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September 28, 2018

When does a claim for damages prescribe?



In Mavuso v Member of the Executive Council for the Department of Health, Mpumalanga, heard in the Pretoria High Court, the issue before the court was whether Mavuso’s claim for damages against the Defendant – launched more than three years from the date of his injury – had prescribed.

The Defendant raised a special plea of prescription. The court found that the Defendant bore the onus of proving that prescription barred the plaintiff from proceeding with his claim.

In terms of section 11(d) of the Prescription Act 68 of 1969 (“the Act”) a claim is subject to a three-year prescription period which starts to run when the debt is due. Section 12(3) provides that “A debt shall not be deemed to be due until the creditor has knowledge of the identity of the debtor and of the facts from which the debt arises: Provided that a creditor shall be deemed to have such knowledge if he could have acquired it by exercising reasonable care”.

The defendant contended that the plaintiff’s claimed for damages, showed that he had knowledge of the identity of the defendant and of the facts giving rise to the debt on which the claim was based, when he was discharged from hospital following his injury in an accident. 

The defence was bad in law. There was nothing to indicate why the plaintiff, on being discharged from hospital, would at that stage have had material facts for a cause of action. It was only when a medical report subsequently obtained by the plaintiff was received, that the plaintiff could have realise that he had a cause of action against the defendant. The special plea of the defendant was thus dismissed with costs.


September 24, 2018

Best 25 South African Law Bloggers



Our blog  Bregmans has been selected by our Feedspot panelist as one of the Top 25 South African Law Blogs on the web from thousands of South African Law blogs on the web using search and social metrics.

These blogs are ranked based on following criteria:
·         Google reputation and Google search ranking
·         Influence and popularity on Facebook, twitter and other social media sites
·         Quality and consistency of posts.
·         Feedspot’s editorial team and expert review


September 23, 2018

When a landlord can’t sue a tenant for unpaid rent


In Picardi Hotels Limited versus Thekweni Properties (680/7) (2008) ZASCA 128, the SCA held that a landlord could not sue his tenant for unpaid arrear rentals if the mortgage agreement concluded between the bank and the landlord contained a cession of rentals. Thus, unless otherwise agreed, the landlord had given up his right to sue for unpaid rent by ceding this income to the bank when concluding the mortgage agreement.



Landlords with mortgage bonds registered over their rental properties may have unwittingly surrendered their right to sue defaulting tenants where the mortgage bond contains a cession. Mortgage bonds typically contain a clause such as this:



Cession of rentals and revenues



Should the Mortgagee give its consent to the letting of the mortgaged property, the Mortgagor cedes, transfers and assigns to the Mortgagee all the Mortgagor’s rights, title and interest in and to all rentals and other revenues of whatsoever nature, which may accrue from the mortgaged property as additional security for the due payment by the Mortgagor of all amounts owing to or claimable by the Mortgagee at any time in terms of this bond, with the express right in favour of the Mortgagee irrevocably and in rem suam:



1      to institute proceedings against lessees for the recovery of unpaid rentals, and/or eviction from the mortgaged property;



2      to let the mortgaged property or any part thereof, to cancel or renew and enter into leases in such manner as the Mortgagee decides, and to evict any trespasser or other person from the mortgaged property;



Landlords should carefully check their mortgage agreements on both commercial and residential properties. If they contain a cession of rentals they need to obtain the bank’s permission before they may sue for unpaid rentals. This decision affects both commercial and residential rental properties as the above cession is included as a term of most commercial and many residential mortgage loan agreements.



Unless otherwise agreed, the landlord gives up his right to sue for unpaid rent by ceding this income to the bank when concluding a mortgage agreement.




August 31, 2018

Retirement age – when must you retire?



#retirement age

Eventually, everyone needs to stop working. Some people prefer to retire at an early age while others choose to work for as long as possible. Whatever your preference, you need to know what your rights and options are.

