Category Archives: Property Law

How to evict an illegal tenant

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Landlords who have tenants that they believe are occupying their premises illegally may not forcefully remove such tenants. The Prevention of Illegal Eviction from and Unlawful Occupation of Land Act (No. 19 of 1998) provides for the prohibition of unlawful eviction and also provides proper procedures for the eviction of unlawful occupiers.

According to the Act:

  • no one may be deprived of property except in terms of law of general application, and no law may permit arbitrary deprivation of property;
  • no one may be evicted from their home, or have their home demolished without an order of court made after considering all the relevant circumstances;
  • it is desirable that the law should regulate the eviction of unlawful occupiers from land in a fair manner, while recognising the right of land owners to apply to a court for an eviction order in appropriate circumstances;
  • special consideration should be given to the rights of the elderly, children, disabled persons and particularly households headed by women, and that it should be recognised that the needs of those groups should be considered;

Procedure regarding evictions in terms of the PIE Act:

  1. According to the Consumer Protection Act (CPA), to cancel a fixed-term lease you must give the tenant at least 20 business days’ notice to rectify a material breach of the lease, failing which the lease will be cancelled.
  2. After 21 days, you can send the tenant a letter to cancel the lease. The letter should state that the tenant is now deemed to be occupying the property unlawfully and that he or she must vacate the premises by a specific date.
  3. If the tenant/occupier has not left the premises by the date mentioned in the letter of cancellation, then your lawyer can lodge an eviction application, which includes seeking the court’s permission to serve a notice of motion on the occupier.

References:

  • Prevention of Illegal Eviction from and Unlawful Occupation of Land Act (No. 19 of 1998), South Africa
  • “How to evict a tenant (lawfully)”, Mark Bechard, Personal Finance, IOL. https://www.iol.co.za/personal-finance/how-to-evict-a-tenant-lawfully-2059984

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Removing an unpaying tenant

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If your tenant has failed to pay his or her rent, it can be tempting to simply kick them out yourself and change the locks. However, do so would be considered illegal, even if the tenant has become an illegal occupant. The reason is because of the PIE Act.

In sum, the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act (PIE) (1998) provides procedures for eviction of unlawful occupants and prohibits unlawful evictions. The main aim of the Act is to protect both occupiers and landowners. The owner or landlord must follow the provisions of the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act (PIE) (except in areas where ESTA operates) if they want to evict a tenant.

Who is covered?

Anyone who is an unlawful occupier, which includes tenants who fail to pay their rentals and bonds, is covered by PIE. It excludes anyone who qualifies as an ‘occupier’ in terms of the Extension of Security of Tenure Act

When is an eviction lawful?

  1. For an eviction to happen lawfully, certain procedures must be followed. If any one of them is left out, the eviction is unlawful. So, if an owner wants to have an unlawful occupier evicted, they must do the following:
  2. give the occupier notice of his/her intention of going to court to get an eviction order.
  3. apply to the court to have a written notice served on the occupier stating the owner’s intention to evict the occupier.
  4. The court must serve the notice at least 14 days before the court hearing. The notice must also be served on the municipality that has jurisdiction in the area.

After a landlord intrusts their attorney to commence eviction proceedings, the following happens:

  1. Typically, (except in a case of urgency, e.g. if the tenant is maliciously damaging the leased premises because he got notice to vacate) the attorney will call on the tenant to remedy the breach (usually failure to pay rent on time);
  2. If the tenant fails to deal with the demand, the tenant will be considered to be in illegal occupation of the property;
  3. The attorney then applies to court for permission to begin the eviction process. The court gives a directive as to how and on whom notice of eviction should be served;
  4. The attorney doesn’t give the tenant notice at this time;
  5. The application to court sets out the reasons for the application and the personal circumstances of the occupants;
  6. If the courts are satisfied that it is fair to evict the tenant and all persons occupying the property with him, it gives a directive as to how the application for eviction must be served;
  7. The sheriff then serves the notice of intention to evict on the tenant and the Local Municipality;
  8. The occupants have an opportunity to oppose the application, and explain why they should not be evicted;
  9. If there is opposition, the matter gets argued before a magistrate or judge, who decides whether an eviction order can be granted, and if so, by when the occupants should vacate the property within a stipulated time;
  10. If the tenant does not oppose, the court will grant the eviction order;
  11. If the tenant fails to move, the attorney will apply to Court for a warrant of ejectment to be issued by the Court. This process can take a further three to four weeks.

