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31 Mar 2020

NEWSFLASH – News from the Banks

Into our first week of lockdown government has put measures in place measures to help assist individuals and business, but will this be enough to get us through?

Banks are also helping. The undermentioned banks have set up dedicated contact centres to manage queries, applications for debt relief and payment holidays. Understandably high call volumes are slowing their turnaround times- they ask that customers please be patient, they know these are stressful times and are trying their utmost to get to every customer as soon as they can.

ABSA

In a statement just released by ABSA to its customers, it will be “introducing an extensive individual and business customer Payment Relief programme for those impacted by the lockdown. This comprehensive solution applies to our retail and business credit products, including home loans, vehicle finance, personal loans and credit cards as well as commercial asset finance and mortgage-backed business loans”.

As of 01 April, Absa will pre-screen customers and send an SMS offering this capability to their customers- who will opt in or out. Customers can contact ABSA using the following e-mail address: bondrs@absa.co.za.

New and existing home loan applications will be processed but not within normal parameters. While ABSA remains open to queries, escalations and appeals, they request that all Home Loan customers be patient with the scaled down processing capacity.

First Rand Group

FNB has just released an outline of their relief measures to the public, effective from 1 April to 30 June 2020, for those customers who’s financial stability has been impacted by the Covid-19 Lockdown.

Individuals and business customers can contact FNB via their usual digital and assisted banking channels to enquire about these services. During this week, customers will also be able to get more information on their current Covid-19 relief measures through a dedicated icon on the landing page of the FNB banking app.

FNB’s Processing teams, Credit Analysts, Relationship Consultants and Provincial Sales Managers are working remotely during the lockdown period. They will continue to process new and existing Home Loan applications.

FNB has instructed us not to meet with any of its bond customers during the lockdown period, not to make any arrangements to sign documents electronically, and not to email any bond documents to clients.

Nedbank

Nedbank is also offering relief packages to their clients. “This support could include deferring payments or part thereof for a suitable period, extending existing loan periods or extending additional credit to manage short-term cash shortfalls. Clients can contact Nedbank on 0860 555 111 or email them at moratoriumrequest@nedbank.co.za to get more information.

Nedbank has confirmed that it will not be sending out any New Loan or Further Loan instructions until 16 April 2020. Priority will also be given to re-advance applications.

Nedbank’s regional teams are working remotely on all new and existing home loan applications. Nedbank Home Loans customers can make contact via 0860 553 573, however call volumes are high, so if customers struggle to get through they can e-mail HLCollections@Nedbank.co.za for assistance.

Standard Bank

On 29 March 2020 Standard Bank announced its second wave of relief measures to its customers. The payment reprieve is aimed at easing the financial burden of customers earning R7,500 or less, who will receive three-month instalment relief if they are not in arrears on any of their accounts (as at 31 March 2020). This relief applies to qualifying customers and their associated accounts, which include home loan, vehicle and asset finance, credit cards as well as short term loans.

Should customers want to make an enquiry about a moratorium/Payment Holiday they can e-mail debtcarecentre@standardbank.co.za, however given the volume of enquiries a delayed response should be expected.

Standard Bank has also confirmed that existing and new Home Loan applications will be processed but not within normal turnaround times. Standard Bank’s Home Loan Call Centre is operational but once again, will be operating with reduced capacity.

We at Miltons Matsemela Inc. have measures in place to acknowledge new instructions received from the Banks during the lockdown period. We shall be in contact with clients to communicate all requirements via telephone and email, in preparation for the signing consultation which will only take place after the lockdown is lifted.

We ask for your patience and understanding towards us and our partners in these trying times.

Miltons Matsemela
31 March 2020

31 Mar 2020

COVID-19: Small Businesses, Employment Laws, and Survival Support

“The secret of crisis management is not good vs. bad, it’s preventing the bad from getting worse” (Andy Gilman)

While the COVID-19 outbreak continues, many businesses will have to be creative in finding ways to sustain profitability, particularly now that we are in National Lockdown.

