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30 Nov 2016

Domestic Workers’ Wages up 1 December 2016

This year’s new minimum wages for all domestic workers are set out in the table at the end of this article.

Who is covered?

  • All domestic workers in South Africa working in a private household
  • People employed by employment services
  • Independent contractors who are doing domestic work
  • A person doing gardening in a private home
  • People who look after children, sick or old people and people with disabilities in a private home
  • A person driving for the household

But excluding –

  • Domestic workers employed on farms
  • Domestic workers employed in activities covered by another sectoral determination or bargaining council agreement (such as contract cleaning workers).

Are you in Area A or Area B?

Area A includes most major metropolitan areas; Area B is all other areas. See the full lists on the Department of Labour website

wage-table-for-domestic-workers

30 Nov 2016

Two minutes to a swimming pool tragedy and a R62m damages claim

“There’s no tragedy in life like the death of a child” (Dwight D. Eisenhower)

A recent High Court decision highlights once again both the personal tragedy and the legal consequences of failing to protect children from the dangers of swimming pools and other hazards.

The facts

  • The property in question had both a swimming pool (fenced, with two entrance gates) and a koi pond (neither fenced nor covered)
  • The 2½  year old child at the center of this case usually accompanied her mother to weekly cell group meetings held at the house
  • The gates were protected with double latches which the child could not have opened herself, but on at least five occasions before the tragedy the gate had been left open. Critically, the mother had pointed this out to the owner’s wife, who had undertaken to ensure it was kept closed in future
  • On the day in question the mother was unexpectedly distracted and out of sight of her daughter for only 2 to 3 minutes. Unfortunately that’s all the time it took for the child to fall in the pool, where she was found floating face down.  She was resuscitated but suffered severe brain damage
  • The child’s parents sued the homeowner (and his wife as the person in control of the property at the time) for over R62m, both on behalf of their daughter and in their personal capacities
  • Faced with conflicting evidence, the Court found on the probabilities that the gate had in fact been left standing open.  If there had been a self-latching spring on the gate (a subject of dispute) it had been insufficient to latch the gate.

Who’s liable?

Negligence, held the Court, was, on the particular facts of this case, shared between –

  1. The property owner, aware of the risk to small children and negligent for failing to ensure that the gate was properly secured with a self-latching spring or padlock
  2. His wife, negligent for failing to ensure that the gate was kept closed as promised
  3. The mother of the child on the other hand was guilty of contributory negligence for leaving her child unattended when aware of the dangers posed by the swimming pool.

So the homeowner and his wife are liable for whatever damages the parents can prove. The mother’s personal claim will be reduced by 30% to reflect her contributory negligence, but the child’s proven damages will be 100% payable.

30 Nov 2016

Getting Married? Don’t Forget the Legal Consequences

“A good wife always forgives her husband when she’s wrong” (Rodney Dangerfield)

With Wedding Season in full swing, here’s a timely reminder – take legal advice on choosing one of the three “marital regimes” available to you in our law before you actually tie the knot.

That’s important because if you don’t specify otherwise in a pre-marriage ANC (antenuptial contract), you will automatically be married in community of property. Which, as we discuss below, may well be a poor choice for you. And although you can usually change your regime after marriage it’s a lot easier and cheaper to get it right up front.

Your 3 choices

  1. Marriage in community of property: This is the default regime that will apply if you don’t specify otherwise in your ANC. With only a few exceptions, everything you own, everything you owe, and everything you accrue while married fall into one “joint estate”. Your spouse must consent in writing to certain transactions. On divorce or death your joint estate will usually be split equally between you, regardless of what each of you contributed to the marriage. And if one of you runs up debts or gets into financial difficulties, it is the joint estate that must pay and may be sequestrated – you could lose everything.
  2. Marriage out of community of property without the accrual system: Your own assets and liabilities, both what you bring in and what you accrue during the marriage, remain yours, and yours alone, to do with as you wish.  You aren’t liable for your spouse’s separate debts and if your spouse’s estate is sequestrated your separate assets will be released to you (against proof that they are indeed yours). This may be the right choice for you, but be aware that without accrual the poorer spouse (usually a spouse whose contribution to the marriage was more on the home-making side rather than financial) risks being left destitute after many years of marriage.
  3. Marriage out of community of property with the accrual system: As with the previous option, your own assets and liabilities remain yours and under your sole control, and you can protect your assets from your spouse’s creditors. On divorce or death however, with only a few exceptions you share equally in the “accrual” (growth) of your estate. Although this is a fair and popular option for modern marriages, it is not necessarily the best choice for your particular circumstances, and proper advice is essential.

