Contracting With A Trust

By Roy Bregman

If you buy a property in the name of a company, the offer to purchase can state that Joe Bloggs acts in his capacity as an agent of a company to be formed. This is perfectly valid in that the company can subsequently ratify the offer.

 This is not the case with trusts. The following principals apply:

• All contracts must be concluded with an already-established trust;
• All (or in the case of some trusts, a majority of) trustees must consent in writing to the contract before entering into contracts on behalf of a trust. If there is no prior written authority (usually in the form of a resolution), the contract will be void;
• A void contract cannot be rectified by ratification (i.e. the remaining trustees can’t approve – and thereby resurrect – a void contract after it has been signed).
  
  This was confirmed by our Supreme Court of Appeal in the case of Thorpe and Others v Trittenwein and Another 2007 (2) SA 172 (SCA). In this case one trustee (who was also the founder and a beneficiary of a trust) signed a sale agreement for the purchase of land without the prior written authority of the other trustees. The other trustees subsequently ratified the first trustee’s act but the Court held that this was not possible and the seller was free to sell to someone else.

• Trustees can only exercise a power if that power is given to them in the trust deed. If, for example, the trust deed doesn’t give the trustees the power to buy and sell property, a unanimous resolution of trustees to do so doesn’t cure this defect – the agreement will still be void.

So if you are about to enter into a contract with a trust, make sure that the trust deed gives the trustees the authority to contract with you, satisfy yourself that the trustees are who they claim to be (see latest Letters of Authority for the trust) and ensure that an appropriate resolution is in place, signed by all the trustees.

Evicting A Non-Paying Client

By Roy Bregman

A landlord can’t take the law into his or her own hands if a tenant stops paying rent.

Spoliation

Some landlords switch off the electricity or change the locks to the doors to the house. This is illegal, and could result in the tenant’s bringing a spoliation application to get undisturbed possession (free use and enjoyment) of the house.

For example, I rent a house. The owner forces me out and changes the lock on the door so I cannot go back in. I go to court that same day and ask for a spoliation order. If I am successful, the magistrate will order that I be allowed back into the house immediately. If the owner wishes to get me out he must make a proper case in the court and he must get a court order to evict me.

The tenant must satisfy two requirements:

• that he was in peaceful/undisturbed possession of the property;
• and he was unlawfully deprived of possession.

A spoliation order is very seldom refused. The court will also order the tenant to pay the costs of the application, which can be quite substantial.
The law also provides that where a tenant is unlawfully deprived of his use and enjoyment of the premises in this manner, he is not required to pay rental during the relevant period.

So what must a landlord do to get his tenant out?

The Prevention of Illegal Eviction and Unlawful Occupation [PIE] Act sets out the steps a landlord must follow. He or she must do the following:

• Give the occupier notice of his/her intention of going to court to get an eviction order;
• Apply to the court to have a written notice served on the occupier stating the owner’s intention to evict the occupier;
• Serve the notice at least 14 days before the court hearing. The notice must also be served on the municipality that has jurisdiction in the area.

The notice must contain the following:

• a statement that says proceedings are being instituted in the court in terms of PIE
• the date and time of the court hearing
• the grounds for the proposed eviction
• that the occupier is entitled to appear before the court and defend the case
• that the occupier can apply for legal aid

The unlawful occupier can go to the court hearing on the day it is set down and defend himself if he believes the eviction is unfair.
A person who wants to defend the court action should approach the Justice Centre at the Magistrate’s court for assistance. An occupier threatened with eviction can apply for legal aid assistance and representation.

The court will only give an eviction order if it is proved that:

• the person who is applying to evict you, is in fact the owner of the land
• you are an unlawful occupier
• the owner has reasonable grounds to ask for your eviction

 Urgent evictions

The Act also allows for urgent eviction proceedings. This will be granted if the owner can show that:

• there is real danger of substantial injury or damage to any person or property
• there is no other way to solve this situation
• the owner is going to suffer more if the occupier stays on the land, than the occupier will suffer if he or she gets evicted In such a case, the owner can go to court and get a final order for the eviction.

If the court grants an eviction order: 

The eviction order will state a date by when you have to leave the property, and also the date on which the eviction will take place if you do not vacate.


Who can remove you? 

Only the sheriff of the court can carry out an eviction.

Contact Roy Bregman:

Tel: 011 646 0335
Cell: 082 881 2360
Fax: 086 680 9142
Email: roy@bregmans.co.za
Web: www.roylaw.co.za

Dismissal For Refusing To Sign A Contract Of Employment?

By Roy Bregman

Employers are often at a loss when an employee refuses to sign a contract of employment. Can the employee be disciplined or dismissed? What other measures are available to the employer?

One of the most common mistakes made by employers is to appoint a person without having agreed on all the terms and conditions of employment. When the employee is subsequently required to sign a contract of employment, the employee refuses or fails to sign the contract. This may be due to some misunderstanding or unhappiness with regard to particular provisions in the contract.

Our law states that verbal employment contracts are perfectly binding. But, obviously, it’s better – for both employer and employee – to enter into a written contract (to record all the pertinent rights and obligations of both parties. This avoids vagueness.

What should an employer do if it does not have a written agreement in place?

It is important to explain to the employee that it is to the benefit of both parties to have a written contract of employment. The provisions of the contract should be explained to the employee and the parties must establish whether there are any areas of disagreement. If there are no areas of disagreement and the employee still refuses to sign the contract, it serves no purpose to attempt to compel the employee to sign.

The Basic Conditions of Employment Act does not require the parties to enter into a written contract of employment. It simply requires the employer to supply the employee with written particulars of employment and it provides that certain items must be included in such particulars. The employer complies with the provisions of the Act if it provides the employee with a copy of the draft contract with a note that the employee has refused to sign it.

A signed written contract does, however, have definite advantages. It brings certainty and reduces the likelihood of disputes. There might also be provisions that are important to the employer, e.g. confidentiality or a restraint of trade undertaking. The enforcement of such provisions would be very difficult, if not impossible, without a signed contract.

If the employee refuses to agree explicitly with a provision that is reasonable, the employer may embark on a procedure that could lead to the termination of the employee’s services due to operational requirements (retrenchment).

Professional advice and assistance are recommended in these circumstances.

Contact Roy Bregman:

Tel: 011 646 0335
Cell: 082 881 2360
Fax: 086 680 9142
Email: roy@bregmans.co.za
Web: www.roylaw.co.za