Reference:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

Co-owning property with someone else: The ups and downs

B2What is co-ownership?

Co-ownership is when one or more people jointly own the same property. In essence, it is when they legally share ownership without dividing the property into physical portions for their exclusive use. It is thus commonly referred to as co-ownership in undivided shares.

It is possible to agree that owners acquire the property in different shares; for instance, one person owns 70 percent and the other 30 percent of the single property. The different shares can be recorded and registered in the title deeds by the Deeds Office.

The benefits

On paper, it’s a great idea. For starters, the bond repayments and costs of maintaining the home are halved. However, there can be problems and although not every friendship or relationship is destined to disintegrate, there does often come a time when one of the parties involved wants to sell up and move on to bigger and better things.

The risks

If ownership is given to one or more purchasers, without stipulating in what shares they acquire the property, it is legally presumed that they acquired the property in equal shares.

The risks, the benefits and the obligations that flow from the property are shared in proportion to each person’s share of ownership in the property. For instance, one of the co-owners fails to contribute his share of the finances as initially agreed, resulting in creditors such as the bank or Body Corporate taking action to recover the shortfall.

Having an agreement

If two people own property together in undivided shares it is advisable to enter into an agreement which will regulate their rights and obligations if they should decide to go their own separate ways.

The practical difficulties that flow from the rights and duties of co-ownership are captured by the expression communio est mater rixarum or “co-ownership is the mother of disputes”. It is therefore important that, when the agreement the co-owners entered into does not help them solve disputes, certain remedies are available to them.

The agreement should address the following issues:

  1. In what proportion will the property be shared?
  2. Who has the sole right to occupy the property?
  3. Who will contribute what initial payments to acquire the property.
  4. Who will contribute what amounts to the ongoing future costs and finances.
  5. How the profits or losses will be split, should the property or a share be sold?
  6. The sale of one party’s share must be restricted or regulated.
  7. The right to draw funds out of the access bond must be regulated.
  8. A breakdown of the relationship between the parties.
  9. Death or incapacity of one of the parties.
  10. Dispute resolution options before issuing summons.
  11. Termination of the agreement.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

Me, my neighbour and that tree

B1The house was just perfect – the right neighbourhood, well-established garden, beautiful trees waving in the breeze with just the right amount of shade next to your swimming pool. And as the trees belong to your neighbour, no need for pruning, said the estate agent. You and your family loved the new home.

Autumn arrived. The leaves have changed and started falling, the swimming pool pump required repairs twice due to blockage and your Saturday golf has been replaced with clearing heaps of leaves. To add to that, a thunder storm ripped a branch off, which broke your electric fence and the wall. Problems with trees from adjacent gardens is an old story.

But what can you do about it?

To merely jump over the fence and prune, or worse, cut down the tree to your satisfaction will not only constitute trespassing but also malicious damage to your neighbour’s property. The courts have carefully considered the basis on which you can approach the court, now generally considered as “nuisance”.

Firstly, you will have to prove to the court that the inconvenience caused to you by your neighbour’s tree is more than you just being sensitive. The inconvenience caused must materially interfere with your ordinary physical comfort and your experience.

The standard that the court will use is that of a normal, reasonable person. The test of reasonableness will be applied, taking into account general norms acceptable to a particular society. Actual damage to your property is not a requirement.

