Smuts & Co Attorneys

CAN I OBTAIN FINANCING IF I DON’T OWN IMMOVABLE PROPERTY AS SECURITY?

Fri, 29 Jun 2018 09:00:20 +0000

The article gives a brief overview of what a notarial bond is, the requirements that need to be complied with to register a notarial bond and give tips regarding clauses that will prove to be useful in a notarial bond. It also deals with the situation where a debtor disposes of an asset listed in a notarial bond, contrary to the provisions thereof.

A very useful way of obtaining financing to start a new business, is to register a notarial bond over the movable property belonging to the business. For instance, notarial bonds are regularly utilised in transport companies – a notarial bond is registered over the vehicles forming the core of the business, but the vehicles do not need to be in the physical possession of the creditor, thus the business can fully operate.

What is a notarial bond?

A notarial bond is a general or special bond where the movable assets of a debtor are used as security for a debt. In terms of the notarial bond, the debtor undertakes to pay his debt towards the creditor, failing which the creditor will be entitled to sell these movable assets and to utilise the proceeds thereof to satisfy his claim against the debtor. There are 2 types of notarial bonds:

General notarial bond: all the movable assets on the debtor’s property serves as security for the debtor’s debt.
Special notarial bond: specific movable assets identified in the bond will serve as security for the debt.

How does a notarial bond differ from a pledge?

A pledge requires the delivery of the movable asset pledged. A notarial bond does not require the delivery of the movable assets identified in the bond, but in terms of section 1(1) of the Security by Means of Movable Property Act 57 of 1993, the movable property listed in the notarial bond will be deemed to have been pledged to the creditor as effectually as if it had been delivered to the creditor. The fact that the creditor is deemed to be in possession of the property thus places him on equal footing with that of a pledgee. The creditor, upon registration of the notarial bond in the deeds registry, acquires a real right of security in the movable property specified in the bond.

Requirements:

Existence of a principal debt;
Assets which serve as security must be movable, including corporeal and incorporeal assets.

Corporeal assets include furniture, vehicles, the goods of a business, animals and the future offspring of animals and stock in trade.

Incorporeal assets include an unregistered long-term lease of immovable property, a short-term lease of immovable property, a liquor license, a water use license, site permit, shares in a company, goodwill of a business, book debts etc.

What if more than one creditor uses the same asset as security for their debt?

A bond which was registered first enjoys priority over a bond registered thereafter.

Important clause to insert in the bond:

To prevent the debtor from disposing of assets which serve as security in terms of the notarial bond, a clause should be inserted disallowing the debtor to sell, alienate, dispose of, transfer or permit the removal of the asset from the debtor’s place of residence or place where he carries on business, without the prior written consent of the creditor.

What happens if a debtor disposes of the asset identified in the notarial bond, contrary to the stipulations in the notarial bond?

The creditor will be able to apply for provisional sentence summons against the debtor, provided that the notarial deed meets the requirement of being a liquid document. A liquid document is a document which indicates, without having to consult extrinsic evidence, an acknowledgement of debt, of which the amount is easily determinable. A notarial bond will in general qualify as being a liquid document.

A creditor will also be able to claim back an asset which has been sold, contrary to the provisions of the notarial bond, to a bona fide third party, from such third party. The reason for that is the fact that a notarial bond, which has been registered in the Deeds Registry, creates a real right, which is a right that attaches to property, rather than a person.

It is not easy to obtain credit in the economic environment in which our country currently finds itself. However, there are ways to get your business off the ground and registering a notarial bond over the property of your business is a recognised method of securing your business’ debt. If notarial bonds can be utilised more frequently, it can help a lot of new businesses get the financing they need to buy equipment, vehicles and machinery necessary for the operation of the business.

Reference List:

Explanatory Notes Part 1: Course in Notarial Practice, compiled by Gawie Le Roux, Erinda Frantzen and Ilse Pretorius
The South African Notary, sixth edition, M J Lowe, M O Dale, A De Kock, S L Froneman, A J G Lang

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

The post CAN I OBTAIN FINANCING IF I DON’T OWN IMMOVABLE PROPERTY AS SECURITY? appeared first on Smuts & Co Attorneys.

