“…the mere exercise of majority shareholding voting rights does not amount to oppression…” (extract from judgment below)

What happens when a company’s directors and shareholders fall out and cannot reconcile their differences? 

“Relief from oppressive or prejudicial conduct”

If you should find yourself in such an unfortunate situation, our Companies Act offers you several possible remedies. 

Professional advice specific to your case is essential here but be aware of a particularly versatile remedy in the form of a court application for relief from “oppressive or prejudicial conduct”. This relief is available where –

1. “any act or omission of the company, or a related person, has had a result that is oppressive or unfairly prejudicial to, or that unfairly disregards the interests of, the applicant”,
   
2. “the business of the company, or a related person, is being or has been carried on or conducted in a manner that is oppressive or unfairly prejudicial to, or that unfairly disregards the interests of, the applicant”, or
   
3. “the powers of a director or prescribed officer of the company, or a person related to the company, are being or have been exercised in a manner that is oppressive or unfairly prejudicial to, or that unfairly disregards the interests of, the applicant.”

If you can prove any of the above, the court has a wide discretion to make any order “it deems fit”, including (a long but not exhaustive list) an interdict against the improper conduct, liquidation if the company is insolvent, business rescue if appropriate, amendment of the Memorandum of Incorporation, “to create or amend a unanimous shareholder agreement”, issue or exchange of shares, appointing additional or replacement directors, declaring persons “delinquent or under probation”, refund of consideration paid for shares, varying or setting aside transactions and agreements, requiring production of financial statements or an accounting/reconciliation, compensation orders, rectification of company registers or records, or trial of any issue.

The critical part, as a recent SCA (Supreme Court of Appeal) judgment shows, is to be able to prove one of those three categories of wrongful conduct. Without that, and no matter how bitter the dispute between you and your nemesis may be, the court has no discretion to grant any of the above relief.

The facts and outcome of the SCA matter are a case in point –

Majority shareholder v fired director

• In a long-established and closely-held fencing manufacturer with only two shareholders but substantial value (the total value of the shares seems to be in the region of between R46m and R74m), the two fell out over a range of issues.
  
• The fall out culminated in the minority (46.67%) shareholder being removed from his directorship by the majority (53.33%) shareholder. After his removal as director he was also dismissed from his employment as a general manager after being found guilty at a disciplinary hearing of four counts of gross misconduct (one of which involved dishonesty). The misconduct complained of included abuse of trust, conflict of interest and abortive attempts to have the company placed under business rescue and liquidation. 
  
• Long story short, the dispute ended up first in the High Court and ultimately before the SCA, the minority shareholder alleging that he had been excluded from the management of the company, denied management and financial information, excluded from decision making, removed as director to be replaced by the majority shareholder’s husband and brother-in-law, and unlawfully and unfairly dismissed from employment.
  
• The Court however found on the facts that he had failed to prove that the majority shareholder’s conduct towards him was oppressive or unfairly prejudicial, or that his interests had been unfairly disregarded. He had been validly removed as a director of the company at a properly constituted shareholders’ meeting (as the Court put it “…the mere exercise of majority shareholding voting rights does not amount to oppression…), and his dismissal as general manager did not amount to oppressive or prejudicial conduct. 
  
• That finding, held the Court, meant that none of the avenues of relief listed above were available to the minority shareholder despite findings that the shareholders’ relationship had broken down irretrievably and was not capable of being resolved. 
  
• As a result, the High Court’s order that the majority shareholder sell her shares to him – an attempt by the High Court “to design or craft a mechanism which would result in a ‘clean break’ between the parties” because “it was not in their best interests to remain ‘in the same bed’” could not stand. Equally the minority shareholder’s new request that the majority shareholder be ordered to buy his shares from him could not succeed. 

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

“Domestic employees” are now covered under the Compensation for Occupational Injuries and Diseases Act (COIDA) and will now be entitled for compensation from the Compensation Fund in the event they are injured or contract diseases while on duty.

The new benefits

Note: The benefits set out below are recorded in summary only and awards are subject to conditions and to limits; so seek specific professional advice in need. 