You have some important decisions to make. All three choices have their own advantages and disadvantages, what is set out above is of necessity just a general summary of your choices, and whichever regime you opt for you should ask your lawyer to tailor your ANC to suit your particular circumstances. So don’t leave it to the last minute!

30 Nov 2016

A Mixed Bag for the Festive Season

Let’s say goodbye to 2016 with some sites to get us into the holiday mood.  Whether you are entrepreneur or employee, captain of industry or middle manager, nine-to-fiver or happy homebody, this is your chance to relax, unwind a bit, and indulge yourself and your loved ones ….. Have fun!

How to enjoy your break

There’s no better way to re-charge your batteries after a long year than a really good holiday.   Make the most of it with the Telegraph’s ‘The science behind having a happy family holiday” on its website http://www.telegraph.co.uk/travel/family-holidays/using-science-to-make-family-holidays-happier/.

The perfect gift

Are you struggling to find the perfect gift for a really special client or family member?  If you’re not all thumbs tackle one of the projects in “Give the Perfect Handmade Gift with These DIY Projects” on LifeHacker http://lifehacker.com/give-the-perfect-handmade-gift-with-these-diy-projects-1742130717?sidebar_promotions_icons=testingoff&utm_expid=66866090-67.e9PWeE2DSnKObFD7vNEoqg.1.

Is that hotel review fake?

Before you book into Hotel Le Swank on the basis of its brilliant 5 star online reviews, check the reviews for authenticity by running them through Review Skeptic http://reviewskeptic.com/.  It’s based on research at Cornell University that uses machine learning to identify fake hotel reviews with “nearly 90% accuracy”.

Your dog’s New Year bedtime story

If your canine companions are terrified of New Year fireworks, try playing them the audiobook bedtime story on the Daily Record’s “Calm canine nerves this Bonfire Night with bedtime story for dogs” webpage http://www.dailyrecord.co.uk/news/uk-world-news/bedtime-story-for-dogs-1411639 – it uses “proven animal psychology tips and tricks, communicative signals, bioacoustics and years of research into dog behaviour”.  It might soothe your nerves as well.  Plus you can have fun testing it on the cat.

Record those memories! Tips for great cell phone videos

Capture the happy times forever with a home movie shot on your smart phone.  “Make Great Videos with Your Phone” on lifewire.com https://www.lifewire.com/make-great-phone-videos-1082078 shows you how.  Finish it off with a video editing app – find the best at “10 best video editor apps for Android” here http://www.androidauthority.com/best-video-editor-apps-android-716248/ or “5 of the nicest video editing apps for iOS” here http://www.phonearena.com/news/5-of-the-nicest-video-editing-apps-for-iOS_id87459.

25 Nov 2016

FESTIVE SEASON CLOSURE – 2016

The Deeds Office is closing on the Friday, 23rd of December 2016 (the last day for registration is Thursday, 22nd December 2016), and will be re-opening on Tuesday, 3rd January 2017.

Our firm will be closed from 12h45 on Friday, 23rd December 2016 and will re-open at 08h00 on Tuesday, 3rd January 2017.

the Directors and Staff wish you well this festive season!

15 Nov 2016

THE COMMUNITY SCHEMES OMBUD SERVICES ACT – REGISTRATION REQUIREMENTS AND LEVIES

As you will have noted from a previous Newsflash dealing with The Community Schemes Ombud Services Act (the Act) this new legislation came to apply as of the 7th October 2016.

This Act applies to all community schemes which by definition includes sectional title development schemes, shareblock companies, property or homeowners associations and housing schemes for retired persons.

As we mentioned in our previous Newsflash, the office of the Community Schemes Ombud is meant to be self-supporting. This means that the office will be acquiring the funds which it needs to fund its operations from community schemes in terms of annual levies.  The proposed levies in terms of the Act are set out in the Regulations in an escalating table depending on the monthly levy payable to the community scheme by members of the scheme.  The maximum levy payable in terms of the Act is R40.00 per month per member of the scheme.  To enable the Ombud to police all community schemes, all schemes were required (this is not a matter of choice) in terms of Section 59(b)(iii) as read with Regulation 18(3) to register with the Ombud within 30 days of the 7th October 2016. There is a prescribed form for this purpose (Click here: Community Schemes Registration Form), set out in the Regulations to the Act. Failure to register is a criminal offence in terms of Section 34 of the Act and is punishable by fine and/or imprisonment not exceeding 5 years.

Community schemes are therefore advised to register immediately if they have not yet done so.

Milton Koumbatis
15 November 2016

08 Nov 2016

Good news for purchasers of property regarding unpaid rate by previous owner!