RETIREMENT AGE
The labour legislation does not deal directly with the issue of retirement age. However, it does say that no one may be unfairly discriminated against because of their age. This means that the employer and employee must agree on a retirement age.

There are three possible situations that you could find yourself in:
·         Your employment contract requires you to retire at a certain age.
·         You have agreed with your employer on a retirement age or there is a company norm.
·         There is no mention of retirement in your contract and there is no agreement.

If you sign an employment contract that stipulates a retirement age, then you can legally be required to retire at that age. The organisation won't be required to give you notice.
If the retirement age is not in the contract but is agreed or if there is an organisational norm, then the employer can give you notice requiring you to retire at that age. The notice period will be the same as the notice period for termination of employment set out in your contract of employment.

When would there be deemed to be an organisational norm? There is a general understanding that the "normal" retirement age is 55, 60 or 65 but this understanding is to

·        the rules of a company's provident or pension fund (but this is not definitive); or
·        company policy.

If there is no mention of a retirement age in your contract and there is no organisational norm, then you can continue to work until you are unable to do your job properly. Your employer can only terminate your contract in accordance with the labour legislation (that is for misconduct, operational requirements or incompetence) and will have to follow the procedures set out in your contract or labour law. The courts have found that it is unfair discrimination for your employer to terminate your employment services just because of your age.

WHAT IF YOU CONTINUE TO WORK AFTER THE RETIREMENT AGE?
There is no legal certainty regarding the rights of an employee who works beyond retirement age. It is thus advisable for the employer and employee to clearly define the terms of employment after the retirement age, for example how long the employee will continue to work for and what notice is required to terminate the employment.


August 01, 2018

A living, loving trust plan.




I want to protect and care for myself and my family while I am alive, and to leave what I have- and what is needed- to whom I want, the way I want, and, in addition, if I can, save legal fees, administrative and court costs, and taxes to the maximum extent legally possible.

Wills and Trusts are both estate planning documents used to pass assets on to beneficiaries at death.  However, there are distinct advantages to using a Trust over a Will.  Fully funded Living Trusts can cost significantly less than Will-planning/ Estate winding-up procedures.

Please see this article on our website and contact me if you’d like some more information. Ideally, please let me know what your concerns are and how I can address and solve them.

July 18, 2018

Contracts in restraint of trade – the law



Contracts in restraint of trade – the law

An agreement in restraint of trade is prima facie enforceable. The onus rests on the party seeking to avoid a restraint clause to prove that it is contrary to public policy.

The approach to restraints of trade is neatly summarised by Malan AJA in Reddy v Siemens Telecommunication, as follows:

·         A court must make a value judgment with two principal policy considerations in mind in determining the reasonableness of a restraint.

o   The first is that the public interest requires that parties should comply with their contractual obligations, a notion expressed by the maxim pacta servanda sunt.

o   The second is that all persons should in the interests of society be productive and be permitted to engage in trade and commerce or their professions.

·         Both considerations reflect not only common-law but also constitutional values. Contractual autonomy is part of freedom informing the constitutional value of dignity, and it is by entering into contracts that an individual takes part in economic life. In this sense freedom to contract is an integral part of the fundamental right referred to in s 22 of the Constitution that guarantees ‘[e]very citizen … the right to choose their trade, occupation or profession freely’ reflecting the closeness of the relationship between the freedom to choose a vocation and the nature of a society based on human dignity as contemplated by the Constitution.

·         In applying these two principal considerations the particular interests must be examined.

o   A restraint would be unenforceable if it prevents a party after termination of his or her employment from partaking in trade or commerce without a corresponding interest of the other party deserving of protection. Such a restraint is not in the public interest.

o   Moreover, a restraint which is reasonable as between the parties may for some other reason be contrary to the public interest. In Basson v Chilwan and others Nienaber JA identified four questions that should be asked when considering the reasonableness of a restraint:

§  Does the one party have an interest that deserves protection after termination of the agreement?

§  If so, is that interest threatened by the other party?

