2010/07/19 05:28:05 PM Jan Ehlers Attorneys Posts: 1	Advising a Landlord on evicting a tenant is no easy task as legal costs are high and in most instances a grudge purchase. In order to provide a Landlord with perspective we offer the following case study for consideration and debate: Our case study is based on a low rental income of R3500.00 p.m. The case study is further based on the following assumptions: In most instances a Landlord will consider eviction only once the tenant is 3 or more months in arrears. In most instances a tenant that is in rental default are unable to service his other debts as rental covers a basic need in housing and is usually one of the fist monthly payments to be made. The defaulting tenant therefore will in most instances be unable to recover from a rental shortfall and will further start to default on utility accounts such as water and electricity accounts. In most instances even when judgement for the outstanding debt is obtained the tenant is unable to satisfy same and upon execution no executable property is found. (These assumptions is based on our firms experience in this market) Scenario 1 The landlord calls the tenant daily for one moth to pressure the tenant into paying. The landlord decides not to evict immediately but start legal action to recover the outstanding amount. It takes two months to obtain judgement and execute on the tenant’s immovable property. Upon execution the tenant indicate the property belong to a 3rd party and therefore can not be attached. Landlord loss: Month 1 R3500 Month 2 R3500 Month 3 R3500 Month 4 (call) R3500 Telephone charges R200 Month 5 (Legal) R3500 Month 6 (Legal) R3500 Legal costs R5 000 ______ Total R26 200 (Tenant still in property) (Utilities bill outstanding to be added) Scenario 2 Landlord act immediately and start eviction proceedings. Seven days after non payment a letter of demand and cancelation is sent via registered post. Seven days further the eviction process commences and takes one month to finalize. The tenant is evicted after one more month as the court granted a month for the tenant to find alternative accommodation. Landlord loss: Month 1 (Eviction process) R3500 Month 2 (Eviction process) R3500 Month 3 ((Eviction process) R3500 Legal costs R10 000 ______ Total R20500 (Tenant out of property) (Utilities bill outstanding to be added) It is important to note that eviction mediates the Landlords potential damages however the landlord still have all other remedies and can therefore still take judgement against the tenant for all amounts outstanding. It is further important to note that a tenant claiming that goods belong to a 3rd party need to prove same and this allegation can be opposed, in most instances the opposition is successful and the goods can be sold and damages recovered. An order for legal costs are usually obtained, which may reduced legal costs. The point of this article is simply to show the advantage of evicting a tenant without delay and all legal costs used is rough estimates. This scenario is further based on the worst case and a tenant might pay after the letter of demand and cancelation, alternatively abscond which will reduce all costs There is a saying in the law “once cancelled always cancelled”, meaning that once the Agreement of Lease is cancelled a new agreement will have to be concluded, in the alternative the agreement will continue on the same terms and conditions but on a monthly basis. Arno Jansen van Vuuren JAN EHLERS ATTORNEYS 082 373 1309
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2010/07/20 11:57:23 PM marcl Posts: 40	Hi Jan Sounds all very true, but please explain why legal costs in scenario 2 are double than scenario 1? If one is not successful with attaching goods and tenant is clever enough to vanish on various monitoring tools like credit bureaus what are the chances to find tenant and go after him e.g. attaching his salary if he has one in the 30 years the judgement is valid for? How long is a piece of string I know. I tried 2 people finding my clever tenant on a no success, no fee basis, but they gave up quickly without any results an dafter I paid them some fees like tracing reports or whatever they are called.
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