Compensation payable to a qualifying employee by the Fund

Temporary Total Disablement (TTD) 

This is for an employee booked off for 4 days or more by a doctor to recuperate, maximum 24 months

Permanent disablement lump sum    

A permanent disablement lump sum is paid to an employee who has received a final medical report from the treating doctor indicating that the employee has reached maximum medical improvement. The permanent disablement should be 1 – 30% disablement for the Compensation Fund to pay this benefit. 

Permanent disablement pension   

The permanent disablement pension is paid to an employee who has received a final medical report from the treating doctor indicating that the employee has reached maximum medical improvement. The permanent disablement should be 31 – 100% disablement for the Compensation Fund to pay this benefit. 

Compensation payable to dependants of employees who died as a result of injury on duty or occupational disease

Under this heading there is cover for some funeral expenses, a widow’s lump sum award, a widow’s pension award, a child pension award, a partial or wholly dependency award payable to parents or siblings in the absence of a surviving spouse or child.

Orthotics and Rehabilitation 

Qualifying applicants can claim for youth bursaries, a “Return to Work” programme, “assistive devices” like wheelchairs and prosthetics, and rehabilitation and re-integration programmes.

Medical benefits

Medical benefits/claims and chronic medication are provided for in this section.

Employers – you must now register, submit annual returns, and pay annual tariffs

All employers of domestic employees are now obliged to register as employers with the Compensation Fund and to submit the necessary returns. You will be assessed and billed annually. To calculate how much your annual tariff payment will be, take the employee’s annual salary, divide it by 100 and multiply it by the current “assessment rate” applicable to domestic employees (1.04) – e.g. at a monthly salary of R4,500 the calculation is: R4,500 x 12 / 100 = R540 x 1.04 = R561-60 for the year. 

Although there is reportedly no deadline for registration set at the moment, keep an eye on the media as this is bound to change. 

For more detail, download the Department of Employment and Labour’s “Notice on The Registration of Domestic Worker Employers in Terms of Section 80 of The Compensation for Occupational Injuries And Disease Act As Amended” from GPW Online. See page 9 for the registration procedure and “Industry Classification” (get this right, high-risk industry employers pay a lot more!), page 10 for the ROE (Return of Earnings) and assessment procedures (plus how to register online) and page 11 for the claims submission process. The necessary forms are on pages 12 onwards. 

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

“Creativity is intelligence having fun” (Albert Einstein)

Continually nurturing creativity and innovation in your business is not just a profit driver, for most businesses it’s a matter of survival – there is always a disruptor or two in the wings just waiting for you to stagnate and fall behind. 

But as Dr Srini Pillay (a South African-born, Harvard-trained psychiatrist, brain scientist, technology entrepreneur and musician) points out: “Creativity is not just for artists or people in business. Creativity is for any person who wants to find an unusual way to take their lives to the next level.” Listen to the full article “Train your brain to unlock creativity and innovation” on Maverick Life.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

“Owning a home is a keystone of wealth… both financial affluence and emotional security” (Personal Finance Expert Suze Orman)

When you buy or sell your “Home Sweet Home”, particularly for the first time, the process can seem complicated, the terminology confusing, and the risks of making a costly mistake intimidating. You are after all dealing with quite possibly your most important asset!  

To help you navigate the process, as either seller or buyer, here are some common questions, with answers.

1. Where can I get a simple guide to the process?   

When you come down to the details it certainly is important to get everything right, but a simple, broad overview to start with will go a long way to de-mystifying the process and to setting you safely onto the right path.   

Have a look at the Law Society of South Africa’s “Buying or Selling a House: What You Need to Know”. Download it in any of four languages here.   

Simply and clearly written, the guide is full of really important information and advice, both practical and legal – take the time to read it in depth!   

Turning now to a few of the other more common questions you will no doubt have…

2. Do I really need legal advice?     

Our law reports are full of court disputes that could have been avoided with a simple upfront request for legal advice. The danger of not doing so is that many pitfalls await the unwary and you will be held to anything you agree to. It’s only sensible therefore to take advice early – well before you appoint an agent, start looking for a house, or get involved in submitting offers and negotiating sale agreements.   

