IMAGINE buying a property and then discovering you are being held liable for rates, refuse, electricity and water charges going back as far as 30 years.
That is the nightmare scenario being faced by all purchasers following a Supreme Court of Appeal ruling which The Mercury reported on yesterday. How could a court comprising such august judges reach such a decision?
It is hard to understand as it is desperately unfair for a new owner to be saddled with debts for which they had no responsibility. And the sums involved could be huge, with new property owners now able to be held liable for historic debts dating back three decades.
With the tough economic climate exacerbated by an unusually high increase in interest rates last month, the property sector is already under pressure. But this ruling by the appeal court will be more than enough to make buying and selling a pit of quicksand for owners, buyers, attorneys and even banks.
Before lending mortgage money banks will want to make sure, as far as is possible, that the property concerned is not going to be attached as a result of outstanding debt, with the bank then standing to recoup only that amount which remains after the relevant municipality has taken its slice for historic debt.
