Consumer Law

THE SALE AGREEMENT: CAN I USE THE COOLING-OFF PERIOD IF I CHANGE MY MIND?

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The Consumer Protection Act has some serious implications for agents selling property – for one, a disgruntled purchaser can get out of a sale agreement within 5 days of signing it.

Section 16 of the Consumer Protection Act states as follows:

“A consumer may rescind a transaction resulting from any direct marketing without reason or penalty, by notice to the supplier in writing …, within five business days after the later of the date on which

  1. The transaction or agreement was concluded; or
  2. The goods that were the subject of the transaction were delivered to the consumer.”

However, the CPAs Cooling-Off Period will not help you when you change your mind. People are under the misconception that the CPA protects them, by providing the “cooling-off period”.

The Alienation of Land Act

In terms of The Alienation of Land Act, residential property transactions of R 250 000.00 or less are subject to a “cooling-off” period of five working days, calculated from the date of signature of the Offer to Purchase. It does not apply to residential properties sold for more than R 250 000.00. This provision remains in place and is not affected by the CPA.

A Purchaser who purchases a property, as a result of direct marketing, has the right to cancel the sale within five business days – the “cooling-off” period. This applies only to sales that result from direct marketing.

Direct marketing in terms of the Act includes to “approach” a person (i) in person, (ii) by mail or (iii) by electronic communication (this includes email and sms) for the purpose of promoting or offering to supply goods or services to the person.

The “cooling-off” period does not apply to sales that result from any other form of marketing such as any purchase made by a client that the agent is already working with or conventional print advertising or show houses.

The cooling-off period creates rights for the consumer buying property while regulating closely how suppliers or estate agents operate. Estate agencies and property professionals need to be aware of the implications and prepare for changes in the way they will interact with property buyers and sellers in the future.

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:

Anderson, AM. Dodd, A. Roos, MC. 2012. “Everyone’s Guide to South African Law. Third Edition”. Zebra Press.

The Estate Agency Affairs Board. “Purchaser’s Cooling-Off Right: Guidelines for Estate Agents”. [online] Available at: https://www.eaab.org.za/ [Accessed 31/05/2016].

http://www.privateproperty.co.za/

Family Law

WHEN CAN SPOUSES GET A DIVORCE?

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There are only two grounds for divorce, namely the irretrievable breakdown of the marriage; or mental illness or continued unconsciousness of one of the spouses.

Examples of the irretrievable breakdown of a marriage as a ground for divorce include:

  1. the spouses not living together for a continuous period of one year;
  2. abuse towards the spouse or the children;
  3. adultery;
  4. habitual criminality;
  5. drunkenness or drug addiction; or
  6. loss of love and affection between the spouses.

The court’s discretion to grant a Divorce order

The court still has discretion not to grant a divorce order, and may postpone the proceedings or dismiss the claim if it appears to the court that there is a reasonable possibility that the parties may reconcile through counselling. If reconciliation is unsuccessful after a few months, the parties may proceed with the same summons. The summons will usually contain the averment that further counselling and/or treatment will not lead to any reconciliation. A court must, therefore, be satisfied that the marriage is really broken down and that there is no possibility of the continuation of a normal marriage.

What if the couple reconciles?

Where the parties reconcile and live together again after the summons was issued and served, it does not necessarily end the divorce proceedings. If, however, the reconciliation is unsuccessful after a few months, the parties may proceed with the same summons. It is extremely important to make sure that the summons is withdrawn formally if you do decide to reconcile. Withdrawal of the summons is formally affected when the plaintiff serves a document referred to as a notice of withdrawal of the summons on the defendant or his/her attorney. If this is not done, a divorce order may be obtained by default without the defendant being aware of it. If a divorce is obtained in this manner, the aggrieved party may approach the court to set aside the order.

Conclusion

Since the present law on divorce is no longer based on the principle of fault, defences like insanity or the plaintiff’s own adultery are no longer valid defences. Therefore, if a divorce is instituted on account of an irretrievable breakdown, there is in fact no defence to prevent the divorce from proceeding. But if the court finds that there is a reasonable possibility of reconciliation, it may postpone the proceedings in order that the parties attempt reconciliation; this, however, is not a defence, but merely amounts to a postponement.

