Consumer act excludes immovable property leases
Fixing a maximum term for leases of 24 months is absurd
THE Consumer Protection Act does not apply to immovable property leases. There are a number of reasons why this is so. The first reason is that the act says so. A service under the act does not include a right of occupancy of immovable property in terms of a rental.
A rental is a lease, namely an agreement in terms of which temporary possession of any premises or other immovable property is delivered to the consumer for consideration. If the act says that a service does not include a lease, then it does not apply to leases.
Secondly, according to the regulations, a fixed term agreement may not exceed a maximum duration of 24 months unless the supplier can show a demonstrable financial benefit to the consumer. There is not always a demonstrable financial benefit to a consumer having a lease of 30 months rather than 24 months. Fixing a maximum term for leases of 24 months, including leases of business premises to individuals, is absurd in the true sense of that word.
Consumers are protected enough under common law and statute.
Entire books have been written on the common law of landlord and tenant describing a rational and effective system of letting property developed over hundreds of years.
More importantly, rentals are protected under the Rental Housing Act. The act includes provisions relating to leases and the relationship between landlord and tenant. A written or oral lease is deemed to include a number of specified conditions that protect the tenant. Rights on termination are explicitly dealt with. The act creates a Rental Housing Tribunal which does the work that would have been done by the National Consumer Commission if rentals had fallen under the Consumer Protection Act. The Minister of Housing is entitled to make comprehensive regulations including those relating to unfair letting practices. The fact that there is another piece of legislation act dealing with the matter does not itself exclude the Consumer Protection Act because the two can be read together giving the consumer the greatest protection. However, rentals are specifically excluded from the Consumer Protection Act, and the Rental Housing Act has mechanisms available to protect tenants to the extent that the legislature wishes to do so.
Patrick Bracher is a senior partner at Deneys Reitz.