The landlord, the tenant and the CPA

Private Property South Africa
Alan Levy

Landlords who choose to ignore the rights that their tenants enjoy under the Consumer Protection Act do so at their own peril. In order to comply with the Consumer Protection Act (CPA), property owners who rent out their properties are going to have to take a lot more care when drafting lease agreements. Those who don’t could end up receiving a hefty fine or, in the worst case scenario, land up in prison.

The introduction of this Act is set to shake the very foundations of the rental housing sector. Although many have chosen to ignore both the Act and the ramifications that failure to comply could have, one thing is for certain: government is serious about implementing the legislation and is going to be coming down hard on those who fail to comply.

Many landlords would argue that tenants already have too many rights and, as the situation stands, the status quo is already unbalanced. In an ideal world the rights of both landlords and tenants would be fully protected. The lease agreements of the past tended to weigh in the landlords’ favour and numerous tenants were forced to adhere to, in many cases, unreasonable demands. The shoe is now definitely on the other foot and it is only a matter of time before an unhappy tenant somewhere in South Africa exercises the rights that are afforded to him.

A lease agreement must be written in plain and understandable language that would enable an ordinary person with average literacy skills and minimal experience to understand it. This means that the landlord needs to ensure that the lease is drafted in a language in which the tenant is fluent.

The contract or lease must also not be subject to provisions that defeat the purpose of the CPA or aim to limit or exempt the landlord from liability for any loss attributable to gross negligence or that require the tenant to assume liability for this. In other words landlords will no longer be able to insert clauses that absolve them of responsibility. For example, if a tenant is injured or killed and this is a direct result of the landlord’s negligence to maintain the property, the landlord could be found responsible even if the lease states otherwise. In addition, landlords may not hold tenants responsible for costs incurred if the problem has arisen due to the landlord’s failure to maintain the property to an acceptable living standard.

Lease agreements also often contain clauses that a property is let “as is” and the landlord will not bear any obligation to remedy defects – and such a term is now deemed unreasonable. These clauses can no longer limit a landlord’s obligation to maintain the leased premises in good order.

Furthermore, lease agreements that are generally one-sided or that contain contract terms that are so adverse that they are inequitable, or instances where the tenant relies on something that is false, misleading or deceptive, will automatically constitute an unfair, unreasonable or unjust term or agreement, and will thus be void under the CPA. In addition to this, the legislator has promulgated a “grey list” of contractual terms or clauses that are automatically deemed to be unlawful.

Contributed by Alan Levy

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