WHY DO YOU NEED A WILL?

  • ensure that your assets go to the loved ones you intend on benefitting
  • ensure that minors are cared for
  • planning may reduce Estate Duty payable by your estate
  • ensure that professionals are appointed to administer your estate and carry out your will and wishes

Contact Bardine Hall at Goldberg & de Villiers In 041-5019800 to assist you to draft a will that meets your needs and wishes.

 

THE IMPACT OF THE JUDGEMENT LEGALISING THE USE OF CANNABIS

On 18 September 2018 the Constitutional Court handed down judgement which declared legislation criminalising the use, possession, purchase and cultivation of cannabis unconstitutional.

According to the judgement, the following summarises that which is allowed and that which is not allowed:

What is allowed:

  • An adult may utilise cannabis in private;
  • An adult to may possess cannabis for personal consumption in private;
  • An adult may cultivate cannabis in a private place for his/her personal consumption in

 What is not allowed:

  • A child may not use/possess cannabis under any circumstances;
  • An adult may not use cannabis in public;
  • An adult may not cultivate cannabis for another person’s consumption, for remuneration or not;
  • An adult may not buy or sell cannabis, including medicinal products (oils, tablets etc)

The impact of the Judgement will have far-reaching consequences for employees and businesses alike. What is therefore required is for employers to update policies and procedures to ensure that they are in a position to deal with the ramifications of the judgement and ensure a safe working environment for its employees, visitors and contractors.

In order to ensure that your company is in a position to ensure it is protected, contact Tracey Mouton at Goldberg & de Villiers Inc. on 041 501 9818 (email traceym@goldlaw.co.za) to conduct an HR audit on your policies, make amendments and educate your employees accordingly.

 

 

PROPERTY BUYERS: BEWARE UNLAWFUL OCCUPIERS!

You are it seems in good company if you view times of depressed property prices and general uncertainty as a great buying opportunity.

Just be aware that if it is a house you are after, whether as an investment or to live in, you should do your homework if the property is (or might be) occupied. Generally speaking, buying a property with occupiers is fine if you know about them and have a binding deal in place with them.

But, as a recent High Court decision illustrates, if you aren’t aware of occupiers and/or don’t have a proper agreement in place with them, you could find yourself unable to evict them even if you buy the property “free of lease”.

Before we discuss the case itself, it is important to know that to get an eviction order from a court, you need to prove in terms of PIE (the Prevention of Illegal Eviction From and Unlawful Occupation of Land Act) both –

  1. That the occupants are “unlawful occupiers” and
  2. That it is “just and equitable” to grant such an order after considering all the relevant circumstances.

The Bo-Kaap flat, the sale in execution, and the occupiers

  • A property investor bought a flat in a sectional title development on a sale in execution. As we shall see below, the history of the flat’s ownership, and its location in Cape Town’s historic Bo-Kaap area, were relevant to the outcome of this matter.
  • The Sheriff of the High Court sold the flat for R375,000 “free of lease”, but also with “no warranty that the Purchaser shall be able to obtain personal and/or vacant occupation of the property or that the property is unoccupied and any proceedings to evict the occupier(s) shall be undertaken by the Purchaser at his/hers/its own cost and expense….”
  • The people living in the flat refused to leave or to “legalise … their rights to the property”, and the investor applied to the Court for their eviction.
  • The eviction order was refused firstly because the investor was unable to prove that the persons it was trying to evict were “unlawful occupiers” for lack of information as to –
    • Who the occupants of the flat actually were, with the result that “the court has scant knowledge of essential details of the occupiers of the property in circumstances where these are material to the exercise of the court’s discretion under the provisions of PIE”. Crucially, there was nothing before the court as to the ages or circumstances of the occupiers, so it was unable to consider “all the relevant circumstances including the rights and needs of the elderly, children, disabled persons and households headed by women”.
    • When and under what legal right the occupiers originally took occupation (lease, right of habitation, usufruct etc), when that right was terminated and under what circumstances. Note that timing is important here because once unlawful occupation has lasted for more than 6 months, the question of relocation to land supplied by the municipality or government becomes relevant.
    • Whether or not the occupants had any form of written or verbal lease. That’s important because of our law’s “huur gaat voor koop” principle – literally “lease goes before sale”, meaning that you are generally bound to honour an existing lease (there are a few exceptions – take specific advice).
  • Secondly, the investor failed to convince the Court that it was “just and equitable” to grant the eviction.

