The new Property Practitioners Act

 

The Property Practitioners Act came into effect on 1 February 2022. The Act provides, amongst other things, for the regulation of property practitioners, transformation of the property sector and continuation of the Estate Agents Fidelity Fund as the Property Practitioners Fidelity Fund. It aims to protect consumers in the property industry and to strengthen the regulatory aspect of the human settlements sector.

It entails these elements:

• Capacitation and enterprise support for historically disadvantaged property practitioners.
• Support of existing SMME’s owned by historically disadvantaged property practitioners.
• Promotion of the standard of training and development of historically disadvantaged property practitioners.
• Supporting existing historically disadvantaged property practitioners to become principal property practitioners and owners of business property practitioners.
• Facilitation of ownership of and participation in property investment enterprises.
• Enabling the transformation of property ownership in South Africa by providing grant support (through the Transformation Fund) to historically disadvantaged property practitioners who are in the business of developing residential properties in the affordable and secondary housing markets. 

The Act Is far stricter and more far-reaching than its predecessor, the Estate Agency Affairs Act 112 of 1976. The definition of "property practitioners" includes persons previously known as estate agents, a person who directly or indirectly sells or leases properties including sales and rental agents, auctioneers, business brokers that deal with the sale and letting of immovable property, managing agents who receive remuneration for managing property on behalf of another, and trusts that do the work of a property practitioner).

Their obligations, among other things, are as follows:

• Property Practitioners must display their Fidelity Fund Certificate (FFC) unless their turnover is below R2,5 million.
• No property practitioner may operate a trust account unless the account fully complies with the Act.
• They must provide a warranty concerning the validity of the property practitioner’s FFC in any agreement relating to property transactions.
• Property practitioners would forfeit remuneration if they received compensation without having a valid FFC.
• They must ensure that all the parties to a sale or lease transaction sign a disclosure form attached to the relevant agreement, dealing with any defects or deficiencies in the property.
• They may not oblige or encourage a consumer to use a particular service provider, including an attorney or conveyancer, to render any service or ancillary services regarding any transaction of which that property practitioner was the effective cause.
• They must maintain mandatory indemnity insurance.
• They must comply with a prescribed code of conduct and the Property Sector Transformation Charter Code.
• They must include certain prescribed minimum information on all written communication and marketing material and certain additional information in respect of the franchisee.
• No property practitioner may use any marketing technique or method "harmful or misleading". Practitioners may not use any underhanded way to persuade a property owner to give them the mandate to sell or lease out their property.
• No property practitioner can show a client any property they have already seen with another real estate agent. This is to avoid competing commission claims.
• No mandate or contract may include any clause stating that the seller or lessor must directly pay a property practitioner any remuneration or commission related to the sale or rental of any property. Similarly, there may be no clause in any contract of sale or lease that entitles a property practitioner to deduct any amount from monies entrusted to them during the selling or leasing of a property.
• The seller, the purchaser and the property practitioner must all sign every contract of sale of immovable property.

 

 

 

When can a landlord evict a tenant?

 

Under the lockdown provisions (contemplated by the Disaster Management Act) “A person may not be evicted from his or her land or home or have his or her place of residence demolished for the duration of the national state of disaster unless a competent court has granted an order authorising the eviction or demolition.”

Landlords may apply for an eviction order, considering:

• The need for everyone to have a place of residence and services to protect their health and the health of others and to avoid unnecessary movement and gathering with other persons.
• The impact of the disaster on the parties.
• Whether affected persons will have immediate access to an alternative place of residence and basic services.
• Whether adequate measures are in place to protect the health of any person in the process of a relocation.
• The occupier’s behaviour, e.g., if they are causing harm to others.
• The steps the landlord has taken to make alternative arrangements of payment of rent to preclude the need for relocation.
• Other considerations as described in the gazette. 

In Grobler v Phillips and Others (446/20) [2021] ZASCA 100 (14 July 2021) the Supreme Court of Appeal (SCA) set aside an order evicting an 84-year-old widow and her disabled son on the basis that such eviction was not just and equitable.

In good faith, Grobler purchased a property at a public auction. He knew that the widow and her son had lived on the property since 1947 and that the previous owners had granted her a lifelong right of occupation of this property. 

Grobler gave them notice to vacate the property. When she failed to do so, he launched an application in the Magistrates’ Court for their eviction in terms of the Prevention of Illegal Eviction and Unlawful Occupation of Land Act 19 of 1998. The court had to balance the rights of an 84-year-old widow and her disabled son against the rights of the owner to an eviction order. The magistrate granted an order for eviction. 

The widow successfully appealed to the High Court, that set aside the eviction order, inter alia, considering the age of the first respondent and the fact that she was living with her disabled son, an eviction order was not just and equitable. 

