24 April 2023

Navigating The Perils Of Troublesome Tenants: A Landlord's Guide To Damage Control

Barnard Inc.


Barnard Inc is a full-service commercial law firm, with services covering corporate and compliance, intellectual property, construction, mining and engineering, property, fiduciary services commercial litigation, M&A, restructuring, insurance, and family law. Our attorneys advise listed and private companies, individuals, and local and foreign organisations across South Africa, Africa and internationally.
In the complex world of property law, some tenants have appointed themselves as experts, wreaking havoc for unsuspecting landlords.
South Africa Real Estate and Construction
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In the complex world of property law, some tenants have appointed themselves as experts, wreaking havoc for unsuspecting landlords. These so-called connoisseurs, who brazenly default on rent or utility payments—or both—can leave landlords reeling from staggering financial losses and mired in legal battles.

When faced with tenants occupying leased premises without paying their due, landlords are often cornered into taking legal action. This complex process involves evicting the tenant and recovering outstanding rent and damages at considerable expense. So, how can one navigate these murky waters and prevent eviction from becoming a necessity?

First and foremost, choose your tenant wisely. Proper screening can save landlords time, effort, and heartache down the line. Performing credit and criminal checks, either through a property practitioner or attorney, can help ensure a reliable tenant. Evaluating a prospective tenant's financial stability, such as requiring bank statements and salary slips, can also help determine their ability to afford the rent. A good rule of thumb is that a tenant should earn at least three times the rental amount.

A solid foundation is key. Never allow a tenant to occupy a leased property without a signed lease agreement and a fully paid deposit. The lease forms the cornerstone of the landlord-tenant relationship, making it imperative to capture all agreed terms. A well-crafted lease agreement should include clauses for a Deed of Suretyship, Holding Over, and Maintenance. Obtaining legal advice during the drafting and enforcement of the lease can prove invaluable.

Embracing mediation can lead to smoother sailing. In response to overflowing court dockets, the legal system now emphasises mediation. Rule 41A of the Uniform Rules of Courts requires parties to mediate disputes before approaching the court for resolution. Incorporating a detailed mediation clause in the lease agreement, complete with a nominated mediator and shared costs, can save time and money on both sides.

Finally, consider alternative income streams. Landlords must adapt to the times, seeking creative ways to prevent future damages. It's a common misconception that landlords can disconnect utilities when tenants default on payments. In reality, tenants can obtain a court order for the reconnection of utilities, often at the landlord's expense. To avoid this predicament and generate extra income, property owners can explore options such as rooftop solar panel rentals, which provide tenants with cost-saving energy services while simultaneously renting out the rooftop space.

Managing difficult tenants can be a draining experience. Proactive measures, such as consulting an attorney to review lease agreements, can ease the burden. If eviction proceedings become necessary, enlisting the help of an experienced property attorney can expedite the process, allowing landlords to move forward and secure more reliable tenants.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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