Again, the lack of information as to the occupiers was relevant, and the Court’s comments on the particular facts of this matter are worth noting in full (our emphasis): “The residents of the area are, generally speaking, not wealthy and Bo-Kaap is home to many poor and working-class people. An eviction of the type sought in this matter, in which a group of related persons appear to occupy a family home that was acquired from the City of Cape Town some time ago, might well render them homeless or at the very least require them to relocate to one of the outlying suburbs that are now home to the many who fell foul of the Group Areas Act. If those circumstances obtain, a court would be required to think long and hard about the justice and equity of ordering people to vacate a dwelling, long occupied, which has been snapped up by a buyer distant to the neighbourhood for investment or development potential. Certainly, it is to be expected of such buyers that when they seek to move established families out of their homes, they do their homework properly and place all relevant facts before the court.”

Do your homework, and do it properly!

Investor or not, the Court’s warning to do your homework applies to you. Establish whether anyone is living in the house, exactly who they are, how long they have been there, and on what basis.

Bear in mind that because leases need not be in writing, you could find yourself battling occupiers who claim to be tenants under a verbal lease. Without a written record they could well claim to be entitled to pay minimal rent and to have many years left on their “verbal lease”.

Credit: Law Dot News

So first prize will always be to reach a written, water-tight deal with any occupants before buying – Phone Tracey Watson-Gill at Goldberg & de Villiers on 041 501 9800 for professional legal assistance.

NEW MONETARY THRESHOLD FOR SMALL CLAIMS COURT

As from 01 April 2019, the monetary jurisdiction of the Small Claims Court will increase to R20 000 (as per Government Gazette, GG 42282, GoN 296 dated 5 March 2019).

The Small Claims Court provides a quicker and cheaper method of pursuing civil claims that fall within the stipulated threshold. Often claimants abandon part of their claim to fall within the jurisdiction of the Small Claims Court where a claimant is able to pursue their claim directly through the court at minimal cost. Many claimants, however, seek legal assistance to guide them with such claims.

Visit http://www.justice.gov.za/scc/scc.htm for further details on the general procedure in the Small Claims Court.

For professional legal advice contact Goldberg & de Villiers Inc on 041 5019800

PROPERTY DEVELOPERS BEWARE: DEEMED ACCRUALS CAN SERIOUSLY DISRUPT YOUR CASH FLOW

 

“Never take your eyes off the cash flow because it’s the lifeblood of business” (Richard Branson)

A recent Supreme Court of Appeal (SCA) judgment has confirmed that when a property developer enters into an agreement with a buyer to transfer the property, even if the developer only actually gets paid in a subsequent tax year, the income is deemed to have accrued to the developer at that date. The developer must therefore include the full proceeds of the sale in its income tax return for the year the agreement was signed.

This has the effect of the property developer paying tax before receiving the proceeds of the sale, putting the developer out of pocket until transfer to the purchaser takes place.

A R1.9m tax assessment challenged

A property developer in Cape Town entered into sales agreements for 25 units. Each agreement called for a deposit of R5,000 with the balance of the money to be paid on completion of the development. Purchasers could take possession once the full sale price had been secured or within 60 days of the sale. By the end of the first year 18 purchasers had taken possession and in all 25 cases the purchase price had been fully secured.

Transfer of the properties took place in the next tax year. The developer did not include the sale proceeds in his tax return for the year of concluding the agreements but showed the proceeds in the next tax year.

The Court upheld the decision by SARS to tax the developer in full in the first tax year. The assessment at just under R1.9m was based on taxable income of R6.8m.

