TO WHAT EXTENT SHOULD YOUR SECURITY PROTECT YOU?

In a recent judgment by the Supreme Court of Appeal, the Court investigated the question whether a private security guard company can be held liable for a client's damages that arose after its employee allowed robbers entry to that client's family home, believing them to be police officers.

Our law acknowledges that in such a relationship, the guard has a duty of care with regard to the client, his home and property; but what is the extent of this duty?

After the incident, the family sued the security company that employed the security guard for the damages they sustained during the robbery. The South Gauteng High Court found in their favour and held the security company liable. The company then appealed to the Supreme Court of Appeal ('the SCA') against this decision.

Click here to read the full story!

‘OCCUPATION’ vs ‘POSSESSION’

With legal jargon as confusing as it is, and the fact that legislation keeps changing and moving the goal posts, it's essential that we do all that we can to keep our clients up to date with legal information that can help them make informed decisions around their property investments!

Every week our lawyers (Smith Tabata Buchanan Boyes) send us great little snippets that are really useful.  Here is one of them regarding the difference between occupation and possession - two fundamentally different concepts.

Many homebuyers are unaware of the legal difference between the terms ‘occupation’ and ‘possession’ of a property as used in sale agreements.

IS YOUR DIVIDING WALL ON YOUR BOUNDARY?

NEIGHBOURS’ DISPUTE WHEN LEARNING DIVIDING WALL NOT ON BOUNDARY

The law will try to exercise its discretion to address the interests of both parties.

When our lawyers, STBB sent us this, we thought it would be very applicable to many of our new home owners! This judgment is an illustration of the exercise of a Court's discretion when faced with a dispute between two owners relating to the boundary between them.

The wall between the erven was, unbeknownst to all, not on the boundary. The Court noted here that demolition is not necessarily the only remedy in the case of encroachment and exercised its discretion to address the interests of each of the owners.

The full judgment can be viewed here.  Roseveare v Katmer, Katmer v Roseveare and Another (2010/44337, 2010/41862) [2013] ZAGPJHC 18 (28 February 2013)

RENTING OUT DIGS FOR STUDENTS

STUDENT ACCOMMODATION & ZONING LAWS

Stellenbosch offers great opportunities for property investment
with the growing demand for student accommodation.  Make sure
you're buying within the correct zoning provisions!

In a recent email from one of our lawyers, Smith Tabata Buchanan Boyes, a case was highlighted where an owner was renting part of her property out to students in Stellenbosch.

This is an important judgment to anyone offering accommodation to students. The Court here granted the Stellenbosch Municipality’s application for an interdict to prohibit a property owner from offering student accommodation if the property zoning only allows for a dwelling house to be occupied by one family. The owner must obtain the required permission from the municipality or face the penalties.

The full judgment can be read here.  Stellenbosch Municipality v Van Wyk and Others (1549/2012) [2013] ZAWCHC 18 (8 February 2013)

HERE ARE THE FACTS

This matter deals with an application by the Stellenbosch Municipality for an order interdicting Ms Van Wyk from providing student accommodation on her residential property in Stellenbosch, as it is contrary to the provisions of the applicable zoning scheme.

HOW DOES THE 2013 BUDGET EFFECT THE PROPERTY MARKET?

Minister of Finance, Pravin Gordhan, delivered the National Treasury's budget for 2013/2014 at 14h00 yesterday afternoon. From a property law point of view, it is business as usual as transfer duty, donations tax, the capital gains tax inclusion rate, VAT and estate duty have remained unchanged! 

If you have any queries - contact us at allison@rivigangroup.com.

WHO IS LIABLE FOR PAYMENT OF A SPECIAL LEVY?

In a recent email from one of our conveyancors (STBB), they answered this question brilliantly.  This troublesome issue has a simple answer!

The Sectional Titles Act makes provision for it in Section 37(2A), which states that a special levy becomes due on the passing of a resolution levying such contribution and may be recovered by the body corporate from the persons who were the owners of units when the resolution was passed.

This becomes especially important when a special levy is raised after an owner has sold his unit, but before the transfer of ownership has taken place. If a seller was the owner at the time the special levy was raised and therefore when it became due and payable, the body corporate must recover the special levy from him and has no legal entitlement to recover the special levy from the purchaser as the new owner, unless there is a contractual agreement to the contrary.

In these circumstances it is very important to deal with the issue of special levies in each and every agreement of sale that relates to sectional title property.

If you would like more information on this topic, please feel free to contact us at allison@riviganpg.co.za.

CC PROPERTY HANDED OVER TO STATE

ANNUAL RETURNS NOT FILED, CC DE-REGISTERED AND PROPERTY GOES TO THE STATE

Outstanding paperwork can carry hefty consequences! STBB recently released this case summary...