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:

Justive.gov.za
Legalwise.co.za

Housing and property law

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

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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)

Estate

DEMYSTIFYING THE EXECUTOR IN A DECEASED ESTATE

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During a person’s lifetime s/he will gather assets, in other words, belongings such as a house or a motor vehicle. These assets and liabilities will form part of a person’s estate. At the death of that person, his/her deceased estate must be administered, in other words, divided, distributed and controlled by someone. This person is called an executor.

However, the role of an estate executor and who can be appointed as one has been largely misunderstood.

What does the executor do?

“Executor” is the legal term for referring to the person, or people, nominated in your will to carry out the directives you set out in your will.

  1. This means that it is the executor’s responsibility to disburse your property to the mentioned beneficiaries in your will, but also obtain information on potential heirs, collecting and arranging payments, and approving or disapproving creditors’ claims.
  2. It is the executor’s duty to calculate and pay the estate tax, and to ensure that the correct documentation is filed with the relevant authorities.
  3. The executor is the individual that represents your estate.

Who can be appointed as the executor?

It has become normal to appoint a friend, family member or beneficiary to act as the executor, as they most likely have intimate knowledge of your estate and your affairs, but also, they will not rack up the fees that a legal body might accrue.

However, there is a misconception that you can avoid the fees by appointing a family member as the estate executor, but this could also mean that you are deferring the cost to the nominated family member.

  1. Family members appointed as executors on larger estates immediately find themselves out of their depth, and not only end up hiring a professional executor, but may also pay more for these services than necessary.
  2. A simple way to address this is by appointing a “professional” executor during your lifetime. This allows you to negotiate the executor fees.

If you appoint a family member, make sure that they understand that they will have to appoint a professional agent, and that they should negotiate the fee and be very cautious of agreeing to a fee arrangement in terms of which the professional agent charges their professional fee, instead of the legislated scale.

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:

https://www.legalwise.co.za/help-yourself/legal-articles/duties-executor

http://www.fin24.com/Money/Wills-and-trusts/Role-of-executor-of-deceased-estate-20150513

Estate

THE BASICS OF ESTATE DUTY

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When a person dies, they leave behind an estate which includes everything they own. Estate Duty is payable on the estate of every person who dies and whose nett estate is in excess of R3,5 million. It is charged at the rate of 20%. Currently, SARS is responsible for collecting the Estate Duty of a deceased person.

How does an estate get reported to SARS?

Even if Estate Duty does not apply to you, it is still necessary to inform SARS that the person is deceased. It is recommended that you consult with a legal expert when going through such as process.

Copies of the following documents must be sent to SARS:

  1. Death certificate or death notice.
  2. Identity document of the deceased.
  3. Letters of Executorship (J238) (if applicable).
  4. Letter of Authority (J170) (in cases where the estate is less than R250 000).
  5. Certified copy of the executor’s identity document.
  6. Power of attorney (if applicable).
  7. The name, address and contact details of the executor or agent.
  8. The last Will and Testament of the deceased.
  9. An inventory of the deceased’s assets.
  10. The liquidation and distribution accounts (if available).

These documents may be sent to the relevant Centralised Processing Centres that is closest to the Master of the High Court where the estate is being administered.

How does Estate Duty work in relation to an inheritance?

All income received or accrued before the deceased’s death is taxable in the hands of the deceased up until the date of death, and will be administered by the executor or administrator acting as the deceased’s representative taxpayer.

  1. After the date of death of a person, a new taxable entity comes into existence – the “estate”.
  2. The assets of the deceased will be held by the estate until the liquidation and distribution account has lain for inspection and become final under section 35(12) of the Administration of Estates Act after which the assets will be either handed over to the heirs or delivered to the trustee of a trust estate.

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:

http://www.sars.gov.za/TaxTypes/EstateDuty/Pages/default.aspx

http://www.sars.gov.za/ClientSegments/Individuals/Tax-Stages/Pages/Tax-and-Inheritance.aspx

Debt

DO DEBTS LAST FOREVER?

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Prescription was introduced as means of protecting South African consumers from dishonest credit providers, who are responsible for recklessly lending credit and have contributed to the detrimental debt crisis many South Africans face today.

