Mandatory Disclosure Form: What the Law Requires

By Louise Fourie | Principal, Africa Estate

No signed form, no mandate. Every property sale in South Africa now starts with one page that too many people treat as paperwork: the mandatory disclosure form. It is not paperwork. It is the law, it decides what the sale agreement means, and an agent who skips it can be held personally liable. This article sets out exactly what the Property Practitioners Act 22 of 2019 says, where it says it, and what it means for sellers, buyers and agents.

1. What the form is

The form is prescribed by Regulation 36 of the Property Practitioners Regulations, 2022, under the title "Immovable Property Condition Report in relation to the Sale of any Immovable Property". The seller completes it and signs it, and discloses the defects the seller knows of: the roof, the electrical system, the plumbing, and anything else that affects the property. Section 68(1) of the Act states that the form must be drafted by the seller for the seller's own account. The agent does not complete it on the seller's behalf.

2. When it must be signed: before the agent may accept the mandate

Section 67(1)(a) is short and it is absolute. A property practitioner must:

"not accept a mandate unless the seller or lessor of the property has provided him or her with a fully completed and signed mandatory disclosure in the prescribed form"

Follow that through. Without a signed form there is no lawful mandate. Without a mandate the agent may not market the property, may not advertise it, and may not introduce a single buyer to it. So the form must be signed before the property is advertised and before any buyer is shown the property. Not at the viewing, not at the offer, not at the signing of the contract. Before.

3. When the buyer must receive it

Section 67(1)(b) requires the agent to:

"provide a copy of the completed mandatory disclosure form to a prospective purchaser or lessee who intends to make an offer for the purchase or lease of a property"

To be precise about what the law says: the Act sets the latest moment, and that moment is before the buyer makes an offer. The Act does not use the word "viewing". At Africa Estate we go further than the minimum. Known defects are told to the buyer at the viewing, while the buyer is standing in the property, because that is when a buyer decides whether to make an offer at all. A buyer who hears about a leaking roof for the first time when the offer is being signed has, in practice, not been told in time.

4. What happens to the sale agreement

Section 67(2) makes the signed form part of the contract itself:

"The completed mandatory disclosure form signed by all relevant parties must be attached to any agreement for the sale or lease of a property, and forms an integral part of that agreement, but if such a disclosure form was not completed, signed or attached, the agreement must be interpreted as if no defects or deficiencies of the property were disclosed to the purchaser."

Read the last part twice. If the form is missing, unsigned or not attached, the law treats the sale as if the seller disclosed nothing at all. A seller who told the agent about the damp wall, but whose form was never signed and attached, can no longer rely on having disclosed it.

5. The consequences for the agent

Ignoring the form is not a technicality. The Act provides for the following:

Personal liability. Section 67(3): "A property practitioner who fails to comply with subsection (1) may be held liable by an affected consumer." The buyer or the seller who suffers the loss can hold the agent liable.

Action by the PPRA. Section 67(4) states that nothing in the section prevents the Authority from taking action against the property practitioner or imposing an appropriate sanction. A buyer, seller or other affected person can lodge a complaint with the PPRA, which can investigate and refer the matter for adjudication under section 30.

Sanctionable conduct. Section 62(1)(k): a property practitioner who "fails to comply with or contravenes any provision of this Act" is guilty of sanctionable conduct. And section 62(2) closes the door on fixing it afterwards: "Subsequent ratification or correction of any conduct contemplated in subsection (1) does not constitute a defence."

Fidelity Fund certificate withdrawn. Section 62(3)(a): the Authority may withdraw the Fidelity Fund certificate of that property practitioner. Without a Fidelity Fund certificate an agent may not trade and may not earn commission.

A fine. Section 62(3)(b): a fine not exceeding the maximum amount determined by the Minister of Justice for the purposes of section 29(1)(a) of the Magistrates' Courts Act, 1944.

A public reprimand. Section 62(3)(c): the Authority may reprimand the property practitioner and note the transgression on its website.

Compensation to the person who complained. Section 30(7)(b): if an adjudicator upholds a complaint, the order may include that the Authority pays not more than 80 percent of the fine as a compensation award to the complainant. Section 27 also allows the Authority to apply part of a fine towards compensating a person who suffered a financial loss because of the practitioner's conduct.

6. For sellers: why signing the form is in YOUR interest

The form is not paperwork for the agent. It protects you, the seller, more than anyone else.

It is your proof. The signed form is written proof of exactly what you told the buyer. If a buyer comes back after transfer about a defect you disclosed, the form shows they knew and bought anyway.

Without it, you told the buyer nothing. If the form is not signed and attached to the contract, the law treats the sale as if you disclosed no defects at all (section 67(2)). You may have shown the buyer the damp wall yourself, but on paper you never did.

Voetstoots does not cover what you knew and kept quiet about. Selling voetstoots does not protect a seller who knew about a problem and did not tell the buyer. That is exactly how a sale ends in a claim, a price reduction or a cancelled sale months after you thought it was done.

A disclosed defect is a settled defect. Once a problem is on the signed form and the buyer accepted it, it cannot later be called hidden. Tell everything you know, including building work done without approved plans, what was repaired and what is still a problem.

Sign it first. The form must be signed before your property is advertised or shown to anyone (section 67(1)(a)). An agent who wants to market your property without it is putting you at risk.

7. For buyers

Ask to see the signed form at the viewing, and do not sign an offer before you have read it. Check that the copy attached to your agreement is the same one you were shown. Section 67(5) confirms that you may also have the property inspected at your own cost before the transaction is finalised.

8. For agents

No signed form, no mandate. No mandate, no advertisement and no viewing. Tell the buyer about known defects at the viewing and give the buyer the form before any offer is written. Attach the form, signed by all relevant parties, to every sale agreement. If the form is missing, stop, because correcting it later is not a defence.

Final word

The mandatory disclosure form exists so that a buyer knows what they are buying, a seller can prove what they disclosed, and nobody ends up in a dispute over a defect after transfer. At Africa Estate the form is signed before a property is marketed, and defects are told at the viewing. If you are selling and want to know how we handle it, contact us.

Sources: Property Practitioners Act 22 of 2019, sections 27, 30, 62, 67 and 68 (Government Gazette No. 42746, 3 October 2019); Property Practitioners Regulations, 2022, regulation 36; PPRA Practice Note on the Mandatory Disclosure Form, 28 September 2023. This article is general information, not legal advice.

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