And as employers they will of course be facing some novel challenges. Complying with all our employment laws will remain as important as ever, and proper planning on how to achieve that whilst simultaneously protecting your business’s viability will be key to surviving (and hopefully thriving!) in these exceptional times.

The good news is that a whole raft of support and relief programs, aimed at helping businesses survive the crisis, have been announced. Read on for the details…

We can only guess at how the COVID-19 coronavirus outbreak will end, but let’s all take whatever concrete steps we can right now to lessen its impact on our personal lives, on our businesses, and on our country.

One of those steps is for businesses to find ways of continuing to operate as normally as possible, given of course the exceptional times we are living through. And as employers, many businesses will find themselves facing some novel challenges, particularly during the National Lockdown…

Small businesses – the new relief programs

A whole raft of support and relief programs has been announced. Some still need to be finalised and the situation is changing daily, so keep an eye on the media and incorporate into your business survival plan all relief channels you think may be open to you. At date of writing, these are the main ones –

  • The DSBD (Department of Small Business Development) will provide relief to businesses in several categories. Call the DSBD on its 0860 663 7867 hotline or email info@dsbd.gov.za to see if you quality. Apply at https://smmesa.gov.za/.
  • The DTI (Department of Trade and Industry) is set to provide relief for large businesses as well as small. Keep an eye on the DTI’s website for developments.
  • The Solidarity Fund has been set up with R150 million from the government to, amongst other things, assist and support those affected (contact details here).
  • Employer and employee relief: Access the “Easy Guide for employers on COVID19” here and read up on the “Temporary Employer/Employee Relief. Scheme” and UIF benefits from a special R30bn National Disaster Benefit Fund. Confirmation that employees who fall victim to the virus will be paid through the Compensation Fund – details here.
  • Other funds and relief measures: The Rupert and Oppenheimer families have pledged R1 billion each to help struggling small businesses and employees – the details are not available at date of writing. Read the President’s speech here for more on planned or implemented measures involving tax relief, changes to the Competition Act, a fund to support the tourism sector, and more.

Employers – comply with the law!

From a legal perspective, employers in particular need to have a solid action plan in place to ensure that they comply with all our many employment laws, which will continue to apply as is, unless and until government announces any new measures to the contrary.

Detailed planning will not be easy. With the situation changing daily, keep informed of developments and keep all your plans flexible.

In any event there is unfortunately no “one size fits all” answer to questions like “Can I dismiss an employee who tests positive for COVID-19?”, “Can my employees insist on working from home?”, “Can I start retrenching?”, “Can I prohibit employees from travelling abroad for personal reasons?”, “What steps must I take to ensure a safe working environment and what rules can I put in place to underpin them?”.

The list is endless and the answers to these questions will depend upon your Lockdown exemption status, your particular employment contracts, business circumstances, operational needs, and so on.

Your employee action plan

We need to get used to constant change and uncertainty, but there are steps you can take now to plan for as many eventualities as possible –

  1. As a start, incorporate into your “COVID-19 Business Plan” all the possible scenarios you can think of, both during the National Lockdown and after it ends.
  2. Then brainstorm – with your employees where you can – a list of all the employment-related problems you and they might face. Use that in turn to make a list of questions you will need the answers to under each scenario.
  3. Then, make sure you are fully prepared to deal with whatever may come your way by taking specific legal advice on each and every one of those questions.
31 Mar 2020

April’s Fool – Viral Virtues

The end of March, we all had plans and goals to achieve that were very abruptly disturbed by COVID-19 doing its rounds, one country at a time. We are being forced to slow down and avoid each other in order to promote social-distancing and self-isolation.

For the first time in recent history we as a global community have been brought to our knees, not by religion, not because of culture, and not by the colour of our skins, but because of the threat of a global disaster. The beauty in this beast is that countries are joining hands and advocating wellness and virus-awareness in the most unselfish way. Truly inspirational. Our actions today will determine our legacies tomorrow.