The case summary pertains to: ABSA Bank Ltd v Companies and Intellectual Property Commission of South Africa and Others, ABSA Bank Ltd v Voigro Investment 19 CC (8250/12, 6601/2012) [2012] ZAWCHC 182 (14 November 2012)

Both the old and the new Companies Acts, read with the Close Corporation Act, provide for the deregistration of corporations that fail to file annual returns. One consequence is that a CC’s assets, including its immovable property, become bona vacantia and vested in the state. 

However, unlike before, there is no express provision for the reinstatement of a deregistered company by way of an application to Court. The holder of the bond over such property will need to apply to the Commission and provide the necessary CC’s outstanding information before reinstatement can be achieved.

The full Judgment may be viewed here.

FACTS
Absa obtained default judgment against Voigro Investments 19 CC (‘the CC’) in respect of a mortgage debt, and, on 13 December 2011, caused the mortgaged property to be attached in execution.

SIGNING INTO AN OWNERS ASSOCIATION?

AGREEING TO BECOME A MEMBER OF THE OWNERS ASSOCIATION HAS CONSEQUENCES

In a recent case summary compiled by STBB, a purchaser was not happy to pay the same levies as everyone else due to the benefits that he felt he was not receiving. It’s an interesting read and holds fair warning to those about to purchase within a membership of an owners association.

The case is: Kingsmead Office Park Owners Association v Shasri Investments CC [2012] JOL 29586 (KZD)

Where a purchaser agrees in a sale agreement to be bound to the provisions of an owners association, he cannot later on refuse to pay levies merely because his property receives less benefit from the communal benefits (such as fencing and garden areas) than other owners. This is because he is contractually bound to comply with the association's rules and regulations.

NEW LEGISLATION | ELECTRIC FENCING

Are you buying or selling a property with electric fencing?

 

We have received important news from our conveyance attorneys regarding the implications and requirements when purchasing a house with an electrical fence.

ARE YOU A DIRECTOR?

HOW DOES THE NEW COMPANIES ACT EFFECT COMPANY DIRECTORS?

Many of our clients own their own businesses and are affected by the changes that were introduced with the new Companies Act, 71 of 2008.  In particular, those relating to the appointment, termination and removal of directors.  In a recent notification from our attorneys, Smith Tabata Buchanan Boyes, they gave a great summary of these changes and we thought they’d be of use!

CC, COMPANY OR TRUST - THAT IS THE QUESTION

what's the best way to buy a property?

One of our attorney’s recently shared with us that they are receiving a significant increase in questions around property taxes.  The biggest question seems to be; “Should I buy my property as a CC, Company or as a Trust”.

As a standard suggestion, we always advise our clients to run these sorts of questions by their tax advisors as there are often many qualifications and legal loop holes that apply to different setups, but here is a general overview from one of our attorneys – hope it helps!




 

COURT SAYS: SCHEME BETTER OFF IN HANDS OF OWNERS

This is an interesting judgment in which the Court found in favour of owners of a sectional title scheme, inexperienced as they may be in managing a body corporate, rather than extending the appointment of an inefficient Administrator.

This, despite the fact that the scheme's finances were still in an unsatisfactory state.  The Court confirmed that the Legislature prefers self administration in schemes and it should exercise its discretion accordingly, where circumstances allow.

 

INTRODUCTION TO THE SUMMARY OF THIS CASE

The plaintiff was appointed as an Administrator of a sectional title scheme, in terms of the provisions of section 46 of the Sectional Titles Act 95 of 1986 (“the STA”).  The application was, at the time, brought by the local municipality because of the high amount of the outstanding rates and taxes due to it.

NO FFC, NO GAIN.

make sure you aren't losing out

Are you an estate agent or receiving part commission for assisting an agent?  If so, do you have a valid fidelity fund certificate (FFC)?  In 2010, IEASA released an article informing all agents of the need to have and FFC  and we recently received this update from one of our legal advisors.

This judgment deals with a claim for commission by an estate agent who was not in possession of a valid fidelity fund certificate at any time, although employed by an estate agency.  The Court a quo (the court from which an appeal has been taken) held that the prohibition against claiming commission in such circumstances was not relevant in the relationship between the agent and the agency, only where such agent sought to claim commission from a member of the public. The present Court disagreed.

 

 

  

SUMMARY INTRODUCTION

Venter was employed by Warren Jack Property Brokers (“the estate agency”) and performed work as an estate agent, although he never was in possession of a valid Fidelity Fund Certificate. His contract of employment provided that he would be entitled to 50% of all commission received by the estate agency in respect of transactions he successfully facilitated on behalf of the agency.

'ROUWKOOP' CLAUSE : WHEN DOES IT APPLY?

from our legal team

A 'rouwkoop' clause included in a sale agreement provides for the purchaser to pay a deposit to the seller which may be retained by the seller should the purchaser decide to withdraw from the agreement.