The court will, however, also consider the nuisance, even if the tree(s) is actually causing damage, balancing this with your responsibility to tolerate the natural consequence of the ordinary use of the land. In other words, the court will consider the dispute and the decision will involve balancing the competing interests of you and your neighbour.

Should I care about the environment?

The judgement of Judge De Vos in Vogel vs Crewe and another 2003 (4) SA 50 (T) raised a further very important aspect – the environment.

In a world where trees and nature are considered all the more important for our well-being and that of the earth, careful consideration should be taken before a demand for the cutting down of a tree is granted. Judge De Vos noted that trees form an essential part of our human environment, not only giving us aesthetic pleasure but also being functional in providing shade, food and oxygen. And, like many other living things, trees require, in return for the pleasure provided, a certain amount of effort and tolerance.

With our increasing awareness of the importance of protecting our environment, we need to become more tolerant of the inevitable problems caused by the shrinking size of properties and the greater proximity of neighbours, and consequently, the neighbours’ trees.

Solving the problem peacefully

Before you sell your property and move to another neighbourhood altogether, consider a friendly discussion with your neighbour and his pruning company of choice, from YOUR side of the fence.

Explain to your neighbour which branches of which trees are problematic or show him the cause for your concern. And be willing to reach an agreement somewhere in the middle, taking the type of tree, its form of growth and the balance of the tree into consideration. It will not suffice to demand the removal of a large branch unbalancing the tree which will then fall over during the next storm taking down your wall.

If all your efforts, including friendly letters and e-mailed correspondence fall on deaf ears, you are allowed to prune all branches as from the point that it protrudes over the wall into your property. You are not allowed to lean over the wall to cut those branches at the neighbour’s side of the wall. You will also be responsible for removing the branches from your property after you have pruned the tree in this manner.

So relax and have a good, impartial look at that “offending” tree. Must that tree go? or can you tolerate it with a little pruning?

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

What are tenant and landlord duties?

article2_img_blogWhen it comes to letting a property – both the tenant and the landlord should always enter into any letting agreements openly and honestly and intending for each party to get proper value. Often it’s the approach which the parties adopt which will determine whether the relationship between the parties and the benefits they derive therefrom is mutually satisfactory. Furthermore, there are important duties that each party is expected to do.

Non-Statutory Law (Common Law)

The tenant is obliged to:

  • Pay the proper amount of rent in the proper commodity at the proper place and time.
  • Take good care of the property and not use it for other purposes than for which it was let.
  • Restore it to the same condition that he received it at termination of the lease.
  • Common law states simply that the full rent must be paid at the proper time – the time and date agreed by both the tenant and the landlord. It does not provide the tenant with a 7-day grace period.

Statuary Law (The Rental Housing Act)

The tenant is obliged to:

  • Make prompt and regular payment of rent and other charges payable in terms of the lease.
  • Make payment of a deposit – the amount of which should be agreed upfront between the landlord and tenant.
  • Have a joint incoming and outgoing inspection with the landlord.

The property owner

The prime duty of a property owner is to give a tenant occupation and control of the property. Furthermore, the owner has to maintain the property in its proper condition, subject to fair wear and tear (defined as the ‘unavoidable consequence of the passage of time’). The owner must also ensure that normal running repairs to the property are carried out.

A second important duty of the owner is a guarantee that the tenant will enjoy the undisturbed use and enjoyment of the property for the duration of the lease. This duty has three facets:

  • The property owner must not unlawfully interfere with the tenant’s rights although he or she is entitled, in certain circumstances, to interfere lawfully if, for instance, the tenant has to vacate the premises temporarily to allow necessary repairs to be done. Although an owner also has a right of inspection, this right must be exercised in a reasonable manner.
  • The owner must protect the tenant against being disturbed by ‘third parties’ who may claim a stronger right to the property than the tenant. For example, if you sub-let property from a lessee whose lease is invalid (perhaps because it has not been drawn up properly), you could be evicted by the original owner of the property. If this happens, the person who sub-let the property to you is obliged to protect you from being evicted.