Opinions and articles are doing the rounds creating fear for our economy, country and our lives. In times like this we must confirm the value of the content before we react. Opportunists are taking advantage of our volatile immune systems and broadcasting fake news for pleasure. If we keep sharing unconfirmed information, we will feed the fear in a situation where the reality is already disastrous enough. We must be wary and only communicate verified information. As per a recently issued Government Gazette, it is in fact a crime to circulate fake news!

Entire countries are shutting down and economies are being placed on hold – consequences of which are very unpredictable. We are fortunate enough to be at the forefront of technological development and we should seize the opportunity to do any amount of work from home that our resources will allow. Collectively we need to do our best to minimize any negative affects this may have on our economy.

Take the time to plan your day, to decide what is important- maybe even to read that one book that’s been gathering dust on the shelf. Educate yourself in your field, do some research and decide how you will approach your goals and career when this time capsule has passed. Be creative, innovative, positive and resilient.

When we are forced to limit our movement we tend to focus on the things that are near and dear and in times like these we should remember to look out for each other, turn the other cheek, let go of the small things and help those who are more vulnerable.

The fallout of this pandemic will affect the less fortunate in ways that we have not yet begun to contemplate. We need to make sure we are doing what we can to help those in need. This disaster will humble us all, but also hopefully create a platform for an improved way forward.

Let us join hands (figuratively) and do our part to avoid the spreading of this virus. We must follow the guidelines and adhere to the law.

We shall not be April’s fools.
We shall survive.
And Will thrive.
(apart) Together.

Cornelius Botha
Miltons Matsemela Inc
01/04/2020

24 Mar 2020

NEWSFLASH – COVID-19: ARRANGEMENTS DURING LOCK DOWN

Dear all,

Herewith an urgent Newsflash to address the most relevant questions we have received from the property industry, arising from the COVID-19 lockdown announcement last night:

PRACTICAL ARRANGEMENTS:

  1. All deeds offices country wide will also be in lockdown. This means no registrations from Friday 27 March 2020 until (the earliest) Friday 17 April 2020. We await a circular from the deeds office in Cape Town regarding the possibility of extended hours and what they are planning to do.
  2. All law firms will be in lockdown, ours included. We are however, doing what we can to set up remote work stations as far as practically possible.
  3. All of our attorneys will be available on their cell phones. Please visit our website www.miltons.law.za for contact details.
  4. All estate agents need to consider the effect of this lockdown on the time lines in their Deeds of Sale.
    • Below is proposed wording for an addendum, which we have prepared and which you may want to put into place. (CLICK HERE to view the word format)
    • It is a general template obviously which can be amended to suit the specific needs of your particular sale.
    • Pay PARTICULAR ATTENTION if you have a “subject to sale”. If the first transfer registers on Thursday 26 March 2020 for instance, the second one will only be able to register 17 April 2020 at the earliest. This means that there will be a 3 week gap between them instead of only one day as is customary in such instances. The seller of the property which registers first (being the purchaser of the second property) may not be able to vacate, as the property he has bought, will only be registered on his name, on 17 April 2020, or later. WE RELY ON ALL AGENTS TO PLEASE CONTACT THEIR SELLERS AND BUYERS TO MAKE ARRANGEMENTS AROUND THIS AND TO ADVISE US ACCORDINGLY!
    • With regard to any of our registrations that may take place on Thursday 26 March 2020, we will do all we can to ensure that proceeds and commission are still released on Friday 27 March 2020. We see this as an essential banking service and will thus attend to work on Friday to deal with this.
  5. All arrangements that were made with compliance companies to attend to repair work, removal companies to move furniture etc, in this time, will have to be postponed.