ARE FATHERS ENTITLED TO PATERNAL LEAVE?

Fri, 29 Jun 2018 08:59:37 +0000

Fathers could spend up to two weeks with their newborn babies, while adoptive parents and parents-to-be via surrogacy, could get up to 10 weeks of leave. This is due to the latest Labour Laws Amendment Bill 2017 (“amendment bill”), which was passed by the National Assembly in November 2017.

The current labour legislation provides that fathers who want to stay home with their newborn babies have to take family responsibility leave, which is limited to three days per annual cycle, or they must take their own annual leave for this purpose. They are only entitled to family responsibility leave once they have been employed for four months and work for at least four days a week. The current law also makes no provision for paternity leave for adoption parents or fathers-to-be via surrogacy. A mother is entitled to unpaid maternity leave of up to four months and she may also claim from UIF for 17-weeks during this period.

The position regarding paternal leave has, however, drastically changed since the end of last year. On 28 November 2017, the National Assembly passed the Labour Laws Amendment Bill. The amendment bill regulates the rights of fathers in taking paternal leave when their child is born. In terms of the amendment bill, fathers will be entitled to 10 days paternal leave on the birth of a child. In addition, the amendment bill provides for 10 weeks adoption leave for one parent when adopting a child under the age of two and ten weeks “commissioning parent leave” when an employee’s child is born by means of a surrogacy arrangement. The amendment bill also increases unemployment insurance benefits from 238 days to 365 days and increases maternity benefits to 66% of the earnings of the employee at the date of the application for unemployment insurance benefits.

Five things you need to know about the amendment bill:

Fathers’ paternity leave could be up to two weeks

An employee who is a parent and not entitled to maternity leave, will now be entitled to 10 consecutive working days parental leave when that employee’s child is born. The Basic Conditions of Employment Act 75 of 1997 (BCEA) still provides that mothers are entitled to take maternity leave for up to four months.

A father must have his name on the child’s birth certificate to qualify

Fathers must have their names on the newborn child’s birth certificate in order to apply for paternal leave. The purpose for this is to prevent dishonesty and ensure that the amendment bill cannot be used and abused.

Adoptive parents and parents via surrogacy could get up to 10 weeks of parental leave

An employee who is an adoptive parent of a child less than two years old, is entitled to adoption leave of ten weeks consecutively. In the case of two adoptive parents, one of the employees is entitled to adoption leave and the other to parental leave. The same provision applies for parents-to-be via surrogacy.

Family responsibility leave falls away

The father of a newborn may take three days family responsibility leave in terms of the BCEA –– but under the amendment bill, this no longer applies.

The amendment bill might come into effect by June 2018

The amendment bill will be referred to the National Council of Provinces and if passed, will be submitted to the president for assent. This new amendment bill will bring South Africa in line with other countries, many of which offer between one to four weeks’ paternity leave.

Reference List:

Labour Laws Amendment Bill 2017
Basic Conditions of Employment Act 75 of 1997

The post ARE FATHERS ENTITLED TO PATERNAL LEAVE? appeared first on Smuts & Co Attorneys.

DAMAGE TO PROPERTY

Fri, 29 Jun 2018 08:59:00 +0000

What happens when your property has been purposefully damaged, especially during an altercation?

Uber car torching

During the road closures by meter taxis in Johannesburg on October 27 2017, two Uber drivers’ cars were set alight. A total of thirty meter taxi drivers were arrested for traffic disruption on the R21 and R24 highways of Johannesburg, and further investigations were underway as to determine how the cars were torched during the protest. With the meter taxi drivers being responsible for the flames, and assaulting an Uber passenger before leaving with her belongings. There have been ongoing violent feuds between Uber, meter taxis and taxi drivers, and in one instance, an Uber passenger was stabbed in the face, allegedly by a taxi driver. Two cars, believed to be Uber vehicles, were petrol-bombed earlier in September.