Reference:

http://www.privateproperty.co.za/advice/property/articles/tenants-rights-and-obligations/559

http://www.legalcity.net/Index.cfm?fuseaction=RIGHTS.article&ArticleID=2663821

http://www.chaseveritt.co.za/tenant-rights-south-africa

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

Private defence of property

A1The common law provides that an owner may protect his property from harm or damage even though there might not be any physical risk of harm to the owner himself.

A person may use force in order to protect property and his or her rights therein. Private defence of property can only be resorted to if there is serious danger to the property or the owner’s rights therein. The danger must involve risk of loss, damage or destruction of the asset. The question is whether there were reasonable grounds for the defender to think that because of the offender’s unlawful conduct the danger existed.

There must be evidence that the property, movable or immovable, was in danger of unlawful damage and destruction at the moment action was taken. Unlike self-defence the danger need not necessarily have commenced or be imminent. Thus, private defence of property by means of protective devices is permitted in response to merely anticipated danger.

In order for a situation of private defence to arise, there must be evidence that:

  • action was necessary to avert danger;
  • the defence was a reasonable response;
  • the defence was directed against the attacker;
  • the attack was unlawful.

The measures taken to protect the defender’s proprietary interests must have been the only means whereby he could avoid danger. The rule regarding retreating has no application in the defence of property. One is not expected to abandon one’s property. Likewise, the inhabitants of dwellings are not expected to flee from homes, rather than resist the intrusion of a burglar.

The test is whether the means of defending the property were reasonable by having regard to all the circumstances, such as the nature and extent of the danger, the value of the property, and the time and place of the occurrence. The value of the property seems an important factor in determining the reasonableness of the defence.

In Ex parte Minister of Justice: In re S v Van Wyk the Court decided that killing in defence of property can be justified in circumstances where no other less dangerous or effective method is available to protect property.

In Ex Parte Minister of Safety and Security: In re S v Walters  2002 (CC), Judge Kriegler stated that while it was unnecessary to say whether our law allows for killing in defence of property, what is material is that the law applies a proportionality test, weighing the interest protected against the interest of the wrongdoer. These interests must now be weighed in the light of the Constitution. Judge Kriegler said that surely in Constitutional terms, the value of a life must be prized above the value of property.

The decision in Van Wyk is ripe for reconsideration by the Constitutional Court. Arguably the best route they could take is to draw a distinction between an excuse and a ground of justification. They could say that killing in defence of property is unlawful or wrongful, but in exceptional circumstances could be excusable if a reasonable person would have done the same thing.

It could therefore be argued that a deadly attack in defence of property would only be regarded as justifiable in extreme circumstances.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE).

Pay your levies, or else…

A1Dear Mr Lawyer

I am the owner of a sectional title, and I have paid my levies every month as required, until the water started seeping through the ceiling of my enclosed balcony into my section when it rains. The leak was clearly emanating from a defect in the common property. I asked the body corporate on numerous occasions to repair the defect, yet after four months of writing letters and sending emails the body corporate still has not done anything to honour this simple request. As a frustrated owner I resorted to desperate measures and employed a contractor to repair the property defect. I settled the bill myself.

May I withhold my levies for a period to set off the money that is owed to me by the body corporate?

Dear Mr Owner

Although this action may sound reasonable, the right to stop paying or to set off a debt against levies is not legally justified and owners are not, under any circumstances, entitled to simply withhold levies.

There is no provision in the Sectional Titles Act 95 of 1986 or the rules that gives an owner the right to withhold levy payments. Even if an owner incurs expense in performing an emergency repair to the common property, and believes that the body corporate owes him money, the owner may only set off the debt against the levies once it becomes liquid.

An amount can only be liquid once it has been agreed upon. An owner cannot set off the amount he believes he is entitled to deduct. The trustees, judge or arbitrator must have confirmed the amount.

