Non-Paying Residential Tenants - What Constitute An Illegal Eviction By Property Owners
Despite challenging economic conditions, the residential rental sector appears to be performing strongly. Rental growth has according to Payprop reached levels not seen in five years, and eight out of nine provinces enjoyed positive rental growth from Q1 2022 to Q1 2023.
Tenants "in good standing" has however according to TPN's Residential Monitor Report declined for third consecutive quarter as high interest rates and inflation are hampering residential tenants' ability to pay their rent. Payprop's Rental Index also indicates that tenants in arrears rose from 18% in Q1 to 18,4% in Q2 2023 - the highest level seen since 2021. While that is still well below the peak recorded during the pandemic, it marks two straight quarters of higher arrears, and Payprop expects that the effect of high interest rates may not yet have filtered through completely on tenants ability to pay rentals - so arrears could get worse before they get better.
Non-paying residential tenants can be a cashflow nightmare for a bond repaying owner and the start of at least a 6-month legal procedure which could set him/her back a few hundred thousand Rands in legal expenses. According to Statistics South Africa, the number of people being taken to court during 2022 for outstanding rental debt is approximately 3 000 per month. According to a report by the Socio-Economic Rights Institute of South Africa (SERI), there were over 250,000 eviction cases between 2014 and 2018.
- Relevant Legislation - PIE Act & Rental Housing Act
An owner can only initiate the eviction process if the tenant is in illegal occupation of the property - which will follow the cancellation of the lease agreement. Such cancellation could happen for various reasons, such as a breach of any of the lease clauses including the non-payment of rent.
The Prevention of Illegal Eviction from and Unlawful Occupation of Land Act No 19 of 1998 (PIE) has very careful regulations laid out that dictate what the eviction process must be. Unfortunately, it does not matter if the tenants are defaulting on their rent or damaging the property, the owner must follow the letter of the law.
The PIE Act sets out the legal procedure for evicting non-paying tenants in breach of the rental or contractual agreement. Owners are generally required to provide written notice to tenants outlining the reasons for their breach and allowing them a reasonable opportunity to rectify the issue - if possible. The exact notice period should be set out in the lease agreement itself. Should the breach not be remedied, then the lease may be cancelled. Accordingly, if the tenant does not then vacate voluntarily, eviction proceedings may then be instituted by way of a formal court application in terms of section 4 of The Prevention of Illegal Eviction from and Unlawful Occupation of Land (PIE) Act.
If the eviction order is opposed, the case can take from 6 to 18 months. Even if the eviction is unopposed, the court will want to ensure the occupier is given enough time to vacate the property and find alternative accommodation before allowing the sheriff to enforce an eviction order, particularly in the case of vulnerable tenants.
If there is a breach of the rental agreement, the landlord must issue a warning to the tenant in writing, giving them a specified amount of time to remedy the breach. This time frame will be determined by the terms of the lease. If not specified, it will be 20 working days, in accordance with the CPA. There is some overlap, especially between the Rental Housing Act and Consumer Protection Act, and tenants' rights always default to the greater level of protection, where the provisions of two Acts differ.
If the breach is not remedied within the designated time, the next step is a letter of cancellation served on the tenant by the landlord. The cancellation notice should include a date by which the tenant must vacate the premises.
- Illegal Eviction Action By Owner:
An owner should never resort to taking the law into their own hands, as an arbitrary eviction of the tenant is a serious infringement of the occupier's Constitutional right to housing - even if the tenant is unlawfully occupying the property.
Decisive and swift action is however key for the owner. The longer a tenant stays in the property and in arrears, the less likely they are to ever pay what they owe. However, should the property owner decide to evict the tenant in an unlawful manner, the court will not side with them, even if the rent has not been paid for quite a while or the property has been damaged by the tenant.
Owning the premises does not give the owner the right to evict a tenant in any way he/she sees fit. An illegal eviction is where an owner takes the law into their own hands through force, intimidation or otherwise, by:
2.1 Turning off the water and electricity - It can be very tempting to owners to make life as miserable and as uncomfortable as possible for the tenants to force them out. This is deemed an unlawful act because it goes against a person's constitutional right to decent housing and the owner's responsibility under the Rental Housing Act, 1999, to provide liveable accommodation.
2.2 Changing the locks - It goes against the regulations set out in PIE to stop the tenant from being able to get into their home before they have found a suitable alternative. Owners must refrain from taking this kind of action, even if a court order for eviction has been granted.
2.3 Scare tactics - Intimidating the tenants and trying to scare them into moving out is an unlawful act. Not only could an owner face charges under PIE, but he/she could also be accused of attempted assault and battery which could lead to a criminal record for the owner.
2.4 Removing the tenant's furniture and belongings - Even if an eviction order has come from the courts, an owner cannot move the tenant out. The only person who can do this is the Sheriff of the Court, and then only if the tenant does not leave by the date and time stated in the court ruling.
- Penalties for an illegal eviction of the tenant by the owner
The illegal eviction actions above will lead to a spoliation court application that will help "put the tenant back into the property". It can be processed a lot faster than an illegal eviction and will also be at the cost of the landlord who took the law into their own hands.
The acts above in 2.1 to 2.4 amount to constructive eviction, which is illegal in terms of the RHA and could result in a fine or imprisonment of up to two years, or both. The courts take this very seriously in South Africa and owners could end up also paying damages to the tenant.