In cases
where property has been damaged due to hail; floods or tornado’s or any other
circumstances beyond the control of the buyer or seller it is imperative to distinguish
whether the
property has been transferred.
Dependant on the Offer to Purchase (“OTP”),
most OTP's will contain a clause which will determine when risk transfers. In
TPN’s OTPs, one can refer to the clause on Possession & Risk which states:
“Legal Possession of the Property shall be given to the
Purchaser on the Registration Date, from which date all benefits and risks in
respect of the Property, including the liability of all rates, taxes and levies
on the Property, shall pass to the Purchaser, subject to anything to the
contrary that may be contained in clause 9.2.” [Clause 9.2
refers to Vacant Occupation].
Therefore, only when the property has transferred to the Purchaser,
will the Purchaser be liable for any damage to the property. Until then, the
Seller will remain liable for any damages that may have resulted due to the
flooding.