Tenants’ rights and the Consumer Protection Act The days of using any ways or means to remove defaulting tenants are over. This means that whether you are a landlord or a tenant, it is vitally important that you know your rights and where you stand should anything go wrong. For many years tenants were at the mercy of the landlords and although there are people out there who have abused the system and the rights of landlords, there are also those who have treated their tenants unfairly. Deposits were often withheld for no legal reason and there were instances where, although rentals were increased on an annual basis, very little in the way of maintaining the property was carried out by the owner. This indicates that while it is vital to vet any new tenant carefully to ensure that they are going to continue to pay rent and maintain the property, it’s becoming increasingly important to keep the property in a satisfactory liveable condition for the parties concerned. So just what are tenants’ rights? What rights do the landlords have and how does the Consumer Protection Act (CPA) feature in rental agreements? Tenants’ rights The days of forcing tenants to move out using illegal tactics are over and anyone who is either renting out property or is considering renting out residential property needs to familiarise themselves with the Prevention of Illegal Evictions Act (PIE). Although the act has been place for several years, generally speaking the effects are being felt far more by landlords as more and more tenants become aware of their rights. While there are systems in place to protect the landlords, tenants certainly have more rights than before and landlords cannot resort to changing the locks, cutting the water and electricity or forcibly removing a tenant that hasnt paid rent without receiving authority from the courts to do so. The Rental Housing Tribunal administers the Rental Housing Act 50 of 1999, facilitating sound relations between tenants and landlords. The responsibilities of the Tribunal include advising tenants and landlords of their rights and obligations as well as resolving issues either via mediation or through a hearing. The most common issues raised with the Tribunal include: • Failure to refund deposits • Unlawful notice to vacate • Exorbitant increases in the rental • Failure to pay rent • Unlawful seizure of possessions • Failure to reduce the lease to writing Although there are many landlords who view property rentals as a business, unfortunately there are also those who don’t and continually ignore the law. In these circumstances, the law is most definitely on the side of the tenant. There are procedures that every landlord has to follow and those who don’t follow the procedure need to understand the consequences when the proverbial wheels fall off. It is equally important for tenants to become familiar with their rights. Forearmed is forewarned and it is imperative for tenants to act quickly when landlords break the law The Housing Tribunal has mediating facilities and if the issue cannot be resolved over the table, then a hearing will be called. It is worth noting that a ruling of the Tribunal is deemed to be an order of a magistrate’s court in terms of the Magistrate’s Court Act, 1944 (Act No 32 of 1944). Consumer Protection Act As far as the parameters of the CPA are concerned, it is important to remember that a rental agreement is essentially a service. This is due to the fact that a landlord is supplying the tenant with the service of a place to live, which they in turn are paying an agreed for. Considering that the CPA was introduced to regulate the supply of goods and services to South African consumers, every lease agreement drawn up after 1 April 2011 must comply with its regulations. The conditions of the CPA stipulate that the lease agreement must be written in plain language with no complicated or misguiding jargon. It is imperative that the tenant fully understands the document before they sign it. This clause implies that the tenant has the right to have the contract translated into their first language if required. If the contract incorporates any provisions that transfer risk from the landlord to the tenant or exempt the landlord from certain liabilities, the tenant must be made fully aware of these conditions and acknowledge them before the contract is signed. As a general rule of the thumb, the contract must not contain any clause that defeats the end of the CPA and no contract may be stacked in favour of either party. Another aspect to consider is that in terms of Section 14 of the Act, a lease agreement is regarded as a fixed-term contract. The CPA has reduced the maximum period of any fixed-term contract to two years. The only exception to this condition is if a landlord can prove that a longer-term agreement would be in the tenants best interest and financially beneficial to the tenant. Even if the lease is reaching its termination date, the landlord is still required to give the tenant the required notice in writing, which is between 40 and 80 days before the end date. The landlord must also set out any costs what will be incurred should the tenant renew the lease, along with the tenant’s options. On expiry the contract will continue on a month-to-month basis unless the tenant has advised the landlord that they wish to cancel the agreement or it has been renewed by another contract. The only instance in which a landlord can cancel the lease agreement is if the tenant is in material breach of the contract for 20 days despite notice. If the matter is rectified by the tenant within the 20 day notice period they will be entitled to continue with the agreement. Conversely a tenant is required to provide the landlord with only 20 business days’ notice at any point in the term of the contract. There can be no provision in the contract preventing a tenant from this right; however the tenant is still obligated to pay any outstanding money up until the end of the cancellation period as well as a reasonable cancellation penalty. There is no prescription of the penalty amount, apart from the fact that it must be reasonable. This will be determined by a number of factors which are listed in the Regulations of the Act, such as the amount still owed, value of the agreement, duration and the length of the notice period given, to name a few. Any landlord who is found to contravene the regulations of the CPA runs the risk of seeing the lease declared void or, in more severe cases, will be fine or imprisoned for up to one year. Mutual respect by both parties will go a long way to ensuring that the relationship remains on an even keel. There are many landlords and tenants that have been benefiting from this form of relationship for many years and because of their approach to the entire affair, will continue to do so for years to come.
Posted on: Mon, 04 Nov 2013 09:45:45 +0000
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