PROPOSED WORDING FOR ADDENDUM

Pertaining to the sale agreement concluded between ……………….. (Seller) and ……………. (Purchaser) pertaining to ……………………………. (property description) concluded on……………………,
the parties hereby agree as follows:

  1. To extend the deadline/s for all suspensive conditions contained therein by 31 days as from date of signature hereto / to ……………………. (date);
  2. To extend the deadline/s for payments of any deposits which are intended to be invested in a separate interest bearing account for the benefit of the purchaser, and which would otherwise have been payable within the period of 26 March 2020 to 16 April 2020, to 17 April 2020 / ………………….. (date)
  3. To extend the deadline/s for the provision of any guarantees or undertakings, that may have been due within the above lockdown period, to secure any financial arrangements, by 7 days / to ……………… (date);
  4. That the estimated transfer date (if any was specifically agreed upon) be extended by 31 days as from date of signature hereto/ to ………..(date);
  5. That in the event that the purchaser was intending to occupy / possess the property during the above mentioned lockdown period, that this be extended by 31 days from date of signature hereof / to …………… (date).

WHAT ABOUT OCCUPATION DATES; TENANTS WHOSE LEASES EXPIRE; TENANTS WHO HAVE PAID DEPOSITS TO TAKE OCCUPATION ON 1 APRIL 2020; LANDLORDS WHO HAVE OBTAINED EVICTION ORDERS ETC:

This is a National lockdown which means that:

  1. Everyone must, quite literally, stay put as from midnight Thursday 26 March 2020 until midnight Thursday 16 April 2020;
  2. No landlord may demand from his/her tenant to vacate, during this time even if the lease has expired or been terminated;
  3. Where a tenant has paid a deposit but now cannot move in, the landlord must hang on to it and honour the lease when he can;
  4. If a landlord obtained an eviction order, it cannot be executed in this time;
  5. Rental deposits will have to be retained; outgoing inspections will have to be postponed;
  6. Where buyers and sellers have agreed to exchange occupation pending transfer, this will also have to be suspended/postponed;
  7. No one will be able to claim damages of any kind should they suffer any damages as a result of any of this;
  8. Removal companies will probably be allowed to retain deposits and payments that were made but will have to then honour the agreement later on.

The above views are our own and based on how we interpret the law surrounding vis major, i.e. a superior force.

We will keep you posted on any other developments as and when they come to hand.

Kindest regards
MILTONS MATSEMELA INC

18 Mar 2020

COVID 19 – NOTICE FROM THE DEEDS OFFICE

We have received confirmation from the Deeds Office that, following the President’s address on 15 March, they have put the necessary health and safety measures in place in order to ensure that business at the Deeds Office continues as usual. As it currently stands the Deeds Office will not be closing and all registrations shall proceed as normal. This is of course subject to change – we shall keep you updated on any further news from the Deeds Office.

Miltons Matsemela Inc
March 2020

18 Mar 2020

THE CORONAVIRUS AND OUR RESPONSE

In an attempt to curb the spread of the coronavirus and to protect our clients and ourselves we have implemented strict protocols at all of our offices. From our clients’ point of view, the important points to note are the following:

  1. On arrival, all clients will be asked if they have travelled overseas in the last 3 weeks. If this is the case, the consultation will be postponed. Please try and avoid this by advising us well in advance if you fall into this category.
  2. Before sitting down and before commencing with any business, all clients will be asked to wash their hands with soap and water for 20 seconds.
  3. Clients will not be greeted with a handshake. We apologise that this might seem impersonal, but it’s the right thing to do. We will keep a safe distance at all times.
  4. All the surfaces in our consultation rooms including door handles and pens will be wiped with a sanitiser containing a 70% alcohol solution after each consultation.
  5. Hand sanitiser will be available in reception and in all consultation rooms.
  6. All our staff members will be washing their hands at regular intervals.

Please bear with us during these difficult times. We are all deeply affected by the crises that faces us, and we are doing what we can to reduce the risks. We can get through this but only if we work together. We know we can rely on your co-operation.

The Directors and Staff
Miltons Matsemela Inc

06 Mar 2020

POPIA’s Deadline is 31 March 2021 – Ignore the “Fake Headlines” But Start Planning!

At long last the main provisions of POPIA (the Protection of Personal Information Act) have been gazetted, and they will commence on 1 April 2020. That means that the one year transitional period will expire on 31 March 2021.

