Special conditions of a contract
Category From the pen of Esti Lombard
Ensure that your sale agreement is binding without unnecessary exit points!
- An unconditional and conclusive sale is what we all want and therefore it is important that you don't create clauses in an agreement that may cause the agreement to lapse or be cancelled unless this is unavoidable.
- A sale agreement is unconditional and conclusive when there are no provisions in the agreement that may cause the agreement to lapse or be cancelled (except due to a breach of contract).
- Two common clauses that are often unavoidable and which make your sale agreement conditional are as follows:
- Where the sale is subject to a bond grant; and,
- Where the sale is subject to the conclusive sale of the Purchaser's property.
- Be careful not to accidently create a suspensive condition in an agreement because of bad drafting and use of the wrong terms.
- The problem with a suspensive condition is that it causes the agreement to lapse and become void if the suspensive condition is not met whereas if the purchaser fails to comply with an ordinary terms of the contract (such as to pay a deposit) the agreement does not become null and void and the seller then has the right to take steps to cancel or enforce the contract and to claim damages based on any loss suffered by the purchaser in complying with this obligation.
- Always try to avoid suspensive conditions in a sale agreement but if it is unavoidable then ensure that the condition you create leaves no room for conflicting interpretations or uncertainty.
ABOUT US
Before founding E. Lombard Attorneys Inc, Esti Lombard served at a prominent and trusted Durban-based law firm for 18 years. At E. Lombard Attorneys Inc we are passionate about law, and, being a small firm, pride ourselves in rendering fast, efficient and personal client service. Our practical and creative problem-solving skills, coupled with our genuine love for people, sets E. Lombard Attorneys Inc apart from the rest.
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E Lombard Attorneys Inc
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www.lombardlaw.co.za elombard@lombardlaw.co.za 032 815 4078
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Author: Esti Lombard
