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Landlords are responsible for tenants default on utilities

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Landlords are responsible for tenants default on utilities


High risk of non payment of electricity and water bills at the end of a lease, coupled with a legal system, which favours the Tenant, can turn a residential investment into a nightmare.



Lauren Maltby of Durban’s Shepstone & Wylie Attorneys, advises that landlords need to proactively protect their interests. "Landlords are liable for any accounts not paid by the tenant in respect of the let property, or any debt not recovered from the tenant in terms of the Municipal Systems Act," she explains.

"Tenants have repeatedly been treated leniently by our courts when it comes to unpaid electricity and water bills. When this happens the landlord, often ends up footing the utility bill."

Maltby says there are a few things that can be done to protect one's property investment.

The landlord can request from the Municipality regular statements of account for the property so that he can monitor the tenants payments. "So if you already have a tenant and therefore cannot change your existing lease, you can at least monitor these accounts to ensure they are being paid on a regular basis," advises Maltby.

In addition, a landlord could include a clause in his lease, which makes provision for the proof of payment of these accounts by the tenant. This can then be followed up with a further clause which provides that should the tenant fail to provide such proof the landlord will be entitled to invoke some sort of sanction, including eviction.

A recent decision in the Constitutional Court confirmed that Municipalities can and will continue to hold the landlord liable for unpaid utility bills left by a tenant.

"It can sometimes take up to two years to evict a tenant, so beware of these potential pitfalls when letting your property," comments Maltby.

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