What landlords and tenants should know about the provisions of the Rental Housing Act.

The Rental Housing Act 50 of 1999 (“the Act”) came into effect on 01 August 2000. The aims of the Act are to regulate the relationship between tenants and landlords by laying down general requirements relating to leases, making provision for the establishment of Rental Housing Tribunals in each province, and laying down general principles governing conflict resolution in the rental housing sector.

This article seeks to provide a summary of the key provisions of the Act which would regulate the common causes of disputes that occur between landlords and tenants, and to thereafter provide an overview of the dispute resolution procedure created by the Act for the resolution of disputes between landlords and tenants.

Key Provisions of the Act

The Act defines a “landlord” as the owner of a dwelling or his/her authorized agent. At the outset, the Act reinforces the principle of non-discrimination entrenched in section 9(3) of the Constitution of the Republic of South Africa, 1996 (“the Constitution”) by requiring that a landlord may not unfairly discriminate against a prospective tenant on one or more grounds, including race, gender, pregnancy, marital status, sexual orientation, age, disability, or religion when advertising a dwelling, in negotiating a lease, or during the term of a lease.

A lease does not have to be in writing but a landlord must reduce it to writing if a tenant requests he/she to do so. A lease, whether verbal or written, will be deemed to include the following terms:

• The landlord must furnish the tenant with written receipts for all payments received by the landlord from the tenant.
• A deposit paid by the tenant to the landlord must be invested by the landlord in an interest-bearing account with a financial institution and the landlord must pay the tenant interest at the rate applicable to a savings account with a financial institution. The tenant may request the landlord to provide him/her with written proof in respect to the interest accrued on the deposit, and the landlord must provide the proof on request.
• The tenant and the landlord must jointly, before the tenant moves into the dwelling, inspect the dwelling to ascertain whether of not there exists any defects or damage to the dwelling. If there are any defects or damages, it must be reduced to writing and attached as an annexure to the lease.
• At the expiration of the lease the landlord and tenant must arrange a joint inspection of the dwelling to take place within a period of three days prior to the expiration of the lease.
• On the expiration of the lease, the landlord may apply the deposit and interest towards the payment of all amounts for which the tenant is liable under the lease, including the reasonable cost of repairing damage to the dwelling during the lease period. The balance of the deposit and interest, if any, must then be refunded to the tenant by the landlord not later than 14 days after the tenant has vacated the dwelling.
• The receipts which indicate the costs which the landlord incurred in repairing any damage to the dwelling must be available to the tenant for inspection as proof of the costs incurred.
• Should no amounts be due and owing to the landlord in terms of the lease, the deposit, together with the accrued interest, must be refunded by the landlord to the tenant, without any deduction or set-off, within seven days of expiration of the lease.
• Failure by the landlord to inspect the dwelling in the presence of the tenant is deemed to be acknowledgement by the landlord that the dwelling is in a good state of repair, and the landlord will have no further claim against the tenant, who must then be refunded the full deposit plus interest.

It is important to note that the standard provisions above are enforceable in court and may not be waived by the tenant or the landlord.

If on the expiration of the lease the tenant remains in the dwelling with the express or tacit consent of the landlord, the landlord and tenant are deemed, in the absence of a further written lease, to have entered into a periodic lease, on the same terms and conditions as the expired lease, except that at least one month’s written notice must be given of the intention of either party to terminate the lease.

An alternative dispute resolution forum: the Rental Housing Tribunal

The Act makes provision for the establishment of Rental Housing Tribunals (“Tribunals”) in each province. To date, Tribunals have been established in the Western Cape, KwaZulu-Natal, Gauteng, and the North West. The Tribunals, which provide a free service to tenants and landlords, seek to resolve disputes that arise between landlords and tenants due to unfair practices, and to inform landlords and tenants of their rights and obligations in terms of the Act. Each Tribunal consists of members who have expertise in housing management, housing development, and consumer matters relating to rental housing.

The Tribunals operate in accordance with the principles laid down in the following legislation; the Constitution, the Act, The Unfair Practices Regulations, and the Procedural and Staff Duties Regulations published in terms of the Act, and the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act, 1998.

Complaints may be lodged by mail or facsimile or delivered in person to the office of a Tribunal. On receipt of a complaint, the Tribunal will acknowledge the complaint in writing and will then begin conducting preliminary investigations to determine whether or not the complaint relates to a dispute that has arisen due to an unfair practice. If the complaint relates to a dispute that has arisen due to an unfair practice, the Tribunal will determine whether or not the dispute may be resolved by mediation. If the dispute may be resolved by mediation, the Tribunal may appoint a mediator who will merely act as a facilitator in trying to resolve the dispute. The final decision will be the decision of the parties and not of the mediator. If the dispute cannot be resolved by mediation, the Tribunal will arrange for a formal hearing of the complaint.

Any dispute that has arisen due to an unfair practice must be determined by a Tribunal unless proceedings have already been instituted in another court. However, a person retains the right to approach a court to institute proceedings for the normal recovery of arrear rental, or for eviction in the absence of a dispute regarding an unfair practice. A ruling by the Tribunal is deemed to be an order of the magistrate’s court in terms of the Magistrate’s Court Act, 1944 and the proceedings of a Tribunal may be brought under review before the High Court within its area of jurisdiction.

It is submitted that the creation of the Tribunals is a commendable initiative by Government. Once an awareness of the provisions of the Act and the activities of the Tribunals have been created among the general public, both landlords and tenants will become more informed and will then feel more empowered and protected. The number of disputes between landlords and tenants may decrease and those disputes that occur will be resolved by the Tribunal, with the result that the burden of our courts will be eased tremendously.

Courtesy: Nadisha Singh from Bowman Gilfillan

Nadisha Singh is an Associate at the Cape Town office of corporate law firm Bowman Gilfillan