Why the developer lost

Property developers assume a substantial risk when they undertake a development – they spend millions of Rand upfront and if they can’t sell the developed properties they make a considerable loss. They mitigate this risk by selling the properties upfront – usually before they commit to building. Clearly they will not get paid until the property is transferred, so they accept a deposit plus a guarantee (usually from the purchaser’s banker) for the balance of the selling price, or alternatively the buyer placing the funds in the conveyancer’s trust account.

Once the developer is assured of selling the properties it then proceeds with the development. On this basis, banks will advance the cost of the development to the developer.

However, in terms of the law as now confirmed by the SCA, the proceeds of the sale of the properties are deemed to have accrued to the developer and are taxable in the year the agreement is signed.

Developers need to be aware of, and plan for, the cash flow implications.

For more information, contact the professional legal team at Goldberg & de Villiers Inc on 041 501 9800.

BEWARE THE BUILDING DEADLINES WHEN BUYING-TO-BUILD

Here’s yet another warning from our courts to take seriously the building deadlines commonly imposed on buyers of plots in residential estates.

Failure to comply with them could expose you to heavy fines, recurring penalties and even the risk of losing your plot altogether.

  • A Home Owners Association (HOA) imposed “double levy” penalties totalling R105k on the owners of a plot when they failed to start development before deadline.
  • Taken to court, the owners challenged the validity of the penalties on a variety of technical and other grounds, but failed on every count.
  • The end result is they must now pay the penalty levies, late payment penalties, and attorney-and-client legal costs for both the original magistrates’ court hearing and for the unsuccessful appeal to the High Court.

3 lessons for HOAs and buyers

The HOA’s victory in this case highlighted several important factors that both HOAs and buyers would do well to take note of –

  1. The HOA’s power to raise “recurring penalties” was upheld only because of the wording of its articles of association. They specifically gave the HOA the power to “impose a system of fines or other penalties”. Had the wording only allowed “a fine”, its attempt to impose a recurring penalty would have been shot down (exactly that happened to another HOA in an earlier case).
  2. Penalties must be proportionate to the prejudice suffered by the HOA, but courts are unlikely to interfere unless “the penalty is unduly severe to an extent that it offends against one’s sense of justice and equity”. Here, the double-levy penalties were upheld because the “ongoing delay in developing their property in accordance with their obligation … prejudiced the underlying rights of other owners … to enjoyment of a fully developed estate.”
  3. The title deed gave the HOA the right to claim the plot back for breach of the building clause, but, held the Court, that right did not replace the right to claim penalties; it was an additional right available to it.

The bottom line for “buy to build” plot purchasers is this – make absolutely sure before buying that you will actually be able to build by deadline.

Before entering into any contract, contact the team at Goldberg & de Villiers Inc on 041 501 9800.

Credit: LawDotNews.

DOES THE THREAT OF CIVIL AND CRIMINAL ACTION RENDER EMPLOYMENT INTOLERABLE ALLOWING FOR A CLAIM OF CONSTRUCTIVE DISMISSAL

 

In the matter of Nokeng Tsa Tacmane Local Municipality vs Louw, the Labour Appeal Court settled this question.

In brief, Louw had been charged with various acts of misconduct and suspended for approximately six months.  In an attempt to evade the enquiry Louw opted to resign should he be paid three months’ salary as compensation.  The Municipality was happy to accept the resignation but refused to pay Louw a cent.  The Municipality went so far as to inform Louw that his conduct was such that it not only was going to press on with the enquiry but would be considering instituting action for the recovery of the loss he had caused and would be laying criminal charges.

In the face of this information Louw concluded that this amounted to “threats” rendering his employment intolerable and thus resigned.

Louw opted not to attend the enquiry and referred a constructive dismissal dispute to the Bargaining Council.  The Bargaining Council found that Louw had not been constructively dismissed.  However, on review, the Labour Court found that the Municipality’s threat of civil and criminal litigation was sufficient to induce any reasonable employee to resign.  This in turn rendered the employment relationship intolerable and the Labour Court was comfortable that constructive dismissal had been proven.

On appeal however the Labour Appeal Court found that the Municipality’s “threat of possible civil and criminal proceedings” was merely setting out that it reserved its right to take action that it may legally be obliged to take.  This “threat” was neither unreasonable nor untenable.  It was clear to the Court that Louw resigned to avoid disciplinary action and this cannot be considered as constructive dismissal.

