Real Estate Investor Magazine South Africa Real Estate Investor Magazine - October 2017 | Page 31

it was found that it is possible to interpret the act in such a way that historical debt is not transferred to the new owner of the property. Kokkie Herman, the Director of Rates Watch, summarises the tools at disposal for the City of Tshwane: “The City of Tshwane, in their Collection Policy, summaris- es their debt collection actions as the disconnection of services at various staes without legal action to follow where: 1. Actions to disconnect services at various stages were un- successful; 2. Disconnection is not possible due to the nature of the services; 3. Debt is older than 90 days. Legal action is then summarised, as follows: 1. A telephone call, followed by the collection of data from the credit bureau – the cost of which is debited to the account; 2. An account smaller than R100 000 is taken to the Mag- istrates court for a summons. Accounts larger than R100 000 is referred to the High Court. 3. If no response is received within 10 days after the issuing of summons, an order of execution is applied. This might lead to the property being sold at auction.” The road ahead Botha explains that the court’s ruling opens the door for “many owners instituting action against municipalities that recovered historic debt from them.” Howie agrees, emphasising that “it would be prudent to consult an attorney before making such a decision.” SOURCES STBB, Rates Watch, MDW Attorneys, Bruno Simão Attorneys A digital campaign for every pocket Reach out to potential investors today Contact us now: [email protected] [phone]