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When sellers sell to two different purchasers: a costly exercise - BEWARE
24 April 2018
 
In a 2017 judgement handed down in a case between Anthony and Another v Japies, the following set of facts was dealt with:

Mr and Mrs Japies sold their property to the Anthony’s in 2016 and appointed BN attorneys to attend to transfer. One month later, they sold the same property to the Lodewyk’s and appointed VT attorneys. Mr and Mrs Anthony knew nothing about this. VT attorneys notified the estate agent about their appointment and the first conveyancer requested VT attorneys for an undertaking not to proceed with their transfer pending a claim for specific performance in terms of the first agreement of sale.  VT attorneys advised BN attorneys that they were proceeding nevertheless based on specific instructions from the sellers. Transfer was effected into the name of the second purchasers a few months later.

Two questions had to be considered by the Court.  Firstly whether the Anthony's, the first purchasers, were entitled to an order for transfer of the property to them; and secondly, who was liable for the legal costs?

The Court found that the matter concerned a double sale and that "he who is earlier in time, is stronger in law".  Therefore transfer of the property to the Lodewyk's could not prevent the Anthony's claim that the property be transferred to them.  In a 2007 judgment the Court confirmed that there was no reason why a first purchaser could not claim transfer of the property directly from the second purchaser who acquired the property with the knowledge of the first sale.

In the present instance the second purchasers knew of the first agreement and chose to proceed with transfer regardless.  Had they in fact NOT known of the first agreement, their claim to the property would have been unassailable.  The Anthony's claim was therefore successful and the property had to be transferred to them from the Lodewyk's.  The Court ordered that the costs had to be paid by the sellers.
 
 
 
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Tags: Property, Fraud