If Mr Owner does withhold his levies without the amount being liquid, he is subject to the following sanctions in terms of the prescribed rules:

  • Firstly, the trustees are entitled to charge interest on arrear amounts at a rate determined by them, and so the defaulting owner may receive a larger account, due to the interest on his arrears, than if he had paid his levies.
  • What is more, The Sectional Titles Act imposes a positive obligation on trustees to recover levies from defaulting owners. Not only does the Act empower them to charge interest, the scheme attorneys will most likely issue summons against the defaulter for all costs that the Body Corporate may incur in recovering any arrears.
  • Secondly, the prescribed management rules provide that, except in the case of special and unanimous resolutions, an owner is not entitled to vote if any contributions payable by him in respect of his section have not been duly paid. Therefore, an owner who withholds his levies is unable to vote for ordinary resolutions in respect of the section that he is withholding levies on.

Mr Lawyer, how does an owner deal with a situation where he believes the body corporate is liable for payment?

A dispute must be declared with the Body Corporate by written notice of the dispute or query to the trustees. The trustees or Body Corporate then have 14 days from receipt to resolve the dispute. During this period, the parties should meet to try and resolve the dispute. If there is no resolution after the 14-day period, either party may demand that the dispute be referred to arbitration. The arbitrator must make his/her recommendations in settlement of the dispute within 7 days from the date of commencement of the dispute. The decision of the arbitrator shall be final and binding and may be made an order of the High Court.

It is clear that prescribed processes are in place according to which disputes and related issues can be settled. Not only will this ensure that you act within the legal guidelines, but it will also eliminate unnecessary frustration.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Capital Gains Tax and the sale of a property

A1_GTCapital Gains Tax was introduced on 1 October 2001. Capital Gains Tax is payable on the profit a seller makes when disposing of his property.

What is meant by Capital Gain?

A person’s capital gain on an asset disposed of is the amount by which the proceeds exceed the base cost of that asset.

What is base cost?

The base cost of an asset is what you paid for it, plus the expenditure. The following can be included in calculating the base cost:

  1. The costs of acquiring the property, including the purchase price, transfer costs, transfer duty and professional fees e.g. attorney’s fees and fees paid to a surveyor and auctioneer.
  2. The cost of improvements, alterations and renovations which can be proved by invoices and/or receipts.
  3. The cost of disposing of the property, e.g. advertising costs, cost of obtaining a valuation for capital gains purposes, and estate agents’ commission.

How was base cost of assets held calculated before 1 October 2001?

If the property was acquired before 1 October 2001 you may use one of the following methods to value the property:

  1. 20% x (proceeds less expenditure incurred on or after 1 October 2001).
  2. The market value of the asset as at 1 October 2001, which valuation must have been obtained before 30 September 2004.
  3. Time-apportionment base cost method. (Original cost (proceeds – original cost) x number of years held before 1 October 2001) divided by (the number of years held before 1 October 2001 number of years held after 1 October 2001).

How is Capital Gains Tax paid?

Capital Gains Tax is not a separate tax from income tax. Part of a person’s capital gain is included in his taxable income. It is then subject to normal tax. A portion of the total of the taxpayer’s capital gain less capital losses for the year is included in the taxpayer’s taxable income and taxed in terms of normal tax tables.

How is Capital Gain calculated?

If you are an individual, the first R30 000 of your total capital gain will be disregarded. Then 33.3% of the capital gain made on disposal of the property must be included in the taxable income for the year of assessment in which the property is sold. When the property is owned by a company, a close corporation or an ordinary trust, 66.6% of the capital gain must be included in their taxable income.

Primary residence and Capital Gains Tax

As from 1 March 2012 the first R2 million of any capital gain on the sale of a primary residence is exempted from Capital Gains Tax. This exemption only applies where the property is registered in the name of an individual or in the name of a special trust. The property should furthermore not exceed 2 hectares. If the property is used partially for residential and partially for business purposes, an apportionment must be done.

