Category Archives: Housing and property law

FEARING FORECLOSURE: WHAT ARE YOUR RIGHTS AS THE HOMEOWNER?

The recent junk status announcement has shaken us into a quick action of tightening our belts and letting go of luxuries to afford our day to day expenses. This financial condition inhibits the possibility of purchasing a new house, let alone affording your current home. Have you thought about what you would do if your foreclosure wiped its shoes on your doormat?

You have the option to sell

Selling, rather than waiting for foreclosure, offers a greater possibility of you receiving greater value for your home. You may choose to sell privately or through an estate agent. It is advisable that your qualified conveyancing attorney be notified of any concerns, as well as any interests of potential buyers. During this time, look for alternative home solutions, and consider a suitable transfer date.

Prior to the signing of the agreement of sale and the transfer of ownership, the property still belongs to you.

You have time

Before receiving a foreclosure notice, the bank allows a grace period for you to catch up on your bond instalments. It may be difficult to do so, considering your finances have already been tightrope walking over the past few months. Meeting with your bank allows the opportunity for a payment restructure to be discussed and agreed upon.

The repossession procedure is paused during the time you are in application of or in debt review. The National Credit Act allows this opportunity.

Approach your lawyer

If, after attempting to recover payments, you receive foreclosure summons, contact your lawyer. As stated by section 26(3) of the South African Constitution, your eviction may not be finalised without an official court order. The courts consider all relevant circumstances before reaching a final eviction decision.

You may not be arbitrarily removed from your home.

You won’t be homeless

You have the right to adequate housing, despite your previous or current economic standing. Adequacy is determined by a place to eat, shelter, a place to sleep, and a place to raise a family, and this accessibility is the responsibility of the state. Following the outcome of the sale by the bank, the home is no longer in your ownership, and the state classifies you as an unlawful occupier.

The eviction process will then follow that of the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act.

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).

References:

National Credit Act

Constitution of the Republic of South Africa [1996]

Prevention of Illegal Eviction from and Unlawful Occupation of Land Act [No. 19 of 1996]

THE RENTAL HOUSING TRIBUNAL: I HAVE A COMPLAINT AGAINST MY LANDLORD/TENANT

Formed in 2001, the tribunal is comprised of five members (including a chair and vice chairperson) appointed by the Provincial Minister of Human Settlements, who each have expertise in property management, housing development and consumer matters pertaining to rental housing.

The tribunal seeks to:

  1. Harmonise relationships between landlords and tenants in the rental housing sector.
  2. Resolve disputes that arise due to unfair practices.
  3. Inform landlords and tenants about their rights and obligations in terms of the Rental Housing Act.
  4. Make recommendations to relevant stakeholders.

How do I lodge a complaint?

  1. First complete the relevant forms available from the Rental Housing Tribunal.
  2. The Rental Housing Tribunal will investigate the matter and find out what the problem is and try to resolve it amicably and as soon as possible.

What will the Rental Housing Tribunal do?

  1. They will establish whether there is any dispute between the landlord and tenant.
  2. They will try to resolve the matter through mediation – if the dispute cannot be resolved it should be referred to a hearing.
  3. They will conduct a hearing, where the landlord and tenant will be summoned for hearing by the Tribunal.
  4. A just and fair ruling will be made.
  5. Where a mediation agreement has been concluded, make such an agreement a ruling of the Tribunal. This ruling is binding on both parties.
  6. The Tribunal may make a ruling as to who pays whose costs.

What happens after I have lodged a complaint?

  1. After a complaint has been lodged with the Tribunal until the date of the ruling on the matter, the:
  2. landlord may not evict the tenant;
  3. tenant must continue to pay the rent; and
  4. landlord must maintain the property.

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)

IS THE TENANT OR LANDLORD RESPONSIBLE FOR THE WATER LEAKS?

Questions, and sometimes disputes, often arise between landlords and tenants regarding where the responsibility lies with the maintenance of a property. The simple answer is that tenants can generally only be held responsible for repairs/replacement on the property if the damage was caused by the tenant’s actions, or items that have a short life span, such as light bulbs.