We have already in the past published newsflashes and articles reporting on a number of judgments of our courts including our Supreme Court of Appeal, the effect of which is the following:

When a property is sold the municipal authority can only insist upon receiving payment of amounts which  relate to bills which are not older than two years.  If such amounts are paid, rates clearance and thereby permission for the transfer of ownership must be given.  The fact that the older debt remains payable cannot retard the transfer process.

The restriction placed upon the municipal authority as stated above does not mean that it is deprived of the right to pursue recovery of the balance which might be owed (i.e. older debt) by the previous owner.  It is perfectly entitled to take legal action against the previous owner and to try and recover the monies from that owner.  It may not however take action against the new owner for that debt.

When and if the municipal authority obtains the necessary judgment against the previous owner and even though the property might have been transferred to someone else and even though (as stated above) the new owner cannot be held liable for the old debt, the municipal authority is allowed to cause the property to be attached by the Sheriff of the Court and to sell the property at a sale in execution to recover the money due to it.

The effect of paragraph 3 above is to force the new owner to pay the debt and to thereby save his property.

This issue has now been brought squarely before another court in the Pretoria High Court which court found that the portion of the law which allows municipal authorities to attach properties after they have been transferred to new owners is unconstitutional and amounts to an improper and arbitrary depravation of a property right.  Such rights are of course protected in terms of our Constitution.  The matter will no doubt now be carried forward to the Constitutional Court for a final ruling but it is our view that the judgement of the Pretoria High Court will not be overruled as it was very well reasoned.

The result of the judgment is that, for the time being in any event, owners of property need not concern themselves with unpaid municipal debt of previous owners.

As a matter of interest the same court found that municipal authorities are not permitted to refuse to render municipal services (i.e. open accounts) to the new owner of the property simply because the previous owner might still owe money to the municipal authority.

Milton Koumbatis
8 November 2016

01 Nov 2016

Sectional Title Schemes: New Reserve Fund Requirement and Other Key Changes

Note:  What follows is of necessity only a brief overview of some very complex new provisions and, particularly if you are a trustee or administrator, it is essential that you familiarise yourself with all the changes.  Contact us if you need any help.

The Sectional Titles Schemes Management Act (“STSM”) applies only to sectional title schemes and replaces the old Act’s Management provisions.  It came into effect on 7 October 2016, together with the related Community Schemes Ombud Service Act (see next article).

The 10 year plan and reserve fund requirements

Bodies Corporate and Trustees in particular need to know about their new responsibilities and liabilities, amongst which is the well-publicised new requirement to prepare a 10-year plan for maintenance, repair and replacement of capital items.  You must support this with a reserve fund sufficient to cover the cost of future maintenance and repair of common property.

The minimum level for this reserve fund has been set at 25% of the previous financial year’s “administrative fund” (the fund for operating costs) levies. If your scheme is short of this requirement (it will be if you have in the past relied on special levies to fund exceptional expenses as they arise), your levies will increase by at least 15% (in addition to any normal annual increase) until you catch up.

Other key changes

  1. The Body Corporate must notify (on Form A of the Regulations) the Chief Ombud, local municipality and registrar of deeds of its domicilium citandi et executandi address for service of process
  2. Changes to the procedures for the calling and conduct of meetings include a provision that no attendee can act as proxy for more than two members
  3. There is a 3 year revaluation requirement for all buildings and improvements, the valuation to be presented to an AGM for approval of insurance schedules
  4. A body corporate may charge interest on arrear levies, and other overdue amounts payable to it by a member, compounded monthly in arrear, at the maximum rate under the National Credit Act (Repo Rate + 21%).
01 Nov 2016

Are You David Trying to Sue Goliath? Consider Litigation Funding

Justice should be accessible to us all, but regrettably litigation, particularly in the higher courts, can be an expensive process and thus out of reach unless you have both deep pockets and nerves of steel.

To the rescue comes a concept which, although relatively new in South Africa, has been successfully implemented overseas – litigation funding.  The “Please Call Me” case is a recent high-profile example of how the practice is starting to gain traction locally. Note that whilst some funders concentrate on commercial litigation, others have a much wider mandate.

How it works

In essence, a litigation funder steps in and takes responsibility for all legal costs associated with launching and running a legal claim. In return, the funder gets a fair share in the final award, usually between 40 – 55%.  If that sounds like a lot to give away, remember the wise old proverb “Half a loaf is better than nothing” – it’s either the deep pockets and nerves of steel we mentioned above, or be very happy with your share of the prize.

If the claim fails, the funder gets paid nothing, does not reclaim the amount it has spent from you as the claim-holder and can be held liable for an adverse costs order.  You don’t risk a cent – provided, of course, that your particular funding agreement provides accordingly, that you have complied fully with your obligations under the agreement, and that you have chosen a reputable funder in the first place.