This does not constitute breach of the agreement, but is a mechanism whereby the purchaser legally buys his way out of the agreement.

CAN THE SALE OF A PROPERTY…

be subject to both transfer duty and vat?

In a recent article from our lawyers, the answer is a resounding “NO!”

Here’s why:
The Seller determines whether the transaction will attract VAT or transfer duty and VAT takes precedence over transfer duty.

LANDLORD & TENANT

electricity blues

 It is common practice, in lease agreements, that the Landlord and Tenant contractually arrange which party will be liable for the costs of electrical consumption on the leased premises. 

However, this arrangement applies between the parties only: the 2010 Electricity Supply By-Law of the City of Cape Town municipality regulates the relationship between the “consumer” of the electrical supply and the municipality, as supplier thereof.

Read the details of the By-Law here.



Landlords, make sure you are not caught out of pocket as a result of your Tenant's failure to pay the municipality for the electrical supply: Contact us at allison@riviganpg.co.za to review your agreement where necessary.

OBLIGATIONS OF LANDLORD AND TENANT

This article covers  the rights and obligations of landlords and tenants, including any effects from the Consumer Protection Act (CPA).

Both parties have rights and obligations in terms of common law as well as statutes. Common law is law which has developed over time through various cases presented in courts; in essence it is law made by the courts of this country.





The following are some of a landlord’s rights and obligations:

1. Landlord must not discriminate against prospective tenants
2. Landlord may charge a reasonable rent amount
3. A landlord does not have to supply a written lease unless requested so by a tenant.
4. A landlord must place deposits paid by the tenant in an interest bearing bank account.  Statements must be provided to the tenant where requested.
5. Landlords have a  right to regular payment of rent.  If not the landlord has legal remedies which can be used. This off course ties in the tenant’s duty to make payment on time.
6. A landlord must allow the tenants privacy in the property and allow them undisturbed possession and enjoyment.
7. A landlord is responsible to carry out repairs to the property when problems have been pointed out by the tenant.
8. A landlord may inspect the property but must give the tenant reasonable notice.

MARITAL REGIMES AND PROPERTY

<MF LEGAL>

Under South African law there are various ways in which a marriage can be governed.  This includes particular reference in the conveyance of a property as a marital regime may determine who the owner of the property actually is.

Where parties are married in community of property the parties own the property jointly.  This is also the case where a person owns a property prior to getting married and thereafter marries in community of property.  In this instance the new spouse’s name will not be on the title deed but by virtue of the marital regime will still own half.  Where parties wish, their new marital status can be endorsed on the title deed to show this, however, this is not a necessity to prove joint ownership in this circumstance.

Where death occurs one spouse may acquire the entire property, meaning that the surviving spouse will retain their 50% of the property and the deceased’s share could be bequeathed to them in terms of a will.  On divorce, however, each party will own 50% of the property, unless a court directs otherwise.

With marriages out of community of property it is important to note that there are two ways in which a person can marry out of community of property, that is, either with accrual or without accrual.  A without accrual scenario occurs where parties have an ante-nuptial contract and state that each person’s assets remain that person’s own, irrespective of what happens in a marriage.  This is probably the safest way to keep a property.

SIGNING TRANSFER DOCUMENTS OVERSEAS

cater for a delay  | organize in advance

<MF LEGAL>

An increasing amount of our sales are for clients who are moving overseas with more people who have moved abroad, or are in the process of, are selling their properties in South Africa.  In many instances the parties involved in the transfer process, i.e the sellers, the purchasers and agents, are unaware of the challenges and reasonable delay that may be caused where the sellers need to sign transfer documents when they have already left the country.
Rule 63 of the High Court Rules states that:

Seller/s must

1. sign the documents abroad in the presence of one of the following officials.  (see below)
2. and The official will confirm its status and attach its seal to the documents.

WHO CAN AUTHENTICATE DOCUMENTS SIGNED OVERSEAS?

WHAT IS A TRANSFER BY ENDORSEMENT?

<MF LEGAL>

Recently, on our blog,  we looked at transfer duty exemptions.  One of these exemptions refers to the condition where a spouse, married in community of property, gets divorced and receives the joint property as part of the settlement.

REQUIREMENTS FOR A SECTION 45BIS(1)(A) (DEEDS REGISTRIES ACT) TRANSFER: 

• Parties must be married in community of property
• One party must receive the entire property on divorce from the other spouse in terms of a court order
• Where the property is bonded, the acquiring party must qualify to carry the bond on their own (naturally this last requirement falls away where the house has been paid in full)

WHY SHOULD I KNOW ABOUT THIS?
This type of transfer (transfer by endorsement) is done in order to speed up the process of transfer of property between parties in the divorce process.  The one spouse obtains full ownership of the house and the procedure should be financially feasible.  Please note that an ordinary transfer in these instances may be done, however there are higher fees, as a normal transfer will attract transfer duty.