Remission or nonpayment of rent during lockdown

The nationwide lockdown, caused by the Covid-19 coronavirus, has had a severe economic effect on the country. As a result, all businesses that Pieter van Zyl.

were not considered essential services, had to shut down for a certain period of time. Most were left with no income and could not meet their overhead expenses, such as paying rent.

Here we will discuss whether tenants are entitled to a remission of rent, or if non-payment is permissible during the period of lockdown.

The landlord/tenant relationship is governed by a lease agreement. Therefore, it is advisable to peruse the lease agreement to establish whether it contains a clause, better known as force majeure or vis major, exempting either party from meeting their respective obligations upon the occurrence of an unforeseen event, which might make this impossible. The reason for such a clause is that, should one of the parties fail to meet their obligations, it will not be deemed to a breach of the agreement.

In the absence of a lease agreement or a force majeure clause, the landlord/tenant relationship is governed by common law, which also caters for the impossibility to meet obligations. However, certain requirements must be fulfilled before one can claim impossibility of performance under common law. These include, among others, that execution must be objectively impossible, in the sense that a reasonable person must be unable to perform.

It is without a doubt that Covid-19 and the subsequent lockdown are unforeseen events which could be described as force majeure. Before relying on this clause or common law to claim remission or non-payment of rent, tenants are advised to carefully consider whether the wording of the force majeure clause includes Covid-19 and the lockdown, or whether such event satisfies all the requirements under common law. Instead of blindly evoking force majeure and running the risk of eviction due to non-payment of rental, tenants are advised to consult their landlords in an attempt to resolve the financial difficulties, or alternatively to consider business rescue before the lease agreement is cancelled to ensure that you are not evicted.