Malicious damage to property

Damaging property belonging to someone else is common – someone’s car door could fling to bump yours, the neighbour’s son may swing a cricket ball towards your kitchen window. These are mistakes which don’t normally require the assistance of authorities. Malicious damage to property is the intentional and unlawful vandalization of property or belongings of another person. As a criminal offence in South Africa, damage to property extends over to the physical harm of pets, and the vandalization of cars, furniture and other tangible items which can cause financial setbacks.

Suing for malicious damage for property follows reporting the incident as soon as possible. It is advised to keep records, such as photographs, names of witnesses, time of incident, and most importantly, financial records of repairing or replacing said property or belongings. It is important to note that in cases where property is damaged in an act of self-defence, or protecting property, the claim for malicious damage to property will not be a successful one.

References:

Criminal Procedure Act 51 of 1977. (1977). [ebook] p.194. Available at: http://www.justice.gov.za/legislation/acts/1977-051.pdf [Accessed 31 Oct. 2017].

The post DAMAGE TO PROPERTY appeared first on Smuts & Co Attorneys.

THE DO’S AND DON’TS OF CONTRACT CANCELLATIONS

Fri, 29 Jun 2018 08:58:17 +0000

Every person, whether an individual or a juristic person, will find themselves in a situation where they will want to terminate a contract. The aim of this article is to set out the requirements for terminating a contract as well as to give basic guidance when doing so.

When a person wants to cancel a contract, the cancelling party (innocent party) will have a choice to either cancel the contract or to enforce it. This article refers to the innocent party and the party in breach. The reader must however remember that fault it not a requirement for breach of contract.

The law regards breach of a contract as a wrongful act in itself which allows the innocent party to cancel the contract. It is important to remember that cancelling a contract is an extreme remedy that is only available in exceptional circumstances, namely where there is a cancellation clause or where the breach of contract is material or serious. If the contract is however silent on cancellation, the innocent party may still cancel the contract provided that the said breach is material or serious in nature.

The point of departure when cancelling a contract is to determine what the exact terms of the contract are, i.e. if the contract has a cancellation clause or not and whether there is a date of performance or not.

If the contract has a cancellation clause, the innocent party will be able to cancel the contract in the event of a breach of a term thereto. The innocent party must however take care not to cancel the contract incorrectly, otherwise the party in breach may interpret the cancellation as a repudiation of the contract, in which case the party in breach will also have the right to cancel the contract.

In the event where the contract does not have a cancellation clause, the innocent party will only be able to cancel the contract if the breach is material in nature. What constitutes a material breach depends on the terms of the contract. According to South African case law, a material breach is one which goes to the root of the contract and constitutes a breach of a vital term thereto.

Depending on the type of breach, the innocent party might have to give the party in breach notice of same. This will be the case where there is no date of performance specified in the contract. The innocent party must then demand performance by giving the party in breach reasonable notice to perform before he will be able to cancel the contract.

On the flip side, if a date of performance is specified in the contract, and a party does not perform in time and as stipulated, that party will be in breach, otherwise referred to as being in mora. It does however not automatically give rise to the right to cancel the contract. The only instance where there will be an automatic right to cancel a contract is if there is a cancellation clause or a suspensive condition in the contract.

A contract containing a suspensive condition will terminate automatically unless the suspensive condition is fulfilled or waived. If there is not a cancellation clause in the contract and no date of performance, the innocent party must give notice to the party in breach that time is of the essence and give him a reasonable time to perform.

In summary, the requirements for cancelling a contract vary according to the terms thereto, the type of contract and the factual scenario. There are no formalities for cancelling a contract unless the parties otherwise agree and/or a statute (i.e. Alienation of Land Act and the National Credit Act) prescribes same.

