The Sunday Mail
This week I centre attention on the lease agreement. A lease agreement can be in respect of either movable or immovable property. In this discussion, l focus on the lease for commercial or residential immovable properties.
As is suggested by its name, “immovable property” refers to any immovable object or other item of property that cannot be moved without destroying or altering it or an object that is so firmly attached to land that it is regarded as part of that land.
The lease agreement is one of the most common forms of contracts. I think it ranks second only to the contract of sale. The reasons for this are many but it is primarily because the demand for housing in our country far exceeds the properties available. As a result, many citizens in urban and semi-urban areas in Zimbabwe are tenants and are for that reason, familiar with the lease agreement.
With respect to the commercial lease agreement, businesses are constrained to construct their own premises by the high costs involved, so renting operating space remains the only option for the great majority of them.
Unlike in South Africa where, in terms of their Rental Housing Act, every lease agreement has to be in writing, in Zimbabwe the situation is different because here, a lease agreement can either be oral or in writing. It is, off course, reasonable and convenient that a lease agreement be in writing at all times to avoid problems.
Otherwise the lease agreement comes into being when one party called the lessor or the landlord, agrees to let or give to the other, called the lessee or tenant, the use of an ascertained property at an agreed rental amount over a specified period of time and for a specified usage. The lessor does not have to be the owner of the premises to be leased. This can be anyone who has authority over the property.
Both parties to the agreement have duties and rights that flow from the agreement by operation of the law. Interestingly, the duties of the one are the rights of the other and vice versa. I look at these in turn.
The landlord
As soon as the contract is concluded, the landlord has a duty to deliver or make available to the tenant, the unoccupied premises at the time agreed upon together with all the essential accessories for its proper use and enjoyment. In law, this is referred to as delivery of vacant possession. Conversely, therefore, the tenant has a right to receive the property in the agreed condition.
The landlord also has a duty not to disturb or harass the tenant or make it difficult for the tenant to stay at the leased premises.
In other words, the landlord must guarantee quiet enjoyment of the property by the tenant. If the landlord wishes to inspect the property, as he is entitled to do, he should not do so without giving the tenant reasonable prior notice for such inspection.
Otherwise the landlord or anyone employed by him, is not entitled to enter upon the premises willy-nilly without first seeking the authority of the tenant. Consequently, therefore, the tenant has a right not to be unduly disturbed or harassed by the landlord.
It is a further obligation of the landlord to effect repairs particularly to the super structure and the exterior of the premises.
This means that any problems relating to the chimneys, roof, cracks in the walls, leaking or blocked gutters and any such defects to the structure are the direct responsibility of the landlord.
If the tenant should take upon himself and effect such repairs, then he will be entitled to claim reimbursement of the costs incurred from the landlord. This amounts to the tenant’s right to expect the landlord to attend to the said defects within a reasonable period of being so notified by the tenant.
Rates and other taxes relating to the property are for the landlord’s account unless the parties have specifically agreed that these be paid by the tenant.
The tenant
The very first duty that falls on the tenant is to pay the agreed rental amount on or before the due date. This is critical because rent is the very soul and spirit that ensures that the lease agreement remains alive otherwise without it, there is no contract and the landlord would be entitled to seek the ejectment of the tenant from the premises.
Legally, the landlord has no right to eject the defaulting tenant without a court order. Put in another way, once the tenant is in breach of the lease agreement, the landlord is not entitled to take the law into his own hands and throw the tenant into the streets. The laid down court process must first ensue before the tenant may be removed from the property in question. By logical reasoning, therefore, the landlord has a right to receive rent from the tenant on or before the agreed date.
The tenant’s next duty is to take good or reasonable care of the premises and to respect the rights of his neighbours. The landlord, therefore, has a right to expect the tenant to care for the premises reasonably.
Minor repairs to the leased premises chiefly in the interior thereof are the responsibility of the tenant. These may be such small things like fixing plugs, replacing light bulbs, interior decorations or ensuring that the garden and the surrounding environment is generally kept clean and tidy.
Arrear rentals
If the tenant falls into arrears with his rental payments, the landlord will accrue a legal right called in law, “lessor’s tacit hypothec for rent”. When reduced to its bare bones, this refers to a right that accrues to the landlord over the tenant’s property sitting at the premises in question. Effectively, the tenant’s property will become the landlord’s security for the payment by the tenant of the arrear rentals.
In this instance, the landlord must move with speed and approach the court “secretly” for an order to prevent the tenant from ever removing his property from the premises until the arrears are settled.
