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Water shortages in the Western Cape - Can a landlord legally increase rental prices in respect of a fixed term lease agreement?

Water shortages in the Western Cape

With “Day Zero” soon approaching for residents in Cape Town, surrounding areas and other parts of the Western Cape, many Tenants are concerned that Landlords will potentially increase rental prices or add additional charges for water.

Disputes could arise between Tenants and Landlords as a result thereof, as the Tenant may not be able to afford this.

In South Africa, the rights of Tenants and Landlords are governed by the Rental Housing Act 50 of 1999, as amended (hereinafter referred to as the “Rental Housing Act”), as well as the Consumer Protection Act 68 of 2008, as amended (hereinafter referred to as the “CPA”).

Whether Landlords can legally increase rental prices as a result of the recent water shortages, will be briefly discussed in this article.

Can a landlord legally increase Rental prices in respect of a fixed term lease agreement?
In terms of Section 14 of the CPA, a Fixed Term Lease cannot be changed while it is in use, unless the Landlord and Tenant agree to any change.

This does not mean that a Tenant may refuse to pay water charges when the rental agreement was that the tenant will pay a monthly rental plus additional charges for water consumption.

Similarly, the Landlord cannot force the Tenant to pay additional charges for water if the rental agreement was that water charges were included in the monthly rental.

The Landlord cannot in this instance, introduce a separate water meter for the individual account of the Tenant without the tenant’s consent. Sufficient Notice must be given herein.

The CPA and Rental Housing Act prohibits one from “contracting out of Law”. The implication is that when the original Fixed Term Lease is drawn up and original Fixed Term is only 12 months, it can’t contain a provision for escalation percentages.

Protection offered to Tenants who cannot afford increased Rentals
The CPA, promulgated to protect Consumers from Suppliers, also applies to Lease Agreements and offers protection to both Tenants from Landlords.

In terms of Section 14 (2) (b) of the CPA, despite any provision of the Lease agreement to the contrary, a tenant may cancel the agreement concerned:

- “any other time, by giving the Tenant 20 business days’ notice in writing or other recorded manner and form, subject to subsection (3)(a) and (b).”

Landlord may only increase the Rental Price in respect of a Fixed Term Lease Agreement, if the Tenants agrees to such an increase.

The Rental Housing Act and CPA offers protection for Tenants from Landlords and it is important for Tenants to know what their rights are.

Tenants may terminate a fixed term lease agreement at any time, even if there is no cancellation clause, by giving the Landlord the required 20 days’ notice.

However, despite the aforementioned, it is strongly recommended that Tenants approach their respective landlord and discuss premature termination in a friendly and professional manner to avoid unnecessary disputes.

© Shannon Vengadajellum - Schoemanlaw Inc. - 2018

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