Lease Agreements generally follow a time-and-tested approach. Tenant likes the property; a Lease Agreement is signed; Tenant moves in; Tenant pays their rent each month. At the end of the fixed period, Tenant elects to either renew the lease, or continue on a month-to-month. Or terminate and move out. Most people are familiar with this approach. But what happens if renewal is not a choice given to the Tenant, but rather the subject of negotiation with the landlord?
I own a small property that I leased to a business just over two years ago. I sent a notice to the tenants informing them that I was terminating the lease and they would be required to move out. I actually thought I was being generous by giving them 60 days’ notice to leave. The tenants have come back to say that they’re not moving out because they’re exercising their right to renew. The agreement says that the lease will last for two years. It doesn’t say anything about any renewal. Is it true that the tenant has a right to renew?
After endless weekends searching for that perfect property, the tenant finally heaves a sigh of relief. Found it! And it’s perfect! The forms are signed, the deposit and first month’s deposit is paid, the removal van is booked. Let the settling in begin.
But have you ever wondered what the landlord is planning on doing with that deposit? Here’s the thing: the deposit doesn’t belong to the landlord. It is held by the landlord as a form of security, in case the tenant damages the property or fails to pay their rent or electricity. But unless or until such time as the tenant steps out of line, the landlord has no right to the money. This is generally not really thought about until the lease ends. Which is when the tenant starts clamouring for their money back. And this is when the landlord often scurries to find another tenant, so that they can use the new tenant’s deposit to pay back the old tenant’s deposit. Because the old tenant’s deposit was spent within days after it was paid over.
There’s a familiar struggle that plays out at the end of every lease. It revolves around the repayment of the deposit. Unsurprisingly, the tenant is keen on getting their deposit back pronto. But the landlord is invariably not so keen to part with the cash. The distrust on both sides is not entirely without justification.
There are many tenants who have been caught out by the games that landlords are wont to play with their deposit. On the final day of the lease the tenant dutifully removes the last moving box, sweeps the last dust particle, locks the door on the pristine property and returns the keys. Only to find themselves being held liable for paying a painter, carpet-cleaner, handyman, gardener, cleaner. For good measure the tenant may even find themselves paying for the carpets to be replaced and fixtures to be updated. All out of their hard-earned deposit.
Here’s a scenario that many a landlord knows only too well. Your faithful tenant of several years has finally decided to move on to greener pastures. You’re a tad dismayed at the news. Finding a tenant who pays their rental on time, in full, every month is no easy feat. But you comfort yourself in the knowledge that you can finally increase the rental to what you feel is a more market-related level. The end of the month falls rather inconveniently during the week, and you’re running ragged at work. So you arrange for the tenant to drop off the keys at your office once they’ve cleared out. And you make a note in your mental diary to go see the property over the weekend.
Are you looking for a CPA-compliant Lease Agreement? We have the solution for you! If you’re asking, “What is a CPA-compliant Lease Agreement?” then read on. When the CPA was initially enacted, most people homed in on the obvious impact, such as the reigning in of retailers selling defective products to customers. It didn’t take long for a new realisation to kick in: the CPA also applies to residential lease agreements!
Getting an eviction order is never easy. But in this case, the landlord’s challenge was trying to keep the eviction order that had been granted to him! In a judgement delivered on 08 June 2017 the Constitutional Court set aside the eviction of 184 residents occupying a block of flats in Berea, Johannesburg. In a nutshell, the Constitutional Court has held that:
It’s well-known that the owner of a property is legally obligated to follow the home owner association rules and codes of conduct. But what about the tenant? The tenant enters a lease agreement with the owner, which makes the tenant contractually bound to the owner. But there’s no contract between the tenant and the Homeowners Association. So is the tenant obliged to follow the home owner association rules and codes of conduct?
The landlord advertises a property for rent. The tenant views the property. Like, sign, pay, move in. All is well, until the property suffers some form of deterioration that seriously impacts on the tenant’s living conditions. Is the landlord responsible for the maintenance of the property? Is the tenant able to terminate the lease if the property is poorly maintained?
Nothing strikes more fear into the hearts of business owners that this one word: Suretyship. It’s a curse that sends them fleeing for the hills quivering in terror. Many businessmen and women can recount numerous war stories of the abuse suffered by guarantors at the hands of creditors who have manipulated and abused suretyships. At the other end of the spectrum, our courts are clogged with creditors kicking themselves for not having insisted on a suretyship before granting credit to their now defaulting debtor. Let’s face it: the suretyship is a very useful business tool. If used correctly, fairly and with both parties in agreement on the scope and parameters. It gives businesses access to the credit they so desperately need to do business. And it gives creditors the comfort they need to release goods before payment is made. There needs to be a balance between the competing interests of debtor and creditor. But all too often we hear of creditors upsetting this balance by claiming more than the surety originally bargained for. Fortunately, the Supreme Court of Appeal came to the rescue by clarifying how a suretyship is to be interpreted and applied.