This article was first published in the second quarter 2016 edition of Personal Finance magazine.
Many people believe that the PIE Act – as the Prevention of Illegal Eviction and Unlawful Occupation of Land Act is commonly known – makes it virtually impossible for a private landlord to evict a tenant from a residential property. Marlon Shevelew, a Cape Town attorney who specialises in property law, says this is not true.
However, he says landlords who do not bring an eviction application in good time or follow the proper legal procedures may have to endure a long and expensive process before they can secure an eviction order.
Section 26(3) of the constitution states that “no one may be evicted from their home, or have their home demolished, without an order of court made after considering all the relevant circumstances. No legislation may permit arbitrary evictions.” For this reason, Shevelew says, a court has to proceed cautiously before it can grant an eviction order.
However, he says case law shows that the courts do not believe that property owners have an obligation to provide accommodation free of charge. For example, in Ndlovu v Ngcobo and Bekker and Another v Jika, two appeals that were heard concurrently by the Supreme Court of Appeal in 2002, Judge Louis Harms said: “The effect of PIE is not to expropriate the landowner, and PIE cannot be used to expropriate someone indirectly, and the landowner retains the protection of section 25 of the Bill of Rights. What PIE does do is delay or suspend the exercise of the landowner’s full proprietary rights until a determination has been made whether it is just and equitable to evict the unlawful occupier and under what conditions.”
In an interview with property portal HomeTimes earlier this year, Michelle Dickens, the managing director of TPN, says it is vital that landlords use an attorney who is well versed in the legalities of evictions, because failing to adhere to the procedures (which may not be the same in every court or every province) will delay the process, which will cost the landlord more in lost rent.
The PIE Act
The PIE Act governs evictions from residential property; it does not apply to property leased for commercial, industrial or agricultural purposes, or to holiday accommodation. The zoning of the land is not relevant in determining whether the Act applies to an eviction; it’s whether or not the property is used as a dwelling.
The registered owner of a residential property, or person in control of such premises, has the right to initiate proceedings under the PIE Act. Examples of a “person in control” are:
* A rental agent who acts on the lawful instructions of the owner;
* A tenant who wants to evict a sub-tenant; or
* An executor of an estate that includes a residential property.
To bring an application successfully, the applicant must show that he or she is the owner or the person in control of the property, and that the respondent is an unlawful occupier.
The Act defines an unlawful occupier as “a person who occupies land without the express or tacit consent of the owner or person in charge, or without any other right in law to occupy such land, excluding a person who is an occupier in terms of the Extension of Security of Tenure Act, and excluding a person whose informal right to land, but for the provisions of this Act, would be protected by the provisions of the Interim Protection of Informal Land Rights Act”.
An unlawful occupier could be:
* A defaulting tenant whose lease has been cancelled;
* A defaulting mortgagor whose bond has been cancelled and whose property has been sold in execution;
* A squatter; or
* Any other person who does not have the express consent of the owner or person in lawful control of the premises to occupy the premises.
Once you, as a landlord, cancel a lease agreement, a tenant is no longer a tenant, but an unlawful occupier.
Six-month count down
Shevelew says it is crucial you realise that, from the day on which you cancel a lease, the clock starts to count down a six-month period that will make a significant difference to the eviction process.
In terms of section 4(6) of the PIE Act, if an unlawful occupier has occupied the land in question for less than six months when the proceedings are initiated, a court may grant an order for eviction if it is of the opinion that it is just and equitable to do so, after considering all the relevant circumstances, including the rights and needs of the elderly, children, disabled persons and households headed by women.
However, in terms of section 4(7), “if an unlawful occupier has occupied the property in question for more than six months when the proceedings are initiated, a court may grant an order for eviction if it is of the opinion that it is just and equitable to do so, after considering all the relevant circumstances, including, except where the property is sold in execution, whether property has been made available or can reasonably be made available by a municipality or other organ of state or another landowner for the relocation of the unlawful occupier, and including the rights and needs of the elderly, children, disabled persons and households headed by women”.