Previously, claim-holders had two choices.  Either they had to rely on attorneys to fund a claim under the Contingency Fees Act, which some attorneys are happy to do but others not, or they could sell the claim upfront – usually for a fraction of the claim amount.  Litigation funding fills this funding gap but ask your lawyer for advice before deciding which course of action is best for you.

When should a claim-holder consider using a litigation funder?

  • The claim has excellent merits. In other words, the case is strong in law and backed by good, preferably written, evidence.
  • The person or entity being sued is solvent and very likely to remain so.
  • The person or entity being sued is well-resourced and intimidating, able to outspend the claim-holder, often stalling the claim, forcing the claim-holder to either abandon the claim or settle at a negligible value to the claim.
  • The claim-holder is committed to the claim, and will remain so for the duration of the litigation process.

Litigation funders will manage the claim with your attorney, as they have real interest in a successful outcome.

The process

On application, a litigation funder will typically ask a claim-holder to sign a confidentiality agreement allowing them to review the claim. This has two effects – the funder cannot disclose the claim-holder’s confidential information, and it ensures that the claim-holder’s privileged documents (documents that cannot be used in evidence in a trial) retain their privilege.

At this stage all documents relating to the claim (both those in favour of the claim and those not so helpful) must be disclosed.

The funder must be in a position to make a call on the case’s merits. It’s useful to think of this as making disclosure to an insurer or medical aid. Hidden documents and facts can cause real problems later in the case, and in extreme cases, the funder may have a claim for damages against a non-disclosing party.

If the funder believes the claim has merits, and falls within its funding mandate, the funder and the claim-holder then enter into a funding agreement. This sets out the funder’s obligation to fund the case, its rights to share in an award, and the claim-holder’s obligations to assist in the conduct of the case.

Levelling the playing field

In the US, the UK and Australia, litigation funds have enabled claim-holders to obtain fair compensation, and have dramatically leveled the legal playing field for individuals and medium sized businesses. There is no reason litigation funding will not have the same effect in South Africa.

01 Nov 2016

Bad Tenants: Can You Lock Them Out?

“I’ll answer him by law” (Shakespeare)

It’s very tempting, when you have a bad tenant who doesn’t pay his/her rentals or otherwise remains consistently and unapologetically in breach of the lease, to slap the biggest and strongest padlock you can find onto the front door/driveway gate.

Don’t do it!  By taking the law into your own hands you immediately put yourself in the wrong and can land yourself in all sorts of trouble with unnecessary delays, extra legal costs, perhaps even a damages claim.
A recent High Court case illustrates.

The landlord who locked the gate and paid the price

  • The tenant of four sets of commercial premises allegedly –
    • Failed to honour an acknowledgment of debt (presumably for rental arrears), and
    • Sub-let a portion to some 150 people as accommodation without the landlord’s permission
  • The landlord put a lock on the entrance gate to deny access to the tenant and his sub-tenants
  • The tenant immediately approached the Court for relief.  To understand the outcome (a decisive victory for the tenant) we need to understand how our law views the whole question of “self-help law”.

Taking the law into your own hands

It has long been a fundamental principle of our law that “no man is allowed to take the law into his own hands; no one is permitted to dispossess another forcibly or wrongfully and against his consent of the possession of property, whether movable or immovable. If he does so, the Court will summarily restore the status quo ante, and will do that as a preliminary to any inquiry or investigation into the merits of the dispute.”

In other words, no matter how strong your case against your tenant may be, a court will without further ado order you (in the form of a “spoliation order”) to allow the tenant back in.  It won’t enquire into whether the tenant’s occupation is wrongful or illegal, nor will it enquire into your respective legal rights.  Those enquiries only come later, when you comply with the law by bringing a proper eviction application before the court.

To succeed in obtaining a spoliation order, your tenant needs to prove only two things –

  1. That he/she was “in peaceful and undisturbed possession of the disputed premises” and
  2. That he/she was “deprived of that possession without consent or recourse to law”.

Tenant 1, Landlord 0

After finding on the facts that the tenant and his sub-tenants had been in physical possession of the premises prior to being locked out, the Court ordered the landlord to immediately restore access and possession to them.  The landlord must also pay the tenants’ legal costs, so it’s back to square one, and with somewhat lighter pockets.

Lessons for landlords

Prevention being, as ever, much better than cure, make sure up front that your tenant is good, trustworthy and creditworthy.  Check with your lawyer that your lease is water-tight.  Take sureties if you can.  Insist on holding a reasonable deposit.  Treat good tenants like gold, even if it means giving them a bit of rent relief.

Most importantly, if and when your tenant falls into arrears or otherwise seriously breaches the lease, seek legal assistance without delay!

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