What happens if a suspensive condition is not met?

A suspensive condition is a term or clause within a contract that clearly stipulates a particular criterion that must be met in order for the contract to come into force. Should the suspensive condition(s) not be met, the contract will be void.

The Deeds Office purpose and process - Snymans Incorporated

An offer to purchase is enforceable under South African law once signed by both parties to the agreement. However, there are certain situations under which the contract may be declared void, and one such situation is when a suspensive condition contained within the offer to purchase is not met.

A suspensive condition is a term or clause within a contract that clearly stipulates a particular criterion that must be met in order for the contract to come into force. Of course, such a condition must also not contravene any laws. Should the suspensive condition or conditions contained within an agreement not be met, the contract will be void.

Typically, in a sale agreement, a suspensive condition relates to the approval of the buyer’s bond, the sale of the buyer’s current home or the purchase of a new home by the seller.

These conditions are often included in a sale agreement for immovable property in order to protect both parties, since the timelines relating to the transfer of a property can be rather complex. For example, the buyer’s ability to purchase the house on the market may be dependent on receiving the proceeds from the sale of his current home. As such, it would be problematic for both buyer and seller if the contract and transfer of the property was to proceed if the buyer is unable to sell his current home and is consequently unable to pay the sale price.

If the offer to purchase included a suspensive condition stating that the sale was pending the sale of the buyer’s current home, the lack of this sale would mean that this condition was not met and therefore that the contract in its entirety is void.

It is important to note that in order to protect both parties to the agreement adequately, there is often also a time restriction attached to the suspensive condition. This means that if the suspensive condition is not met within a certain time (e.g. if the buyer’s current house is not sold within 30 days), the condition is deemed not to have been met and therefore that the contract is void.

Should there be any such conditions on which the sale of a property is dependent, it is important to include these explicitly in writing in the offer to purchase in order for them to appropriately affect the validity of the contract.

For advice on what conditions can and should be included in an offer to purchase to protect both the seller and the buyer, it is useful to consult with an experienced conveyancing attorney or estate agent.

#‎AskSnymans‬ your property-related legal questions on Facebook.

4647

Recommended for you

Property Transfers | Bond Registrations | Snymans Attorneys
Contractual Matters

The right of first refusal

2026

A right of first refusal is a mechanism in a contract that affords the holder of such right the preference to buy a particular property, should the owner ever choose to sell it. However, it is worth noting that the…

Read More
Property Transfers | Bond Registrations | Snymans Attorneys
Contractual Matters

Different forms of ownership

2070

There are a number of forms of ownership of immovable property in South Africa, and sometimes prospective buyers as well as homeowners are not aware of the intricacies of each. To take the mystery out of this for you, we have put together the basics on each of the 3 most common types of ownership: full title ownership, sectional title ownership and long-term lease.

Read More
Property Blog Articles | Advice | Contractual Matters | Market News
Contractual Matters

Auctions in the property industry

4240

To help buyers looking to purchase property on auction, here is some crucial information relating to auctioned property.

Read More
Property Blog Articles | Advice | Contractual Matters | Market News
Contractual Matters

The sale of a property as a going concern

4152

Given certain conditions being met, a property can be transferred as a ‘going concern’ which can be beneficial to the transacting parties.

Read More
Property Blog Articles | Advice | Contractual Matters | Market News
Contractual Matters

The Lapsed Offer to Purchase

8255

For prospective buyers who have found the right property, it is always an exciting but also a daunting time when an Offer to Purchase (OTP) has been signed and presented to the seller. The wait then begins before finding out whether or not it has been accepted.

Read More

Need more Snymans content?

Sign up for our monthly newsletter.

What happens if a suspensive condition is not met?

A suspensive condition is a term or clause within a contract that clearly stipulates a particular criterion that must be met in order for the contract to come into force. Should the suspensive condition(s) not be met, the contract will be void.

The Deeds Office purpose and process - Snymans Incorporated

An offer to purchase is enforceable under South African law once signed by both parties to the agreement. However, there are certain situations under which the contract may be declared void, and one such situation is when a suspensive condition contained within the offer to purchase is not met.

A suspensive condition is a term or clause within a contract that clearly stipulates a particular criterion that must be met in order for the contract to come into force. Of course, such a condition must also not contravene any laws. Should the suspensive condition or conditions contained within an agreement not be met, the contract will be void.

Typically, in a sale agreement, a suspensive condition relates to the approval of the buyer’s bond, the sale of the buyer’s current home or the purchase of a new home by the seller.

These conditions are often included in a sale agreement for immovable property in order to protect both parties, since the timelines relating to the transfer of a property can be rather complex. For example, the buyer’s ability to purchase the house on the market may be dependent on receiving the proceeds from the sale of his current home. As such, it would be problematic for both buyer and seller if the contract and transfer of the property was to proceed if the buyer is unable to sell his current home and is consequently unable to pay the sale price.

If the offer to purchase included a suspensive condition stating that the sale was pending the sale of the buyer’s current home, the lack of this sale would mean that this condition was not met and therefore that the contract in its entirety is void.

It is important to note that in order to protect both parties to the agreement adequately, there is often also a time restriction attached to the suspensive condition. This means that if the suspensive condition is not met within a certain time (e.g. if the buyer’s current house is not sold within 30 days), the condition is deemed not to have been met and therefore that the contract is void.

Should there be any such conditions on which the sale of a property is dependent, it is important to include these explicitly in writing in the offer to purchase in order for them to appropriately affect the validity of the contract.

For advice on what conditions can and should be included in an offer to purchase to protect both the seller and the buyer, it is useful to consult with an experienced conveyancing attorney or estate agent.

#‎AskSnymans‬ your property-related legal questions on Facebook.

4647