On the other hand, alarm systems, auto gates and doors, locks, fixtures and fittings, appliances, or anything provided to the tenant are generally the responsibility of the owner to repair, unless damaged by the tenant.

Fair wear and tear

Damage due to fair wear and tear is the owner’s responsibility to correct. This includes situations where the property has, over time, experienced wear due to its use or age.

Examples would include:

  1. Fireplace chimneys: The landlord should maintain the fireplace e.g. having the chimney cleaned at appropriate intervals. Gardens, however, would require the tenant to do general maintenance.
  2. Blocked drains: This is usually due to tenant usage making it the tenant’s responsibility, but if blockage is due to tree roots, it would be the landlord’s responsibility.

Regarding appliances, as with any fixture or fitting, the landlord is responsible for repairs to appliances provided under the tenancy agreement unless the damage was caused by the tenant’s deliberate actions or negligence.

Tenants should report any damage on the property. If they fail to do this, they could find themselves held liable for any further damage due to lack of immediate attention to the initial problem. Furthermore, tenants are obliged to provide access for contractors to effect repairs.

Conclusion

If there is a water leak on the property, it would most likely be the landlord’s responsibility to fix. It is advisable for tenants to read and understand the lease agreement fully and for landlords to list as much as possible that needs to be maintained by the tenant. For example, if the unit has a garden that the tenant is responsible for maintaining, this should be mentioned in the lease.

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)

Reference:

https://www.privateproperty.co.za/advice/property/articles/sectional-title-who-pays-when-things-get-wet/520

https://www.property24.com/articles/maintenance-and-repairs-when-renting/18311

WHAT ARE THE DUTIES OF THE TENANT AND LANDLORD?

When 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 carry out.

Non-Statutory Law (Common Law)

The tenant is obliged to:

  • Pay the full amount of rent on the date and time agreed upon by both the tenant and the landlord. The tenant is not entitled to a seven day grace period.
  • Take good care of the property and not use it for purposes other than for which it was let.
  • Restore it to the same condition in which it was received, at termination of the lease.

Statutory 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.
  • Take part in 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 the guarantee that the tenant will be afforded 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.

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)

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

PAY YOUR LEVIES, OR ELSE…

A3_BDear 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:

l 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.

l 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.

l 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).

RIGHTS CREATED BY HOMEOWNERS’ ASSOCIATION CONSTITUTIONS

A2_bMany residential estates are governed by homeowners’ associations, which have constitutions requiring anyone owning property in that particular estate to belong to the association.

The association owns communal facilities and operates the estate’s infrastructure, including roads, water, sanitation, telecommunications networks and security services. All these are funded by monthly levies, recovered from residents.

The constitution of such associations include a clause stipulating that no member can transfer his or her property unless the homeowners’ association has certified that the member has fulfilled all financial obligations to the association.  These clauses are inserted to prevent any post-transfer problems in recovering amounts owed by residents.

A complication arises if a resident is sequestrated (or wound up, in the case of a corporate entity owning property in the estate).  The trustee or liquidator is obliged to sell the assets, and utilise the proceeds to the benefit of creditors.  Can the homeowners’ association prevent transfer, in such circumstances, if the amounts due to it are not paid?  This was the problem recently considered by the Supreme Court of Appeal in Willow Waters Homeowners v Koka NO & Others 2015 (5) SA 304 (SCA).  The Court approached the issue by considering whether the embargo on transfer of property, contained in the homeowners’ association constitution, constituted a real right as opposed to a personal right.  Broadly speaking, a real right prevails against the whole world and is enjoyed in respect of specific property, whereas a personal right is relative in the sense that it is only enforceable against a particular person, namely the other party to the obligation.  (Van der Merwe, “Sakereg”, pp 60 – 61).