If more than one person holds an interest in a primary residence, the exclusion will be in proportion to the interest held by each party. For example, if you and your spouse have an equal interest in the primary residence, you will each qualify for a primary residence exclusion of R1 million. You will also be entitled to the annual exclusion, currently R30 000.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Suspensive conditions in a deed of sale: Know your obligations

A3_GTImagine signing a deed of sale for your dream house and later discovering that the contract lapsed because you obtained bond approval one day too late. The situation could be worsened if the Seller receives a better offer for the house and accepts that better offer.

If a deed of sale is made subject to a suspensive condition it will lapse if such condition is not fulfilled in time. This was confirmed in the case of Marais v Kovacs Investments 724 (Pty) Ltd [2009] 1 All SA 174 (C) (hereinafter referred to as “the Marais case”). There is then no contract for the sale of the property between the two parties and the Seller can sell the property to another purchaser.

Examples of suspensive conditions are obtaining bond approval before a certain date, or the sale of the Purchaser’s current property before a certain date. It is very important for both the Seller and Purchaser to take note of the wording of these conditions and ensure that they understand them.

The following is an example of the wording of a suspensive condition relating to a bond, also sometimes referred to as a “bond condition”:

This Deed of Sale is subject to the Purchaser obtaining bond approval from a financial institution for the amount of R1 500 000 before 2 December 2013, failing which this agreement will lapse.

In the above example, if only R1 400 000 is approved before 2 December 2013, in other words R100 000 less than the required amount, then the condition is not met and the contract will lapse. Similarly, if a bond is approved for R1 500 000 but only on 5 December 2013, then the condition is not met in time and the contract will lapse, as was decided in the case of Meyer v Barnardo and another 1984 (2) SA 580 (N).

The parties can however agree to extend the time during which the suspensive condition must be fulfilled. Such extension must be in writing and signed by both the Seller and Purchaser as per the requirements of the Alienation of Land Act 68 of 1981. It must also be done before the time limit of the suspensive condition expires. In the above “bond condition” clause example, this would mean that the parties would have to sign the extension before 2 December 2013 to prevent the Deed of Sale from lapsing. In the Marais case the court held that even if the suspensive condition had been inserted in the contract for the exclusive benefit of the Purchaser, the Purchaser would have had to communicate his intention to waive the requirement before it lapsed.

In the Marais case the parties entered into a written agreement of sale with a suspensive condition that a bond in the amount of R10 149 072 needed to be obtained by 15 August 2005. The Purchaser, however, only obtained a mortgage bond in the amount of R9 650 000, which was granted on 2 August 2005. The respondent’s attorneys argued that the suspensive condition had been substantially fulfilled because the shortfall was, in their opinion, only a “minor shortfall” and therefore an insignificant amount compared to the purchase price. The court did not agree with this and found that it could not be said that the parties intended the suspensive condition to be fulfilled in any way other than what was expressly stipulated in the Deed of Sale. The court found that the contract had therefore lapsed.

If a suspensive condition will not be fulfilled in time, rather take the necessary precautions beforehand to avoid a lapsed Deed of Sale. We advise that you contact a professional for advice in this regard.

References:

  • Kontraktereg, UNISA 2004
  •  Self Study Conveyancing Course for Attorneys, Gawie le Roux, 2013
  •  Alienation of Land Act 68 of 1981
  •  Marais v Kovacs Investments 724 (Pty) Ltd [2009] 1 All SA 174 (C)
  •  Meyer v Barnardo and another 1984 (2) SA 580 (N)

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Tenant and landlord: What are your rights and obligations?

A2_GTSandra would like to move into her own place but like many people she is unsure what a lease is and what responsibilities it will place on her. A lease agreement is defined as the agreement entered into between the tenant and the landlord for the leasing of a property. The lease agreement regulates the rights and obligations of both parties and protects the parties mutually.

The Rental Housing Act No 50/1999, as amended by the Rental Housing Amendment Act No 43/2007, regulates the relationship between a tenant and a landlord, even before commencement of the lease agreement.

