guided by the sale agreement and the nature of their appointment. It is essential for both buyers and sellers to understand their rights and the conveyancer’s role in the process. If a dispute arises and cannot be resolved amicably, it is important to recognise when to seek independent legal advice to ensure that your interests are properly protected.