Mr Attorney, where is my money?
By Arno Crous
Associate: Millers Inc

Property transactions usually involve the transfer of large sums of money. As a general rule, the seller appoints the conveyancing attorney handling the transfer. It is, however, open for the parties to the transaction to agree otherwise, and the conveyancer appointed in terms of the written agreement is sometimes chosen by the purchaser.

In a recent High Court judgment, the seller nominated the attorney and the purchase price was paid into the attorney’s trust account. The attorney misappropriated the money, but the buyer insisted on transfer of the property. Rightly so, the buyer had performed in terms of the agreement and paid the purchase price to the attorney nominated by the seller.

However, the seller took a different view and refused to consent to transfer. Why would anyone give away your house without receipt of the purchase price? The seller lodged a claim with what was then called the Attorneys Fidelity Fund, but the Fund repudiated the claim on the ground that the loss was sustained by the buyer.

The buyer approached court and won. Transfer was ordered. It was found that the conveyancer acted as agent for both parties and the buyer complied with her obligation in terms of the deed of sale. One would imagine that the seller can now go back to the Fund and demand payment of the money stolen, the court has found that the loss was indeed his.

Always nominate a reputable attorney. In the case discussed above, an attorney stole the money, however, large transactions are also targeted by fraudsters that can intercept e-mail communications.

Do not pay over large amounts of money without verifying the banking detail. Always be mindful that hackers can intercept e-mail communications. Electronic payments are made based on the account number only. It is your responsibility to ensure account details being used are correct by conducting an independent verification.

It is of utmost importance for us to adhere to strict internal verification procedures and to remain compliant with policies governing the protection of our clients’ funds.