by Vicky | 13, 04, 16 | Uncategorized
When times are tough, unethical behaviour becomes more common and, as unethical behaviour often leads to fraudulent and illegal activities such as corruption, the costs add up.
The legal profession is required to maintain an unquestionable standard of ethics and professionalism. Unfortunately, even in the legal profession, lines distinguishing ethical from unethical behaviour are sometimes manipulated and can become blurred. The Law Society of South Africa (“the Law Society”) has formulated a set of rules that clarify acceptable behaviour in the legal profession. The Law Society implements these rules and investigates any alleged contravention of these rules in order to protect the public against unprofessional, unethical and irresponsible conduct by attorneys.
When you engage the services of an attorney you enter into a relationship with that attorney. Every relationship consists of rights and duties for both parties to the relationship. To help clarify the rights and obligations involved in your relationship with your attorney, we have explored three aspects below.
What is an attorney?
The Attorneys Act 53 of 1979 (“the Attorneys Act”) governs the attorneys’ profession. An attorney is someone who has obtained a legal degree, passed the admission examinations set by the Law Society and has been admitted to practise as an attorney in South Africa.
What can you expect from your attorney?
The foundation of the relationship between an attorney and his/her client is trust. In terms of the Law Society rules and the Attorneys Act:
Your attorney must:
o maintain the highest standards of honesty and integrity at all times;
o always act in your best interests;
o inform you of what you can expect in terms of the possible outcome of your matter as well
as the potential costs involved;
o keep you informed of the progress of your matter in the manner you have chosen;
o treat you and your matter with respect and confidentiality;
o never place his/her own interests above his/her professional duties to you as the client.
Your attorney must not:
o give a financial reward to an individual to solicit legal work;
o acquire a financial interest in the subject matter of the dispute in which he/she is acting;
o accept an instruction in which there may be a potential conflict of interest;
o act unlawfully;
o accept a mandate from you if you still have an existing mandate with another attorney in
respect of the particular matter.
The above lists provide the bare minimum you should expect from your attorney and, if any of the above
are missing or contravened, warning bells should ring.
What can your attorney expect from you?
Just as the attorney has certain obligations to fulfil, you also have obligations to your attorney. Some of these are to:
treat your attorney with respect and courtesy as a professional in the legal profession;
provide your attorney with accurate and complete information disclosing all relevant facts which
may be necessary to assist your attorney to provide you with the correct advice;
settle your attorney’s account timeously;
pay a deposit when requested to do so.
Clarifying expectations at the outset of a relationship is essential and it is advisable to conclude a written mandate with your attorney setting out your respective expectations and obligations prior to the commencement of any work by your attorney.
Ethics are vital to ensure a profitable and sustainable economy and it is the responsibility of each of us to conduct ourselves in an ethical manner. A tough economic climate may tempt you to consider taking short cuts or to work with an attorney with a blurred ethical compass, but be warned: not only will the attorney face the consequences of the Attorneys Act and the Law Society, but if you are found to be a party to a relationship which is corrupt, you may face the severe penalties laid down in the Prevention and Combating of Corrupt Activities Act, 12 of 2004 (“PACCA”). Punishment for contravention of PACCA includes a criminal conviction and possibly a prison sentence.
For professional but personal advice please contact Stuart Fourie (stuart@fouriestott.co.za), Vicky Stott (vicky@fouriestott.co.za), Chris Salmon (chris@fouriestott.co.za), or Allison Schoeman (allison@fouriestott.co.za) or visit our website for further information about our firm and areas of
expertise.
by Vicky | 22, 01, 16 | Uncategorized
The “voetstoots” clause is familiar to most of us. This is a standard clause in a sale agreement which protects the Seller by stating that the property, whether movable or immovable, is purchased “as is”. This clause therefore seeks to deprive the Buyer of any recourse against the Seller should the property have latent or patent defects. A latent defect is one which could not have been discovered by a reasonably thorough inspection prior to sale, while a patent defect is visible on inspection.
The Consumer Protection Act, 2008 (“CPA”) (and the restrictions it places on voetstoots clauses) is only applicable to immovable property sale transactions where the Seller sells the immovable property in the ordinary course of the Seller’s business, and to the marketing service provided by the agent in negotiating between the Seller and Buyer. Where the CPA does apply, a Seller will find it difficult to rely on a voetstoots clause.
