About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: North Gauteng High Court, Pretoria
SAFLII
>>
Databases
>>
South Africa: North Gauteng High Court, Pretoria
>>
2021
>>
[2021] ZAGPPHC 392
|
|
Hoya Investment CC v Phiri and Others (76835/2019) [2021] ZAGPPHC 392 (31 May 2021)
SAFLII
Note:
Certain
personal/private details of parties or witnesses have been redacted
from this document in compliance with the law and
SAFLII
Policy
IN
THE HIGH COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
Case
Number
: 76835/2019
REPORTABLE:
NO
OF INTEREST TO OTHER
JUDGES: NO
DATE:
31-05- 2021
In
the matter between:
HOYA
INVESTMENT
CC
APPLICANT
(Registration
number: […])
and
LELIAH
PHIRI
FIRST RESPONDENT
MATLOU
D L
SECOND RESPONDENT
SHAI
N
E
THIRD RESPONDENT
MAJADIBODU
S B
FOURTH RESPONDENT
THE
CITY OF TSHWANE METROPOLITAN
FIFTH RESPONDENT
JUDGMENT
KUBUSHI
J
Delivered:
This judgment was handed down electronically by
circulation to the parties’ legal representatives by e-mail.
The date and
time for hand-down is deemed to be 10h00 on 31 May 2021.
INTRODUCTION
[1]
This is an opposed application brought by the applicant in terms of
the Prevention
of illegal Eviction and Unlawful Occupation of Land
Act 19 of 1998 ("the PIE Act) for the eviction of the first to
fourth
respondents ("the respondents”) from the property
known as the […] at […] Street, P[…] ("the
property").
[2]
The specific relief sought by the applicant in its notice of motion
is framed as follows:
2.1
That the respondents (and all other persons and/or individuals who
occupy and/or
claim the property through them) be ordered to vacate
Rooms […], […], […] and […] respectively
of the
property within 20 (twenty) days from date of this order.
ALTERNATIVELY, a date as determined by this court, which is just and
equitable in the circumstances.
2.2
Should the respondents (and all other persons and/or individuals who
occupy and/or
claim the property through them) fail to comply with
the order referred to in paragraph 1 above, the Sheriff of this court
be authorised
and/or mandated to take all necessary steps to execute
this order to evict the respondents (and all other persons and/or
individuals
who occupy and/or claim the property through them) from
the property and, if necessary, to obtain assistance of the South
African
Police Service to assist him/her in this regard.
2.3
In the event of the Sheriff of this court or his/her deputy
being
required to carry out the order contained in prayer 1 read with 2
supra
, the respondents who refuse to vacate the property shall
be liable for the costs of such removal.
2.4 That
the respondents be ordered to pay the costs of this eviction
application.
[3]
The respondents are opposing the application on the basis that the
applicant launched
the application in terms of the PIE Act to
circumvent the binding and enforceable prescripts of the interim
ruling of the Gauteng
Rental Housing Tribunal (“the Housing
Tribunal), a body established under the Rental Housing Act 50 of 1999
("the Act")
read with the Gauteng Unfair Practices
Regulations, 2001 (“the Regulations”).
[4]
As such, the respondents raise a point
in limine
that, there
are pending proceedings at the Housing Tribunal pertaining to the
property in question. The contention is that the
respondents have
lodged a complaint in respect of the property with the Housing
Tribunal. They argue that this court cannot
entertain the
matter before that complaint is finalised by the Housing Tribunal.
They contend, further, that the matter should
be remitted to the
Housing Tribunal for finalisation of the complaint. According to the
respondents, the various rulings already
made by the Housing Tribunal
in respect of the respondents’ complaint, are only interim in
nature and no final ruling has
been made. The Housing Tribunal must
be given a chance to finalise the complaint before it can be
entertained by this court.
[5]
In support of this
in
limine
point,
the respondents referred to a Constitutional Court decision in
Maphango
and Others v Aungus Lifesfyle Properties
,
[1]
wherein, the court granting the applicants therein leave to appeal,
held that the statutory (namely, the Act) argument should have
prevailed [when the matter was argued in the High Court and in the
Supreme Court of Appeal].