§  In that case, does such interest weigh qualitatively and quantitatively against the interest of the other party not to be economically inactive and unproductive?

§  Is there an aspect of public policy having nothing to do with the relationship between the parties that requires that the restraint be maintained or rejected? Where the interest of the party sought to be restrained weighs more than the interest to be protected the restraint is unreasonable and consequently unenforceable. The enquiry which is undertaken at the time of enforcement covers a wide field and includes the nature, extent and duration of the restraint and factors peculiar to the parties and their respective bargaining powers and interests.


July 09, 2018

Can I list a debtor as a bad payer with the credit bureaus?




A credit granting business client can list a business or individual, who has defaulted on payment in accordance with the National Credit Act (NCA) regulations, directly onto the several Credit Bureau Default Listing databases.

This listing will immediately appear on the person's Consumer Credit Report as adverse information under Default listings. In the case of a business, the Default listing will immediately appear on the business's Business Credit Report under Default listings.
Default listings will negatively influence the person or business's credit rating and will reflect on their credit report for a minimum of two years.
These are the steps to follow:
·         In terms of section 72 of the NCA, a creditor is obliged to give the consumer 20 business days’ notice of its intention to list any default information on a consumer’s credit report. The written notice may be contained in a written notice that is sent via registered post or in an e-mail. The onus would be on the creditor to prove that any such written notice had been duly given to the consumer. It is important to note that the aforesaid applies to “default” (aka adverse information as defined in Regulation 17 – such as a failure to pay) and would not apply to information listed under the consumer’s payment profile as such information is classified as account information which is essentially information that relates to how a consumer pays his or her account on a monthly basis.

During that 20 days period, the consumer can challenge the accuracy of the information proposed to be reported to a credit bureau or to the National Credit Register.
A creditor can list judgment information on a consumer’s credit report without being obliged to give the consumer written notice of its intention to do so.



June 26, 2018

Are you confused by or unhappy with your family trust?




Are you someone:
  •  who has had an estate plan done, but who knows or suspects that somehow it is incomplete or lacking?
  • who has purchased a boiler-plate estate plan from a living trust company rather than engaging the professional services of a specialist?
  • who has not yet begun to plan for themselves and their families but would like to do so?
If you have had an estate planning done, but are uncomfortable with that planning, our firm will enable you to review what you have done. We will show you whether or not it is in your best interests to make additions or changes in your planning, so that you can fine-tune your plan.

If you have not yet accomplished any planning, we will show you - from the very beginning - the right way to effectively and efficiently complete your estate plan.
We will assist you to implement a modern living-trust-centered estate plan, from beginning to end. We will provide you with step-by-step advice, that has helped many clients over our forty-plus years of practice experience.

We endeavour to utilize the best workable estate planning strategies and practicalities. We explain how you can formulate your estate planning goals, and how to work profitably from the beginning all the way through to the successful completion of your estate planning documentation.

We explain what estate planning is, and what you should expect to accomplish. We determine what a living trust-centered estate plan should look like, so you can clearly see a picture of your objectives.

We determine the process of precisely what you should and should not do, to make your estate planning process effective and pleasant. It encompasses professional planning secrets and empowers you.

We also advise how to take best advantage of the planning talents, of your accountant, financial planner and stock broker. We share with you those planning matters that each of your advisers is good at and enjoys accomplishing, and those tasks which he or she is not so good at and would rather delegate.

We will explain to you the legal language of your plan, and how could we actively participate in making sure that your assets would be placed safely into the protection of your living trust. We would assist you in how to determine the funding of your trust and how you and your accountants, financial advisers and stock brokers, should complete various aspects of your trust funding.

We would warn you of hidden planning dangers, while stepping you through the procedures for getting your assets into the protection of your trust. Our documentation makes your trust endure particularly following your disability or death. We share them in the hope that your estate planning efforts will succeed because of proper follow-through.

