5 STEPS LANDLORDS CAN TAKE AGAINST LATE-PAYING TENANTS
The global pandemic has left some in a financially challenging position. The current economic circumstances have affected many jobs and weighed heavily on people’s income. Some landlords may find themselves in a predicament where their tenant is no longer able to pay monthly rent.
However, landlords cannot simply evict their tenant as they’re protected by the Prevention of Illegal Eviction from Unlawful Occupation of Land Act, No. 19 of 1998 (PIE Act). The act applies to the occupation of premises which constitute a dwelling, which in the case of a landlord and tenant relationship would be the residential property. This act was introduced to ensure that tenants were protected from being unlawfully evicted from a property and that the correct procedure are followed during the process.
Evictions were prohibited under Alert level 5 and 4. At Alert level 3, Landlords can issue notices for eviction, but cannot enforce them. Below are the steps landlords should take when dealing with a defaulting tenant:
Step 1: Speak to your tenant
If the agreed-upon payment date has come and gone and you’ve yet to receive payment, contact your tenant immediately to inform him/her that their payment is overdue. If the tenant is facing financial difficulties, you may agree on a later payment date – however, you’re not obligated to offer this.
Step 2: Provide notice of contract breach
If your tenant hasn’t paid their rent and has no plan to do so, the landlord should send the tenant a notice informing them that they’ve breached the lease agreement. Landlords should ensure that the lease agreement is comprehensive and in line with the Consumer Protection Act (CPA). According to the CPA, landlords are required to provide a notice of at least 20 business days to their tenant to allow them to rectify the breach.
Step 3: Decide between an interdict or cancellation
Should the tenants fail to rectify the breach within the given timeframe, the landlord has two options – proceed with a summons or immediately cancel the agreement. If, after the summons is issued, the tenant has still not made any attempt to pay the outstanding rental amount, you are within your right to cancel the lease agreement.
Step 4: Eviction process
If the agreement is cancelled, the tenant will no longer fall under the protection of the PIE Act and will be regarded as an illegal occupier. According to the PIE Act, the landlord will then be able to evict their tenant legally. Once the lease is cancelled, you can initiate the summons proceedings and the eviction proceedings simultaneously. Landlords should contact their attorney to begin the eviction process.
Step 5: Eviction notice
The application to evict an illegal occupier must be made to either a Magistrate’s Court or the High Court. If the application is unopposed, it can take between 8-10 weeks for the eviction order to be granted. Also, it’s common practice in South Africa to provide the tenant with at least another 14 days to find new accommodation before the eviction order is executed.
Don’t let the possibility of a defaulting tenant stop you from searching for an investment property. All landlords should ensure they take every precaution from the start to protect themselves and their investment. Before entering into a lease agreement, seek advice from an experienced real estate agent or attorney to avoid unnecessary situations with your tenants.