Not having your “offer to purchase” or “agreement of sale” legally checked is a recipe for disaster. Once you sign on the dotted line you are on the hook for everything in the document. With very limited exceptions our law holds you to your signature and it is no good saying later “But I didn’t read the document, it all looked like the normal standard stuff” or “I had no idea I was agreeing to term x or condition y” – tough, you are bound.   

Bottom line – chat to your attorney before you do anything else! 

3. Whose name/s should I put the property in?

Should you buy the house in your name or in your spouse’s name? Should you buy jointly? Does it matter what marital regime applies to your marriage? What if you are in a permanent cohabitation arrangement rather than a formal marriage? Or perhaps you are wondering whether you should put the house into the name of a company or family trust.

Your choice now will have far-reaching legal, tax and practical consequences; and with some complex areas of law involved, specialist upfront advice is a no-brainer. 

4. What else should I ask my attorney?

Common areas of dispute and litigation include “bond clauses” and “72-hour clauses” in sale agreements, confusion over the need to identify or disclose both visible and invisible defects, disagreements over what is a “fixture” that comes with the house and what isn’t, misunderstandings over neighbours’ rights to build and encroach on views and the like, not checking for building plans and municipal Certificates of Occupancy (you will have a problem if a previous owner built or extended without proper plans), not checking the zoning and title deed restrictions (which could put a damper on any plans you have to extend, go up a storey, build a home office, or the like), servitudes or other rights of use over the property, limited “home business” options and so on.

(Tip: Take lots of “before and after” photos of the house and property with your cell phone – a dated picture is hard to argue with!)

Other “homework” items to ask about – what paperwork you will need (do you know where your title deed is?), how long your particular transfer is likely to take (and a linked question “what date of occupation should we agree on?”), to whom deposits and any occupational rental must be paid (and who gets paid the interest earned on monies held in trust), what compliance certificates you need, how to find the best bond rates, whether you might qualify for a FLISP (Finance Linked Individual Subsidy Program) subsidy, how to cancel and open municipal service accounts, the rights of any occupiers (not just tenants, also “unlawful occupiers”), and so on – you will have your own list.

5. What about planning my finances?

Ask your lawyer for a breakdown of who will pay what and when. Think deposits, bond and transfer costs, transfer duty, agent’s commission, bond settlement balances and so on. Cash flow forecasting, and a clear understanding of the timelines involved, are critical here to avoid unpleasant surprises down the line.

As a buyer, factor into your “affordability budget” not only bond repayments and your projected regular monthly costs (rates, services, insurance premiums, security costs etc) but also an emergency fund to cover any unexpected costs that may crop up. 

On the subject of finances, cyber-fraud is a growing issue when it comes to electronic communications and payments so agree with your lawyer on measures to ensure that neither of you falls victim. Fraudulent “here are my new bank account details” emails are flavour of the month, but the scams are constantly evolving.   

6. Should I buy-to-let in the current market?    

Buying-to-let can be an excellent investment channel, and for a whole host of reasons this time of pandemic and disruption has opened up an abundance of opportunities to prospective landlords. Just don’t rush in blind – choose the right property in the right area, go into the process with your eyes fully open, and in particular beware the common pitfall of failing to minimise your risk of having to fight a difficult, destructive or non-paying tenant. Residential property occupiers enjoy strong protections against eviction even in normal times, and these protections are even stronger for the duration of the National State of Disaster.

It is essential also to understand the impact of the Rental Housing Act on the landlord/tenant relationship – do you know for example the specific requirements around rental deposits and joint property inspections? “Ignorance of the law” is no excuse, and non-compliance could cost you dearly.   

7. Who appoints the conveyancer and why do I need one?

In a nutshell, you need to appoint a specialist lawyer (a “conveyancer”) to pass transfer of ownership from the seller to the buyer in the Deeds Office. That’s because only on registration of the transfer does the buyer become the legal owner of the property.   