Other requirements include that the innocent party must give reasonable notice to the party in breach that they are cancelling the contract, which cancellation becomes effective from the time the cancellation comes to the attention of the party in breach.

The consequences of cancelling a contract are that the obligations to perform terminate and the parties are obligated to return what has been performed. If both parties agree to the cancellation, the preferred route would be to enter into a cancellation agreement, setting out what needs to be returned, claims for damages etcetera.

Considering that each contract and factual scenario differs and will be judged and interpreted accordingly, readers are advised to obtain legal counsel before cancelling a contract.

Reference List:

“Contract: General Principles” by Van Der Merwe, Van Huyssteen, Reinecke & Lubbe 2004 (Juta Law)

The post THE DO’S AND DON’TS OF CONTRACT CANCELLATIONS appeared first on Smuts & Co Attorneys.

WHEN DOES PRESCRIPTION OF A DEBT START?

Wed, 27 Jun 2018 09:32:27 +0000

Debt does not last forever, after a period of time it prescribes and becomes invalid. Prescribed debt can be explained as old debt that has not been acknowledged over a period of three years. This means that a debt prescribes if:

You have not acknowledged the debt in the past three consecutive years, either in writing or verbally.
You have not made a payment promised to make a payment to the outstanding debt amount.
You have not been summoned to make a payment by a creditor for the debt within the past three consecutive years.

Trinity Asset Management (Pty) Limited v Grindstone Investments 132 (Pty) Limited

On 5 September 2017, the Constitutional Court handed down a judgment in an appeal against the judgment and order of the Supreme Court of Appeal (SCA) against Trinity Asset Management (Pty) Ltd (Trinity). The SCA ruled that Trinity’s claim for repayment of a debt of some R4.55 million against Grindstone Investments 132 (Pty) Ltd (Grindstone) was unenforceable because it had prescribed.

The parties entered into a written loan agreement, effective from 1 September 2007, in terms of which Grindstone borrowed a capital amount of R3 050 000 (loan capital) from Trinity. Clause 2.3 of the loan agreement provided that the loan capital was due and repayable to the applicant within 30 days from the date of delivery of Trinity’s written demand.

The majority judgment found that, on a holistic reading of the loan agreement, the parties did not intend to delay when the debt would become due or when prescription would begin to run. The parties’ language in the contract did not signify an intention to delay. The parties simply meant to allow Grindstone 30 days to repay the debt once Trinity had issued demand, not to postpone the due date of the debt to an indeterminate future date. The debt thus became due, and prescription began to run, immediately on conclusion of the contract.

Grindstone therefore raised a valid prescription defence, and the appeal was dismissed.

Conclusion

If you are uncertain about a debt amount or require assistance in this regard, then please contact your financial advisor, who will assist you with taking the next steps.

References:

Trinity Asset Management (Pty) Limited v Grindstone Investments 132 (Pty) Limited (CCCT248/16) [2017] ZACC 32 (5 September 2017)
http://www.debtbusters.co.za/what-is-prescribed-debt/

The post WHEN DOES PRESCRIPTION OF A DEBT START? appeared first on Smuts & Co Attorneys.

THE RIGHTS OF A DOMESTIC PARTNERSHIP

Wed, 27 Jun 2018 09:31:20 +0000

Domestic partnerships, also known as cohabitation relationships, are becoming more common in our modern day society, and it therefore becomes ever more important for parties to understand the different legal implications of being married and merely cohabiting. Parties to a domestic partnership do not enjoy the same legal protection as married couples upon termination of the partnership with regards to maintenance claims, property division or succession.

In the South African legal system, there are three forms of fully legally recognised unions, namely marriages, civil unions and customary marriages. However, in our modern society it is becoming more common for couples to live together in domestic partnerships, without ever getting married. It is important for parties to these partnerships to realise that little to no legal protection is provided upon the termination of such a relationship, either by agreement or due to the death of either party.

The general rule for domestic partnerships was laid down in Butters v Mncora: A domestic partnership does not give rise to any special legal consequences, such as that of a marriage or a civil union.