Our practice endeavours to prompt action. It gives you many options every step of the way and empowers you to make the right choices at the right time, to maximize your and your family’s emotional and financial successes. It is based on the simple philosophy that knowledge should be with action.


June 24, 2018

What happens if a usufructuary dies and she rented out the house during her lifetime?




What rights does the owner have to sell the house? What rights does the tenant enjoy?
Here’s an example of a simple usufruct:

I bequeath to my son, Joe Bloggs, my house at 67 Henry Road, Norwood, Johannesburg, and all the contents therein, subject to a life usufruct therein in favour of my wife, Jane Bloggs.

So, the will enables Jane (the usufructuary) to use the Norwood property (the usufructuary property) belonging to her son, Joe (the bare dominium owner) and to enjoy the fruits (fructus) thereof, for her lifetime.

The usufruct ends on Jane’s death, when the usufructuary property vests in Joe.
These are some of Jane’s and Joe’s rights and obligations:
·         Jane’s estate is obliged to restore the property to Joe on her death in the same condition as that in which she received it, fair wear and tear excepted;
·         Jane was responsible for the maintenance of the property, but not to improve it;
·         Jane could not mortgage the property subject to the usufruct;
·         Unless both Jane and Joe agree, the property subject to a usufruct cannot be sold by the usufructuary or by the bare dominium owner without leave of the court;
·         Unless the will provides otherwise, Jane had to pay rates and taxes;
·         If the property is subject to a mortgage bond, Jane was not responsible for payment of the interest, unless the will has so specified, or there were insufficient funds in the estate to do so;
·         Jane had the right to let the property which is subject to a usufruct and collect the rental (the fruits and profits which may be derived from the property subject to the usufruct), but the lease can only be valid for the period of the usufruct.
Accordingly, on Jane’s death, the lease comes to an end and Joe can sell the property.


June 19, 2018

The prescription of debt – must I pay a claim older than 3 years?




A client asked: debt collectors have been phoning and texting me to recover a claim that goes back more than three years. Do I have to pay?

In summary, if you know that the debt is older than three years, never admit anything, sign anything or pay anything. In that way, the claim against you will have lapsed and you won’t have to pay anything.
Creditors sell their Debtor’s Book to Debt Collectors, who will then try to collect the debt. Obviously, they will try to collect more than what they paid for the Debtors’ Book. So, when they call or text consumers, they will try to get them to admit that they owe the money and, preferably, get them to make a small payment. The reason for this is that any express or tacit acknowledgement of liability or payment by the debtor, interrupts the running of prescription.
Debt
The Prescription Act 68 of 1969 provides that a debt shall be extinguished by prescription after three years.

Interruption of prescription by acknowledgement of liability
(1) The running of prescription shall be interrupted by an express or tacit acknowledgement of liability by the debtor.
(2) If the running of prescription is interrupted as contemplated in subsection (1), prescription shall commence to run afresh from the day on which the interruption takes place or, if at the time of the interruption or at any time thereafter the parties postpone the due date of the debt, from the date upon which the debt again becomes due.

Judicial interruption of prescription
(1) The running of prescription shall be interrupted by the service on the debtor of any process (any document whereby legal proceedings are commenced) whereby the creditor claims payment of the debt.
(2) Unless the debtor acknowledges liability, the interruption of prescription in terms of subsection (1) shall lapse, and the running of prescription shall not be deemed to have been interrupted, if the creditor does not successfully prosecute his claim under the process in question to final judgment or if he does so prosecute his claim but abandons the judgment or the judgment is set aside.
(3) If the running of prescription is interrupted as contemplated in subsection (1) and the debtor acknowledges liability, and the creditor does not prosecute his claim to final judgment, prescription shall commence to run afresh from the day on which the debtor acknowledges liability or, if at the time when the debtor acknowledges liability or at any time thereafter the parties postpone the due date of the debt, from the day upon which the
debt again becomes due.
(4) If the running of prescription is interrupted as contemplated in subsection (1) and the creditor successfully prosecutes his claim under the process in question to final judgment and the interruption does not lapse in terms of subsection (2), prescription shall commence to run afresh on the day on which the judgment of the court becomes executable.