Don’t panic just yet, and ignore the many “fake headlines” in the media implying that you are at immediate risk of non-compliance, but at the same time don’t leave this to the last minute! Preparing for compliance is going to be a time-consuming affair, almost all South African businesses will need to comply, and the penalties for not doing so will be very severe indeed…

  • You risk administrative fines of up to R10m;
  • You could face criminal prosecution (with up to 10 years’ imprisonment);
  • You could be sued for millions by anyone whose data has been compromised, and this is an instance of strict liability” in that no “intent or negligence” on your part need be proved;
  • The loss of trust and the adverse publicity resulting if your data breach goes public could be devastating.

In future issues we’ll let you have a lot more practical advice on how POPIA will affect your business, and on the steps you will have to take to protect yourself from the dangers of non-compliance, but for now get started with this first planning step: Ask yourself what personal information you hold, where you hold it, who has access to it, and how secure it is.

06 Mar 2020

Watch What You Say on WhatsApp – The Case of the R20m Lottery Win and the R1m “Offer”

“Engage brain before hitting send” (Anon)

As WhatsApp use grows exponentially (it just hit the 2 billion mark worldwide) we all need to be mindful of the risks that come with it. One of them is the danger of committing yourself inadvertently to a binding legal obligation.

We’ll start off by understanding the basic elements of a legally-enforceable contract in our law, then – with reference to a R1m “offer” made by a WhatsApping father to the mother of one of his children, we’ll discuss the question of “intention to contract”. The father, having won R20.8m on the National Lottery, denied any real intention to offer the mother the R1m. Was his “offer” an offer capable of acceptance?

The Court’s reasoning in answering that question holds important lessons for us all.

WhatsApp comes with a host of business and personal benefits, and its use is growing exponentially here as in the rest of the world. Which brings us to a possible downside – binding yourself to a legally-enforceable agreement without really meaning to.

First principles: Offer + Acceptance = Contract

What makes for a binding contract? In the most simplistic sense, all you need is for one person to make an offer and for another to accept that offer.

There are of course many other requirements – consensus ad idem (‘true agreement’ or ‘meeting of minds’), lawfulness, capacity to contract, compliance with any formalities, certainty of terms, possibility of performance and the like. Lawyers and legal academics love to wax lyrical on the finer ins-and-outs of these and of related concepts like “quasi-mutual assent” (more on that below, it’s actually an important concept), but the core principle applicable in the vast majority of cases remains this: Offer + Acceptance = Contract.

And of course, with only a few exceptions (such as property sales, wills and ante-nuptial contracts), even verbal agreements are fully binding, and the binding effect of electronic messages has been established both by legislation (most importantly the ECTA or Electronic Communications and Transactions Act) and by a series of modern court decisions.

A R20m lottery windfall and a R1m WhatsApp “offer”

  • A father was paying R1,000 p.m. child maintenance to the mother of one of his seven children.
  • Shortly after becoming the lucky recipient of a National Lottery windfall in the form of a prize of R20.8m, he met with the mother, told her that his health had deteriorated, that he could no longer be employed (by SARS) and that he would get about R600,000 in pension benefits.
  • He offered R100,000 out of these pension benefits in full and final settlement of his child maintenance obligations, which the mother accepted and which was paid to her for the child’s benefit.
  • At a meeting with the maintenance officer he denied having won R20m but the mother, after getting proof of his win, sent a WhatsApp message to the effect that she knew about it. He replied – also on WhatsApp – “if I get 20m I can give all my children 1m and remain with 13m.I will just stay at home and not driving up and down looking for tenders”.
  • The mother sued the father for R900,000 on the basis that he had contracted to pay her R1m and had only paid R100,000. The father denied liability, saying that his WhatsApp message was just to “get rid of” the mother and that he had no intention to make an offer to contract.

