PAIA and a banks’ refusal to say why it declined vehicle finance.

A client asked me to advise if she had any recourse against a bank for refusing to provide reasons why it declined her application for vehicle finance.

I told her that in terms of the Promotion of Access to Information Act (PAIA), the bank could withhold that information and that her only recourse would be to apply to court, to challenge the decision.

What follows is a very brief summary of PAIA. For a more detailed summary, in plain language, see http://www.mpumalanga.gov.za/paia/plainlanguagePAIA.pdf.

The purpose of PAIA is:

·        to give effect to the constitutional right of access to any information held by the state, as well as information held by another person that is required for the exercise or protection of any right;

·        to foster a culture of transparency and accountability both in public and private bodies and to promote a society in which the people of South Africa have effective access to information to enable them to more fully exercise and protect all their rights.

Who does the Act apply to?

·        The Act applies to all records held by public (i.e. State) or private bodies (or their contractors).

·        The Act does not apply to records that are being used in criminal or civil proceedings.

·        The Act does not apply to Cabinet Ministers and committees, members of parliament or of the provincial legislature, courts (in their judicial capacity) and certain investigative tribunals.

What are public and private bodies?

Public bodies are generally government departments, bodies created by Constitutions such as Parliament or the Gender Commission, or institutions set up by law which perform services for the public such as universities or Telkom. Private bodies are those that have no connection with the government and which are privately owned and controlled, i.e. any person who runs a business, or trade or profession, or a partnership or any juristic person, like a company or a CC. It doesn’t mean a person as a private individual, but only their records as they relate to their business, trade, profession, etc.

Who can ask for records?

Anyone can ask for records from a private body, but the record must be needed for the exercise or protection of a right. A requester must use the form that has been printed in the Government Gazette. It must contain enough so that it is clear what records are wanted and who the requester is. The form must explain how the requester wants to get access to the record (by post, fax, email, by hand, telephone, etc.). The requester must identify the right that he or she wishes to exercise or protect and explain why the record is needed for the exercise or protection of that right.

When can a request be refused?

·        If a requester asks for information that would disclose personal information about a third party, the request must be refused (to protect the privacy rights of other people and to make sure that these rights are not infringed upon by requests under the Act). This may not apply if the third party whose privacy is affected consents, or if the information has been made publicly available, when it may be disclosed.

·        If someone asks for information that would disclose certain commercial information about a third party, the request must be refused. Commercial information includes trade secrets, financial, technical or scientific information. It also includes information which has been supplied in confidence by the third party and which may place them at a disadvantage in negotiations or commercial competition.

·        A private body must refuse a request for information if disclosing it could threaten the life or physical safety of other people, safety and security of buildings, equipment or any other property. It may also be refused if its disclosure would prejudice or impair a system or plan for the protection of individuals, the public or property.

·        A request for a record that can’t normally be used as evidence in a court case, because it is privileged, must be refused. An example of this would a letter written by a lawyer to the private body during a court case, discussing a settlement of the case.

·        If someone asks a private body for information that would disclose certain commercial information about that body, the request may be refused. Commercial information includes trade secrets, financial, technical or scientific information, which, if disclosed, could harm that body’s financial interests. It also includes information which, if disclosed, could place the private body at a disadvantage in negotiations or commercial competition.

What steps must a requester take if the information he seeks is refused?

If a private body makes a decision to refuse a request, the requester may go to court to challenge this decision. The application to court must be made within 30 days of being informed of the decision. There is no system of internal appeal with respect to the decisions of private bodies.

FLISP assists first-time homeowners and homebuyers

If you are a first-time homebuyer, did you know that you may qualify for a subsidy to buy your first home and save thousands over the period of the loan, by reducing the monthly repayments? The benefit applies to homeowners who have already taken transfer.

What is FLISP ASSISTANCE?

Finance Linked Individual Subsidy Programme – FLISP

FLISP is the drive by the Department of Human Settlements to provide a subsidy to allow aspiring home owners to purchase a home, supporting your application to a bank for finance to buy your own home.

If you earn too little to qualify for mortgage finance to buy your own home, or you earn too much to qualify for the Government’s free basic house under their RDP Housing Subsidy Scheme, you may apply for the FLISP subsidy.

The once-off FLISP subsidy amount ranges between R20 000 and R87 000, depending on monthly income. The less you earn, the higher the subsidy. FLISP may be used for the following: - Buy an existing, new or old, residential property; Buy a vacant serviced residential-stand; or Build a residential property.

To qualify for the FLISP subsidy, you must meet certain criteria determined by the Department as well as the banks. It is available to all first-time residential homeowners (who have already taken transfer) or homebuyers (whose home loan has been approved by your bank) who earn between R3501 and R15000 a month.