June 16, 2018

Contracts under the Consumer Protection Act




A client asked: “I signed a tuition agreement that requires me to give a full term’s notice. Am I bound by this?”

I answered:

As you are a “protected person” - defined in the Consumer Protection Act (CPA) as any individual or any legal entity with a turnover and an asset value of under R2 million - the notice period is not binding, and you need only give 20 business’ days’ notice (section 14 and section 51). However, this is subject to payment of a reasonable penalty  for premature cancellation.

The CPA sets out the following rights and obligations concerning contracts between suppliers and consumers:   

·         The contract must be in plain language (section 22);
·         A consumer may rescind a transaction that came about because of direct marketing, without reason or penalty. The consumer merely needs to give the supplier written notification of his or her intention to rescind the agreement, and this notification must be given within 5 business days of the transaction being concluded or, within 5 business days of the goods being delivered to the consumer. (Section 16);
·         The consumer has the right to an itemised breakdown of his or her financial obligations under the contract and to receive a copy of the contract free of charge (section 5);
·         Suppliers must not offer to supply, supply or enter into an agreement to supply goods or services at an unfair, unjust or unreasonable price or on terms that are unfair, unjust or unreasonable. Suppliers are also prohibited from marketing any goods or services in an unfair or unjust manner (section 48);
·         Consumers must be alerted to any contract term that limits the consumer’s rights. This notice or provision must be in a conspicuous manner and form that is likely to attract the attention of an ordinarily alert consumer (typically highlighted at the top of the contract or initialled by the consumer (section 49); and
·         A contract may not contain clauses that are misleading or deceptive, subjects the consumer to fraudulent conduct, directly or indirectly waives or deprives a consumer of a right entrenched in the CPA, avoids a supplier’s duty in terms of the CPA, sets aside or overrides the effect of any provision contained in the CPA,  authorizes the supplier to do anything that is unlawful in terms of the CPA or limits or exempts a supplier of goods or services from liability for any loss attributable to the supplier’s gross negligence section 51).


June 02, 2018

Ubuntu and the law




Wikipedia defines Ubuntu as a Nguni Bantu term meaning "humanity". It is often translated as "I am because we are," and "humanity towards others", but is often used in a more philosophical sense to mean "the belief in a universal bond of sharing that connects all humanity".

According to a colleague, Adv Viljoen Meijers, who researched the impact of ubuntu on the modern law, the term first appears in the Child Justice Act, whose objects are to ‘promote the spirit of ubuntu’ by fostering children’s sense of dignity and worth and reinforcing their respect for human rights and the fundamental freedom of others by holding children accountable for their actions and safeguarding the interests of victims and the community.

The Constitutional Court found that the primary application of ubuntu was in the field of political reconciliation. The court stated: ‘ubuntu is a culture which places some emphasis on communality and on the interdependence of the members of a community. It recognises a person’s status as a human being, entitled to unconditional respect, dignity, value and acceptance from the members of a community such person happens to be a part of’. By the same token, ‘the person has a corresponding duty to give the same respect, dignity, value and acceptance to each member of the community’. Ubuntu ‘carries in it the ideas of humaneness, social justice and fairness…’; ‘an instinctive capacity for and enjoyment of love towards our fellow men and women.’

In a Supreme Court of Appeal matter, dealing with a breach of contract, it was argued that the court should import a term into a lease based on ubuntu. The court refused to do so, reiterating the principle of sanctity of contract.
However, the same court, hearing a claim based on delict (in this case, child support), stated that one must have regard to constitutional values, one of such being ubuntu.

The Equality Court (in Afriforum v Malema) found that freedom of expression, particularly was is classified as hate-speech, is limited not only by the law but also by the spirit of ubuntu.

Adv Meijers concludes that ‘ubuntu will clearly shape the contractual and delictual landscape in the future.’