In the Willow Waters Homeowners matter, the Court pointed out that, to determine whether a right or condition in respect of land is a real right, two requirements must be met, namely:

(a) The intention of the party who creates the right must be to bind not only the present owners but also successors in title; and

(b) The nature of the right or condition must be such that it restricts the exercise of ownership in the property saddled with such right.

The Court held that a clause requiring payment to the homeowners’ association of all monies due to it before transfer is intended to create a general security for the payment of a debt by binding successive owners in the township.  By doing so it restricts the exercise of rights of ownership by limiting an owner’s right to freely dispose of the property.  The provision therefore met both of the aforegoing requirements, and is qualified as a real right.  The court rules that the homeowners’ association was entitled to enforce this right against any party, including the trustee of an insolvent estate, where an owner of property in the estate had been sequestrated.

The judgment clarifies an important legal question.  Homeowners’ associations exercise an embargo on the transfer of property in a residential estate, unless and until all monies owed by the transferor to the homeowners’ association have been paid.

Compiled by Kinney Oosthuizen

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)

FIXTURES AND FITTINGS

Many transfer attorneys have heard the question from a seller: “May I remove the stove or the curtain rails or the shelves or the … ?”

The most common dispute that arises between a seller and a purchaser is a dispute as to what is regarded as fixtures and  fittings. The simple answer is that this would be what the seller and purchaser agreed on in the offer to purchase, as the law leaves it to the seller and purchaser to make their own arrangements.

Usually the offer to purchase only states that the sale is “voetstoots and includes all improvements and all fixtures and fittings of a permanent nature”. It could also be that the offer to purchase does not refer to fixtures and fittings at all. If this is the case there are three factors that have to be  considered to determine whether a movable item is a fixture or a fitting.

  1. The nature and the purpose of the item

The item should be of a permanent nature and intended to always serve the immovable property. In other words it must be attached to the land or the structure erected on the land. Examples of this are a carport, steel security gates welded to door frames, and an irrigation system.

  1.  The manner and the degree of attachment

The question is whether the item loses its own identity and becomes an integral part of the immovable property or if the attachment is so secure that separation would involve substantial damage to either the immovable property or to the item itself. One must also take into account the method, time and costs involved in removing the item and whether the item could be used elsewhere.

  1. The intention of the owner

One should look at the intention of the owner at the time when the attachment was made.

It is therefore important to address this issue in the offer to purchase and draft a comprehensive list of what is included in the sale. This could save both parties a lot of time and frustration.

The following is a list of items that are usually considered to be permanent fixtures:

Built-in extractor fans; built-in kitchen cupboards; fitted bookshelves; fitted curtain rails; wall mirrors; stoves; existing garden, trees, shrubs, plants; pool filter, pool pump and pool cleaning equipment; fitted carpets; light fittings; towel racks; tap fittings; tennis court net; fireplace; awnings; post box;  alarm system; television aerial (but not satellite dishes) and door keys.

Some estate agents have amended their fixtures and fittings clause since the CPA came into operation, to read as follows: “The property is sold with all fixtures and fittings, including the following … which shall be in good working order on date of transfer.” The words “in good working order” are a very subjective assessment and opens the door to debate. The effect hereof is that the seller will be seen to have promised that all the fixtures and fittings will be in good working order, and to a large extent it will be eroding the protection of the voetstoots clause. Sellers should therefore take caution when signing the fixtures and fittings clause.

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.

HOW TO EVICT A DEFAULTING TENANT

You are an owner of a residential property and have entered into a lease agreement with a tenant. Unfortunately your tenant is unreliable and falls into arrears with the monthly rental. What is your position now and what legal steps can be taken to claim back your property?

The Prevention of Illegal Eviction and Unlawful Occupation of Land Act, Act 19 of 1998 (more commonly known as PIE) allows for the eviction of unlawful occupiers of land in the Republic of South Africa. PIE applies to an “unlawful occupier” who is any person who occupies land without the express or tacit consent of the owner of such land. The High and Magistrate’s Court has jurisdiction to grant an eviction order under the provisions of PIE. However, for purposes of this article the Magistrate’s Court process for an eviction will be discussed.