When is an “offer” not an offer? The “intention to contract” factor

The mother won in the High Court but lost on appeal to the Supreme Court of Appeal (SCA), which held that the father wasn’t bound because on the facts his message was a denial of having won R20m and it “related what [he] could possibly do in the hypothetical future event of him receiving R20 million. It set out what the [he] might do if he received R20 million … the message clearly did not contain an offer that could on acceptance thereof be converted into an enforceable agreement.”

On the facts of this case, the father “subjectively had no intention to contract and the message did not suggest otherwise.” His “morally reprehensible conduct” lost him his claim for legal costs, but it did not affect his lack of intention to contract. So in this case our WhatsApping father is off the hook and gets to keep his R1m.

But… before you hit send

On slightly different facts his WhatsApp message could easily have been held to have been a valid offer, binding him on acceptance. For example, the concept of “quasi mutual consent” which we mentioned above, means that even if you don’t actually intend to make a binding offer, our law can hold you to it if your actions or conduct lead the other party “as a reasonable person” to believe that you did intend to enter into a contract. So you may not intend your message to be a real offer but if the recipient reasonably thinks it is, you are in trouble.

The lesson for us all is this – all users of electronic communications, whether via WhatsApp, Facebook, email or any of the many other electronic messaging channels open to us, face the very real danger of inadvertently making a promise in haste which down the line a court will hold us to.

Think before you message!

06 Mar 2020

Running a Business in a Residential Area – Check Your Zoning First!

“It is unquestionable that an owner of land is not permitted to perform activities which contravene the restrictive title conditions or the zoning restrictions” (extract from judgment below)

If you would like to run a business from home or to buy a residential property specifically to convert it into business premises – or indeed on the other side of the coin if you want to object to a new business opening up in your leafy suburb – you should be aware of a recent High Court decision in which a small 8 am – 4.30 pm office was ordered to stop operating in a residential area.

The Court addressed questions such as “Who can apply for an interdict?”, “Does a pending rezoning application make any difference?”, “Must the business be causing a nuisance?”, “What difference does it make that the suburb’s residential character is already changing?” and “What if other property owners are also breaking the law by operating under the radar and getting away with it?”

You decide to open a home business, or perhaps you are about to buy a house in order to run a business from it. You apply for rezoning but the council is taking forever to decide (although it has happily started charging you rates and taxes on the business tariff), your immediate neighbours are supportive, you won’t cause any nuisance, you know of many other businesses operating undisturbed “under the radar”, and anyway the suburb’s residential character has been eroding for years. Surely you are safe to just go ahead and open your business?

On the other side of the coin, perhaps you bought your dream house in a leafy suburb, secure in the knowledge that its residential character is protected by strong and effective zoning laws. Then businesses start moving in – what can you do about it?

A recent High Court decision addresses both questions directly…

A suburban office and the interdict application

  • A construction company opened an administrative office in a suburban area, manned from 8 am to 4.30 pm on weekdays by a staff of four (with the occasional visitor).
  • Three complainants in the suburb, objecting strongly to this move, applied to the High Court for an interdict against the running of any business on the property. They had, they said “acquired their properties with a keen expectation of residing in a residential suburb with amenities that are consistent with a residential suburb and with a residential character” – sentiments which will no doubt resonate with many other home-buyers.
  • Critically, one of the restrictive conditions in the offending property’s title deeds read “this erf shall be used for residential purposes only and no trade or business or industry whatsoever shall be conducted thereon”. That, said the Court, rendered the property’s usage illegal. Full stop.

All the defeated defences

The property owner and the business (let’s refer to them together as “the business” for simplicity) raised a series of defences to the interdict application, all of them rejected by the Court on essentially the same ground that “the use or continuation to use the property for any business or trade other than for residential purposes constitutes an illegal act” –

  • The suburb’s character had been changing over the years with businesses moving in, including a large shopping mall. Not relevant.
  • The business had applied to the local council for re-zoning and removal of the title deed restriction over a year before, no objections had been received and it had in fact been supported by at least one neighbour. Not relevant.
  • Although the rezoning application had yet to be granted or declined, council was already collecting rates and taxes payable by business and commercial properties. Not relevant.
  • The office caused no nuisance to anyone in the area. Not relevant.
  • Other property owners in the area were also in contravention of the law. Not relevant.