[2]
[6]
No relief is sought against the fifth respondent but it is merely
cited herein as
an interested party in this matter as required by
statute.
[7]
This court has directed that the application be determined on the
papers filed on
Caselines without oral hearing as provided for in
this Division’s Consolidated Directives re Court Operations
during the
National State of Disaster issued by the Judge President
on 18 September 2020.
THE
ISSUE FOR DETERMINATION
[8]
The question that requires determination is whether this matter
should be entertained
by this court or whether the matter should be
remitted to the Housing Tribunal for finalisation.
FACTUAL
BACKGROUND
[9]
The facts of the application are mostly common cause between the
parties. The applicant
is the owner of a 5-storey building which
comprises of flats with approximately 280 rooms, shops and a crèche.
The rooms
are used as residences and are let out to members of the
public on a month-to-month basis. The respondents are tenants of the
applicant
in terms of the month-to- month lease agreements which
entitles them to occupy rooms at the property. Some of the
respondents are
said to be renting rooms since 2006.
[10]
In October 2018, the applicant resolved to increase rental for 2019
by between 4% and 6% depending
on the room size, equating to an
actual rand and cents increase of either R 50.00, R 100.00 or R
150.00
per
room
per
month. This decision to increase
rental was communicated to the residents of the property, including
the respondents, on 1 November
2018 and was meant to take effect from
1 January 2019.
[11]
On 18 January 2019 the tenants attended a meeting to choose committee
members. A committee was
elected and appointed to represent the
tenants in any informal process, mediation etc. The respondents were
appointed as members
of the committee.
[12]
The respondents, together with other tenants, failed and/or refused
to pay the increase in rental
and raised concerns about the
maintenance required at the property. A meeting was held with the
applicant's representatives regarding
the concerns raised by the
tenants, during which the applicant undertook to effect maintenance
to the property. The respondents
ostensibly withheld payment of the
increase in rental on the basis that the property was not
sufficiently maintained.
[13]
The respondents contend that they continued paying the rent but
refused to pay the increased
rental because maintenance on the
building was not done. The building is said to be a safety risk as it
caught fire on numerous
instances. Windows were broken, the
common ablution facilities were in poor and unhygienic conditions.
The urine port drain
pipes leaked, and there are no doors in the
toilets. There are cracks in the walls and floors, with water seeping
through to the
flats located underneath. There is, also, no wash
basin to wash hands after using the toilet.
[14]
On 19 February 2019 the applicant purported to cancel the lease
agreements it had with each of
the respondents. Having received the
cancellation notices, the respondents approached the Housing Tribunal
on 22 February 2019
and lodged a complaint against the applicant.
They raised numerous complaints including, maintenance of the
building; rental dispute
relating to the billing of their accounts;
increased rental; unacceptable living conditions; and the notices
received to vacate
the premises.
[15]
The matter was first heard by the Housing Tribunal on 23 April 2019
and an interim ruling was
delivered on 25 April 2019, in the
following terms:
15.1
The respondent [applicant in these proceedings] is ordered to prepare
a maintenance plan with requisite time
lines.
15.2
The respondent is ordered to prepare lease agreements for such
tenants as he considers appropriate.
15.3
The respondent is afforded the opportunity to file a counterclaim for
non-payment of rent which is to be
combined with the present
complaint.
15.4
The respondent is ordered to prepare a schedule of arrear rental
owing by tenants which reflects the names
of the tenants, their
units, the amount of the arrears and how the arrear is made up.
15.5
The Tribunal is to undertake a rental comparison relevant to this
matter.
15.6
The matter is postponed to 13 May 2019 at 09h30.
[16]
The matter was heard again on 13 May 2019 and a ruling was
delivered on 23 May 2019. The
ruling was couched in the following
terms:
16.1
The respondent [the applicant in these proceedings] is ordered to
implement the maintenance plan within the
time frames set out in the
plan, failing which remission will be considered.
16.2
The rent owing by the tenants above-mentioned be paid as indicated.
16.3 No
rent increase will be effected until such time the maintenance plan
is implemented in full.
