19 Sep 2011
Legal firms which run debt collection divisions have seen a marked rise in the number of recalcitrant, non-paying tenants whom they are instructed to ‘deal with’, according to Ian Teague of Cape-based Gunstons Attorneys.
The problems faced by landlords and/or their managing agents, says Teague, are exacerbated by the sensitivity of the housing issue in South Africa – of which the Courts, he says, are well aware.
He says the courts have to bear in mind that the right to access adequate housing is spelt out by the Constitution, and elaborated upon by a long line of case law. “This obliges the Courts to consider legal proceedings carefully where the result may land a defaulting tenant on the street.”
Having said that, says Teague, it has also to be recognised that non-payment of rent is a breach of the lease agreement and those guilty of it will in the long run be called on to pay not only the money owing but also the interest on unpaid rents and the legal costs involved, provided this has been covered in the lease agreement.
Some tenants, he says, withhold their rent to try and pressurise the landlord into carrying out certain maintenance, repairs or other tasks that they believe are his responsibility.
“This kind of action is certainly a breach of the lease where a good lease agreement is in place. Rents have to be paid on the due date no matter how unsatisfactory the conditions of the rented unit.”
Frustrated landlords, says Teague, will often be tempted to use strong-arm tactics and threats to make the tenant catch up with payments. However, these kinds of tactics often run foul of the law.
“The appropriate way for the landlord to enforce his rights is through the courts. This usually involves two sets of legal action. Firstly, the defaulting tenant can be sued for his rental arrears and, secondly, the landlord can institute eviction proceedings, whereby, once an order is granted by the Court, a tenant can be forcibly evicted by the Sheriff of the Court if he does not leave voluntarily.”
The difficulty here, says Teague, is that the Court process is lengthy and frustrating, especially the eviction process, which commonly lasts at least three months before a bad tenant is evicted. Where a tenant decides to oppose an eviction application, the process can run even longer.
He says a tenant who knows that the Courts place a great emphasis on hearing arguments from both sides of a dispute can find many ways of delaying an eviction.
“The good news, however, is that in the vast majority of cases, eviction applications are ultimately successful. The less good news is that during the often lengthy legal processes, the recalcitrant tenant is unlikely to be paying any rents and the costs involved in instituting further legal action are frequently lost for good to the landlord.”
For these reasons, says Teague, in-depth credit checks should always be instituted before any tenant is accepted - “and if you cannot do this for yourself - and many of us cannot - employ a top agency to do it for you”, he says.
It is also essential, says Teague, in today’s market that a deposit equal to one and a half or two months’ rent is paid in by the tenant before he is given occupation.
This, he says, can be used to cover unpaid rents and to do the repairs that are almost always necessary once a tenant’s lease expires and he moves out.
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Could you please inform Mr. Teague that deposits are not allowed to be used to “cover unpaid rent” as he states. Deposit may at no time be used to fund a rental instalment. Instead what may be done is a deposit of 1 months rent may be payable plus an additional amount equalling 1 months rent as a surety. In effect the tenant then pays a security deposit as well as 2 months rent so the tenant always pays 2 months in advance. The tenant may then also opt to use the additional surety amount as one of the final months rent at the agreement of the landlord. - Hayden
Just as a balance to the legal point of view: I had a tenant who defaulted on his rent and proved very difficult to communicate with ie was a liar. After various threats etc etc I eventually got him out by cutting the electricity. I got various legal opinions beforehand - all advising against it, however, it worked like a charm. It should be made clear - as you do in your article - that once in it is well nigh impossible to get tenants out. The legal route is the " civilized " and in my opinion totally ineffective way to try and remove these people, who often are much more law-savvy than oneself. To add a different perspective to the leniency of the courts: After this experience I now have a perfectly good house standing empty for the past 18 months. My gardener stays in a room in the house ( for
free) and looks after the property. I would much rather have this situation than have an arrogant tenant who I need to beg to pay money owed to me. Methinks a case of the law stabbing itself in the back? - Dr PWL Groenveld
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