What does prescription mean?

  • The Prescription Act 68 of 1969 (PA) says that a debt (payment of money) is extinguished/expired after the lapse (passing) of a specific time period.
  • South Africa has different laws which specify time periods, for example, the PA says contractual and delictual debts extinguish after 3 years from when prescription starts.
  • Prescription may be delayed or interrupted.

It is important to bear in mind that not all debt prescribes after a period of three years. Debt related to a cheque, for example, only prescribes after 6 years. The purpose of prescription in South Africa is to compel creditors and collections agents to collect money owed to them within a specified period and not delay collection so that it accumulates massive amounts of interest and costs.

What are the consequences of an extinguished debt?

  • The debtor is not liable to the creditor for a debt after the time period has lapsed.
  • The creditor may not institute legal action against the debtor for a debt.

When does prescription start?

As soon as the debt is due (a debt is due once the creditor can identify the debtor and the facts from which the debt arises).

If the debtor prevents the creditor from gaining knowledge of the debt (excluding debts arising from agreements) prescription runs from when the creditor has knowledge of the existence of the debt.

An important point to remember is that it’s perfectly legal for a debt collector or attorney to demand payment for a prescribed debt. It is up to a debtor to raise prescription as a defence.

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:

https://www.legalwise.co.za/help-yourself/quicklaw-guides/prescription

http://www.debtbusters.co.za/faq/what-is-prescription/

Law

AUTHENTICATING DOCUMENTS FOR USE OUTSIDE SA

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If you need to use official South African documents in another country, it is necessary that they are legalised for use abroad. This can be for any number of reasons, such as legalising university degrees for a job in another country.

What is legalisation?

Legalising documents means that official (public) documents executed within South Africa for use outside the country are affixed, sealed and signed either with an Apostille Certificate (where countries are party to The Hague Convention) or with a Certificate of Authentication (where countries are not party to The Hague Convention).

Legalisation basically means the process followed by which the signature and seal on an official (public) document is verified.

The process involved in signing/executing documents:

If a country is part of The Hague Convention, the following process applies:

  1. The documents are signed and/or executed in the presence of a Notary Public. The Notary Public will attach the Certificate of Authentication to the documents which must bear his signature, stamp and seal.
  2. The documents are then forwarded by the Notary Public to the High Court in the area in which the Notary Public practices. The Court will then attach an Apostille Certificate authenticating the Notary Public’s signature.

There are certain documents that the High Court will not Apostille/Authenticate and must be sent to the Department of International Relations and Co-operation (DIRCO), which is based in Pretoria. For example:

  1. All Home Affairs documents; and
  2. Police Clearance Certificates.

If a country is not part of The Hague Convention, the following process applies:

  1. The documents are signed and/or executed in the presence of a Notary Public. The Notary Public will attach the Certificate of Authentication to the documents which must bear his signature, stamp and seal.
  2. The documents are then forwarded by the Notary Public to The High Court in the area in which the Notary Public practices. The Court will then attach an Apostille Certificate authenticating the Notary Public’s signature.
  3. Documents are then submitted to the Legalisation Section at DIRCO to be legalised.
  4. Once legalised by DIRCO the documents are then forwarded to the Embassy/Consulate of the country in which they are intended to be used for further authentication.

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)

Contracts

CAN BREAKING-OFF AN ENGAGEMENT PROMPT LEGAL ACTION?

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Once a couple has become engaged, you could say that they have concluded a verbal contract to get married. From that point, up until the marriage, the couple would be committed to getting married, as well as the planning and preparation leading up to it. However, in some instances, one of those in the relationship might decide to break off the engagement. This might seem unimportant, but what if the couple had gone to great lengths to plan the wedding and even went as far as changing lifestyles in the expectation of getting married. Would the person being left behind be able to sue for damages lost?

Does our law mention engagement?

Our common law has, over the years, recognised the principle that the aggrieved party has a claim for breach of promise. Traditionally this claim comprises two parts, namely:

  1. The delictual claim which the aggrieved party would have under the action injuriarum for contumelia, in other words, damages for the humiliation caused as a result of the break-up of the relationship; and
  2. The contractual claim for the actual financial loss suffered by the aggrieved party as a result of the break-up of the relationship of the parties.