The Act determines that the landlord may not discriminate against the prospective tenant, his family or friends, including on grounds of race, sex, pregnancy or marital status. This applies as early as placing an ad for the leasing of a property or even during negotiations between prospective tenants and the landlord.

The lease itself does not have to be in writing to be binding on both parties and should a tenant request that an oral agreement be reduced to writing, the landlord may not refuse the request.

A written lease agreement must contain the following information:

  1. The names of the parties, as well as their South African addresses;
  2. A description of the property being leased;
  3. The monthly rental payable and reasonable increases;
  4. The deposit payable, if applicable;
  5. The period for which the property will be leased. Should the agreement not mention a specific period of lease, the agreement must indicate the notice period required should one of the parties wish to terminate the contract;
  6. Any other consideration, besides the monthly rent, which may be payable;
  7. A complete list of defects that are present at the time that the parties entered into the lease agreement.

If the property is situated in a complex that has its own rules, a copy of those rules should be attached to the lease agreement. The landlord must ensure that he/she gives effect to the provisions contained in the lease agreement.

As mentioned, mutual rights and obligations are created for both parties in the lease agreement. These rights and obligations include the following:

Tenant’s rights:

  1. To jointly inspect the property before the tenant moves in and record any defects or damage to the property. This provision protects the tenant at the end of the lease period to ensure that the tenant will not be held liable for damages that already existed at the time the lease was entered into.
  2. During the lease period, the tenant has the right to privacy and the tenant’s property, home or person may not be searched.
  3. If the landlord fails to inspect the property upon expiry of the lease, the tenant can assume that the landlord acknowledges that no damage has been done to the property, and that the full deposit, together with interest thereon, must be refunded to the tenant.

Landlord’s rights:

  1. To request a deposit, in the amount agreed upon between the parties, before the tenant takes occupation of the property.
  2. To receive timeous payment of the monthly rent and also to collect overdue payments, after a court order or order from a Tribunal has been obtained.
  3. To receive the property in a good condition upon termination of the lease.
  4. To jointly inspect the property within three days before the lease expires and determine if any damage has been done to the property for which the tenant should be held liable.
  5. To recover the cost of repairs, should the property be damaged, from the tenant.
  6. Should the tenant not give access to the property for a joint inspection before expiry of the lease, the landlord should inspect the property within seven days after expiry of the lease and utilise the deposit for necessary repairs. The balance of the deposit, if any, should be refunded to the tenant within twenty-one days.

Landlord’s obligations:

  1. To invest the tenant’s deposit in an interest-bearing account at a financial institution, with an interest rate equal to or higher than the interest rate at that time earned on a savings account at such financial institution. The tenant may request proof that the deposit is invested and the landlord may not withhold such evidence.
  2. To furnish the tenant with a receipt for each payment made by the tenant, which receipt should clearly describe the property, be dated, and indicate in full what the payment is made for (e.g. Rent for the month of February 2013, or deposit).
  3. To utilise the deposit to repair any damage to the property or to recover arrears rent after expiry of the lease, and to pay the balance together with interest earned thereon to the tenant within fourteen days after the expiry of the lease.
  4. To keep all receipts in respect of repairs done to the property which were deducted from the tenant’s deposit, and make such receipts available to the tenant.
  5. To refund the tenant’s deposit together with interest thereon, within seven days of the expiry of the lease, in the event that no repairs are to be made to the property.

Should a dispute arise between the parties, the Rental Housing Tribunal in the area where the dispute arises, can be contacted.

It is very important for both the tenant and the landlord to make sure that their intentions are clearly defined in the lease and that they understand the terms of the lease before the lease agreement is signed. All provisions, responsibilities and obligations should also be clearly set out in the agreement. It is advisable to seek legal advice if any uncertainties arise, before the lease agreement is signed.

References:

  • Rental Housing Act No 50/1999, as amended by Rental Housing Amendment Act No 43/2007

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)