16.4
The eviction court application postponed sine die.
16.5
Notice to vacate given to the 5 members of the committee are of no
force and effect.
[17]
The matter was further heard on 20 December 2019 and a ruling was
delivered on 6 January 2020.
The ruling reads as follows:
17.1 An
inspector will be dispatched to the rented dwelling by the Tribunal
to verify and confirm that the maintenance
plan was executed as per
the maintenance plan submitted.
17.2 In
the event that the inspector's report confirms that the maintenance
to the property was implemented in
full as per the maintenance plan,
then complainants must enter into lease agreements with the
respondent with the proposed rent
increase without any further
delays.
17.3
the respondent will furnish the complainants with written receipt for
all payment of rent forthwith.
17.4
the respondent ordered to cease and desist from Intimidation of
complainants as such conduct constitute an
unfair practise which if
found guilty of the offence, will be liable to a fine or imprisonment
not exceeding two (2) years or both
such fine and such imprisonment.
[18]
No other ruling has been made since that made on 6 January 2020.
The applicant has in the
meanwhile sent out fresh cancellation
letters to the respondents on the basis that it does no longer want
to enter into lease agreements
with them. The respondents were
also informed to vacate the rooms they are occupying. The respondents
failed and/or refused
to abide with the cancellation letters and the
applicant approached this court for their eviction, hence the
proceedings before
me.
[19]
The applicant contends that it acted in terms of section 13 (7) of
the Act when it launched the
present application against the
respondents, because the respondents failed to continue with the
payment of rent though ordered
to do so by the Housing Tribunal. In
the main, the applicant contends that it does no longer want to lease
the rooms to the respondents.
[20]
Section 13 (7) of the Act provides as follows:
"As
from the date of any complaint having been lodged with the Tribunal,
until the Tribunal has made a ruling on the matter
or a period of
three months has elapsed, whichever is the earlier —
(a)
the landlord may not evict any tenant, subject to paragraph (b);
(b)
the tenant must continue to pay the rental payable in respect of that
dwelling as applicable
prior to the complaint or, if there has been
an escalation prior to such complaint, the amount payable immediately
prior to such
escalation; and
(c)
the landlord must effect necessary maintenance.”
[21]
Conversely, the respondents’ argue that the Housing Tribunal
has not finally dealt with
their complaint and that the applicant
seeks the cancellation of the respondents’ lease agreements and
their eviction on
grounds which constitute unfair practice, in terms
of the Act. According to the respondents, the true basis for the
cancellation
of their lease agreements are retaliation for exercising
their rights under the Act and the Regulations, and assisting other
tenants
to do the same. This they proclaim is so because only the
committee members’ lease agreements were cancelled and
subsequent
eviction applications issued only against them. The
respondents contend that only after the committee was established
were they
threatened with eviction. It is on this basis that the
respondents submit that the application be dismissed with costs.
DISCUSSION
[22]
In
Maphango,
a judgment which the respondents referred to in their argument, the
Constitutional Court granted the applicants therein, leave
to appeal
in a matter based on similar facts. In that judgment, the landlord
instituted eviction proceedings against the tenants,
first in the
magistrates' court and after the proceedings in the magistrates'
court had been withdrawn, the landlord instituted
eviction
proceedings in the High Court. Like in the current application,
the
landlord used its bare power of termination to cancel the lease
agreements and the tenants had, likewise, lodged a complaint
with the
Housing Tribunal.
The
majority judges held that the High Court erred in granting an
eviction order against the tenants, as it should have referred
the
matter to the Housing Tribunal because the Housing Tribunal was
better suited to determine the complaint of the tenants. The
court
held that
whether
the termination of the tenants’ lease agreements was an unfair
practice, and what a just and fair ruling would be
if it was an
unfair practice, lies within the Tribunal’s power to decide.
[3]
[23]
In its reasoning the court expressed itself as follows:
“
47.