The Labour Appeal Court thus found that the threat of civil of criminal action does not render employment intolerable and that constructive dismissal is not proven.

For professional legal advice, contact Director Tracey Mouton at Goldberg & de Villiers Inc on 041 5019800.

 

IMPACT OF THE CHANGES IN LEGISLATION ON LEAVE ALLOWED WHEN A CHILD IS BORN OR ADOPTED

On 1 January 2019 various amendments came into play in relation to both the Basic Conditions of Employment Act and the Unemployment Insurance Act pertaining to the leave which an employee may take when his or her child is born or adopted.

Three additional categories of leave is applicable:

  1. Parental Leave;
  2. Adoption Leave;
  3. Commissioning Parental Leave.

Parental Leave:

  1. An employee who is a parent of a child is now entitled to at least 10 consecutive days parental leave in the event of the following:
  • An employee’s child is born; or
  • An adoption order is granted; or
  • A child is placed in the care of a prospective adopted parent by a competent Court.
  1. Payment in relation to the above is paid subject to the provisions of the Unemployment Insurance Act, unless the employer has contracted with the employee for such leave to be paid by the employer.

Adoption Leave

  1. In respect of adoption leave, the adoptive parent of a child below the age of 2 is entitled to leave as follows:
  • Either adoption leave of at least 10 consecutive weeks; or
  • Parental Leave of 10 consecutive days (as discussed above).
  1. Payment of the adoption leave will be paid out in terms of the Unemployment Insurance Act, unless the employer has contracted differently.
  2. If the adoption order is made in respect of two adoptive parents, the adoptive parents must decide which parent would apply for parental leave and which adoptive parent would apply for adoptive leave. Both parents are thus not entitled to apply for adoptive leave in relation to that specific child.

Commissioning Parent Parental Leave

  1. The commissioning parent in a surrogate motherhood agreement is entitled to commissioning parental leave of at least 10 consecutive weeks or 10 consecutive days parental leave.
  2. Should the surrogate motherhood agreement have two commissioning parents, one of the commissioning parents may apply for commissioning parental leave and the other apply for parental leave.
  3. Payment of the commissioning parental benefits shall be paid in terms of the provisions of the Unemployment Insurance Act, unless the employer has contracted differently.

Given the changes in categories of leave relating to the birth of a child, it is important that employment contracts and policies are properly updated.

For assistance in this regard, please do not hesitate to contact Goldberg & De Villiers, Tracey Mouton, telephone number (041) 501 9818, e-mail address traceym@goldlaw.co.za.

 

 

 

TEN THINGS TO LOOK FOR WHEN BUYING A HOUSE

Buying a house is a bit like planning for your wedding day — there are months packed with excitement, stress, planning, and then, finally, the big payoff.

1. Recognise a roof in need of repair

Before you ever set foot inside, check out what’s happening on top. Does the roof look relatively new or is it caving in? If the roof is eye-catching (as in, “My, look at that gaping hole”), chances are it could end up costing you.
A newer roof, on the other hand, could mean a lower homeowners insurance rate. Likewise, a roof made of an especially sturdy material is better equipped to defend against wind and hail (and can save you from a potential claim).

2. Don’t judge a room by its paint job

When you step inside your prospective abode, focus on the structural stuff — aging appliances, loose wires — and tune out any freshly painted walls or upscale decor. The foundation will be there long after the paint has started chipping and you want that to be what lasts.

3. Look at the municipal plans

Get a copy of the approved building plans from the municipality or the owner and check that all structures on the property are on plan. This could save lots of money in the future if you decide to do renovations and find that there are structures which are not approved and may possibly never be approved.

4. Decide on your dealbreakers

Aside from the basics, like quality windows and countertops, think about the purpose of your home and the requirements for your lifestyle, like storage for a large book collection or a big entertainment area.
It can also be smart to spring for a home with an extra bedroom if you’re planning on kids or guests. And if your significant other is a night owl while you’re a connoisseur of cat naps, it might be a good idea to look for a house with an entertainment area set far away from the master bedroom.

