Real Estate Investor Magazine South Africa June/ July 2019 | Page 11

Q&A WHAT DO TO DO WHEN A RENTEE WANTS TO CANCEL AN AGREEMENT? Cilna Steyn, Managing Director of SSLR incorporated says: Question: Dear REImag team, I have a tenant who saw my property online and she sent her aunt to view the place on her behalf since she was staying in Cape Town and my apartment is in Pretoria. The aunt said she liked the place and that she will give the feedback to her niece. A day after I got a call from the tenant saying she will want to secure the place as soon as possible. She came to the apartment and we did the inspection and she signed for the keys, but she said she will sleep at her Aunt’s place since she didn’t have furniture. The following morning, I got an sms form her saying that she doesn’t like the place and she doesn’t feel safe, she demanded that I changed the burglar door of which is I did that. Soon after that she sent another message that she has found another place elsewhere and that she wants her deposit back immediately. Please advise how do I handle this situation. Protection Act (CPA), being section 14 will have to be addressed. Answer: In a case where the CPA does apply, the tenant would be in a This is unfortunately something we see quite often. Very often position to cancel the lease agreement by giving the landlord 20 a tenant and a landlord agree on the terms of an agreement and business days’ notice of the intention to cancel the agreement. In then one of the parties wants to get out of the agreement prior to this case it seems like there was a fixed term lease agreement and commencement of the lease term, usually prior to or directly after it appears as if the agreement was concluded between natural taking occupation. The relevant question to answer is whether the persons, this will then mean that section 14 of the CPA does agreement has been concluded or not, this will affect the remedies apply. With this in mind, immediate cancellation is not really an available to the parties. option for a tenant in this position. In a case where the CPA At this point it is important to consider the moment of conclusion does apply, the landlord will only be entitled to claim reasonable of a lease agreement. In terms of common law, a lease agreement cancelation penalties, however in this particular situation the will be concluded at the moment when the parties reach tenant did not cancel the agreement. The tenant’s actions amount consensus, being a meeting of minds, as soon as the parties are to repudiation of the agreement, repudiation being a clear both happy with the proposed terms. Lease agreements are a very communication that the party will no longer be bound by the simple concept of offer and acceptance. It is important to know terms of the agreement. With this in mind my advice would be that at this point in time it is not a requirement in law for lease to accept the tenant’s repudiation by way of written notice and agreements to be in writing. Promulgation of the Rental Housing then further to claim damages because damages was suffered Amendment Act will change this position, after enactment of because the premises would most likely stand vacant for about this act lease agreements will have to be in writing, we do not two or three months, at the very least the deposit can be retained have any indication at this point of when the promulgation date for the first month’s rental. The property has to be marketed will be, but there is a 6 months window period to comply, so there immediate to mitigate damages, the tenant would definitely be is no reason for concern at this moment. It is important to note liable for the damages suffered by the landlord up to the point of that a lease agreement is always offered by the landlord to the placing a new tenant. My suggestion in matters like this would tenant, the landlord offers the terms to the tenant and when the tenant accepts the proposed terms the contract is then concluded. always be to negotiate first, tell the tenant what the position is This position can be postponed in terms of the lease agreement, and tell the tenant that she would be held liable for rental on the premises until a new tenant is found, this might encourage her what happens quite often in lease agreements is that the lease to settle the matter. If, however she is unwilling to come to an agreement specifically states when the lease agreement will be amicable solution, that the first step would be to withhold the concluded, for example the lease agreement might state that the deposit as you are entitled to appropriate the deposit to damages agreement will only be concluded by at the point of signature suffered. I would further recommend a claim for damages, in the by the landlord, if this is the case regardless of the common law form of court proceedings or even a claim at the Rental Housing position will the lease agreement will only be fully concluded at Tribunal, as soon as the damages can be quantified, this will be as the point of signature by the last party. soon as another tenant has been placed. Further to your question the relevant part of the Consumer ASK THE EXPERTS If you have a property question, send it to us at [email protected] or post it on our facebook page. SA Real Estate Investor Magazine JUNE/JULY 2019 9