Which party has the right to appoint the conveyancer in a property transfer?
Whilst the appointment of the conveyancer is up for negotiation between the purchaser and the seller, the general position throughout South Africa is that, where the parties cannot agree, the seller shall nominate the conveyancer.
This is based on the case of James v Liquidators of the Amsterdam Township Company (1903) which held that even though the purchaser is paying the costs, the conveyancer will act as an agent of the seller and therefore the seller should be entitled to choose their own agent and not have one forced upon them.
Some other reasons to support this approach are:
- The purchaser is more likely to delay the transfer or breach the terms of the agreement as they have additional obligations to raise the purchase price and pay transfer costs. The conveyancer is placed in a dilemma when it is their client who does not perform in terms of the agreement.
- One of the most important responsibilities of a conveyancer is to ensure that the purchase price is secured before transfer of the property is passed to the purchaser. It is easier for the seller's conveyancer to insist that the purchase price be properly secured rather than be swayed by undertaking’s to pay provided by their client purchaser.
At one point the practice was different in Kwazulu-Natal in that it was the purchaser who had the right to nominate the conveyancer. In the case of Kothandan v Arbuthnot (1920), whilst the court held that it was the purchaser’s right to nominate the conveyancer, it acknowledged that there was a movement by practitioners toward the custom that the seller should nominate. Following this judgement there was a concerted effort on the part of practitioners to insert a clause in the sale agreement stipulating that the seller would nominate the conveyancer, indicating that in 1920 the custom of nominating a conveyancer was changing from that of the purchaser to that of the seller to be in accordance with the rest of South Africa. Nearly 100 years on, it seems clear that the practice of the purchaser nominating the conveyancer has been abrogated by disuse and that current custom is that the seller should nominate in the absence of an agreement between the parties.
Regardless of who nominates the conveyancer, the conveyancer owes a duty of care to both the seller and the purchaser.