RENTAL RECOVERY - LEGAL PROCESS EXPLAINED

RENTAL RECOVERY - LEGAL PROCESS EXPLAINED

Rental collection in South Africa falls under the scope of the Debt Collection Act 114 of 1998, which ensures professional conduct throughout the collection process.

Step 1: Letter of Demand

A Letter of Demand is sent providing the Lessee a number of days to make full payment of the outstanding arrears. If no payment is made, the next step is taken.

Step 2: Rent Interdict Summons

1. A Rent Interdict Summons is issued by the relevant Magistrates Court.           

2. The Sheriff serves this document on the Lessee and attaches assets to the value of the outstanding amount owed by the Lessee.

3. The Lessee may not remove these assets until the matter has been finalised, alternatively he might face criminal prosecution.

4. The Sheriff does not remove the attached assets and merely writes them up on an inventory which is provided to the attorney's offices, and the Lessee.

Step 3A: If the matter is defended

A1. The Notice of Intention to Defend is filed. This indicates the Lessee's intention to defend the matter and the Lessee will have 20 days to file a plea to the averments made.

A2. A Plea is filed in which a defence is set out, thereafter pre-trial preparations start. The matter will proceed to trial unless settled.

Step 3B: If the matter is not defended

B1. The Lessee has 10 days to defend the matter. Should he fail to defend the matter, the attorney will apply for a Request for Default Judgment. This process is explained to completion as it is more common.

Step 4: Request for Default Judgment

In this document, the attorney requests the Magistrates Court to grant Judgment against the Lessee.

Step 5: Issuing of a Warrant of Execution

A Warrant is to be provided to the Sheriff to enable the Sheriff to attach and sell the movable assets of the Lessee.

Step 6: Section 65 Proceedings

Should the Sheriff not be in a position to locate enough assets to sell in order to settle the outstanding debt, the attorney will issue a Section 65 Notice to the Lessee. The Lessee would be provided with a date to appear in court to explain his income and expenditure to a Magistrate, whereafter a Magistrate will order the Lessee to pay a specified amount monthly to settle the arrears.

It is important to note that the obtaining of a Default Judgment takes between two and four months, depending on the jurisdiction. Finally, a Default Listing is made on the credit record of the Lessee and he will not be able to obtain credit for a period of 5 years.

Courtesy: Van Wyk van Heerden Attorneys. www.vwvh.co.za