RENTAL WATCH: Rental income can be seized
This is referred to as an emoluments (salary) attachment order. Can a court order a tenant to pay their rentals to a third party and not the owner/landlord with whom they entered into a lease contract?
Let us take the example of the owner of a flat in a sectional-title scheme who owed the body corporate money.
The owner failed to pay the monthly levy and the body corporate issued a summons to recover the outstanding levies. The case was finally decided in favour of the body corporate with a judgment against the owner. The owner refused to settle the debt, which included interest and the body corporate’s legal costs.
There is no contractual relationship between the tenant, who occupies a dwelling (flat or unit) in a sectional-title block, and the body corporate. However, if the body corporate has obtained a judgment against the sectional-title owner and an order attaching his or her rental income, then it may collect rentals from the sectional owner-landlord’s tenant.
The body corporate is obliged to provide proof to the tenant that it has obtained the right to do so. It can approach the magistrate's court (or high court) for a garnishee order that would allow it to seize the owner's rental income.
Once the garnishee order is granted, the tenant is legally obliged to pay the rental over to the body corporate (judgment creditor).
The owner’s (judgment debtor’s) rental from the tenant is attached and the tenant (the garnishee) is ordered to pay “the judgment creditor or judgment creditor's attorney so much of the debt as may be sufficient to satisfy a judgment or order obtained against the judgment debtor by the judgment
The garnishee (the tenant) is afforded an opportunity to appear before the magistrate if she or he fails to pay the judgment creditor (body corporate) or its attorney to explain or show cause why he or she should not pay the rentals to the judgment creditor. The sheriff must give written notice to all parties who would be affected by the garnishee order.
The garnishing proceedings in terms of the high court are laid out in Rule 45(12): “(a) Whenever it is brought to the knowledge of the sheriff that there are debts which are subject to attachment, and are owing or accruing from a third person to the judgment debtor, the sheriff may, if requested thereto by the judgment creditor, attach the same, and thereupon shall serve a notice on such third person, hereinafter called the garnishee, requiring payment by him to the sheriff of so much of the debt as may be sufficient to satisfy the writ, and the sheriff may, upon any such payment, give a receipt to the garnishee which shall be a discharge, pro tanto, of the debt attached.
“(b) In the event of the garnishee refusing or neglecting to comply with any such notice, the sheriff shall forthwith notify the judgment creditor and the judgment creditor may call upon the garnishee to appear before the court to show cause why he should not pay to the sheriff the debt due, or so much thereof as may be sufficient to satisfy the writ, and if the garnishee does not dispute the debt due, or claimed to be due by him to the party against whom execution is issued, or he does not appear to answer to such notice, then the court may order execution to issue, and it may issue accordingly, without any previous writ or process, for the amount due from such garnishee, or so much thereof as may be sufficient to satisfy the writ.”
In University of Stellenbosch Legal Aid Clinic and others v Minister of Justice and Correctional Services and others (SA Human Rights Commission as amicus curiae) (2015)) 3 All SA 644 (WCC), referring to the emoluments attachment order (EAO) and the changes needed in the Magistrate’s Court Act (MCA), Judge Siraj Desai stated: “The process of issuing an EAO requires an evaluation of the amount of money to be attached per month as compared to the amount needed by the debtor to support herself and her family. On the reasoning in Gundwana, judicial oversight over the issue of an EAO must be mandatory (rather than being subject to the discretion of the clerk of the court) and must occur when the execution order is issued (not subsequently, when an attempt might be made to have the execution order varied or set aside). Section 65J(2)(b)(i) and section 65J(2)(b)(ii) of the MCA are in the circumstances constitutionally invalid to the extent that they allow for EAOs to be issued by a clerk of the court"
The majority judgment of the Constitutional Court in 2016 confirmed the judgment of the Western Cape High Court that judicial supervision when granting emoluments orders and its execution is a constitutionally indispensable requisite. It's important for the tenant to seek legal advice upon receiving an application for garnishee order.
Dr Sayed Iqbal Mohamed is the chairperson of the Organisation of Civic Rights and deputy chairperson of the KZN Rental Housing Tribunal. He writes in his personal capacity. For advice, call Pretty Gumede or Loshni Naidoo on 0313046451, email [email protected] or [email protected]