As a seller, insist on choosing the conveyancer – pick a firm you can trust to act with professionalism, integrity and speed.    

8. What about buying into a complex? 

 Owing a house and living in a community scheme come with substantial benefits, just understand exactly what you are letting yourself in for both on a practical level and in regard to the various rules and regulations you will be agreeing to. 

Our courts regularly have to sort out bitter (and unnecessary) disputes around owners desperately – and almost always unsuccessfully – trying to get out of complying with body corporate and Home Owners Association rules. Common areas of complaint are home businesses, pet ownership and control, vehicle parking, noise, nuisance objections and the like. 

9. What records and paperwork should I keep?     

One thing is certain – the document you don’t keep on file is the one you will be desperately searching for in 10 or 20 years’ time! So when in doubt about a particular item keep it, but at the very least have a file (backed up electronically) with –

• Your title deed (also called a “deed of transfer”) from the conveyancer. If your property is bonded the bank will keep the original in which event keep a copy plus a note as to which bank has the original. If you lose your title deed you can get a copy but there are delays and costs attached which you really want to avoid when you come to sell again down the line.
• The full signed agreement of sale and annexures,  The conveyancer’s final statement of account and associated invoices,  
•  All bank loan and bond documents,
• Your municipal Certificate of Occupancy if you undertook any building work (construction, renovations, extensions etc),
• A running list with supporting documents of all tax-relevant expenses. For example, keep a running Capital Gains Tax schedule with –
  
  • A list of expenses relevant to the house’s “base cost” (purchase price, transfer costs and legal fees, bond costs, agent’s commission, costs related to the sale or purchase like advertising, architect’s fees etc) and 
  • Ongoing capital expenses i.e. improvements and renovations (but not repairs or maintenance).  
    
• “Before and after” photos of the house and property,
• Ask your lawyer if there is anything else you should keep relevant to your particular property and transfer. 

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

“…an employee who gives short notice in violation of the contract … may be obliged to serve out the notice period” (Quoted in the judgment below)

It’s an age-old workplace dodge – threatened with a disciplinary hearing and fearing a guilty verdict, an employee resigns with immediate effect and walks out the door with a defiant “Well that’s it, you just lost your right to discipline me. See you around, loser”. 

No longer! Our courts have dealt with this issue often in the past in various guises and with conflicting outcomes. Fortunately, a new Labour Appeal Court (LAC) decision has finally settled the matter.

The bank employee and the fraudulent cheque charge

• A bank employee was given notice to attend a disciplinary hearing on a charge of misconduct after a R30,000 cheque was cashed without proper procedures being followed (the cheque was later found to have been fraudulent, and the bank lost R30k). 
• She resigned “with immediate effect”, presumably fearing a guilty verdict and the risk of her name being put onto the Banking Association of South Africa’s REDS (Register for Employees Dishonesty System) database.
• The bank however insisted that she serve the four-week notice period in her employment contract and convened a disciplinary enquiry within the notice period.
• The employee and her attorney arrived at the enquiry to argue that her immediate resignation had ended the employment relationship and that the enquiry could not therefore continue. When the chairman rejected this argument, she left the enquiry to proceed in her absence.
• Found guilty of misconduct and summarily dismissed, the employee approached the Labour Court which agreed that the resignation had terminated the employment. It accordingly ruled the dismissal null and void. 
• On appeal however the LAC found that the employer had been entitled to enforce the contractual four-week notice provision, that the employment relationship therefore still existed at the time of the hearing, and that the dismissal was accordingly valid.

Employers: Be clear and be quick!

• You can choose to enforce the notice period provision, or you can choose to waive it. If you are found to have waived it, the employment relationship will have ended immediately. To avoid any risk of that, make it crystal clear to the employee that you are enforcing the notice period.
• Secondly, don’t drag your feet on holding the disciplinary enquiry – you must act before the notice period expires and the employment relationship ends.

What if there is no notice period in your employment contract?