As I see it, the question before us is not whether the Act prohibited
the landlord from terminating
the tenants’ leases in order to
secure higher rents, but whether the termination was capable of
constituting an unfair practice. Whether
it was an unfair
practice, and what a just and fair ruling would be if it was an
unfair practice, lies within the Tribunal’s
power to decide. If
the termination is capable of constituting an unfair practice, I must
consider what order this Court should
make.
48.
In my view, neither the landlord nor the tenant fully appreciated the
force of the Act’s provisions
in litigating their dispute. But
it would be wrong for this Court to take a narrow view of the matter
that ignores the importance
and impact of the statute. That would
imply that this Court could allow litigants to ignore legislation
that applies to an agreement
between them. Rule of law considerations
militate against this.
49.
The Act abolished rent control legislation, but in its stead it
enacted a more complex, nuanced and
potentially powerful system for
managing disputes between landlords and tenants. That system
expressly takes account of market
force as well as the need to
protect both tenants and landlords. Even-handedly, it imposes
obligations on both. It is in particular
sensitive to the need to
afford investors in rental housing a realistic return on their
capital. The statutory scheme is therefore
acutely sensitive to the
need to balance the social cost of managing and expanding rental
housing stock without imposing it solely
on landlords. Far from
ignoring the interests of investors like Lowliebenhof’s
landlord, the Act seeks to create a framework
for resolving disputes
with tenants that accommodates landlords’ requirements.
50.
At the same time, the Act does not ignore the need to protect
tenants. Its most potent provisions are
those at the centre of the
dispute in this case, namely termination of a lease and rental
determinations that are just and equitable.
The Act expressly
provides that a landlord’s rights against the tenant include
the right to “terminate the lease .
. . on grounds that do not
constitute an unfair practice and are specified in the lease”.
“And” is not disjunctive.
It is conjunctive. It means the
Act recognises the landlord’s power to terminate a lease,
provided the ground of termination
is specified in it, but, in
addition, does not constitute an unfair practice. Differently put,
the Act demands that a ground of
termination must always be specified
in the lease, but even where it is specified, the Act requires that
the ground of termination
must not constitute an unfair practice.
51.
In this way, the Act superimposes its unfair practice regime on the
contractual arrangement the individual
parties negotiate. That the
statute considers its unfair practice regime to be super-ordinate
emerges not only from the requirement
that a lease-based termination
must not constitute an unfair practice, but also from what the Act
enjoins the Tribunal to take
into consideration when issuing its
rulings: these include “the provisions of any lease”, but
only “to the extent
that it does not constitute an unfair
practice”. The effect of these provisions is that contractually
negotiated lease provisions
are subordinate to the Tribunal’s
power to deal with them as unfair practices.
52.
It follows that where a tenant lodges a complaint about a termination
based on a provision in
a lease, the Tribunal has the power to rule
that the landlord’s action constitutes an unfair practice, even
though the termination
may be permitted by the lease and the common
law. Whether a termination in these circumstances could be
characterised as “lawful”
need not be decided now.
“Unfair practice” is an act or omission in contravention
of the Act, or a practice the MEC
prescribes as “unreasonably
prejudicing the rights or interests of a tenant or a landlord”.
This formulation is significant.
It poses “interests” in
contradistinction to “rights”. This embraces more than
legal rights. So used, “interests”
includes all factors
bearing upon the well-being of tenants and landlords. It encompasses
the benefits, advantages and security
accruing to them.
53.
This greatly enlarges the compass of unfairness under the Act. It
means that unfair practices
are not determined by taking into account
only the common law legal rights of a tenant or landlord, but by
considering also their
statutory interests. This makes it even
clearer that the statutory scheme does not stop at contractually
agreed provisions, and
conduct in reliance on them. It goes beyond
them. It subjects lease contracts and the exercise of contractual
rights to scrutiny
for unfairness in the light of both parties’
rights and interests.
54.
The Gauteng Unfair Practices Regulations provide that a landlord must
not “engage in oppressive
or unreasonable conduct”. This
must be read in the light of the power to prescribe as unfair a
practice that unreasonably
prejudices a landlord’s or tenant’s
rights or interests. It means that “oppressive” conduct
might be held
to entail an exercise of a landlord’s legal
entitlements under a lease that oppresses or unreasonably prejudices
a tenant’s
interests.
