About Me

My photo

I am a qualified Attorney. I specialise in Property Law, Commercial Law, Corporate Law and Trusts.
 
Please visit our website at www.prop-law.co.za for more details.
 
I am an elected Committee Member of the Property Committee of the Association of Pretoria Attorneys and through my involvement, I like to ensure that I am constantly at the "sharp-end" of Conveyancing Practice.

I am the elected Chairman on the Gauteng Council of SAPOA. The South African Property Owners Association (SAPOA) is the biggest and most influential institution in the property industry. SAPOA members control about 90% of commercial property in SA, with a combined portfolio in excess of R150 Billion (about $22 Billion). I am also on the National Council and the National Legal Committee of SAPOA.
 
Member of the Institute of Directors South Africa and Member of the Sirdar Governance Panel.

29 November 2012

Tshwane to probe illegal land sales

My question is: What about all the squatters who have set up camp at the side of the roads in suburbs like Faerie Glen? 

Just take a drive out Atterbury, Garsfontein and Hans Strydom Streets and you would think that Tshwane Camping Grounds have opened along these roads.

Gareth


www.prop-law.co.za

Tshwane to probe illegal land sales

The Tshwane Metro Council has warned that land invasions will not be tolerated in its area of jurisdiction and drastic action will be taken against those who illegally sell and invade land.

"We will not hesitate to take drastic action against those involved in land invasion or the illegal sale of land," said Joshua Ngonyama, the member of the mayoral committee responsible for housing.

This comes after a group of residents were allegedly sold stands in Soshanguve Extension 6, near Rosslyn.

The residents built shacks on the land earlier this week and the Red Ants were called in to dismantle them.

Some of the residents said they had paid about R16 000 for the stands.

They said they knew the people who had illegally sold them land.

A resident - who did not want to be named for fear of victimisation - claimed he had been trying to blow the whistle on the scam.

He told the Pretoria News that he had information on those behind the illegal sale of land.

The man said what worried residents was that people from as far afield as Hammanskraal and Mamelodi had been allocated stands in the area.

He claimed that most of the stands in Extensions 12 and 13 were occupied by people who had been allocated land illegally.

Ngonyama said the city would investigate all aspects of the issue, especially allegations that council employees were involved.

"If those involved in the illegal sale of land are [council] officials they will be dismissed," Ngonyama said.

"We will also lay criminal charges against those involved in the scam."

Ngonyama said there had also been rumours that some ward committee members were involved in the illegal sale of stands.

"We will not hesitate against these people."

Ngonyama said those who paid money for stands should come forward and state their case in an affidavit.

"We need written proof in the form of an affidavit to be able to act against those involved in the scam."

Ngonyama said the council's investigative unit would move into the area soon to probe the illegal sale of land.

Acting ward councillor Sello Huma said he had instructed people who had paid for the stands to write affidavits.

The affidavits would be warded to the metro police.

Huma said "land mafias" in the area were illegally selling land.

He said most of these "land mafias" worked with developers, who promised they could build houses for those who purchased land.

"What they are doing is illegal and we cannot allow this to happen."

Huma said he was not aware that any ward committee members were involved in the illegal sales.

"The information I have is that area committee members are the ones who are involved in the illegal sale of land."

Huma said illegal land invasions had increased in the Soshanguve area.

"We cannot allow these people to illegally occupy sites."

Most of the people who bought land illegally were from outside Soshanguve.

Huma said the area where the illegal occupation took place was earmarked for an RDP housing project.

The RDP houses would be allocated to people who qualified, Huma said.

"These beneficiaries are on the housing waiting and they are entitled to those RDP houses.

"People cannot just jump waiting list for RDP houses.

"They should also not spend their money on buying land illegally."

Pretoria News

21 November 2012

Landlords can't take the law into their own hands

www.prop-law.co.za


Landlords can't take the law into their own hands

When a tenant does not pay the rent, some landlords resort to unlawfully disconnecting the water and electricity supply to the tenant.

What if the contract states that failure to make payment gives the landlord the right to shut off the water and electricity? Would the landlord's action be justified? Would a consumer then have recourse to a legal remedy, such as an urgent interdict (spoliation), to have the services restored?

A closer look reveals that it is the by-laws that allow for the disconnection of basic services in the event of non-payment.

The Strand Magistrate's Court granted a spoliation order to property owner Marcel Mouzakis Strümpher compelling the City of Cape Town to reconnect the water supply to his Strand property.

The water supply was disconnected on August 17, 2007, when Strümpher failed to pay accumulated arrears of R182 000. An urgent court application was successful and the City of Cape Town's action was declared unlawful. It was ordered to reconnect the water immediately.

Strümpher had earlier complained to the city that the meter recorded water consumption even when no water was used.

