Unfair lease cancellation policy?

lukefrom zim

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Dec 13, 2019
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Hello all, I am about to sign a 12 month lease for an apartment rental, but the cancellation clause (particularly 24.2) has given me reason to pause (see below).

24.1 NOTICE IN TERMS OF THE CONSUMER PROTECTION ACT: Should the LEASE be deemed to be subject to the CPA, the TENANT may cancel this LEASE by providing 20 (twenty) business days’ written notice to the AGENT. The LANDLORD shall however be entitled to claim 2 (two) months’ rental should a replacement TENANT not be found for this 2 (two) month period or part thereof.

24.2 Should the TENANT cancel the LEASE at any stage during the initial LEASE term, in addition to any damages suffered by the LANDLORD, the TENANT will be held liable for the following reasonable cancellation costs to procure a new TENANT:
24.2.1 The TENANT shall be held liable to pay the Lease Cancellation Fee of R1,725.00 as well as the costs outlined in Clauses 24.2.2, 24.2.3 and 24.2.4 below.

24.2.2 The TENANT shall be held responsible for advertising costs until such time as a new TENANT has been procured.

24.2.3 The TENANT shall be held responsible for the AGENT’s commission and procurement fee on the outstanding portion of the LEASE, at the commission rate which was agreed upon the LANDLORD’s signature of the LEASE. Example; if the LEASE was for a period of 12 (twelve) months and the TENANT cancelled the lease 6 (six) months into the LEASE, the TENANT will be held responsible for the payment of the commission for the remaining 6 (six) months.

24.2.4 The TENANT will also be liable for rent until such time as a new TENANT is sourced.


Firstly, I don't understand why both 24.1 and 24.2 are given in the lease, and which clause is meant to apply where. Clause 24.2 also seems rather harsh, and I am particularly concerned by 24.2.4 which seems to suggest I could be liable to pay rent until the end of the lease period if no replacement tenant is found.

Is it just me or do these cancellation clauses seem extra harsh? Any advise would be much appreciated.
 

Quintrix

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Ask the agent to refer you to the appropriate laws that justify these.
Some illegal clauses.
More info on Facebook Legal talk south africa
 
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Just don't cancel the lease early?

24.2 only applies if you cancel early in the first year.
24.1 is if you cancel early from the 2nd year onwards.

Does NOT apply if you decide to not renew the contract, only if you move in the middle of a contract.
 

F1 Fan

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This is the problems with using agents. All of those fees above are to cover themselves. For my leases, you can give me 3 months notice and you can leave. No charges. If you dont want to be there, I won't keep you.

If I were you, walk away.
 

ToxicBunny

Oi! Leave me out of this...
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Honestly, walk the fsck away.

That lease agreement is so horribly one sided in favour of the agent/landlord its grossly unfair that many of the clauses would be difficult to actually uphold if challenged in court.
 

lukefrom zim

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Dec 13, 2019
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Thanks for all the advice so far and glad to see it's not just me who thinks the agreement is off. The apartment itself does seem to be a really good deal so it's unfortunate that the lease is so unsatisfactory. I might try take it up with the agent because I do really want the apartment, but perhaps this cancellation clause is a bad omen of future unreasonableness I might have from the agent if I do sign up.
 

B-1

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Draw a line through those initial next to them and tell them you are not happy with those clauses. If they agree then you have a contract you both agreed to. But also understand many people have a bond on the units they rent out so if you cancel short notice they lose out on a significant amount if they cannot find a replacement in time. That's why they try and protect themselves against unreasonable people.
 

AdrianH

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Sorted.

24.1 NOTICE IN TERMS OF THE CONSUMER PROTECTION ACT: Should the LEASE be deemed to be subject to the CPA, the TENANT may cancel this LEASE by providing 20 (twenty) business days’ written notice to the AGENT. The LANDLORD shall however be entitled to claim 2 (two) months’ rental should a replacement TENANT not be found for this 2 (two) month period or part thereof.

24.2 Should the TENANT cancel the LEASE at any stage during the initial LEASE term, in addition to any damages suffered by the LANDLORD, the TENANT will be held liable for the following reasonable cancellation costs to procure a new TENANT:
24.2.1 The TENANT shall be held liable to pay the Lease Cancellation Fee of R1,725.00 as well as the costs outlined in Clauses 24.2.2, 24.2.3 and 24.2.4 below.

24.2.2 The TENANT shall be held responsible for advertising costs until such time as a new TENANT has been procured.

24.2.3 The TENANT shall be held responsible for the AGENT’s commission and procurement fee on the outstanding portion of the LEASE, at the commission rate which was agreed upon the LANDLORD’s signature of the LEASE. Example; if the LEASE was for a period of 12 (twelve) months and the TENANT cancelled the lease 6 (six) months into the LEASE, the TENANT will be held responsible for the payment of the commission for the remaining 6 (six) months.