The CPA does not apply to “once-off” transactions such as the sale by an individual of his/her home. The voetstoots clause is therefore still applicable to the vast majority of property transactions. Where the CPA does not apply, patent defects will always be covered by a voetstoots clause, as will latent defects of which the Seller was not aware. In order for a Buyer to succeed in circumventing the voetstoots clause and holding a Seller liable for a latent defect, the Buyer will have to show that the Seller:
- knew of the latent defect and did not disclose it; and
- deliberately concealed it with the intention to defraud.
In the matter of Odendaal v Ferraris 2008 ZASCA 85 the Supreme Court of Appeal (“SCA”) found that the Seller’s failure to obtain statutory approval for building alterations on the property constituted a latent defect but did not render the property unfit for its purpose. The SCA further held that where a Seller does not wilfully conceal a latent defect he/she is entitled to rely on the provisions of the voetstoots clause. A similar result was arrived at in the later High Court matter of Haviside v Heydricks and Another 2014 (1) SA 235 (KZP).
The circumstances of each matter are extremely subjective as can be seen in the earlier decision of Ornelas v Andrews Café and Another 1980 (1) SA 378 (W) where a café and restaurant business was sold as a going concern. It emerged that the business did not have a license, and therefore the voetstoots clause did not protect the Sellers as they had a duty to deliver a business that could lawfully be conducted. This case can be differentiated from the Odendaal and Haviside matters on the facts.
Given the strength of the voetstoots clause, the high onus of proof on the Buyer, and the subjective nature of the evidence that would have to be led in circumventing this clause, it is critical that all Buyers inspect their prospective immovable property with a high degree of care and diligence, even to the point of obtaining a home inspection report or other expert reports so that a purchase can be made with complete clarity on what constitutes “as is”.
Failing to properly consider the application of a voetstoots clause to your transaction could be very problematic and expensive.
For professional but personal advice on, and assistance with “voetstoots” related matters please contact Stuart Fourie (stuart@fouriestott.co.za), Vicky Stott (vicky@fouriestott.co.za), Chris Salmon (chris@fouriestott.co.za), or Allison Schoeman (allison@fouriestott.co.za) or visit our website for further information about our firm and areas of expertise.
by Vicky | 08, 06, 15 | Uncategorized
Communal living in a sectional title complex (“Scheme”) can be difficult at times because it involves a wide range of people with diverse needs, interests, languages, and cultures which sometimes clash. The ability to live harmoniously can also be difficult due to the high number of tenants residing in sectional title units within the Scheme, who are sometimes unaware that they are also bound by the Conduct and Management rules of the Sectional Titles Act, 1986 (“Sectional Titles Act”).
The purpose of this newsletter is to outline some of the major issues that often arise between a Body Corporate and a tenant within a Scheme, and what trustees of the Body Corporate can do in order to prevent and regulate these disputes.
- LOCUS STANDI AND PRIVITY OF CONTRACT
In plain terms the above means: Can the Body Corporate (“BC”) sue and evict a tenant for being a nuisance within the Scheme and for not abiding by the provisions of the Sectional Titles Act, Management and Conduct Rules?
The short answer is – no. The lease agreement between an owner and a tenant is between the owner and the tenant. As the BC is not a party to this contract, it cannot lawfully bring eviction proceedings against the tenant. The owner is however liable for the actions of his/her tenants, employees, guests, occupants and members of their family, and the BC can exert pressure on the owner through application of the Sectional Titles Act, Management and Conduct Rules to ensure that the offending tenant complies with his/her obligations to the other residents of the Scheme.
- APPLICABLE LAW
The following legislation applies to the above situation:
1) Sections 5(8) and 5(9) of the Rental Housing Act 50, 1999 (“Rental Act”) provide that the landlord must ensure that a copy of any Management and Conduct Rules (“House Rules” are defined in the Rental Act as rules relating to the control, management, administration, use and enjoyment of the rental housing property) applicable to the dwelling must be attached as an annexure to the lease. This is peremptory.
2) Prescribed Management Rule 69 of the Sectional Titles Act provides that the provisions of the Management Rules and of the Conduct Rules, and the duties of the owner in relation to the use and occupation of sections and the common property shall be binding on the owner of any section and any lessee or other occupant of any section (our emphasis). It further provides that it shall be the duty of the owner to ensure compliance with the rules by his/her lessee or occupant, including employees, guests and any member of his/her family, his/her lessee or his/her occupant.