The price of a property that can be financed through FLISP is determined by the joint household income, of not more than R15k per month.

Check out their website to find out more.

What happens to your assets if you die without a will and any living relatives?

A client advised that a friend died without leaving a will. His assets include a townhouse, two cars and a few bits of furniture. Who inherits?

The common law provides that, in this case, the State acquires the whole estate as bona vacantia. The matter is now regulated by sections 35(13) and 92 of the Administration of Estates Act 66 of 1965. The procedure is that where the intestate heirs cannot be identified or if there are no intestate heirs, the executor must sell all the assets in the estate (in this case, the townhouse, etc.) and, after payment of the estate’s debts, pays the residue into the Guardian’s Fund. If nobody can prove that they have a claim to the estate as an intestate heir of the deceased, then after 30 years have elapsed after payment of the funds into the Guardian’s Fund, the money accrues to the State.

You will find a really useful overview on the distribution of an estate of a person dying with or without a will, here: http://www.justice.gov.za/juscol/news/201106_intestate-and-testate-succession.pdf

Change the registered office of your company!

As a result of recent High Court decision, it will no longer be possible for a company to use an address chosen for convenience (e.g. of its auditors) as its registered address. Company management should ensure that CIPC's records reflect the company's registered office as the address of its office. If there is more than one office, then the address of the principal office should be used.

A company can change its registered office by filing a notice of change of registered office with the CIPC. There is no filing fee payable.

The Western Cape High Court recently considered the issue of the 'residence' of a company under the new Companies Act (the '2008 Act') in the matter of Sibakhulu Construction (Pty) Ltd v Wedgewood Village Golf and Country Estate (Pty) Ltd.

The judgment highlights the changes introduced by the 2008 Act relating to a company's registered office as well as the impact of these changes on the court having jurisdiction over proceedings involving the company in certain circumstances.

Judge Binns-Ward found that under the 2008 Act:

• a company's registered address must be the address of its office;
• if the company has more than one office, its 'principal office' must be its registered office in accordance with section 23(3). The term 'principal office' is not defined in the 2008 Act. Looking at the 2008 Act's requirements as to what must be kept at its registered office (sections 24 and 28), the court concluded that the principal office should be the place where "the company's general administration is centered" in other words where the "administrative business of the company is principally conducted";
• the transitional provisions in Schedule 5 of the Act do not deal with a pre-existing company's registered office and accordingly section 23(3) applies equally to such companies (a 'pre-existing company' is a company that was incorporated before 1 May 2011 under the Companies Act 1973); and
• the place where the company's registered office is situated determines where a company resides and therefore which court has jurisdiction in proceedings affecting the status of a company, such as liquidation and business rescue proceedings. (Before the 2008 Act came into effect, it was possible for a company to reside at more than one place and one could elect to institute proceedings using, for example, either the place of its registered office or its principal office.)

A summary of customary marriages in South Africa

The Recognition of Customary Marriages Act, 120 of 1998 (RCMA), that came into operation on 15 November 2000, gives full legal recognition to customary marriages in South Africa.

The following summarises the position:

·        The law recognises your customary marriage if

o   you and your spouse are both older than 18;

o   You have both agreed to be married under customary law;

o   You negotiated and celebrated your marriage following the rules set out in customary law;

·        Even though the husband does not need pay Lobola for the marriage to be recognised by the law, payment of Lobola helps to show that you followed the traditions of customary marriage (the customs and usages traditionally observed among the indigenous African peoples of South Africa and which forms part of the culture of those people;.  

·        If you are married under customary law, you should (but don’t have to) register your marriage with the Department of Home Affairs;

·        Customary marriages can be monogamous or polygamous.  Polygamy means that a male older than 18 years of age can marry more than one wife.  If the husband has only one wife, the law will recognise the traditional law marriage whether it has been registered or not. But if the husband wants to take a second wife, he must enter into a written agreement stating what should happen to the property and how it should be shared among his wives. The husband must apply to the court to approve the written contract. The court will ensure that all the proprietary interests of all wives are protected;

·        The RCMA automatically sees all people in customary marriages as married in community of property. This means that the husband and wife share all property, money, and debts equally. If you and your partner do not want to be married in community of property, you will have to enter into an ante-nuptial contract before you get married. If you are already married and do not want to be married in community of property, you will have to apply to the High Court to change your status.

·        The RCMA recognises that the wife has equal rights and status with the husband when it comes to deciding what happens to property they own together. A customary wife is also allowed to enter into a contract without the permission of the husband;

·        If the husband has no other wives, you can get married under civil law as well as customary law. However, neither of you will be able to enter into customary marriages with anyone else while you are married under civil law.