The main eviction application is issued by the Clerk of the Court and a case number is then allocated. This case number is then copied onto an Ex Parte application as well as a Notice in terms of Section 4(2) of PIE. The Ex Parte application is not an interim order, but is rather an interlocutory application where the Court is requested to authorise the Notice in terms of Section 4(2) and also give a service directive for this notice. The Court will then consider the facts of the specific case and give a directive as to what the Court deem as sufficient service of the papers on the land occupier.

Once the Ex Parte order has been obtained the main application as well as the Section 4(2) Notice will be served on the Respondent in terms of the service directive provided by the Court. This service directive will include a directive to serve on the local Municipality as well. It is a requirement of PIE that this notice is served 14 calendar days prior to the hearing of the eviction application. Therefore after successful service and lapsing of the required time period the final eviction application will be heard and granted accordingly.  Should the occupant however fail to vacate the premises as directed by the Court Order, the Sheriff of the Court will be authorised by the Court to attend to the eviction of the occupant on or shortly after a specific date.

Compiled by Annerine du Plessis

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.

IMPLICATIONS OF ESTATE DUTY

Estate duty is charged on the dutiable value of the estate in terms of the Estate Duty Act. The general rule is that if the taxpayer is ordinarily resident in South Africa at the time of death, all of his/her assets (including deemed property), wherever they are situated, will be included in the gross value of his/her estate for the determination of duty payable thereon.

The current estate duty rate is 20% of the dutiable value of the estate. Foreigners/non-residents also pay estate duty on their South African property.

To minimise the effects of estate duty you need to understand the calculation thereof. The following provisions apply in determining your liability:

  1. Which property is to be included.
  2. Which property constitutes “deemed property”.
  3. Allowable deductions: the possible deductions that are allowed when calculating estate duty.

Property includes all property, or any right to property, including immovable or movable, corporeal or incorporeal – registered in the deceased’s name at the time of his/her death. It also includes certain types of annuities, and options to purchase land or shares, goodwill, and intellectual property.

Deemed property

A. Insurance policies

i)  Includes proceeds of domestic insurance policies (payable in South Africa in South African currency [ZAR]), taken out on the life of the deceased, irrespective of who the owner (beneficiary) is.

ii)   The proceeds of such a policy are subject to estate duty, however this can be reduced by the amount of the premiums, plus interest at 6% per annum, to the extent that the premiums were paid by a third person (the beneficiary) entitled to the proceeds of the policy. Premiums paid by the deceased himself/herself are not deductible from the proceeds for estate duty purposes.

iii)   If the proceeds of a policy are payable to the surviving spouse or a child of the deceased in terms of a properly registered antenuptial contract (i.e. registered with the Deeds Office) the policy will be totally exempt from estate duty.

iv)  Where a policy is taken out on each other’s lives by business partners, and certain criteria are met, the proceeds are exempt from estate duty.

B.  Benefits payable by pension and other funds by or as a result of the death of the deceased

C.  Donations at date of death
Donations where the donee will not benefit until the death of the donor and where the donation only materialises if the donor dies, are not subject to donations tax. These have to be included as an asset in the deceased estate and are subject to estate duty.

D.  Claims in terms of the Matrimonial Property Act (accrual claim)
An accrual claim that the estate of a deceased has against the surviving spouse is property deemed to be property in the deceased estate.

E. Property that the deceased was competent to dispose of immediately prior to his/her death (Section 3(3)(d) of the Estate Duty Act), like donating an asset to a trust, may be included as deemed property.