24.2.4 The TENANT will also be liable for rent until such time as a new TENANT is sourced.
 

Stonemason

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24.2 is actually very generous. Normally, if you sign a 12 month lease and you leave early, you are liable for the rent for the remaining period of the 12 months. This contract gives you options to leave without having to pay for the full term. At first glance it may appear harsh, but actually if you read it carefully is givers the tenant options. Many contracts don't .

A two months notice period after the initial lease term is normal
 

RedViking

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Agents. Snakes. Don't trust them or anything they make you sign.

My lease has 1 month notice period. Simple.
 

Quintrix

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24.2 is actually very generous. Normally, if you sign a 12 month lease and you leave early, you are liable for the rent for the remaining period of the 12 months. This contract gives you options to leave without having to pay for the full term. At first glance it may appear harsh, but actually if you read it carefully is givers the tenant options. Many contracts don't .

A two months notice period after the initial lease term is normal

NO. That full clause is not even legal as pointed out by others. Some landlords blatantly ignore the law.
 

AdrianH

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24.2 is actually very generous. Normally, if you sign a 12 month lease and you leave early, you are liable for the rent for the remaining period of the 12 months. This contract gives you options to leave without having to pay for the full term. At first glance it may appear harsh, but actually if you read it carefully is givers the tenant options. Many contracts don't .

A two months notice period after the initial lease term is normal

Laws were changed, so no, its not normal. 20 business day notice can be given and most agents agree a maximum of two month rent could apply.
 

lukefrom zim

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Thanks everyone, it seems the general opinion is that these terms are unfair and even illegal, at least in terms of more recent legislation. I have sent back a version of the lease with comments on the clauses which seem most problematic (24.2.2-24.2.4) and will see whether the agent is willing to amend satisfactorily. If not, I will most probably have to walk away, as much as I like the flat.
 

rvZA

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Hello all, I am about to sign a 12 month lease for an apartment rental, but the cancellation clause (particularly 24.2) has given me reason to pause (see below).

24.1 NOTICE IN TERMS OF THE CONSUMER PROTECTION ACT: Should the LEASE be deemed to be subject to the CPA, the TENANT may cancel this LEASE by providing 20 (twenty) business days’ written notice to the AGENT. The LANDLORD shall however be entitled to claim 2 (two) months’ rental should a replacement TENANT not be found for this 2 (two) month period or part thereof.

24.2 Should the TENANT cancel the LEASE at any stage during the initial LEASE term, in addition to any damages suffered by the LANDLORD, the TENANT will be held liable for the following reasonable cancellation costs to procure a new TENANT:
24.2.1 The TENANT shall be held liable to pay the Lease Cancellation Fee of R1,725.00 as well as the costs outlined in Clauses 24.2.2, 24.2.3 and 24.2.4 below.

24.2.2 The TENANT shall be held responsible for advertising costs until such time as a new TENANT has been procured.

24.2.3 The TENANT shall be held responsible for the AGENT’s commission and procurement fee on the outstanding portion of the LEASE, at the commission rate which was agreed upon the LANDLORD’s signature of the LEASE. Example; if the LEASE was for a period of 12 (twelve) months and the TENANT cancelled the lease 6 (six) months into the LEASE, the TENANT will be held responsible for the payment of the commission for the remaining 6 (six) months.

24.2.4 The TENANT will also be liable for rent until such time as a new TENANT is sourced.


Firstly, I don't understand why both 24.1 and 24.2 are given in the lease, and which clause is meant to apply where. Clause 24.2 also seems rather harsh, and I am particularly concerned by 24.2.4 which seems to suggest I could be liable to pay rent until the end of the lease period if no replacement tenant is found.

Is it just me or do these cancellation clauses seem extra harsh? Any advise would be much appreciated.

I agree. Leave them an find another place.

It seems they are not well versed with the CPA and some recent decisions made by the RHT.

Firstly, the agreement is not in line with the CPA Act and they may be liable to prosecution. In any event, the agreement is not binding.

Secondly, you are entitled to give a calendar month notice. The landlord has only one calendar month to find a new tenant. It is not your duty to do so. Secondly, he cannot hold you responsible for any losses in the event he does not find a tenant.

Thirdly, the termination fees he is charging is also not in line with the act. A mere complaint to the RHT will overrule him and his agreement and cancellation fees.

Everything else I am reading there is in stark contradiction with the CPA Act. The act mentions clearly that a cancellation fee may not prevent a person from cancelling or terminating an agreement early. This is exactly what he is doing.
 
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tRoN

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Are these terms related to a commercial lease ?
 

rvZA

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tRoN

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If the agreement was entered to as a juristic person, then no, the act does not offer any protection.


Ok so if I run a business in an office property and I am a sole proprietor entity then CPA will apply?

/OP sorry to hijack your thread with my question.
 
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