In other words, landlords who allow six months to pass before they initiate proceedings have to clear a much higher hurdle to obtain an order, because the court is obliged to investigate whether the municipality should provide the occupiers with alternative accommodation.
Shevelew says it is conceivable that a court could not grant an eviction order on “just and equitable grounds”, but this is extremely rare. What exactly “just and equitable grounds” are depends on the circumstances of each case, he says.
In most cases, the primary consideration is to ensure that the occupier is given enough time to vacate the property and find other accommodation before the sheriff can move in to enforce an eviction order, Shevelew says. So it’s not “if” an eviction will be ordered, but “when”.
He says section 4(7) does not mean that you are obliged to find alternative accommodation for an unlawful occupier. In the context of a residential lease, the court would enquire into whether the occupier could find other rental property in the area. The extent to which this consideration influences the court’s decision depends on the circumstances of each case. For example, the unlawful occupier of a luxury beachfront apartment would not be entitled to the same consideration as the unlawful occupier of a backyard dwelling who has three minor children.
Elize le Roux, a partner at Gauteng specialist property law firm SSLR, says the courts usually do not refuse an eviction order in the case of normal residential leases; the difficulties arise when a property has been sold in execution (sold by order of a court), particularly if the occupants have been living there for some time – for example, where shack-dwellers occupy a piece of vacant land.
Shevelew says a common mistake made by landlords and rental agents after a lease has been cancelled is to create a “tacit lease” by accepting rent from an occupier who refuses to vacate the premises. Another mistake is to send invoices or letters of demand after cancelling a lease. If you accept or demand rent, you are implying that a lease is in place, which undermines the contention that the premises are occupied unlawfully.
Shevelew says if an occupier decides to pay up after the lease has been cancelled, he or she must be sent a letter stating that the payment is not accepted as rent, but as damages for holding over (remaining in the property after cancellation). The letter should also inform the occupant that a new lease has not been entered into and that the landlord has not waived his or her right to evict. (The original lease should include a “holding over” clause, which states that, if you cancel the lease and the tenant disputes the right to cancel and remains in occupation of the property, the tenant will, pending the outcome of the dispute, continue to pay you an amount equivalent to the monthly rent.)
In terms of the Consumer Protection Act (CPA), to cancel a fixed-term lease you must give the tenant at least 20 business days’ notice to rectify a material breach of the lease, failing which the lease will be cancelled.
If the tenant has not rectified the breach by the end of the 20-day period, on day 21 you can send the tenant a letter that cancels the lease, Shevelew says. The letter should state that the tenant is now deemed to be occupying the property unlawfully and that he or she must vacate the premises by a specific date.
Some landlords mistakenly believe that the letter of cancellation also serves as an “eviction notice”, and that the eviction can be enforced without further legal action. There is no such thing as an “eviction notice” in South African law. However, the letter of cancellation is an essential step before the landlord can proceed with applying to evict an unlawful occupier.
If the occupier has not vacated the premises by the date in the letter of cancellation, Shevelew says, your attorney can lodge an eviction application, which includes seeking the court’s permission to serve a notice of motion on the occupier.
Section 4(5) of the Act states that this notice of motion must:
* State that proceedings are being instituted in terms of section 4(1) of the PIE Act for an order for to evict the occupier;
* Indicate on what date and at what time the court will hear the proceedings;
* Set out (in a supporting affidavit) the grounds for the proposed eviction;
* State that the unlawful occupier is entitled to appear before the court and defend the case; and
* State that the occupier has the right to apply for legal aid.
Shevelew says the attorney must obtain the permission of a magistrate or judge (not, as in the case of a summons, the clerk of the court) to serve the notice on the occupier. In terms of the Act, the notice of motion, as well as the main application to evict the occupier, must also be served on the municipality.
There must be at least 14 calendar days between the date on which the occupier receives the notice and the date on which the matter is set to be heard in court, Shevelew says. If the period is one day shorter, the application will have to be lodged all over again.
