Question posted in the Property Law category relating to Western Cape
Good morning ,
My mother had property in Franschoek on a nature reserve . It was always intended to be divided between my brother , sister and I . When my dad passed away 15 years ago my mother was left in a Les than desirable position financially, she continued to work for another 5 years but then retired and my brother being older and better off financially - he was 35 at the time with a business and I was 19 and just started university built a granny flat for her . All his studies were paid for whereas I had to take a student loan etc due to bad timing so I couldn't do it at that time . She stayed there since but my sister and I also helped her financially . It came to light recently that my brother and his wife forced her to sign over franschoek property rights in exchange for living there. It was always intended to go to all 3 of us and she is also not happy with it she just didn't feel like she had a choice at the time . I don't trust them at all , they did it behind our backs, and it doesn't bode well. I am now in the uk , have obtained citizenship and have started a business in South Africa that I feel will start becoming very profitable within the next 18-24 months . When my sister and I found out, he said it's worth less than one million which is a lie . He also said we can each buy 33% and pay him off over 10 years which my sister doesn't want to do . He said he paid R680k to have my moms place built 10 years ago and that's why he deserves the property so based on that that's what it's worth . I then offered to buy 50% as I didn't want to have less than that , to which he said he doesn't want to do business with me but I can buy 100%. I am 34 and don't have kids yet , if I do I'll leave it for them and my sisters kids and if not it will go to my sisters children. I know it is legally in his name so if he won't sell it to me I cannot do anything but if that is the case I don't plan on having any relationship with him going forward as that is not something family does .
If he is willing I want a contract drawn up and legal advice, could you also assist with property valuation . This whole situation came as a massive shock and only came out after his son tragically passed away last year . Emotionally it's a complete mess but I cannot tolerate people in my life that will disrespect me in such an unthinkable manner. I can easily pay 680k cash but I'm afraid they know what it's really worth and have already stollen it for themselves so not optimistic on the outcome . I just want resolution one way or another so I can move on with my life .Please advise
Answer to the Question
Hi there and thank you for your question,
I am a practicing attorney based in South Africa and I will assist you with your question. Please feel free to ask as many follow-up questions in order to clarify your question. If you have a new question, you must please open a new thread.
Okay, so I assume that your brother "convinced" your Mom to sell the property to him because he built her a house on the property and gave her some sort of "life rights" to live there, rent free, until she dies, and maybe on the basis that your brother attends to all of the rates & taxes and maintenance of the property.
If this is indeed the case, and your Mom sold the property to your brother, legally speaking, there is nothing that you can do. It was your Mom's property and there is nothing stopping her from doing whatever she wants to it... even if "it was intended" that the property should be left to the 3 children.
Morally however, I think that your Mom should tell your brother that he needs to "make things right", and that you and your sister must chip in your 1/3 and 1/3 of the R680k which he spent in order to buy 1/3 and 1/3 of the property from him. In that way, the property would be owned 1/3 be each of you, and each of you would have effectively paid for the construction of your Mom's place on the property, and your Mom would be able to live there until she dies.
The only issue for you is that you really wouldn't be able to sell your 1/3 in the property unless ALL of you decided to sell. I mean, I would never buy a 1/3 share in a property with 2 people who I didn't know.
If your sister doesn't want to take up the offer, then there is nothing stopping you from suggesting that you take up 50% like you suggested.
But if he doesn't want to do that, then you have a stalemate.
Why not get an estate agent to value the property, assuming that it was 10 years ago, and assuming that the house hasn't been constructed, and then your brother should pay you and your sister 1/3 and 1/3 for the property. If he is right in that the property wasn't worth a lot, then he won't need to pay you much.
But you need to also think about your Mom. Your brother might be the owner of the property, but he has built your Mom a house, and she can live there forever. Where else can she get that deal?
Otherwise, if you think that you'll get a good deal paying the R680k yourself to buy the property, then you must do that! Property always goes up in value.
If there is a part of the answer which you need more advice on, or clarity please continue in this same thread instead of opening a new question.
Please remember this is a dialog if you have follow-up questions please use the REPLY button and ask. If I did not answer the question you thought you were asking, please respond with the specific question you wanted to be answered. I hope you found my answer helpful, and you have finished asking your questions, please click on the GREEN ACCEPT button in order to mark the question as closed.
Information provided by client
He didn’t construct a property in franschoek , just built a granny flat on his own property in Johannesburg which is definitely not worth nearly as much as the Franschoek property . My mom spends time between all three children . She’ll likely spend 4 months a year with me , 4 with my sister and 4 with him until she passes one day . She’s not permanently living there, that is why the whole situation is so messed up . I’ll offer the 50% and see what he says . I don’t really want to do business with him after this but worth a try to get some of it back
Answer to the Question
Okay, thank you. Understood re the granny flat in Joburg. Then you need to say to him that the construction of the granny flat on his OWN property for your Mom has actually increased the value of his own property, so when he eventually sells his property, HE will benefit from the granny flat. Not your Mom. So he should bear the cost of the construction of the granny flat himself. NOT try do a swop with your Mom where she uses the granny flat and then transfers the Franschhoek property to him. That's NOT fair.
It really does come down to (i) what was the Franschhoek property worth, and (ii) what did he actually pay for it in cash - forgetting the value of the construction of the granny flat.
If he paid LESS than what it was actually worth, then morally that is wrong and he needs to rectify the situation. The issue that you have is that because he is the owner, he (to a large degree) can simply say No. You can't force him into anything. Only your Mom could apply to have the sale set aside, but she would need grounds to set it aside, like fraud or duress. She couldn't argue that she sold it for less than market value in order to set the sale aside.