Rental housing legislation provides tenants with protection, whether or not there is a written lease
It’s not best practice, but it often happens that a landlord and tenant do not have a written lease agreement. In the digital age, when everything is captured online and on cell phones, it is understandable to assume this means there is no lease. However, the Rental Housing Act does not require a lease to be in writing, although it is strongly advised. A verbal agreement between the parties constitutes a lease agreement, even if that conversation consists of no more than a statement of the monthly rent and the amount of time the property may be occupied.
So when we talk about “no lease”, what we really mean is no written lease. And, although the tenant still has rights under the law, the absence of clarity surrounding the terms and conditions of the tenancy can lead to disputes and confusion. But it does not mean the eviction process is any less stringent.
One reason why a tenant might not have a lease
There are two scenarios in which the tenant might not have a written rental agreement, and the eviction process is slightly different in each case. The first is where the landlord and tenant have agreed the terms of the occupancy informally, and perhaps shaken hands on the deal. They may be friends or family members with a harmonious enough relationship to consider a legal document unnecessary, or the property may be a cottage in the garden of a homeowner who takes an informal approach to letting it out. This won’t be permitted for much longer, as we will come on to, but at present it is not uncommon.
Another reason for no lease
The second scenario is where a lease has expired, but the tenant has the landlord’s permission to remain in the property on a month-to-month basis. In some countries this is called a “tenant-at-will”. This might occur because a tenant has purchased a property and is waiting on an entry date; or the property owner is planning to sell and does not want to commit to a lengthy lease period but is happy for the tenant to occupy the property while seeking alternative accommodation. Or there may be minor breaches to the lease that are not serious enough to cause the landlord to evict but nonetheless they do not wish to renew the lease. The tenant may be allowed a few extra months on a month-to-month basis to avoid homelessness while seeking alternative accommodation.
If a lease expires and the tenant continues to pay rent, and the landlord continues to accept it, without spelling out the conditions noted above, they have effectively created a new, implied lease. There are also certain fixed-term leases that become implied month-to-month leases after expiry, in terms of the Consumer Protection Act (CPA). By law, the payment and acceptance of rent after the official end of the lease implies that a new lease has been agreed.
Eviction with a verbal lease
The eviction process where there is a verbal lease is identical to the process for a written lease. The Prevention of Illegal Eviction Act from and Unlawful Occupation of Land Act, No 19 of 1998 (PIE Act) ensures that landlords follow a clearly defined set of actions, and there must be due cause. No one can be evicted without reason or notice. There must be a breach of the lease agreement. In the absence of a written document setting out the conditions of the tenancy, the most common breach is non-payment of rent. This is the one contractual obligation a tenant has that cannot be disputed. Some landlords may be willing to forgive a late payment or two, but this is a matter for personal discretion. Legally, if the rent is not paid on the date it is due, a breach has occurred. In the first instance, the tenant is given the opportunity to rectify the breach. The landlord serves notice to the tenant to this effect, and then if the breach is not rectified, the landlord can terminate the lease contract.
The landlord must give notice of the intention to evict the tenant through the courts. The eviction order will give a date for a court hearing, at which the tenant may offer a defence. If there is a valid defence, a trial date will be set. In the absence of such a defence, the court issues a warrant of eviction to the Sheriff. Note that only a Sheriff is authorised to remove a tenant or a tenant’s possessions from a property.
Month-to-month or open-ended leases
The landlord must give the tenant “reasonable” notice of termination of the lease. A calendar month’s notice will satisfy the 20 business days required by the CPA and is considered reasonable. There does not have to be any breach of an agreement. If the tenant fails to vacate the property at the end of the calendar month, as requested, then the landlord can begin the eviction process described above.
Remember that a month’s termination means from the beginning to the end of the same month, or what is commonly known as a calendar month. Therefore if it is the third of January and the landlord wishes to terminate the agreement, the termination would only apply at the end of the following month, i.e. the end of February, and not the end of January. This is so a full month can elapse and the termination takes effect at the end of a month.
Time’s running out
Soon this advice will be irrelevant. The Rental Housing Amendment Act 35 of 2014 will require landlords to provide tenants with a written lease agreement. Verbal agreements will no longer be binding. The Rental Housing Amendment Act will apply immediately to new lease agreements and landlords will have six months to bring existing agreements in line with the new legislation. At the time of writing, the Act has not yet been gazetted and a commencement date has not been announced. We will keep readers of this blog informed.
Seek the guidance of an expert eviction lawyer
If you are a tenant without a written lease and would like to discuss your circumstances, or if you are a landlord needing to draw up a formal lease agreement, contact Cape Town attorney Simon Dippenaar on 086 099 5146 or email email@example.com to discuss your case in confidence. Eviction lawyers Johannesburg and Cape Town are experts in rental property and eviction law, and we uphold the rights of both parties without bias.