Who can object and who can’t?

The business also argued that only property owners living “in close proximity” to the office had any right to object. That, it said, excluded not only the complainant who was not an owner (she lived with her parents) but all three of the complainants because they all lived about a kilometer away from the office.

No problem, said the Court, “the essence of town planning schemes is conceived in the interest of the community to which it applies” and the complainants lived “in an area affected by an applicable zoning scheme”. All the complainants had “protectable interests” and therefore locus standi (in plain English, the ‘right to bring a legal action’) and were entitled to enforce their rights under the planning scheme.

The interdict and the request to suspend it

“Once it is accepted”, quoted the Court from an earlier judgment “that the nature of the right in question is a public right, then it must follow … that for continuing infringements of that right the only effective remedy is an interdict, all the more so where such infringements amount to an offence.” Final interdict granted with costs.

Finally, the Court rejected a request by the business to suspend the application of the interdict. The business had been continuing to act in an unlawful manner for at least fifteen months, it was “hell-bent to do so without the necessary relaxation of the restrictive conditions” and to suspend the interdict would be to support or give approval “to an ongoing illegality which is also a criminal offence … tantamount to the subversion of the doctrine of legality and undermining of the rule of law”. The business “must be brought into line immediately when such matters are brought to the attention of the court.” Interdict effective immediately.

Owners – must you always rezone?

Have your attorney check what title deed restrictions your property is subject to, what your current zoning is and what it allows and doesn’t allow. Your local town planning scheme may perhaps let you run a small scale “home enterprise” or “micro business” either without any municipal consent (there will be conditions attached) or with a municipal permit. Or you may need to formally apply for rezoning and removal of title deed restrictions. Every local authority will have its own rules on this and the important thing is to comply with them or risk unhappy neighbours applying to close you down.

04 Mar 2020

THE GREAT SPLUMA SPLASH!

Another rumour that is causing anxiety in our industry is that, as from October 2020, no property will be able to be transferred unless a certificate in terms of the Spatial Planning and Land Use Management Act (SPLUMA) has been obtained from the municipality. The main purpose of this Certificate will be to confirm that all improvements on the land are built in accordance with approved building plans and comply with the zoning scheme.

Thankfully, this is not true, at least not in the Western Cape.

The confusion appears to have arisen because we have SPLUMA, which is a law that applies to the whole country, and a by-law in Emalahleni, Mpumalanga, that applies only in Emalahleni, which has a similar name.

SPLUMA, which was passed in 2015, applies nationally, and requires provinces and municipalities to pass provincial and local laws to govern land use and land development in their provinces and municipalities within 5 years (which is where the 2020 deadline appears to come from).

It does however not specifically state that before a property can be transferred, a certificate to confirm approved building plans and zoning is required.

The similarly named SPLUMA by-law of Emalahleni, Mpumalanga however does contain such a section. In Emalahleni, Mpumalanga such a certificate is therefore required before a property can be transferred. This is apparently the practice in the Mpumalanga Deeds Office.

Given the fact that the by-law in Emalahleni, Mpumalanga so closely resembles the “main” SPLUMA by name, we think that this is where the confusion has arisen, and some commentators have interpreted the local by-law to apply to the whole of the country. We must however point out that the wording of the Emalahleni Municipal By-law is also repeated in the Polokwane by-law, so this might be a trend in the northern part of the country too.

The Western Cape Land Use Planning Act (the provincial legislation that governs how we do things in the Western Cape), and the City of Cape Town Municipal Planning By-Law (which tells us how we do things in the City of Cape Town) – both of which were passed specifically in order to comply with SPLUMA – however do not require such a certificate before transfer.

It thus appears that those of us lucky enough to be in the Western Cape can all calm down to a mild panic!

We will however continue to monitor the situation and if any further information comes to light, we will let you know.

Robert Krautkramer and Deon Welz
Miltons Matsemela Inc

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