In that case, said the Court, the notice periods in the Basic Conditions of Employment Act (BCEA) would apply –

“(a) one week, if the employee has been employed for six months or less;
(b) two weeks, if the employee has been employed for more than six months but not more than one year;
(c) four weeks, if the employee

(i) has been employed for one year or more; or

(ii) is a farm worker or domestic worker who has been employed for more than six months.”

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

“It is a fundamental principle that no man is allowed to take the law into his own hands” (Transvaal Supreme Court, 1906)

Landlords can be sorely tempted to force defaulting tenants to settle their arrears (or to vacate the premises altogether) with a bit of instant “self-help” by cutting electricity or water supplies, or perhaps by changing locks or disabling access codes. 

From the High Court comes another timely warning that you cannot resort to self-help without risking an immediate and costly “spoliation order”.

What exactly is a spoliation order?

In a nutshell, it is an order rapping you over the knuckles for taking the law into your own hands and forcing you to return to the previous status quo whilst you fight your weary way through proper legal channels. 

To quote from a 2012 Supreme Court of Appeal decision (emphasis supplied): “Spoliation is the wrongful deprivation of another’s right of possession. The aim of spoliation is to prevent self-help. It seeks to prevent people from taking the law into their own hands … The cause for possession is irrelevant – that is why a thief is protected … The fact that possession is wrongful or illegal is irrelevant, as that would go to the merits of the dispute”.

The two things the tenant must prove

At this stage, the court is not interested in how strong or weak the landlord’s claim may be. Your full-on fight over the “merits of the dispute” comes later, and all the tenant need show now is –

1) That it was in “peaceful and undisturbed” possession, and 
2) That it was “unlawfully deprived” of that possession.

The filling station, the laundromat and the “personal rights” argument

• A landlord was in a protracted clash with two of its long-standing tenants – a filling station and a laundromat – over disputed electricity arrears totalling some R240k. As often happens, the landlord was on the hook for the arrears, and was, it said, “facing financial ruin”. The leases had been cancelled and High Court litigation over the disputes was pending.
• Eventually, by agreement, pre-paid meters were installed. The tenants loaded their first credit tokens but suddenly found themselves unable to top up the meters. It turned out that the landlord had instructed the electricity supplier to load the arrears onto the pre-paid meters, meaning that the tenants would have to pay the disputed arrears before they could buy more electricity.
• When the tenants launched an urgent spoliation application, the landlord argued that the tenants’ rights to a supply of electricity were purely “personal rights” in terms of their respective leases. Thus, argued the landlord, spoliation could not apply. 
• The tenants countered that “the right to access to electricity supply is an incident to the possession of the property from which they conduct their businesses” which would come to a standstill without electricity. 
• The Court’s analysis of the various legal arguments around the “personal rights v incident of occupation” fight, and over whether our law recognises “quasi-possession” of an “incorporeal” (like electricity) – as opposed to “actual possession” of the property itself – will be of great interest to lawyers. But for landlords and tenants it is the practical outcome that really matters. 
• Finding that there was an “irresistible inference that the [landlord] effectively cut the electricity (by uploading the arrears on the pre-paid meter) to force the [tenants] to vacate and to avoid having to follow due process to recover the alleged arrears” and that “this is a matter where the interference on the supply of electricity … constituted material interference of the possession of the property itself”, the Court ordered the landlord to immediately (a) restore the tenants’ access to their electricity supply and (b) cancel the negative and arrear balances on their pre-paid meters. An adverse costs order rubs salts into the landlord’s wounds.

The lesson for landlords

No matter how strong your main case may be, taking the law into your own hands is likely to be a costly mistake. Seek legal advice before you take any form of self-help action!

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

(N.B. The increases highlighted below are extracted from the Employment and Labour Minister’s announcement of 9 February 2021, and emphasis has been supplied where helpful in enabling quick identification of your employment sector. Comment is in square brackets)

• “The National Minimum Wage (NMW) for each ordinary hour worked has been increased from R20,76 to R21,69 per hour [a 4.5% increase] for the year 2021 with effect from 1 March 2021.
  