In 2006, the South African Law Reform Commission acknowledged the need for legal protection to be granted and drafted the “Draft Domestic Partnership Bill.” Parliament has however shown no urgency to pass the Draft Bill, and the legal position in South Africa thus remains unchanged.

Maintenance claims

The Maintenance of Surviving Spouses Act entitles a surviving spouse of a marriage, and a surviving civil partner of a civil union, to institute a claim for maintenance against the estate of the deceased. This provides for a claim of any reasonable maintenance needs that they cannot provide for by their own means, until such time that they remarry or pass away.

Parties of a domestic partnership should note that this protection does not extend to domestic partnerships, and thus no such maintenance claim can be made. Should the Domestic Partnership Bill be enacted in the future, section 28 will offer such an opportunity to claim for maintenance. However, at this stage no such protection is afforded.

Property Division

Parties to a marriage have a choice of two matrimonial property regimes. Simply put this is to be married either in community of property, or out of community of property. Each property system will have different consequences flowing from it either by law or contractually due to an Antenuptial contract. However, no property regimes exist for domestic partnerships, and thus no joint estate can exist as it would in a marriage.

The Supreme Court of Appeal has recently portrayed an increased willingness to extend contract-based legal protection to parties of a domestic partnerships. Contracts can be concluded by parties in domestic partnerships to govern aspects such as division of property upon termination of the partnership. Although these types of contracts are legally enforceable, they may give rise to potential problems. The contract may be concluded solely for the benefit of one of the parties, or circumstances may occur that the parties had not anticipated when the contract was drawn up. In practice however, it seldom happens that parties to a domestic partnership actually enter into a contract. This may be due to a mutual decision, or due to the fact that parties did not foresee a need for such contract.

Intestate Succession

In terms of the Intestate Succession Act, a spouse of a marriage will inherit if the deceased spouse dies without making a will. This has been extended to include partners of a civil union and customary marriage. Provision for inheritance by a partner of a permanent same-sex partnership has also been made in terms of this Act. This has however not been extended to the termination of heterosexual domestic partnerships, and thus no claim can be made in terms of the Intestate Succession Act on the estate of a deceased partner of a domestic partnership.

Couples living together in cohabitation relationships do not have similar rights to institute claims against the other party upon termination as they would have in a marriage or civil union. This could leave financially dependent parties in unanticipated vulnerable positions.

Reference List:

Butters v Mncora 2012 (4) SA 1 (SCA).
Barratt A “Private contract or automatic court discretion? Current trends in legal regulation of permanent life-partnerships” (2015) 26 Stellenbosch Law Review 110-131.
Clark B “Families and domestic partnerships” (2002) 119 South African Law Journal 634-648.
Intestate Succession Act 81 of 1987.
Maintenance of Surviving Spouse Act 27 of 1990.
Skeleton A (ed) Family Law in South Africa (2010), Cape Town: Oxford University Press.
The Domestic Partnership bill in GG 30663 of 14-01-2008.

The post THE RIGHTS OF A DOMESTIC PARTNERSHIP appeared first on Smuts & Co Attorneys.

THE A, B AND C OF SERVICE OF LEGAL DOCUMENTS

Wed, 27 Jun 2018 09:27:56 +0000

How are legal documents supposed to be served, and what is regarded as invalid service?

Purpose of service of legal documents:

The fundamental rule with regards to service is that the court must be satisfied that the defendant or respondent has received these documents and is therefore aware that legal proceedings are being brought against him/her. Erasmus stated in his book, Superior Court Practice: “It is a cornerstone of our legal system that a person is entitled to notice of legal proceedings against him”.