55.
I therefore respectfully consider that
the Supreme Court of Appeal erred in concluding without more that the
landlord’s
termination
of the leases could in the circumstances not be denounced as
unreasonable or unfair, let alone oppressive. This approach
in my
view applied an unduly constricted approach to the question, which
focused solely on the landlord’s common law entitlement
to
cancel the leases. Since in my view this dispute is best approached
through the generous and powerful mechanisms the Act offers
both
sides to the dispute, I express no view on whether the landlord was
entitled at common law to cancel the leases, nor on whether,
if it
was so entitled, the common law should be constitutionally developed
to inhibit that power.
56.
It is enough to say
that in my respectful view the High Court and the Supreme Court of
Appeal under-assessed the power of the statute.
In particular, they
overlooked the history and setting of the statute, its broad
definition of “unfair practice”, its
clear intimation
that invocation of lease terms may constitute an unfair practice and
the carefully balanced powers that are conferred
on the Tribunal.
These show that the statute sought to create a just and practicable
means of resolving landlord/tenant disputes.
This encompasses a
ruling by the Tribunal that a termination of a lease in the exercise
of a right conferred by the terms of the
lease constitutes an unfair
practice. Since the tenants never abandoned their reliance on the
provisions of the Act, this Court
should in my view afford a remedy
that enables the tenants to seek a ruling from the Tribunal.
57.
I also respectfully differ from the
Supreme Court of Appeal’s conclusion that “practice”
envisages
only “incessant and systemic conduct by the landlord which is
oppressive or unfair” and cannot consist in
unacceptable
conduct on an isolated occasion. It has long been established in our
law that a “practice” may consist
in a single act. This
accords with one of the ordinary meanings of the word. Thus, it was
decided early under the unfair labour
practice jurisdiction in
employment law
that
a single dismissal may constitute a labour “practice”.
That authority has never been doubted.
It
forms the interpretive backdrop for understanding the use of the word
“practice” in the Act.
More
importantly, the broader interpretation accords with the
Constitution. The Act is a post-constitutional enactment adopted
expressly to give effect to the right of access to adequate housing.
A cramped interpretation of “practice” would thwart
its
good ends.
58.
There can thus be no doubt that the
Tribunal had jurisdiction to rule that the landlord’s
t
ermination of the
tenants’ leases was an unfair practice, and that the Tribunal
had the power to issue a ruling granting the
tenants appropriate
relief. That may include a ruling setting aside the landlord’s
termination of their leases.
59.
Here, it bears especial emphasis that
the tenants’ right to seek a ruling setting aside the
termination of their leases has
a mirror counterpart in remedies the
Act affords the landlord. It too can lodge an unfair practice
complaint with the Tribunal.
It can thereby seek an increase in the
rents it says have become uneconomic and unsustainable. The Tribunal
is empowered to issue
a determination regarding the amount of rent
payable by the tenants.
60.
The rent it determines must be just and
equitable to both landlord and tenant. And it must take cognisance of
exactly the concerns
that speak loudly in the landlord’s
depositions in this case – the unsustainability of the building
and of its business
model at present rents, and the fading of lustre
of its investment in Lowliebenhof. It seeks “a realistic
return” on
its investment – not unjustly so. The statute
demands that the Tribunal in determining rent take due cognisance of
precisely
that. If it fails to do so, the landlord may bring its
proceedings under review.
61.
At the same time, the Tribunal’s
determination whether the landlord’s termination of the
tenants’ leases, solely
to get higher rents, was an unfair
practice, would be material to any subsequent decision on whether to
grant an eviction order.
The Constitution requires that an eviction
order be granted only “after considering all the relevant
circumstances”.
A Tribunal’s determination that the
landlord’s termination of the tenants’ leases was an
unfair practice would
be most pertinent to that.
62.