The city investigated and found the meter to be faulty. It replaced the meter and the mains connection. Soon after, Strümpher was asked to replace several pipes that caused leakage. The water usage recorded subsequently dropped, but the municipality threatened to disconnect the supply if the arrears were not settled within two days.

Strümpher's attorney questioned the account amount, and declared a dispute, as provided for in the municipality's Credit Control and Debt Collection Policy. But the city ignored the letter and later in 2007 disconnected the water supply.

When the magistrate granted the spoliation order, the city appealed to the full Bench of the Western Cape High Court. Judge Siraj Desai and Acting Judge AJ Gassner.

The high court confirmed the magistrate's order, but granted the city leave to appeal to the Supreme Court of Appeal.

On appeal (City of Cape Town v Strümpher (104/2011) (2012) ZASCA 54 (March 30, 2012), the city contested Strümpher's argument that he was entitled to a spoliation order as the disconnection of the water supply violated his statutory water rights. A disconnection could only follow a court decision in the city's favour that the arrears were due.

On March 30, the Supreme Court of Appeal handed down its judgment rejecting the city's appeal, confirming the magistrate's court order and upholding the high court's judgment.

The city argued that there was a contractual relationship with the owner in terms of the its water by-law, and the credit control and debt collection by-law.

Also, the monthly billing statement reminded the owner/consumer that the payment for service due to the city could not be withheld, even in the instance of a dispute.

According to the Supreme Court of Appeal, the city's contention that it had the right to limit or shut off water supply in terms of the Water Services Act and other by-law for nonpayment was not lawful.

The city is required to follow specific procedures, including a dispute resolution, to ensure that the outcome is fair and equitable.

The city failed to follow its own procedures and took the law into its own hands by shutting off the water supply.

In a unanimous judgment, the appeal was dismissed with costs. The judge said there was no justification for the city to cut off the water supply to the property.

As for the granting of the spoliation order, the judge said that it was an appropriate remedy.

"A spoliation order is available where a person has been deprived of his or her possession of movable or immovable property, or his or her quasi-possession of an incorporeal," the judge said.

"A fundamental principle at issue here is that nobody may take the law into their own hands. In order to preserve order and peace in society, the court will summarily grant an order for restoration of the status quo where such deprivation has occurred, and it will do so without going into the merits of the dispute.

"The evidence... shows that the respondent [had] for the past 37 years received an uninterrupted supply of water from the city at the time when that service was summarily terminated.

"I have already alluded to the fact that the respondent's rights to water were not merely personal rights flowing from a contract, but public law rights to receive water, which exist independently of any contractual relationship the respondent had with the city.

"The respondent's use of the water was an incident of possession of the property. Clearly interference by the city with the respondent's access to the water supply was akin to deprivation of possession of property."

Dr Sayed Iqbal Mohamed
Chairman, Organisation of Civic Rights
Tenant Matters
Daily News

20 November 2012

Body corporate ordered to restore property owner's access right

Body corporate ordered to restore property owner's access right

The Fisher v Body Corporate of Misty Bay (2012 94) SA 215 (NGP) decision highlights the consequences a body corporate should consider before summarily denying an occupier the right of access to a complex.

According to the body corporate of the Misty Bay Complex (the respondent), an owner of one of the units (the applicant) had fallen into arrears in respect of his rates and levies.

Due to the applicant's failure to make the necessary payments, the respondent made the hasty decision to suspend his access tag. This suspension resulted in the applicant being unable to enter and exit the complex as and when he pleased.

Reacting to this decision, t he applicant brought an urgent application in the North Gauteng High Court for "the restoration of the applicant's possession and access to the house".

In defence of its actions, the respondent's legal representatives submitted two arguments. The first was that the applicant's car, rather than the applicant himself, had been barred from accessing the complex.

Thus the respondent submitted that the applicant was only restricted "when using his vehicle", as opposed to being restricted in general.

The basis for the second argument was that even if the court found against the respondent on the first submission, the respondent was nevertheless entitled to suspend the applicant's access on account of the arrears.

To bolster this second submission, the respondent submitted that the rules of conduct of the Misty Body Corporate stipulated that a failure to pay rates and taxes entitled the body corporate t o suspend occupiers' access tags.

Judge Legodi Phatudi dismissed the technicality of the first argument, saying such an action amounted to spoliation.

He went on to discuss the rules relied on by the respondent and concluded that the rules contained no reference that justified the respondent's actions.

More importantly, Judge Phatudi pointed out that even if such a rule had been found to exist, it would not have entitled the respondent to "take the law into its own hands", which, according to the court, is exactly what the respondent did in this case.

Interestingly, Judge Phatudi expressed the view that the suspension of access amounted to spoliation of the house as well as the vehicle. Accordingly, he suggested that the applicant's request in his notice of motion should be amended to include the restoration of the motor vehicle. For no apparent reason, the applicant declined to take advantage of this opportunity.