3) Prescribed Conduct Rule 10 of the Sectional Titles Act deals with the letting of sectional title units and provides that all tenants of units and other persons granted rights of occupancy by any owner of the relevant unit are obliged to comply with the Conduct Rules, notwithstanding any provision to the contrary contained in any lease or any grant of rights of occupancy.
- REMEDIES
A BC should therefore take the following steps to ensure that tenants comply with the Management and Conduct Rules of the Scheme:
1) Notify all landlords within the Scheme that a copy of the Management Rules, Conduct Rules and any applicable House Rules must be annexed to their lease agreement/s.
2) Ensure that the BC or managing agent administering the BC has detailed contact details of the landlord and the tenant, including a residential or employment address for service of letters and legal documents. A postal address or email address is not sufficient for service by a Sheriff of court processes such as a summons.
3) Amend the Prescribed Management Rules or Conduct Rules to clearly set out a process where a reasonable fine can lawfully be levied against an owner of a unit in the Scheme and added to the levy account should the tenant contravene any Management or Conduct Rules.
4) Ensure that the owners are aware that in terms of the Sectional Titles Act the unit address within the BC is the landlord’s default domicilium for the service of all legal process on the landlord. The landlord should ideally nominate his/her residential address as his/her domicilium in writing so that the BC can advise him/her of any transgressions by his/her tenants before imposing any fines.
If, notwithstanding the above suggestions, the landlord and tenant still fail to comply with their obligations, the BC can either bring an interdict compelling the tenant to comply with the Management and Conduct Rules, or declare a dispute with the owner in terms of Prescribed Management Rule 71 and refer the matter to arbitration. These remedies are costly, and if defended can take some time to finalise.
- CONCLUSION
If the BC ensures that it is on top of its administration and ensures that reasonable fines can be levied lawfully against owners in respect of their tenants, there is no reason why issues arising between the BC and absentee landlords failing to deal with nuisance tenants cannot be dealt with effectively, reasonably, and transparently.
Please note that the above newsletter is offered for information purposes. It is not offered as and does not constitute legal advice. For professional but personal advice in respect of litigation, conveyancing and drafting of commercial agreements, please contact Stuart Fourie (stuart@fouriestott.co.za), Vicky Stott (vicky@fouriestott.co.za) or Chris Salmon (chris@fouriestott.co.za) or visit our website or Facebook page for further information about our firm and areas of expertise.
by Vicky | 08, 06, 15 | Conveyancing
A sale agreement in respect of immovable property is not valid unless certain formalities are complied with in. In particular, Section 2 (1) of the Alienation of Land Act 68 of 1981 provides that:
“No alienation of land after the commencement of this section shall, subject to the provisions of section 28, be of any force or effect unless it is contained in a deed of alienation signed by the parties thereto or by their agents acting on their written authority.”
The above formality is of particular importance when, for example, a sale is subject to a suspensive condition. A suspensive condition is one which makes rights and obligations of the sale agreement subject to an uncertain future event occurring timeously. This was discussed in the matters of Fairoaks Investment v S Oliver (268/07) [2008] ZASCA 41 (28 March 2008) and Pangbourne v Basinview (381/10) [2011] ZASCA 20 (17 March 2011).
In the Fairoaks decision an agreement of sale was concluded but was subject to the fulfilment of three suspensive conditions. One of these conditions was not fulfilled within the requisite 12 month period and the agreement consequently lapsed. The parties then signed an addendum purporting to revive the agreement and amend the unfulfilled suspensive condition. The Court held that the addendum was not sufficient to revive the sale agreement – a new sale agreement had to be entered into.
In the Pangbourne decision again an agreement of sale was concluded subject to the fulfilment of certain suspensive conditions, which remained unfulfilled. The parties concluded an addendum, and were under the impression that this “revived” the agreement. The Court held that a contract ceases to exist if a suspensive condition is not fulfilled. The agreement cannot be revived and as such the addendum was of no force or effect in either reviving the sale agreement or constituting a new sale agreement.
The above two decisions can be differentiated from the matter of Neethling v Klopper and Others 1967 (4) SA 459 (A) where the Court held that a valid contract which had been cancelled (as opposed to the agreement lapsing as in the cases above) could be revived when both parties waived their rights created by the cancellation of the agreement, and that an agreement to do so does not constitute a fresh agreement of sale.
