Agreements of sale of land on instalments are regulated in terms of Chapter 2 of the Alienation of Land Act, 68 of 1981.  The Act specifically provides in section 20 for the recording of such instalment sale agreements which recording is effected by the Registrar of Deeds for the area in which the property sold, is situated and takes place at the instance of the seller.  Should the seller however not take any steps to records such agreement of sale within the statutory stipulated period (which is normally 90 (ninety) days from the date of the contract), the purchaser may either cancel the contract within 14 (fourteen) days of the expiry of the 90 (ninety) day period or at any time thereafter himself apply to the Registrar to have the contract recorded.

The purpose of recording the contract is to afford certain protection to the purchaser in particular eg. for example to prevent the seller from alienating the property to someone else. section 26(1)()b) of the Alienation of Land Act provides, subject to certain exceptions, that no person shall receive any "consideration" by virtue of a deed of alienation in respect of a sale of land on instalments until the recording of the contract required in terms of section 20 as set our above, has been effected.  

The term "consideration" is defined in section 1 of the Alienation of Land Act to mean "in relation to a sale of land under any Deed of Alienation, …… the  purchase price and interest thereon, excluding rent or occupational interest constituting reasonable compensation for the use and enjoyment of the land by the purchaser."  In the recent case of Amardien and others vs Registrar of Deeds and others (2017) ZAWCHC 14, the Western Cape High Court had to rule on the issues as to when a debt in terms of a sale of land on instalment agreement falls due and becomes payable.  The seller in this instance failed to record the agreement in terms of section 20 as envisaged above within the required statutory time limit.  The purchaser however also failed to exercise his rights in either cancelling the agreement or himself applying for recording of the agreement of sale.  The seller eventually applied for recording of the contract in terms of section 20 and on claiming payment of the consideration in terms of the said agreement from the purchasers, was met with opposition by the purchaser on the basis that the seller was not entitled to recover any consideration for the period between entering into the agreement and recording thereof in terms of Section 20.  

The seller was of the opinion that although the instalments in terms of which the purchase price was payable, may not have become payable until the contract had been recorded, this did not prevent such instalments from falling due in accordance with the terms of the contract and that the accrued amounts outstanding under the contract became immediately due and payable upon recording of the contracts.  This argument by the seller was accepted by the court in deciding that the provisions of sections 20 and 26 of the Act are not directed at affecting the terms of an agreement between parties thereto as they do not affect when payments fall due under the contract.  Section 26(1) in particular is directed only at excluding the sellers' rights to recoup any payment in terms of the contract until it has done what is necessary to afford the purchaser the protection provided to him consequent to the recording of the contract.  Section 26 is primarily aimed at creating an incentive to a seller to attend promptly to the recording of a contract in the deeds office, but does not impact on the terms of the agreement between the parties.

Thus, although instalments might become due even if the contract is not recorded, such instalments would only become payable on recording of the contract.  This would obviously impact on the interest payable as agreed in terms of the contract between the parties.