Judge Phatudi went on to point out that the robust remedy of mandament van spolie is applicable only i n circumstances when the access in question is required for the "use of the house and/or motor vehicle".

In other words, the peaceful and undisturbed possession of the property must be dependent on the right of access to the premises in order for the remedy to apply.

In drawing to the close of his judgment, Judge Phatudi took exception to the respondent's insistence, which continued right up to the hearing, that it was entitled to restrict the applicant's access to the complex. To demonstrate this distaste, he awarded a punitive costs order against the respondent.

The Misty Bay decision reveals the harsh stance the court takes in circumstances where a party takes the law into its own hands. It is clear that the provision for such action in the rules of a complex does not exempt a body corporate from following the due process of the law.

Lucia Erasmus and Lara Thomas, Cliffe Dekker Hofmeyr.

Weekend Argus, Saturday Edition

Property market remains subdued

Property market remains subdued

The local property market remained subdued during the first three quarters of 2012, Absa said on Thursday.

"The planning phase of new housing continued to contract up to September, while the construction phase showed some marginal growth over the nine-month period compared with a year ago," said Absa property analyst Jacques du Toit.

Residential building activity was likely to remain subdued in 2013, he said.

FNB said the figures continued to show a settled picture.

The size of completed residential buildings were similar to the late 1990s, before the economic boom, said FNB property strategist John Loos.

Growth in square metres for completed residential buildings, on a three-month moving average, reached 2.37 percent in September.

This was slightly down from the second quarter's seven percent.

The residential replacement cost gap had also flattened.

This reflected the percentage difference between a home's existing value and its replacement cost.

This gap narrowed from 24.1 percent in the second quarter to 23.5 percent in the third quarter.

"As yet the decline is not significant, with the gap still remaining well above the virtually zero level at a stage in 2007," said Loos.

"That was a situation which facilitated the peak of the residential building boom in that year, as back then it was very easy for the development sector to compete price-wise with the existing home market."

The residential building sector continued to battle to gain traction at a time when it faced heavy competition from a well-supplied existing home market, he said.

The replacement cost gap made it difficult to compete price-wise with the existing market, said Loos.

Sapa

The cost of sectional and full title properties are converging

The cost of sectional and full title properties are converging



House prices between different segments of the market had seen a general narrowing in the gaps in the third quarter of 2012, according to FNB housing data released on Wednesday.

"The average price growth rate of full title homes, at 6.7 percent year-on-year, no longer far exceeds the 4 percent growth for sectional title homes, as was the case a few quarters ago," John Loos, property strategist at FNB said.

Sectional title refers to separate ownership of units or sections within a complex or development.

Full title segment is where the consumer buys the ownership rights of the property and the land on which it is built.

It was expected that the various segments' price growth rates will move increasingly closer to each other in the near term, with relative affordability advantages having been reduced over the past few years.

At stages during the pre-2008 house price boom, the average price of a three-bedroom sectional title home was in excess of 20 percent higher than the average for a three-bedroom full title home.

The gap was still very significant as at 2009, just after the recession.

"However, thereafter this gap has steadily narrowed to a virtually insignificant 0.6 percent, as full title house price growth has exceeded sectional title price growth in recent years."

Loos said the full title market's affordability advantage that was built up in the boom period had probably come to an end.

From a price affordability point of view there was no longer much of an advantage in buying a three-bedroom full title home compared to a three-bedroom sectional title home.

"The average price gap in this segment has virtually disappeared as a result of superior full title house price growth over the past few years."

The percentage by which the average sectional title-two bedroom price exceeded that of two-bedroom full title had also significantly reduced.

The four-bedroom sectional title average values were back below average four-bedroom full title values since late-2009.

Sapa

Victory on rates for Joburg business property owners

Victory on rates for Joburg business property owners

I am very proud of my friends at SAPOA for pursuing this all the way and ultimately succeeding.  Well done Adv. Portia Matsane, SAPOA Staff and their legal team.

We have been discussing this for many months at the meetings of the SAPOA National Legal Committee and I am very pleased that it all turned out well in the end.

Gareth

'The clock is ticking' for tax-friendly property transfers

'The clock is ticking' for tax-friendly property transfers

The government has created a valuable  and unique opening for persons owning property in Companies, Close Corporations or Trusts to take advantage of a window of opportunity to secure MASSIVE Capital Gains Tax (CGT) savings.

I am surprised that it has not been seized upon by many more property owners and why more Estate Agents have not actively and enthusiastically marketed this to their clients.

Now the window is about to close, so please contact me urgently at gareth@propertylaw.onmicrosoft.com if you still want to take advantage of this CGT opportunity.

Gareth Shepperson
SHEPPERSON ATTORNEYS