Grobler appealed to the SCA and lost. Amongst other reasons, the Court found that the Constitution provides protection against arbitrary evictions and for evictions to only be granted when it was just and equitable to do so. Therefore, considering all the facts before it, the court was of the opinion that it was not just and equitable to grant an eviction and made the order to dismiss the appeal against the High Court decision. 

Conclusion

In conclusion, although legislation provides for clearly set out requirements for the eviction of an unlawful occupant, it has to be just and equitable to do so.

Failure to communicate the decision to treat a contract as at an end to repudiating party

 

Dave Pretorius v Kenneth Bedwell (659/2020) [2022] ZASCA

The parties were brothers-in-law. Bedwell owned a property in Oyster Bay in the Eastern Cape. He needed money to complete a guesthouse project. He sold the Oyster Bay property to Pretorius in exchange for a loan to complete the project, it being understood that Bedwell would continue to occupy the property and would remain liable to maintain it at his own cost and pay rates and taxes. As soon as Bedwell could pay back the loan, Pretorius would transfer the property back to him.

There was a falling out between the brothers-in-law and Pretorius sold the property to a third party. Bedwell sued Pretorius for damages on the basis of the repudiation of the contract. Pretorius argued that the claim had prescribed. The court had to decide two separate issues, namely the questions of prescription and repudiation.

Regarding repudiation, the court stated:

It is settled law that repudiation of a contract occurs where one party to a contract, without lawful grounds, indicates to the other party, whether by words or conduct, a deliberate and unequivocal intention to no longer be bound by the contract. Then the innocent party will be entitled to either: (i) reject the repudiation and claim specific performance; or (ii) accept the repudiation, cancel the contract and claim damages. If he or she elects to accept the repudiation, the contract comes to an end upon the communication of the acceptance of the repudiation to the party who has repudiated. Only then does a claim for damages arise. Accordingly, prescription commences to run from that date.

Regarding prescription, the court held that as Bedwell did not accept the repudiation, prescription did not start running from the date of repudiation of the contract.

CCMA AWARD: DISMISSAL FOR REFUSING TO GET VACCINATED IS FAIR

 

Sharusha Moodley 

Can an employer dismiss an employee for refusing to get vaccinated? 

The CCMA, on 21 January 2022, published the first award relating to the fairness of dismissal on grounds of refusing to get vaccinated, in the matter between Theresa Mulderij and Goldrush Group. 

The brief facts of the matter were that following the introduction of the Employer's Mandatory Workplace Vaccination Policy (MWVP), the employee elected not to comply and have herself vaccinated. Consequently, she attended an incapacity enquiry on 28 October 2021. The presiding officer concluded that the employee was permanently incapacitated due to her decision not to get vaccinated. Moreover, it meant, by implication, her refusal to participate in the promotion of a safe working environment. The presiding officer further concluded that the employee's incapacity was permanent as she had no intention of ever being vaccinated. Subsequently, the presiding officer concluded that it would be fair for the employer to terminate the employee's employment. 

The employee then referred a dispute to the CCMA, challenging the substantive fairness of her dismissal. 

The Commissioner noted that the employee who had applied for an exemption in terms of the employer's MWVP had placed reliance on section 12(2) of the Constitution. Section 12(2) provides that every person has the right to bodily and psychological integrity. The employer's Exemption Committee considered and declined her application on the basis that the employee was a high-risk individual who interacted with her colleagues daily whilst on duty in a confined and uncontrollable space, placing those colleagues at risk of possible infection. The employee's appeal had further failed. 

The Commissioner considered both parties versions and concluded that the employee was permanently incapacitated based on her decision not to get vaccinated and, by implication, refusing to create a safe working environment. The Commissioner then concluded that the employee's dismissal was substantively fair. 

This is the first award from the CCMA on a very controversial topic. Time will tell if the  Labour Court or a higher court may be called upon to review the award.

 

 

Can an Employer exercise discipline over an employee for off-duty misconduct?

 

By Sharusha Moodley 

It may happen that an employee's misconduct does not fall within the express terms of an employer's disciplinary code. E.g., the misconduct complained of - such as an assault of another employee – occurred outside the workplace or working hours. 

Nothing prevents an employer from disciplining the employee if a factual enquiry into certain factors demonstrates a connection between the employee's conduct and the employment relationship. 

The factors to consider are, but not limited to: 

·         the nature of the misconduct,

·         the type of work performed by the employee,

·         the position which the employer occupies in the marketplace and its profile therein,

·         the type of work or services performed by the employer,

·         the size of the employer's workforce,

·         the relationship between the employee and the victim,

·         the impact of the misconduct on the workforce as a whole,

·         the relationship between employer and employee and the capacity of the employee to perform his job. 

At the end of the enquiry, if the employee's misconduct effectively destroyed or damaged the employer-employee relationship, an employer can most certainly exercise discipline over the employee.