Deductions
Some of the most important allowable deductions are:

  1. The cost of funeral, tombstone and deathbed expenses.
  2. Debts due at date of death to persons who have their ordinary residence in South Africa.
  3. The extent to which these debts are to be settled from property included in the estate. This includes the deceased’s income tax liability (which includes capital gains tax) for the period up to the date of death.
  4. Foreign assets and rights:
    a. The general rule is that foreign assets and rights of a South African resident, wherever situated, are included in his/her estate as assets.
    b.  However, the value thereof can be deducted for estate duty purposes where such foreign property was acquired before the deceased became ordinarily resident in South Africa for the first time, or was acquired by way of donation or inheritance from a non-resident, after the donee became ordinarily resident in South Africa for the first time (provided that the donor or testator was not ordinarily resident in South Africa at the time of the donation or death). The amount of any profits or proceeds of any such property is also deductible.
  5. Debts and liabilities due to non-residents:
    a.  Debts and liabilities due to non-residents are deductible but only to the extent that such debts exceed the value of the deceased’s assets situated outside South Africa which have not been included in the dutiable estate.
  6. Bequests to certain public benefit organisations:
    a.  Where property is bequeathed to a public benefit organisation or public welfare organisation which is exempt from income tax, or to the State or any local authority within South Africa, the value of such property will be able to be deducted for estate duty purposes.
  7. Property accruing to a surviving spouse [Section 4(q)]:
    a.  This includes that much of the value of any property included in the estate that has not already been allowed as a deduction and accrues to a surviving spouse.
    b.  Note that proceeds of a policy payable to the surviving spouse are required to be included in the estate for estate duty purposes (as deemed property), but that this is deductible in terms of Section 4(q).
    c.  Section 4(q) deductions will not be granted where the property inherited is subject to a bequest price.
    d.  Section 4(q) deductions will not be granted where the bequest is to a trust established by the deceased for the benefit of the surviving spouse, if the trustee(s) has/have discretion to allocate such property or any income out of it to any person other than the surviving spouse (a discretionary trust). Where the trustee(s) has/have no discretion as regards both the income and capital of the trust, the Section 4(q) deduction may be granted (a vested trust).

Portable R3.5 million deduction between spouses

The Act allows for the R3.5 million deduction from estate duty to roll over from the deceased to a surviving spouse so that the surviving spouse can use a R7 million deduction amount on his/her death. The portability of the deduction will only apply when the entire value of the estate of the first dying spouse is left to the surviving spouse.

Life assurance for estate duty

Estate duty will also normally be leviable on these assurance proceeds.

Source: Moore Stephens’ Estate Planning Guide.

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.

WHAT HAPPENS AFTER YOUR HOUSE HAS BEEN BURNT TO THE GROUND?

There are definite steps that a homeowner will need to take if he ever has the traumatic experience of having his house burnt to the ground.

Over and above all the emotional and financial tension it causes in a person and his family, there will be several steps that a homeowner will need to take before the problems accompanying such an experience will be resolved.

The first step that needs to be taken by the homeowner is to report the matter to the nearest police station. The reason for this is twofold. Firstly, by reporting the matter the homeowner will receive the necessary case number as required by most insurance companies. Secondly, the conduct of the third party may turn out to be a crime, for example, arson. Thereafter the complaint will be investigated by the police and handed over to the prosecuting authority that will decide if the third party should be prosecuted or not.

The second step is to report the matter to the insurance company together with the abovementioned case number. Thereafter the insurance company will investigate the claim and decide whether it is going to accept or reject the claim. The insurance policy will determine the ambit of the insurance company’s discretion in deciding whether to accept or reject the insured’s claim. The reason for this is that the insurance policy will determine the rights and obligations between the insurance company and the insured. If the insurance company decides to reject the insured’s claim the insured will have two further options at his disposal. The insured will be able to take the matter to the ombudsman for determination, or he may dispute the matter in a civil court based on breach of contract by the insurance company.

The third step will be to indemnify the insured if the claim is accepted by the insurance company. The amount that the insurance will pay out to the insured will once again be determined by the terms and conditions of the insurance policy. If the insurance company rejects the insured’s claim or if the insured decides not to claim from the insurance company, then the insured will be able to institute action against the third party if he can prove that the house was burned down as a result of the intentional or negligent conduct or omission by the third party or, alternatively, that the house was burned down as a result of a breach of a contractual obligation between the homeowner and the third party, had a contract been in place.

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.