Recovering leased properties from tenants

MANY companies, organisations have invested heavily in real estate. These properties are often rented out as a way of taking advantage of the investment.

There are instances that these organisations want their premises back from the tenants for their own use. The Courts in the past have been overwhelmed with tenants who refuse to vacate the rented premises. We are going to look at commercial premises in the present instalment and in particular what does the law say.

There are grounds upon which a lease agreement can be terminated. In many cases, lease agreements have been terminated because of breach of material terms of the lease, main one being non-payment of the rentals. These cases have clogged the courts with other litigants being adamant even in times when they do not have a case either on the facts or on the law.

The lease can be terminated because of effluxion of time.

The agreed time has come to an end, and there is no intention to renew the lease by the other party.

There are also instances when the Lessor wants premises for their own use. No breach has been alleged, and no issues to do with effluxion of time is being raised. The Lessor can lay a claim to its property in terms of the Rent Regulations.

The law

The demand for premises for personal use is made against a legal requirement of establish “good and sufficient grounds” in terms of Section 22(2) of the Commercial Premises (Rent) Regulations of 1983 SI 676/83.

The position of the law is settled that in the Court is empowered to grant the relief of eviction where the Lessor succeeds in establishing good and sufficient grounds entitling it to the eviction order. [FBC BUILDING SOCIETY V PAVIAN INV (PVT) LTD HB 34/17 — see page 8 of the cyclostyled judgement)

The essence of the pronouncements of the Court is that while the Commercial Premises (Rent) Regulations 1983 were enacted to protect tenants, that protection is directed against unscrupulous landlords and not genuine ones who bona fide require to reclaim their property for own use.

Although the phrase “good and sufficient grounds” is not defined in the regulations except to exclude from it the refusal of the tenant to agree to a rent

increase and the desire by the landlord to lease out the premises to someone else who is not the tenant the courts have come out very clearly as to what constitutes good and sufficient grounds for reclaiming the leased premises.

[FBC BUILDING SOCIETY V PAVIAN INV (PVT) LTD HB 34/17 — see page 8 of the attached cyclostyled judgement)

The law has prescribed the threshold to be met in cases as this one. ZIYAMBI JA in

Kingstons Ltd v D Ineson (Pvt) Ltd 2006 (1) ZLR 451 (S) 457 A — C held that; “Our courts have held that the landlord need do no more than assert his reasons in good faith and then to bring some small measure of evidence to demonstrate the genuineness of his assertion and it rests upon the lessee who resists ejectment to bring forward circumstances casting doubt on the genuineness of the lessor’s claim. See Film and Video Trust v Mahovo Enterprises (Pvt) Ltd 1993 (2) ZLR 191 (H); see also Newman v Biggs 1945 EDL 51 at 54 and 55.

In determining what constitutes good and sufficient grounds, the court makes a value judgment which, if arrived at without caprice, bias, or the wrong application of principle, will not lightly be set aside on appeal.”

This was quoted with approval in FBC BUILDING SOCIETY V PAVIAN INV (PVT) LTD HB 34/17 — see page 9 of the cyclostyled judgement).

It must be stated that good and sufficient grounds for requiring the tenants’ eviction exist where the lessor genuinely requires the use of the leased premises for the operation of a business or it is necessary for the lessor to effect extensive repairs to the premises which repairs cannot be effected while the tenant is in occupation. (FBC BUILDING SOCIETY V PAVIAN INV (PVT) LTD HB 34/17 — see page 9 of the attached cyclostyled judgement).

The Court in the FBC case supra also made reference to Delco (Pvt) Ltd v Old Mutual Properties (Pvt) Ltd 1997 (2) ZLR 415 (S) 417 D – E; Mungadze v Murambiwa 1997 (2) ZLR 44 (S).

When confronted with a claim by a Lessor which is clear bona fide, it is disingenuous to protest such a claim as it will attract legal costs in the process. Its rather better to engage and agree on much more flexible notice periods. A tenant cannot be in a lease property forever.

Once we understand this reality it can help de-congest the Courts with some litigation that ordinarily should not be before the Courts.

LEGAL DISCLAIMER: The material contained in this post is set out in good faith for general guidance in the spirit of raising legal awareness on topical interests that affect most people on a daily basis.

They are not meant to create an attorney-client relationship or constitute solicitation. No liability can be accepted for loss or expense incurred as a result of relying in particular circumstances on statements made in the article/post.

Laws and regulations are complex and liable to change, and readers should check the current position with the relevant authorities before making personal arrangements.

Arthur Marara is a Law Lecturer, Corporate law attorney practicing law in Harare, Zimbabwe with a reputable firm. He is also a notary public and conveyancer. He is passionate about promoting legal awareness and access to justice. He writes in his personal capacity. You can follow him on social media (Facebook Attorney Arthur Marara), or WhatsApp him on +263780055152 or email attorneyarthurmarara@gmail.com