I say “secretly” because such an application is permissible to be made without notice to the tenant as doing so on notice may defeat its purpose because the tenant may immediately vacate or escape from the premises upon being served with the relevant court papers.
Good tenancy deposit
Normally and rightly so, at the inception of the contract, landlords insist on a good tenancy deposit which is usually equivalent to one month’s rental amount.
Problems and misunderstandings usually arise at the end of the lease agreement when the tenant will now be vacating the premises.
A lot of disputes have arisen where the landlord will be refusing to refund the deposit alleging that the same was/is going to be appropriated towards certain damages that were allegedly caused by the tenant to the property.
At the same time, the tenant will be contending that the damages alleged were not caused by him but have always been present or something of the sort. I locate a gap in our law with regards to this issue. As the law currently stands, the landlord is allowed to take and keep the deposit amount in his pocket all throughout the subsistence of the lease agreement.
It is suggested that disputes surrounding the good tenancy deposit could be averted if the deposit amount was placed in the hands of a third party, probably a statutory independent body such as the Rent Board to which anyone wishing to rent out a property would be registered.
So, upon termination of any lease agreement, the landlord would first have to prove the damages caused to his property by the tenant before claiming that deposit from the independent body.
Perhaps time might have now come for those in the real estate sector and elsewhere to debate on this matter with a view of eventually placing it before Parliament for formulation of some piece of legislation to take care of this thorny issue.
The other option is the South African approach where the landlord is required by law to keep the good tenancy deposit in an interest bearing account.
If at the end of the lease agreement, it is agreed that there were no damages caused to the property, the landlord is obliged to return the deposit in full together with the accrued interest to the tenant.
This option sits well with me because then the landlord is prevented from squandering the amount all throughout the period of the lease agreement much to the discomfort of the tenant.
The Rent Board
The Rent Board was set up as an instrument to control the relationship between the parties to a lease agreement. It handles disputes relating mainly to rent increases, notices to vacate the premises and so on.
With the apparent high demand for accommodation versus a very low supply of dwellings, it is inevitable that rentals will sky rocket. Economists refer to this as the law of supply and demand.
So the Rent Board was set up as a much cheaper route to justice as its procedures are very informal so that parties do not really need lawyers to represent them in the hearings. The biggest weakness of the Rent Board though is that it has no mechanisms with which to enforce its rulings.
A landlord who has had a decision issued by the Board in his favour has to approach either the High Court or the Magistrates Court for enforcement of that order.
What I am saying is that if one gets for example, a Certificate of Ejectment authorising him to evict his tenant, that does not give that landlord the licence to remove the tenant himself.
The eviction itself has to be done by either the Sheriff of the High Court or the Messenger of Court. These two officials act only in terms of court orders.
That is why the holder of an Ejectment Certificate must proceed to the said courts for enforcement of the Board’s decision. Access to the Sheriff or the Messenger is only through the court.
Amazingly, however, despite its apparent lack of enforcement power, the Rent Board actually successfully resolves the great majority of disputes that are brought before it.
Sale of the property
by the landlord
But what becomes of the lease agreement in the event the landlord decides to sell the property while the agreement is still running?
Put in another way, is the landlord free to sell the property while the tenant is still in occupation? Is the landlord to wait for the lease to expire before he can sell the property?
The answer is simple. The landlord is free to sell the property at any time. He can even use the property as security for his own debts while the lease agreement is still running.
When that occurs, the tenant’s rights will remain unaffected except that he will from then on, pay the rental amount to the new landlord.
The new landlord will get into the shoes of the previous owner and will, therefore, be bound by that lease agreement.
If, however, the tenant had paid rent to the previous landlord in advance, he will have to pay again to the new owner and then claim the amount prepaid to the old landlord from him is a separate action.
In law, they refer to this as “hire goes before sale” the meaning of which is that the tenant has superior rights over the property than the purchaser of that property at least for the remaining period of that particular lease agreement.
Termination of the
agreement
Is a tenant who is in breach of the lease agreement entitled to a notice to vacate the premises? No, he is not. However, as already said above, the landlord must follow due process before evicting the defaulting tenant.
Otherwise if the lease agreement expires and not renewed but the parties nevertheless continue to abide by the terms and conditions of the expired lease, the matter assumes a slightly different colour. From then onwards, the tenant dons a new title, he will be called a Statutory Tenant who may only be evicted in terms of that expired agreement.
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