Michelle Dickens, CEO of the Tenant Profile Network, answers questions from readers on rental issues.

Q: Can the tenant be forced to pay electricity and water costs after moving out?
I would like to find out if a tenant can be made to pay for the water, refuse and sewage costs at the end of the lease term (or even after the tenant has moved out - what is the time frame the landlord has to claim this) if a copy of the municipal account was never provided during the duration of the lease allowing the tenant to pay these in manageable amounts (i.e. one lump sum at the end of the term of the lease)?

Can a landlord pass on the cost of sewage and refuse or only electricity and water? If the tenant had reported water leaks to the landlord and this was not repaired can the tenant be held liable for the full (very high) water and sewage (which is related to water usage) costs?

A: Michelle's response
Payment for the charges referred to are determined by the lease agreement in place. Most lease agreements make provision for additional charges for the lessee's account: water, lectricity, gas, refuse removal & sewerage. There is no final date by when the charges would prescribe.

It would be in the Lessor's interest to charge these amounts monthly. However if this was not done either by omission or the accounts were not available, the lessor is entitled to claim the outstanding arrears due.

I must stress this is only as long as the additional charges have been specified in the agreement of lease.


Q: Eviction of non-paying tenants
In reference to the article where 400 occupiers of a derelict building reached an agreement with the JHB municipality that they would not be evicted but instead that temporary housing would be provided in the interim while the derelict building is upgraded, I would like to know the following:
1. As a private property investor in buy-to-let housing units, what should be my recourse when I have a non-paying tenant who after repeated requests and warning letters still refuses to pay the monthly rent or arrears?
2. Am I allowed by law to disconnect the electricity supply?
3. When do I have the right to evict a tenant?
4. Should it always be done through first obtaining a court order?
5. Should the police or the sheriff of the court be present when the eviction is done?
6. To what extent are my rights as a landlord protected?

A: Michelle's response
1. A landlords remedy to enforce rental payment is subject to his lease agreement with the tenant. Most lease agreements will have a rent clause which states that rent is due and payable on the 1st of each month. Most lease agreements also have a breach clause and here the lease agreements might differ. Should the tenant breach any of the terms of the agreement, the Landlord is entitled to give the tenant X numbers of days written notice to remedy the breach after which the lease is cancelled. (where X is number of days could be 3, 5 or 7 days depending on what is stated in the agreement.) Some leases do not allow for a notice period at all for a breach in terms of rental payment. In other words the Landlord would be entitled to cancel the lease immediately should the tenant default by non-payment of rent.

2. A Landlord is not allowed to disconnect electricity to a property. A municipality or managing agent is allowed to disconnect electricity to a property should the account fall into arrears. Should the account be in the Landlord's name and the Landlord approaches the municipality / managing agent with concerns over the tenant's arrears in most cases the municipality will disconnect supply. Some managing agents are prepared to disconnect and some managing agents will not.

3. A Landlord does not have the right to evict a tenant. An eviction order is an order of the court and as such can only be granted by the court and carried out by the sheriff. However, the Landlord does have the right to cancel the lease should the tenant default and the Landlord has give the required number of days to remedy the breach in writing (See point 3 above). The Landlord would be required to send the tenant a notice in writing advising the tenant that the lease was forthwith cancelled and they would have to vacate the premises - the Landlord could state the tenant should vacate immediately. In practise this would not be feasible, most defaulting tenants would not be able to find alternative accommodation so quickly. So in reality the Landlord would give the tenant until the end of the month.

4. Eviction Orders can only be obtained via the courts.

5. Once the eviction order is granted by the court the tenant is order to vacate the property on a certain date. If the tenant does not vacate the sheriff would be required to enforce the eviction order.

6. In practice, most tenants will follow the conditions of a lease agreement. If the tenant breaches the contract and the landlord takes steps as per the agreement to enforce his rights the tenant will make right. Currently 8% of tenants are not paying at all for any given month. However should the Landlord enforce his cancellation clause most tenants will vacate. It is only a small percentage of tenants where the Landlord has to resort to the legal eviction process. The court will always grant an eviction order to a Landlord where a tenant has defaulted on the rental payment. The frustration is the time it takes to obtain an eviction order (average time is 3 months) and the cost involved.

TPN's advice: Prevention is better than cure. Always perform the necessary enquiries on a tenant before they move in. Collect a deposit, preferably a double deposit. Follow your lease agreement to the letter - if the tenant defaults on his rental payment - start the breach process immediately in terms of the lease agreement.


Q: What happens in the absence of a lease agreement
I have been renting a flat in a hostel environment for approx 8 years. There is no written lease, only a verbal agreement to pay a lower rental. I am renting from my employer and it was now decided to change my rental to market related rent.

I have requested that market related rent be phased in over 3 years at 33.3 % of market per year. They also request me to now sign a written lease to this effect. The net effect is my rental has gone up by more than 100% in 13 months.

Do I have to sign their lease?
Can they evict me if I don't?
What recourse do I have?

A: Michelle's response
A lease agreement can be a verbal agreement or a written lease agreement. One of the difficulties of a verbal lease agreement is determining the terms of the lease when a dispute arises.
It is then in the best interest of both the tenant and the landlord to have a written lease agreement where all the terms to the agreement have been agreed by both parties.

The current situation is a verbal agreement with a "below market value" rent. The landlord is entitled to require that their agreement is reduced to writing. At this point the tenant and landlord must negotiate the terms of the agreement:

It appears that the tenant and the landlord have decided to increase the rent to a market related value with the increase phased in over 3 years.

1. The tenant does not have to sign an agreement of lease for terms which he is not in agreement to. However, the Landlord would then be entitled to cancel the current lease and give the tenant notice to vacate.

2. If the tenant is given notice that the current lease has been cancelled and he should vacate on a certain date and he does not, then the Landlord would at that point be entitled to claim relief from the Court in terms of an eviction order.

3. Did the employment contract between the tenant and his employer (also Landlord) take into account the reduced rate of rent as benefit forming part of his pay package? This might offer the tenant some relief if the intention of the reduced rental was to form part of his salary package.

Poperty24 07/07/2008