Whereas a summons for unpaid rental can be attached to the door of the premises by the sheriff, a notice of eviction proceedings must be served on the occupier personally. If the sheriff is unable to serve the notice personally, your attorney will have ask the court for permission to serve the notice in some other way, Shevelew says. Once a lease has been cancelled, occupiers know that a notice of motion is likely to be on the way and make themselves scarce. As a result, it may be necessary to go to court two or three times before the notice can be served, Shevelew says.
An unopposed application can take two forms:
* Neither the occupier nor his or her attorney appears in court on the day of the hearing. In this case, the court will grant the eviction order and decide by what date the occupier must vacate the premises.
* The occupier and/or his or her attorney appears in court and agrees to vacate the premises by a certain date.
Le Roux says that if you and occupier can’t agree on the date, the court may decide it at the hearing, or it may postpone the matter so that you and the occupier can argue your cases at another hearing. If the occupier informs the court, before the date set down in the notice, that he or she intends to oppose the application, the hearing will be postponed to allow both parties to file papers.
An occupier may neglect to lodge an application to oppose the motion, and oppose it only on the day of the hearing. In this case, Shevelew says, the occupier will have to explain to the court why he or she failed to oppose the application timeously and why the application should not be granted. If it is apparent that there are no grounds for opposition, it is likely that the court will allow the application to proceed and grant an eviction order.
If the occupier does not vacate the premises by the date agreed to or set by the court, the sheriff is authorised to eject the occupant and to remove his or her possessions, at the occupant’s expense.
Shevelew says the court is not bound to make a costs order, although costs are usually awarded to the party that wins the case. If the lease states that costs will be awarded on the attorney-own client (the highest) scale, the landlord is entitled to ask for costs to be awarded on this basis, but the court is not obliged to agree to this.
According to HomeTimes, an uncontested eviction can cost between R5 000 and R25 000, while an opposed eviction can cost up to R100 000. It can take between six weeks and 18 months to obtain an eviction order, depending on whether the eviction is unopposed or opposed.
Rental insurance products commonly include cover for legal fees. For example, Rentshield and MiRent have legal cover of up to R50 000, while Tenrisk’s cover is up to R120 000.
An eviction application can be heard in either a magistrate’s court or the High Court. There is an automatic right to appeal a decision of a magistrate’s court, whereas permission is needed to appeal a decision of a High Court. This means that a High Court order may provide a landlord with greater certainty that the occupier will vacate the property, Shevelew says.
If, when the matter comes to court, the court believes that you, the landlord, engaged in an unfair practice under the Rental Housing Act, the court will send both parties to a Rental Housing Tribunal (RHT) to obtain a ruling on that before it continues with the eviction application, Shevelew says.
Furthermore, he says, you cannot initiate eviction proceedings if a tenant lodged a complaint with a RHT before the application was launched and the tribunal has yet to make a ruling, or unless at least three months have passed from the date on which the tenant lodged the complaint with the RHT.
Consider cutting your losses
If the occupier decides to oppose the application, it may be in your interests to negotiate a settlement, in terms of which the occupier agrees to vacate the premises within a certain period, Shevelew says. You may find this unfair, but bear in mind that, if the application is opposed, the occupier could continue living in your property, rent-free, for six months from the date on which the lease was cancelled, and you will incur legal fees to secure the eviction order. In addition, if a magistrate’s court grants the eviction order, the occupier could appeal the decision in the High Court. If the High Court grants the order, the occupier might apply to the Supreme Court of Appeal.
If the occupier breaches the terms of the settlement agreement, your attorney will still have to apply for an eviction order. However, the occupier will not have grounds for opposing it, because, by signing the agreement, the tenant would have acknowledged that his or her occupation of the property was unlawful.
An occupier will incur legal fees to fight the application and lodge appeals, Shevelew says, but even then he or she might live in your property for as long as two years for half what he or she would have paid in rent.
As Shevelew says, swallowing your pride and reaching a settlement with the occupier will enable you to put a paying tenant in your property much sooner.