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Can I cancel the rental contract if the agent is not registered with the EAAB?

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Q

I need advice on what I can do or what process to follow to get my money. I am a landlord and have been working with a certain estate agency since May 2015. I never had problems with rent or any other issue until last year. It is a privately owned agency by a husband and wife.


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I started to have problems with on-time rental payments from the agency towards the end of last year. I had to find out from the tenant whether he had paid over the rent money to the agency and then had to beg for the rent money to be paid over to me once the agency had taken their portion of the rent (commission).

This happened for two months, but I eventually got the payment every time about two to five days after complaining and begging. This was during a period which the husband was working somewhere in Africa. The husband (whom I have always dealt with from the start) then returned from Africa after about three or four months and promised me that we will not have issues with late payments again. In the meantime the tenant at the time moved to Johannesburg on 31 January, 2017. The agency quickly secured a new tenant who moved in on 1 February, 2017. This tenant paid the deposit of R13,500 as well as the first month’s rent of R13,500 over to the agency in January 2017. I had been calling and texting the agency since 1 February asking, begging and warning for the money, but I had not received a cent until 25 February.

My fiancé had made warnings to the husband who finally came to meet us at the complex on Saturday, 18 February, 2017. He then begged us to give him a last chance because they had internal issues and my rent money was accidently paid over to another landlord’s account. He promised that the error transaction will be reversed at the bank on Monday, 20 February and that the money would be paid over to me the same Monday. Monday afternoon at 16h00 he texted us and said that the money had been paid over to my account. I requested him to send me proof of payment, because I know that it takes 48 hours for transactions to clear from Standard Bank to Capitec bank. The money should have reflected in my account by Wednesday, but it did not. I only received proof of payment on the morning of Friday, 24 February, 2017 after numerous calls from my fiancé. This proof of payment document did not state from which account a payment was made and did not have a reference/transaction number. It, however, stated a date of 22 February, 2017. I went to Standard Bank who could not confirm that the proof of payment was legit and could not confirm that the payment had been made. I also went to Capitec bank which said that I should wait until the end of 24 February for the 48 hours to pass.


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The rent contract signed in January 2017 states their business address. When we visited this address we were told by the occupant that these people had not been living (business from home) there for over a year. Every time we asked the husband and their agents for their address, they would give this same “old” address. I have in the meantime managed to find their new/recent/correct address. However, it is not possible to gain access to the residential house without them allowing us entrance.

I also contacted the Estate Agency Affairs Board (EAAB) which confirmed that the husband does not have a Fidelity Fund Certificate (FFC) and that their agency is not registered with the EAAB. The wife had an FFC with ERA estate agents previously, but it expired in 2015. The other three agents working for them also do not have valid FFC Certificates. I never knew about the EAAB and that agents and agencies need to be registered, otherwise I would not have done business with them.

I have three questions

#1 Is it possible to have the contract cancelled or disregarded due to the fact that the agency and the agents are not registered with the Estate Agency Affairs Board?

#2 Can it be changed that the monthly rent should now be paid to my (the landlord’s) account and no longer to the agent, in spite of the contract which states that the tenant should pay it to the agent by no later than the last day of each month?

#3 Is the contract still valid or what process do I follow to change the contract for the monthly rent to be paid to me? – Sunette


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A

Dear Sunette,

I refer to your query under reply and wish to advise as follows:

  1. With regard to the validity of the lease agreement, it should be borne in mind that the agreement has been concluded between the landlord and tenant and therefore serves to create obligations between these parties.
  2. Thus, the fact that an estate agent is not registered with the EAAB, or is not in possession of a valid Fidelity Fund Certificate, does not invalidate the lease agreement per se.
  3. The fact that an estate agent is not registered/in possession of a Fidelity Fund Certificate would only serve to preclude that agent from managing the lease in question or claiming any remuneration for his/her services.

  4. With regard to your second question, if it is the case that the agent is not EAAB registered or does not possess a Fidelity Fund Certificate, the landlord and tenant may agree to vary the terms of the agreement, insofar as payment is concerned, and the tenant may simply pay the rental (and municipal accounts) directly to the landlord.
  5. Even in the absence of such an agreement, if the tenant pays the required amount directly to the landlord (as opposed to the agent) the tenant’s payment would be considered as a valid discharge of his/her obligation to pay rental.

In order to facilitate the change in payment details, the landlord should simply contact the tenant, and conclude a brief addendum to the lease agreement (to be signed by both parties), which details the new payment details.


Got a burning legal question? Email david@hometimes.co.za and we’ll be sure to assist you


Who is Marlon Shevelew?

Marlon Shevelew, director of Marlon Shevelew and Associates.

Marlon Shevelew, director of Marlon Shevelew and Associates.

Marlon Shevelew is the director of Marlon Shevelew and Associates Inc. a law firm specialising in rental property, contractual, consumer and company law. The firm is the recipient of more than 45 international property law awards. Marlon is current author of PayProp’s rental documentation and preferred rental property attorney to the Institute of Estate Agents South Africa (IEASA), the Rental Housing Tribunal Western Cape and presenter of the Advanced Residential Property Law Seminar endorsed by the University of Cape Town. Marlon has featured on Cape Talk 567 and Property Matters on DStv, contributes as a guest expert to several property publications and was invited by Juta to write a book on rental property law, by LexisNexis Butterworths to edit its forms and precedents on rental property law and, on no less than three occasions, was invited by the Law Society of South Africa to lecture and train candidate attorneys and attorneys on rental property law. Marlon also created the unique Rental Retainer ClubRentDoc  and LevyDoc which offers clients affordable legal fees for rental property and sectional title related matters. Marlon is contactable on marlon@marlonshevelew.co.za anytime for more information on these services.

 

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David A Steynberg, managing editor and director of HomeTimes, has more than 10 years of experience as both a journalist and editor, having headed up Business Day’s HomeFront supplement, SAPOA’s range of four printed titles, digimags Asset in Africa and the South African Planning Institute’s official title, Planning Africa, as well as B2B titles, Building Africa and Water, Sewage & Effluent magazines. He began his career at Farmer’s Weekly magazine before moving on to People Magazine where he was awarded two Excellence Awards for Best Real Life feature as well as Writer of the Year runner-up. He is also a past fellow of the International Women’s Media Foundation.

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