5. Plumbing: what lies beneath

When you’re poking around a new kitchen, don’t stop at eye level — get underneath the sink and examine those pipes. Check for leaks, water damage, and mold.
Not only is mold unsightly and foul-smelling, but it can also cause health problems. If you live with a baby, an elderly person, or someone with asthma, you’ll want to be especially careful before moving in with mold.

6. Check out the land beforehand

Don’t just look at the building — examine the area around it. Is the house in an area prone to flooding or wildfires? Is the driveway shared with another property? If there are fences, have they been built and positioned properly? It’s a lot to take in, but when you buy a house, you can’t ignore its surroundings.

7. Smell the roses (and more)

Do you smell sewage, gas, or anything equally unpleasant? Sewage systems in older homes can sometimes get clogged or damaged by tree roots. Luckily, some sewer or plumbing companies can send a camera through the pipes to detect any breaks or blockages.
Also worth noting: pet odors, cigarettes, and mildew.

8. Invest in a well-insulated house

Above all else, your home should be comfortable. Check the ceiling, water pipes, and heating ducts to make sure they’re properly insulated. This can reduce heating and cooling costs and keep you comfortable in summer and winter. Double-paned windows can also save you money down the road. Plus, they can help soundproof your place from outside noise.

9. Get your hands on everything

I mean that literally. Turn on every tap and light switch, open every window and door, flush the toilets, even taste the water. Buying a house is a big step — maybe one of the biggest — and you need to know how everything works firsthand. That way, you can address problem areas and see if there’s a cost-effective solution.

10. Have a home inspection done

There’s only so much you can do with your own 5 senses. You’ll also want to enlist a professional to ensure the foundation is solid. If there is a lot of wood in the building/s, make sure that you request a borer beetle certificate and ensure that the relevant clause is incorporated in your offer to purchase.

For professional legal advice, contact Goldberg & de Villiers Inc on 041 501 9800.

 

TRAVELLING ABROAD? KNOW LOCAL LAWS OR RISK JAIL

“Ignorance of the law is no excuse” (old Roman law principle applied in many legal systems worldwide)

Whether you travel abroad on business or on holiday, ignorance of local laws can easily land you in a situation where your protestations of “But I had no idea that that is illegal here, it’s totally legal in South Africa” are met with stony faces and a complete lack of sympathy from your destination’s law enforcement authorities. And whilst the nearest South African embassy or consulate can offer you some basic support, it’s the local laws – and penalties for contravening them – that could put you in jail (or worse).

Recently government has specifically warned travellers to acquaint themselves with the laws and customs of their destination countries. This follows the death sentence imposed on a South African drug smuggler in Vietnam, and reports that some 800 South Africans are currently doing time in foreign jails, not only on drug-related charges (see “Know your foreign laws before travelling” on the South African Government News Agency’s website).

In regard to drug laws the problem is that, with many countries in the process of either legalising or easing their stance on marijuana and other “soft” drugs, it can be difficult to keep up with what’s legal where.

And remember that even prescription drugs can put you behind bars – in some countries medicines which are legal in South Africa could land you in prison (in the case of Dubai for example, for 6 months to 2 years unless you are carrying the required “medical certificate” ).

Moreover the warning goes far beyond illegal drugs, and applies to you even if you have never had anything to do with them. In Thailand for example, you can be imprisoned for disrespecting the Thai Royal Family in any way.

There are many other such examples from around the world, and whilst some general articles are interesting for an overview of some unexpected laws in popular destinations, rather Google specifically for the laws of the particular country or countries you are visiting. Just make sure that whatever webpage you land on is (a) authoritative and (b) up to date. A good place to start is perhaps the UK Government’s “Foreign travel advice” page.

DIRCO (the Department of International Relations and Cooperation) has plenty of guidance on its “Advice for South African Citizens Travelling Abroad” .

If you’re unsure of anything don’t take any chances, rather ask the team at Goldberg & de Villiers Inc for advice. Tel.  041 5019800

Credit: LawDotNews