In the Supreme Court of Appeal case Van Jaarsveld vs Bridges (2010), it was found that no claim in South African law exists other than actual expenses incurred in the planning and preparation of the marriage.

The judgement draws attention to a court’s right and more importantly, duty to develop the common law, taking into account the interests of justice and at the same time to promote the spirit of the Bill of Rights.

ES Cloete vs A Maritz (2013) WCH

The question whether or not the claim for breach of promise is a valid cause of action in South African law was once again considered in the Western Cape High Court. In this Court, Judge Robert Henney was the presiding Judge in the matter of ES Cloete vs A Maritz.

Miss Cloete claimed that Mr Maritz proposed formally to her in Namibia on the 9th February 1999 with an engagement ring, and she accepted. The relationship was turbulent and a decade later Maritz called off the engagement and the intended wedding. Cloete instituted action against Maritz and alleged that Maritz’s refusal to marry her amounted to a repudiation of the agreement which they had reached 10 years earlier. In his judgment, Judge R Henney said: “Clearly, to hold a party accountable on a rigid contractual footing, where such a party fails to abide by a promise to marry does not reflect the changed mores, morals or public interest of today.”

The judge also said: “As pointed out by Sinclair, The Law of Marriage Vol 1 (1996), to hold a party liable for contractual damages for breach of promise may in fact lead parties to enter into marriages they do not in good conscience want to enter into, purely due to the fear of being faced with such a claim.”

Conclusion

Divorce, which in earlier days was only available in the event of adultery or desertion, is now available in the event of an irretrievable breakdown of the marriage. There is no reason why a just cause for ending an engagement should not likewise include the lack of desire to marry the particular person, irrespective of the ‘guilt’ of the latter.

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. (E&OE)

Trusts

THE BENEFITS OF CREATING A TRUST

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Trusts are well-known to facilitate effective estate planning and continuity planning strategies. That said, setting up a trust – whether an inter vivos (between the living) or a testamentary (created in a will) − should be carefully considered and not just implemented blindly.

The difference between testamentary and inter vivos trusts

  1. A testamentary trust is established when a person (the founder) makes provision for establishing a trust in their will. The trust does not come into existence until the founder dies.
  2. An inter vivos trust is set up between the living. In other words, property is transferred before death to the trust by its founder and managed by the trustees for the benefit of another person or persons.

The death benefits of creating an inter vivos trust exceeds the cost – both in time and money. According to The Estate Duty Act, upon death, a duty is levied against your estate known as estate duty. The nett value of any estate will be determined by deducting all liabilities from your assets of your estate, both real and deemed.

Should you create a testamentary trust, upon death the assets are in your name and will need to be transferred to the trust posthumously, meaning all assets are taken into account when assessing the duty payable.

Advantages

Taking the above into account, here are some benefits you could experience from creating a trust:

  1. Reducing estate duty: Inter vivos trusts can be used to minimise estate duty. No estate duty should be payable on assets owned by the trust as a trust does not die.
  2. Protection against creditors: As the trust’s assets are not owned by the beneficiaries, creditors do not have a claim on the assets. This advantage is especially important for people who could be exposed to potential liability. Companies as well as individuals are able to transfer assets into trusts.
  3. Efficient succession: Since trusts never die, beneficiaries will be able to continue enjoying the assets if one beneficiary were to pass away.

 Disadvantages

Despite the advantages, there are also some disadvantages of having a trust. They include the following:

  1. Costs: The costs of setting up a trust can be high. If assets are transferred into the trust, then transfer duty needs to also be paid.
  2. Duties of trustees: Trustees could find themselves personally liable for losses suffered by the trust if it can be proven that they did not act with care, diligence and skill according to Section 9 of the Trust Property Control 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:

https://www.iprotect.co.za/articals-trust-info/article-arcives/why-an-intervivos-trust-as-opposed-to-a-testamentary-trust.html

http://www.entrepreneurmag.co.za/advice/starting-a-business/start-up-advice/should-i-set-up-a-trust/

https://www.findanattorney.co.za/content_inter-vivos-trust

Housing and property law

IS THE TENANT OR LANDLORD RESPONSIBLE FOR THE WATER LEAKS?

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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