Monday, April 20, 2015

Landlord given go ahead to disconnect electricity by High Court

By Kirsten Ronnie | Admitted Attorney, TPN Legal Advisor

On Tuesday 14 April 2015, the Western Cape High Court found in favour of a landlord who was owed in excess of R300 000.00 by a tenant due to the non–payment of electricity bills. The Court’s order – disconnect the electricity (can you believe it)?!

The case in question is that of Anva Properties CC v End Street Entertainment Enterprises CC. The facts, in short, are as follows:

  • Anva (the landlord) owned a building on Riebeeck Street in Cape Town and End Street was one of the tenants occupying the building;

  • The landlord paid the City of Cape Town directly for electricity supply to the building and then recovered the costs, pro rata, from its tenants;

  • End Street had not paid electricity in months and, practically speaking, the landlord was “subsidising”  End Street’s business;

  • The problem faced by the landlord? If the landlord didn’t keep up – to – date with the full electricity account, the City of Cape Town would disconnect the supply to the entire building, thereby prejudicing the rights of other consistently paying tenants.

The judge in the end held that the landlord was authorised to terminate the supply of electricity to the premises occupied by the tenant and that the tenant could, under no circumstances, reconnect the supply.
 
So what exactly does this mean for landlords and rental agents? Can you now finally take the law into your hands and punish those frustrating, non- paying tenants by flicking the switch and keeping them in the dark?  The answer (unfortunately) is still a resounding no. You still cannot disconnect a delinquent tenant’s electricity of your own volition - under any circumstances! You need to approach the Courts and obtain an order first, as the landlord successfully did in this case.
 
But what this judgment has shown us is that the Courts are, in fact, beginning to consider the economic implications of non – paying tenants and the plight of landlords effected by such non - payment. The fact that the judgment is a High Court Judgment makes it all the more powerful. With all of the legislation out there favouring the tenant, it’s comforting to know that should you, as a landlord, need to approach the Courts for relief, there is now a chance that the judge may finally sit in your corner!
 
Click here to read the full judgement: Anva Properties CC v End Street Entertainment Enterprises CC

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