  It is illegal and an unfair labour practice for an employer to unilaterally alter hours of work or other conditions of employment in implementing the NMW. The NMW is the amount payable for the ordinary hours of work and does not include payment of allowances (such as transport, tools, food or accommodation) payments in kind (board or lodging), tips, bonuses and gifts.
• Following a transitional phase, the farm worker sector has been aligned with the NMW rate of R21,69 per hour [a 16% increase]. 
• The domestic workers sector will be entitled to R19,09 per hour [a 23% increase] and could be expected to be aligned with the NMW when the next review is considered [i.e. 2022]. [Use the Living Wage calculator to check that you are paying your domestic worker enough to cover a household’s “minimal need”].
• In line with the Basic Conditions of Employment Act (BCEA), the increase in the NMW will mean that wages prescribed in the sectoral determinations that were higher than the NMW at its promulgation, must be increased proportionally to the adjustment of the national minimum wage. Therefore, the Contract Cleaning; and Wholesale and Retail Sector will also have their wages upwardly adjusted by 4,5 percent.
• In another development, the Minister has also, in terms of the BCEA earnings threshold, revised the rate from R205 433.30 to R211 596.30. Chapter 2 of the Act deals with the regulation of working time, limit on the duration of an employee’s working week and to prescribe a rate at which an employee should be paid to work outside normal working hours among others.
• Employees that earn in excess of this rate per annum are excluded from sections 9, 10, 11, 12, 13, 14, 15, 16, and 17(2) and 18(3) of this Act from 01 March 2021. These sections protect vulnerable employees and regulate amongst others, hours of work, overtime, compressed working time, average hours of work, meals interval, daily and weekly rest period, pay for work on Sundays, night work, and work on public holidays.”

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

Now more than ever before, scenario planning is essential for the success of your business. But of course the next step in the process is just as critical – you need to create an actual business strategy based on your scenario planning. It’s a process that can be both quick and simple.

As the author of “From Scenarios to Strategy: Top 3 Methods” on the Medium website points out, even smaller businesses with limited resources will find the “wind tunneling” method both powerful and flexible.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

“7,000 people have already been arrested for not wearing masks and most of them now have criminal records” (Police Minister Bheki Cele in mid-January)

We all know that wearing a face mask is the right and the safe thing to do, but it is also a legal requirement – and it’s one that you really don’t want to breach.

Firstly, can you be arrested for not wearing a mask?

The short answer is yes, the amended Disaster Management Act Regulations providing that –

• Everyone (except children under six) must always wear a face mask (covering nose as well as mouth!) when in a public place.
• It is a criminal offence not to comply with a verbal instruction to wear a face mask by an “enforcement officer” (defined to include SAPS and SANDF members, “peace officers” such as magistrates, Justices of the Peace, correctional services officers, municipal law enforcement officers and other designated officials). There are also reports of arrests without such an instruction being given beforehand, and as the police appear to be using their interpretation of the Regulations to conduct these “arrests without warning”, rather be safe than sorry – assume that if you have no mask you risk immediate arrest and prosecution.
• You are liable on conviction to “a fine or a period of imprisonment not exceeding six months, or to both such fine and imprisonment.”
• You need not wear a mask while undertaking “vigorous exercise” (not defined in the Regulations but presumably including fast running, cycling and the like – err on the side of caution here) provided that you continually maintain a distance of one and a half meters from any other person.

You could end up with a criminal record, and that’s real trouble

You can of course elect to go to court to fight the charge, but often you will also be given the alternative of paying an “admission of guilt” fine. 

It will be a tempting offer at the time but be careful – paying a fine is one thing but if you end up with a criminal record (an entry in the SAPS Criminal Record Centre database) you will regret it. Imagine for example a scenario where you apply for a job, or a travel visa, or a firearms licence, or for credit (such as a home loan). And suddenly up pops your long-forgotten criminal record, a nasty surprise at the worst possible time.

Plans to change the law so that only some admission of guilt fines will result in a criminal record have so far come to nought. So as the law stands you will end up with a “deemed” conviction and sentence – and thus a record – if you are arrested and your fingerprints are taken. Which is exactly what the Minister says will happen to you.