It follows that the High Court ought to
have postponed the eviction application to enable proceedings before
the Tribunal to determine
whether the termination of the leases was
an unfair practice. Remitting the matter to the High Court would
unduly protract what
has already been a long-fought case. Hence the
remedy I propose will ensure that this Court can itself issue a just
and expeditious
order, after enabling the parties to approach the
Tribunal. I turn to that now.” (footnotes removed)
[24]
The
Act,
it has been held, creates a finely-balanced mechanism to resolve
disputes between landlords and tenants. It offers an appropriate
and
fair mechanism for the resolution of disputes that constitute unfair
practice.
[4]
[25]
The Act provides that any tenant, landlord, group of tenants or
landlords, or interest group
“may in the prescribed manner
lodge a complaint with the Tribunal concerning an unfair
practice”.
[5]
“Unfair
practice” means:
(a)
any act or omission by a landlord or
tenant in contravention of the Act; or
(b)
a practice “prescribed as a
practice unreasonably prejudicing the rights or interests of
a tenant
or a landlord”.
[26]
The Gauteng Unfair Practices Regulations provide that neither a
landlord nor a tenant may
“engage in oppressive or
unreasonable conduct”.
[6]
A landlord must not “conduct any activity which unreasonably
interferes with or limits the rights of the tenant or which
is
expressly prohibited under the lease, these regulations, the Act or
any other law”.
[7]
The
parallel provision for tenants proscribes “any activity which
unreasonably interferes with or limits the rights
of other tenants
and that of the neighbours, or which is expressly prohibited under
the lease, these regulations, the Act or any
other law”.
[8]
[27]
In addition, the regulations provide that a tenant must not
“intimidate, discriminate or
retaliate against the landlord for
exercising any right under these regulations, the Act or any other
law”.
[9]
The
Regulations also import an obligation of good faith into the parties’
dealings. They stipulate that every obligation
under these
regulations, the Act, or any other law, and every act which must be
performed as a condition precedent to the exercise
of a right or
remedy, imposes an obligation of good faith in its performance or
enforcement.
[10]
[28]
The Constitutional Court has
spoken, and I am bound by its decision. I have, on the basis of the
decision in
Maphango
,
to refer this matter to the Housing Tribunal for it to determine
whether the termination of the lease by the applicant, in this
instance, was a fair practice.
[29]
It is evident from the rulings of the Housing Tribunal referred to in
the body of this judgment that the
consideration of the respondents’
complaint lodged with the Housing Tribunal has not been finalised.
The report of
the Housing Tribunal’s inspector in respect of
the maintenance of the building has not been delivered and the
Housing Tribunal
can only make a final ruling once the inspector’s
report has been made available to it. A final ruling need to be
made
by the Housing Tribunal, in particular, as to whether the
cancellation of the lease agreements of the respondents, is a fair
practice.
ORDER
[30]
Similarly, as in
Maphongo
, I make the following order:
1.
The application is postponed
sine die
.
2.
The matter is remitted to the Gauteng Rental Housing Tribunal to
determine whether
the cancellation of the lease agreements of the
first, second, third and fourth respondents by the applicant, is a
fair practice.
3.
The parties are granted leave to apply to this court within fifteen
(15) days
after the ruling of the Gauteng Rental Housing Tribunal, or
other disposition of the matter, for any further determination by
this
court.
E.M
KUBUSHI
JUDGE
OF THE HIGH COURT
GAUTENG
DIVISION, PRETORIA
Appearance
:
Applicant’s
Counsel
:
ADV
G R EGAN
Applicant’s
Attorneys
: CHRIS GREYVENSTEIN ATTORNEYS
Respondents’
Counsel
:
ADV MARYNA STEENEKAMP
Respondents’
Attorneys
: LEGAL
AID SA, THE PRETORIA OFFICE
Date
of hearing
: 20 April 2021
Date
of judgment
: 31 May 2021
[1]
2012
(5) BCLR 449 (CC).
[2]
See para 4.
[3]
See para 47.
[4]
See para 40 of
Maphango.
[5]
See section 1 of the Act.
[6]
See Regulations 14 (1) (d) and 14 (2) (e).
[7]
See Regulation 14 (1) (f).
[8]
See Regulation 14 (2) (g).
[9]
See Regulation 14 (2) (c).
[10]
See Regulation 14 (3).