Service on person’s residence or place of business:

The ideal would be that the service of all legal documents should be effected via personal service. However, due to the fact that people on the wrong side of the law are often very evasive, service can be effected on any person above the age of 16 years, who is apparently resident at the residence of the person to be served/employed at the place of business of the person to be served.[1]

Service on a domicilium address:

A domicilium address is a regular term of the most modern contracts and means that the contracting party chooses an address where all legal notices and documents may be served, by delivering or leaving the document to be served at such address.[2] This could be a potentially dangerous term, especially with regards to contracts which are being renewed annually, but of which the content is not necessarily updated as regularly as it should be. It often leads to documents being served at an address where a person is no longer resident or carrying on business, and where the person has neglected to update such information in the contracts which he/she concluded.

Service of legal documents on a company/closed corporation:

Service of legal documents in which a company or closed corporation are to be served, are effected by serving such documentation at the company/closed corporation’s registered address or principle place of business.[3] Because a company/closed corporation’s principle place of business often differs from their registered address, this could also lead to a company/closed corporation changing the place at which it conducts business, but neglecting to change their registered address, causing legal documents served at the registered address not coming under its attention.

Invalid Service

Rule 9(3) of the Magistrate’s Court Rules determines that a court may, if there is reason to doubt whether the process served has come to the actual knowledge of the person to be served, treat such service as invalid. Thus if a judgment was granted against a defendant on whom there did not occur proper service of the summons as explained above, it would be a ground for rescission of such judgment.

Preferable method of service:

Personal service should be used whenever possible, and the other methods of service provided for in the rules should only be used where the Defendant is elusive or untraceable. In O’Donoghue v Human[4] the following is stated: “what the Court requires in regard to service of a summons is that it be served in the best possible manner likely to bring the summons to the attention of the defendant. Rule 4 appears to contemplate that, if possible, service should be personal, and that only if the defendant or respondent cannot after diligent search be found may some other authorised form of service be adopted. The whole purpose is to take the most effective steps possible to ensure that the summons comes to the Defendant’s notice.”

Reference List:

Magistrate’s Court Rules
O’Donoghue v Human 1969 (4) SA 35 (E)

[1] Rule 9(a) – (c) of the Magistrate’s Courts Rules

[2] Rule 9(d) of the Magistrate’s Court Rules

[3] Rule 9(e) of the Magistrate’s Court Rules

[4] 1969 (4) SA 35 (E) par. 4

The post THE A, B AND C OF SERVICE OF LEGAL DOCUMENTS appeared first on Smuts & Co Attorneys.

PROPERLY EXECUTING A WILL IS EXTREMELY IMPORTANT

Wed, 27 Jun 2018 09:25:51 +0000

I gave instructions to my attorney to prepare a last will and testament for me as my will no longer reflected my wishes. At my request, my attorney emailed the will to me with clear instructions as to how I should go about signing it. I asked my neighbours to act and sign as witnesses. My neighbours signed the will on all the pages and left before I signed. I then signed the will on all the pages. I am now worried about the validity of my will as the email from my attorney states that I have to sign the will in the presence of two witnesses. Is my will valid?

The formalities for the valid execution of a will are set out in the Wills Act. Section 2 of the Wills Act, Act 7 of 1953, reads: “No will executed… shall be valid unless the will is signed at the end thereof by the testator… and such signature is made by the testator… in the presence of two or more competent witnesses present at the same time and such witnesses attest and sign the will in the presence of the testator and of each other…”. Therefore, in order for a will to be valid, it has to be signed in the presence of two independent witnesses, both witnesses being present when the will is signed by the testator. The two witnesses signed your will in the presence of each other, but not in your presence.

A similar set of facts presented itself in a court case recently heard by the Gauteng Local Division of the High Court. In this matter, the two daughters of the deceased, who lost out on their inheritance in terms of the will of their father, claimed that it was never their father’s intention for his much younger lover to inherit his total estate. The testator was 85 years old at the time of his death and he had been living with a woman 38 years his junior for 8 years.

The deceased executed two wills during his lifetime. One on 6 November 2011 (“the 2011 will”) and another on 7 January 2014 (“the 2014 will”). The 2014 will was signed shortly before his death leaving the bulk of his estate to his much younger lover. The daughters of the deceased claimed the 2014 will was invalid as there were “suspicious” circumstances. They claimed their father either did not sign the 2014 will himself or, if he did, that he lacked the mental capacity to execute a valid will by reason of dementia. The daughters of the deceased were not successful in proving that the deceased’s signature was a forgery despite the fact that three handwriting experts testified.

Another witness called to testify was a witness to the 2014 will. Her testimony focused on the circumstances surrounding the signing of the 2014 will. She signed the will as a witness. She testified that she and her husband met the deceased in the street. As they were acquainted they naturally engaged in social conversation. She and her husband were informed that the deceased was on his way to the police station to sign a will. She and her husband were asked if they would accompany the deceased in order to sign the will as witnesses. They were assured that the process would not take long so they agreed to assist.

She and her husband signed the will and immediately left. They were the first to sign the will. At the time they signed the will the deceased had not signed the will. They left before witnessing the deceased signing the will. Hence, the 2014 will was not signed by the deceased in their presence even though it reflects their respective signatures as witnesses.

The evidence assessed collectively established that the deceased signed the 2011 will and also that he signed the 2014 will. However, the 2014 will was signed by the deceased after the two witnesses to the will had already left and therefore was signed in their absence.

The court referred to Section 2 of the Wills Act in terms whereof no will is valid unless the signature made by the testator is made “in the presence of two or more competent witnesses present at the same time”. The court confirmed that this requirement is mandatory and, if not met, the will is not valid for want of compliance with a statutorily required formality.

The court therefore found the 2014 will to be invalid and, as there was no evidence that there was any irregularity in the execution of the 2011 will, the 2011 will was declared the will of the deceased.

This judgement of the High Court once again emphasizes the importance of complying with the Wills Act. Your will is invalid, and it is advisable for you to print the will again and to sign it in the presence of two competent witnesses or, even better, for you to make an appointment with your attorney in order to sign the will at his office.

Reference List:

Twine and Another v Naidoo and Another [2017] ZAGPJHC 288; [2018] 1 All SA 297 (GJ)
Wills Act, Act 7 of 1953

The post PROPERLY EXECUTING A WILL IS EXTREMELY IMPORTANT appeared first on Smuts & Co Attorneys.

HOW AND WHEN TO USE THE SMALL CLAIMS COURT

Wed, 02 May 2018 12:51:45 +0000

The small claims court (SCC) is for anyone who wants to institute a minor civil claim against someone else. You can also claim against companies and associations. However, the claims are limited to amounts that are less than R15 000. This excludes the State, meaning a person cannot make a claim against a local municipality, for example. Claims made in the SCC are done quickly and cheaply without having to use an attorney and anyone, except juristic persons, are allowed to use them.

Read more about the SCC on The Department of Justice and Constitutional Development’s website: justice.gov.za

Where do I start?

If you are going to institute a claim against someone else, be smart about it. Don’t make a claim against someone who you know has no money to pay you back, such as an unemployed person.

Before running to the court to make a claim, first contact the person you intend to claim from and ask them to fulfil your request. Let them know you are planning on going to the court to make a claim against them if they don’t comply.

Perhaps the person is not interested in your claim, then send them a written demand letter. The letter should set out the details of the claim, including the amount. Give them at least 14 days from the day of receiving your letter to settle your claim. Make sure they get an actual physical copy of the letter. This can be posted to them, or you can simply take it to them directly.

So 14 days has passed and they didn’t respond. Now you can go to the clerk of the court with documents to institute your claim. Firstly, you will need proof that you delivered the letter of demand. This can be a post office slip, for example. You will also need a contract or document that gives a bases for your claim. Your claims can’t just be based on thin air. Lastly, provide the court with all the details of the person you’re claiming from, such as name, address and phone number.

The summons

The clerk of the court will help you in drawing up the summons. Once the summons is complete a hearing will also be scheduled. You then have to serve the summons to the opposing party (defendant) in person and get them to sign it. Don’t be surprised if they are visibly upset. Remember to make copies of all the documents and keep them. Also give copies to the defendant. The original documents must be handed over to the clerk of the court before the day of the hearing. This information will be kept in the court file.

After they receive the summons, the defendant may deliver a plea (written statement) to the clerk of the court. They may also issue a counterclaim. Regardless of whether the defended institutes a plea or counterclaim, they still have to attend the hearing. On the other hand, the defendant may decide to fulfil your claim before the hearing, you should then issue a written receipt and let the clerk of the court know that you won’t be continuing with the case.

Going to the hearing

You and the defendant must appear in court in person, attorneys or lawyers are not necessary. Remember to bring along all the documents on which your claim is based, there’s no point in showing up empty-handed. If you have witnesses, make sure they also come with you to the hearing. The SCC proceedings are basic and straight-forward. As mentioned, no attorneys are involved. As the proceedings begin, answer any questions that the commissioner of the court asks you. If you want and the commissioner agrees, then you can direct questions to the defendant.

The final judgment

After the proceedings have been completed, the court will make a judgement, which is final. There may, however, be some grounds for review. If the judgement is against you, then you should settle any order for costs. Since the court judgement is final, you have to abide by it. You can’t change your mind afterwards.

The post HOW AND WHEN TO USE THE SMALL CLAIMS COURT appeared first on Smuts & Co Attorneys.

CO-OWNING PROPERTY WITH SOMEONE ELSE: THE UPS AND DOWNS

Wed, 02 May 2018 12:47:19 +0000

What is co-ownership?

Co-ownership is when one or more people jointly own the same property. In essence, it is when they legally share ownership without dividing the property into physical portions for their exclusive use. It is thus commonly referred to as co-ownership in undivided shares.

It is possible to agree that owners acquire the property in different shares; for instance, one person owns 70 percent and the other 30 percent of the single property. The different shares can be recorded and registered in the title deeds by the Deeds Office.

The benefits

On paper, it’s a great idea. For starters, the bond repayments and costs of maintaining the home are halved. However, there can be problems and although not every friendship or relationship is destined to disintegrate, there does often come a time when one of the parties involved wants to sell up and move on to bigger and better things.

The risks

If ownership is given to one or more purchasers, without stipulating in what shares they acquire the property, it is legally presumed that they acquired the property in equal shares.

The risks, the benefits and the obligations that flow from the property are shared in proportion to each person’s share of ownership in the property. For instance, one of the co-owners fails to contribute his share of the finances as initially agreed, resulting in creditors such as the bank or Body Corporate taking action to recover the shortfall.

Having an agreement

If two people own property together in undivided shares it is advisable to enter into an agreement which will regulate their rights and obligations if they should decide to go their own separate ways.

The practical difficulties that flow from the rights and duties of co-ownership are captured by the expression communio est mater rixarum or “co-ownership is the mother of disputes”. It is therefore important that, when the agreement the co-owners entered into does not help them solve disputes, certain remedies are available to them.

The agreement should address the following issues:

In what proportion will the property be shared?
Who has the sole right to occupy the property?
Who will contribute what initial payments to acquire the property.
Who will contribute what amounts to the ongoing future costs and finances.
How the profits or losses will be split, should the property or a share be sold?
The sale of one party’s share must be restricted or regulated.
The right to draw funds out of the access bond must be regulated.
A breakdown of the relationship between the parties.
Death or incapacity of one of the parties.
Dispute resolution options before issuing summons.
Termination of the agreement.

Reference:

http://igrow.co.za/co-ownership-of-property-what-you-need-to-know/
http://www.privateproperty.co.za/advice/property/articles/the-pitfalls-of-property-co-ownership/5046
http://www.jgs.co.za/index.php/property/owning-prop-jointly-the-do-s-and-dont-s

The post CO-OWNING PROPERTY WITH SOMEONE ELSE: THE UPS AND DOWNS appeared first on Smuts & Co Attorneys.