And once you have a criminal record, it’s not at all easy to get rid of it.

Three ways you can try to remove your criminal record  

1. Firstly, you can apply for “expungement” of the record to remove it from the CRC database, but that option is only available to you after 10 years and for certain “minor offences”. It will also take a long time to process – “20 – 28 weeks” per SAPS. Note that some specified minor convictions fall away automatically after 10 years – ask for specific advice.
2. Secondly, you could ask a court to set aside your conviction and sentence – costly, not an immediate fix, and not guaranteed to succeed.
3. Thirdly, you could hope that planned amendments to our criminal procedure laws will retrospectively come to your aid – speculative for now.

The bottom line – wear your mask, and don’t admit guilt without legal advice!

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews

“…a third party is expected to do more than rely upon a bold assurance by another party regarding his or her marital status” (quoted in judgment below)

If you are taking advantage of our current low interest rates and reduced selling prices to buy a property, make sure that you establish the seller’s marital status with something more than what the seller tells you.

Your risk comes in if the seller is married in community of property. That’s because, whilst our law generally allows spouses in such a marriage to “perform any juristic act with regard to the joint estate without the consent of the other spouse”, there are exceptions.

And one exception relates to immovable property. A spouse needs the written consent of the other to sell, mortgage or burden the property (by granting a servitude over it for example). Without that written consent the transaction is void, unlawful and unenforceable.

Which is where the danger comes in. Consider this scenario – you pay for and take transfer of a property from a seller who you think is unmarried, but a spouse suddenly appears and says “I never consented to that sale so it’s void. The transfer to you is cancelled so out you go and good luck getting your money back”. What now? 

Competing rights and a balancing act

There is of course a fine balancing act for courts involved here – on the one hand, the rights of the non-consenting spouse and on the other hand your rights as a good-faith buyer from a seller who you believed to be unmarried.  

A recent Supreme Court of Appeal (SCA) judgment addressed exactly that situation.

“But I thought I was buying from an unmarried seller”

• A husband married in community of property sold and transferred a house to a buyer in 2009. At the time, his wife was not living in the house, having moved to another part of the country due to old age.
• When the seller passed away in 2013 his wife was appointed executrix of his deceased estate. Some four years later she successfully applied to the High Court for cancellation of the deed of transfer on the basis that the sale had been without her knowledge or consent.
• The buyer appealed to the SCA on the basis that the wife’s consent to the sale should be “deemed” to have been given in that the relevant legislation provides for such deemed consent where a buyer “does not know and cannot reasonably know that the transaction is being entered into contrary to [the requirement for written consent]”. 
• He had, said the buyer, acted bona fide (in good faith) as he had not known of the marriage: “At the time I purchased the property from the deceased/seller, he was staying alone in the said property and he also confirmed to me that he was not married. He signed the deed of sale and also the transfer documents alone as unmarried.”

What the buyer must prove

The buyer had to prove that he did not know, and could not reasonably have known, that consent was needed but lacking. 

What the Court here needed to decide was whether the buyer should at the time of the sale have known of the marriage and the lack of written consent. “A duty is cast on a party seeking to rely on the deemed consent provision” held the Court “… to make the enquiries that a reasonable person would make in the circumstances as to whether the other contracting party is married, if so, in terms of which marriage regime, whether the consent of the non-contracting spouse is required and, if so, whether it has been given.”

Finding that the buyer had indeed proved (1) that he did not know that the deceased was married and (2) that he could not reasonably have known this, the SCA allowed the appeal and the transfer to the buyer stands on the basis of deemed consent by the spouse. 

The facts of each case will be different, and it is important to bear in mind that in this particular matter the husband’s claim to be unmarried was supported not only by the absence of any sign of a wife but also by two official documents – the deed of transfer and the power of attorney to pass transfer.

The bottom line is that as buyer you must make “reasonable enquiries” as to the seller’s marital status and as to whether the other spouse’s written consent to the sale is needed.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews