How to evict a tenant: Water-tight leases look like this
Rent is late…again. As this dreadful month-end ritual unfolds, you can’t help but wonder: Will the rent be paid in full, or at all, this time? If not, what then? Can this situation be resolved? How can it be prevented? Perhaps the most common predicament landlords face when having to evict a tenant is the uncertainty of what to expect and figuring out what to do. In her book, The Landlord’s Guide – Property Rental and Eviction, attorney and MD of SSLR Inc, Cilna Steyn, provides guidance on some of the typical problems facing landlords while providing the legal options available to address them.
Steyn has kindly granted HomeTimes permission to republish her book.
As regards evictions, prevention starts with a properly drafted lease agreement and thorough screening of tenants. These important aspects are all too often neglected by landlords.
Whether to cut costs or through ignorance, prospective landlords often refrain from seeking legal assistance in the drafting of lease agreements by obtaining pro forma contracts from the internet or other sources. These are then edited by changing the relevant names, dates and figures and often by adding or deleting clauses. While these contracts may contain most of the relevant clauses, it may also contain (or omit) clauses that could make the application of the contract impossible to execute. It could in fact result in the agreement being nullified.
There are clauses often used in lease agreements that could for various reasons, be considered hazardous. Section 48 of the CPA states that no agreement may contain terms that are unfair, unreasonable or unjust. Some clauses are often included in lease agreements, while the drafter knows that the term would be unenforceable. It could be that the landlord insisted on these clauses without realising that it could place the validity of the entire agreement in dispute, providing the landlord with a false sense of security. Likewise, certain clauses could be very helpful by improving the landlord’s legal position if included in a lease agreement. Some examples of these hazardous and helpful clauses are provided below.
- Exclusion of the Prevention of Illegal Evictions Act
This clause will typically be used in residential lease agreements with the intention to benefit the landlord. The parties hereby agree that the provisions of the PIE Act would not apply to the agreement. Since this legislation cannot be excluded by agreement, the landlord would be greatly prejudiced if she believes that the PIE Act does not apply to the lease.
- Early termination clause
This clause would provide for a party to terminate the agreement prior to the agreed termination date. Such a clause would be enforceable where Section 14 of the CPA applies to the agreement. However, where it does not apply, it cannot be terminated on notice prior to the termination date. Section 14 clearly stipulates that, in spite of any contrary provisions in the agreement, the landlord will only be in a position to cancel the agreement prior to the termination date as a result of breach of a material term of the agreement by the tenant.
- Extension at the tenant’s sole discretion
This clause allows for extension of the lease agreement by notice from the tenant. This clause causes immense problems when the owner wishes to sell the property, not to an investor but as a primary residence, and would like the agreement to terminate on the termination date.
With a clause like this, the tenant would in fact be allowed to extend the lease agreement regardless of the owner’s desire to have the agreement terminated. In a case where an extension clause is necessary, it would be preferable to have the clause worded to allow the extension by mutual agreement instead.
- Clauses writing the provisions of the CPA into the lease agreement
It often happens that a lease agreement is governed by Section 14 of the CPA at the time of being drafted. The agreement then, for example, stipulates that the tenant be allowed 20 (twenty) business days’ notice to remedy the breach before the landlord can cancel the agreement. As Section 14 of the CPA applies only to fixed-term lease agreements, it will no longer be applicable when the agreement continues on a month-to-month basis after expiry of the fixed term. It is therefore not necessary to allow the tenant 20 business days for remedy of the breach before cancelling the agreement, but only 7 calendar days.
A lease agreement containing a clause where the parties agree that all notices be delivered by post is for obvious reasons, in most cases, impractical. Clauses like this cause a delay in delivery and will result in further unnecessary damages being suffered. Other methods of delivery can be by hand, by email, by fax or any other practical method of delivery. SMS is not advisable.
- Magistrates’ court jurisdiction clause
Many agreements, not only lease agreements, contain a clause where the parties agree to the jurisdiction of the Magistrate Court, despite the value of the claim exceeding the jurisdiction limits. It is however very important to word such a clause in a manner that does not exclude the High Court’s inherent jurisdiction. Furthermore, it would be beneficial to approach the High Court in many instances, rather than the Magistrates’ Court, as in the case of an eviction.
- Notice by fax or email
The parties can agree that all notices and correspondence are to be delivered by fax or email and that notices despatched in this manner will be deemed to be received on the day of despatch or the day thereafter. This allows for easy communication and would limit any unnecessary delays.
- Alternative accommodation clause
Even though a clause like this would not necessarily change the view that a court might have during eviction proceedings, it could be a very handy clause to prove that the occupant would not be left homeless or destitute if evicted.
- A clause containing full details of all occupants
Many lease agreements contain minimal information of the tenant, being only the full names and ID number. During eviction proceedings it is crucial to have as much information as possible. Therefore, a clause with fields to complete for instance occupation, income bracket, number of dependants, ages of dependants, marital status, health, disabilities and so forth, would greatly assist the attorney attending to the eviction.
A clause limiting the number of occupants in a property would limit the risk of overcrowding. It is however important to note that some body corporate rules contain overcrowding regulations, to ensure that the occupant-limit set in the lease agreement coincides with the overcrowding limit as per the body corporate rules.
- Attorney and own costs
This is a very important provision in any lease agreement, allowing the landlord to reclaim from the tenant the maximum legal costs accrued during any proceedings.
The losses incurred due to a delayed eviction process resulting from both the increased legal cost as well as the prolonged forfeiture of rental income, could be devastating to an unprepared landlord. A lease agreement drawn up professionally, with the possibility of potential calamities (such as an eviction) in mind, could reduce the legal work necessary and expedite the legal process considerably, saving time and money when legal action is required.
Screening and selecting good tenants is no guarantee for a problem-free rental, but could go a long way in preventing the pains of getting rid of a bad tenant later. Hopefully with the information provided in this book, a landlord will understand the benefits of investing the time to find the right tenant and avoid the risks that accompany poor tenant choices.
Proper screening of a prospective tenant should ideally include an application form containing all the applicant’s personal details, bank statements, proof of income and references from previous landlords but over and above that, could be extended to include items as listed in point 3 above under ‘Helpful Clauses’ to be added into the lease agreement.
Besides verifying the applicant’s income and cash flow, bank statements could also indicate if the previous rental amounts were paid on time each month.
In many instances, it is advisable to outsource the management of rental properties to reputable rental agents since that is what they specialise in. Well-managed rental properties promote tenant contentedness and reduce the risk of tenant revolt as their services often include aspects like:
Rental payments by debit order;
Payments of rates, taxes and levies;
Property portfolio accounting and reporting;
Recovery of utilities etc. from tenant as per the lease agreement;
Property inspections and handovers;
Utilising the tenant’s deposit to restore damages according to the lease agreement;
Monthly management statements.
Insurance products are available which offer rental income guarantees in the event of tenant default and cover the legal expenses of evicting tenants. The terms of these insurers usually require (or include) that proper tenant screening be done anyway to reduce the risk of potential claims.
Proactive tenant management generally reduces the risk of eviction, but should an eviction be inevitable all the additional information and subsequent correspondence with the tenant will make the case less complicated, quicker and most likely less costly.
Finally, timeous action can be a precautionary measure in its own right. Consider the following scenario:
Assuming you have screened the tenant and that presumably the tenant has a clean record – and consequently ‘something to lose’ (if only a good credit rating) – if placed on terms immediately upon defaulting, chances are the tenant would remedy the problem and become a good paying tenant. But by allowing late payments, on the other hand, you could be turning a potentially good tenant into a habitual late payer or worse, a defaulter.
Who is Cilna Steyn?
Cilna Steyn, MD of SSLR Inc, completed her LLB Degree at Unisa, after which she was admitted as an attorney in 2007. She co-founded Steyn & Steyn Attorneys, where she began specialising in evictions.
She regularly presents training sessions, where she advises groups of rental agents and private landlords on matters relating to landlord and tenant disputes and broader scope property law-related matters. She also acts on the panel of experts for the Law Society of South Africa’s Legal Education and Development. She presents seminars on behalf of LSSA: LEAD, educating attorneys nationally on eviction procedures and rental claims. She is one of the drafting attorneys of the TPN (Tenant Profile Network) Residential Lease Pack.
Cilna authored The Landlord’s Guide – Property Rental and Eviction in 2015 and regularly publishes articles in newspapers and peer-review magazines. She also appears on television and radio, participating in discussions relating to property law and, in particular, evictions. As the managing director she is dedicated to leading SSLR Inc in accordance with its core values.
Cilna is passionate about property and understands the pressures of being a landlord. Her attention to detail and knowledge of property law makes for efficient evictions.