To summarize, the position in our law is that, if a suspensive condition is not fulfilled timeously, the sale agreement lapses and is regarded as void ab initio or “void from the beginning”. The effect is that the sale agreement is not capable of being revived.
After the sale agreement has lapsed, no addendum signed between the parties or any agreement to waive the suspensive condition would be of any force or effect. The parties would have to conclude a fresh sale agreement that complies with the Alienation of Land Act.
Below are three different scenarios which could occur:
Scenario A:
The parties sign the agreement of sale but it subsequently emerges that the agreement was signed by the second party after the offer made by the first party had expired.
In this scenario the agreement is void and is incapable of being revived through an addendum. The parties should conclude a new sale agreement in compliance with the Alienation of Land Act. This new agreement can be a short and simple document incorporating the terms of the lapsed agreement by using the lapsed agreement as an annexure.
Scenario B:
The parties sign an agreement of sale which contains a suspensive condition. The suspensive condition lapses.
In this scenario the agreement is void, and incapable of being revived as per Scenario A. The solution would be the same as Scenario A.
Scenario C:
The parties sign an agreement of sale which contains a suspensive condition. Prior to the agreement lapsing, the parties either waive the suspensive condition or extend the time for its fulfilment by signing an addendum.
In this scenario the addendum signed by both parties would keep the agreement alive.
To prevent sale agreements from becoming unenforceable and potential litigation between the parties, it is crucial that all parties be aware of applicable timeframes, the effect of non-fulfilment of these, and the options available should there be a danger of not meeting a particular timeframe.
For professional but personal advice on, and assistance with the drafting and conclusion of, sale agreements or any litigation matters associated with sale agreements, please contact Stuart Fourie (stuart@fouriestott.co.za), Vicky Stott (vicky@fouriestott.co.za) or Chris Salmon (chris@fouriestott.co.za) or visit our website for further information about our firm and areas of expertise.
by Vicky | 08, 01, 15 | Uncategorized
When you need to have documents signed or copied in South Africa for use outside South Africa, you will need to go through a process of having the documents authenticated. The nature of the authentication process will depend on the country in which the documents will be used.
- APOSTILLE
A relatively simple process (“the Apostille Process”) can be followed when the documents are intended to be used in a country that is a party to the Hague Convention dated 5th October 1961. A list of participant countries is available at http://www.hcch.net/index_en.php?act=states.listing.
The Apostille Process is as follows:
1. The original documents must be taken to a South African Notary Public and must be signed or copied in his/her presence. The Notary will then attach an authentication certificate to the signed document or copy which will include the Notary’s signature, stamp and seal.
2. The Notary will then send the authenticated documents to the High Court in the area in which he/she practices and the Registrar of the High Court will sign an Apostille Certificate authenticating the Notary’s signature.
Once the Notary’s certificate and the Apostille Certificate are attached to the signed or copied document, the document is ready to be used abroad.
- AUTHENTICATION
The Apostille Process cannot be used where the country in which the documents will be used is not party to the Hague Convention. In this instance the process is more complicated:
1. The original documents must be taken to a South African Notary Public and must be signed or copied in his/her presence. The Notary will then attach an authentication certificate to the signed document or copy which will include the Notary’s signature, stamp and seal.
2. The Notary will then send the authenticated documents to the High Court in the area in which he/she practices and the Registrar of the High Court will sign an authentication certificate authenticating the Notary’s signature, instead of an apostille.
3. The documents must then be sent to the legalisation section at The Department of International Relations and Co-operation (DIRCO) in Pretoria, where they will authenticate the signature of the Registrar.
4. Finally, the documents must be sent to the embassy or consulate of the country in which they are intended to be used for their final authentication.
Once all four steps have been completed the documents are ready to be used abroad.
Where documents are signed or copied outside South Africa and are to be used inside South Africa, the Apostille Process is acceptable, alternatively any authentication which complies with our High Court Rule 63 should suffice.
For professional but personal advice on, and assistance with notarial authentication of documents, please contact Stuart Fourie (stuart@fouriestott.co.za) or Vicky Stott (vicky@fouriestott.co.za) or visit our website for further information about our Firm and areas of speciality.
