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Tuesday Jan 22, 2013

Durban property development 'hijackers' evicted

More than 200 people who "hijacked" a high-quality housing estate in Durban and embarked on a rent boycott, plunging the non-profit development company into a financial crisis, have been given six weeks to move on.

Durban High Court Judge Jerome Mnguni has issued an order against 231 named residents of Riverview in Cato Manor, their relatives and any other "unlawful occupiers", directing them to vacate their units by February 28, failing which the sheriff will evict them.

His judgment - in which he found their conduct "inimical to our legal order" - should bring to an end years of legal action instituted by Sohco Property Investments against the residents and others in two other similar housing schemes in Durban in which it had invested hundreds of millions of rand.

Sohco, in papers before the court, says it aims to provide affordable and quality homes for families earning between R2 500 and R7 500 a month in Durban and other cities in South Africa. It does this through the crosssubsidisation of rentals with higher income earners paying more than lower income earners for identical units.

Two years ago, when it launched the eviction applications in all three of its projects, it was owed R9.5 million in rent and it expressed fears that it could be forced into liquidation.

It was in arrears with its bond from the National Housing Finance Corporation, which was threatening legal action, and the financial risk to the provincial and national governments - which provided an institutional subsidy - was about R16m.

At Riverview alone, it had invested R75m in the 330 two-bedroomed unit complex, but, it complained in court papers, the estate had been hijacked by gangsters who were knocking down walls, chasing out lawful tenants and taking rent from others.

The residents denied this, claiming they had a legitimate dispute with the company.

They claimed the rental amounts on their leases were left blank - only filled in after they signed - and they were advised that the (government) subsidy would cover rentals or reduce them.

Judge Mnguni, in his judgment, said despite the "mountain of evidence", the residents denied they had breached their leases. "It seems they have arrogated to themselves the decision as to when, where and how to pay the rentals due.

"Importantly they have also defied a finding of the KwaZuluNatal Rental Housing Tribunal (that they must pay rent) and have embarked on a deliberate strategy of non-payment to force the applicant to reduce rentals."

Regarding submissions that they would be left homeless if evicted, he said it appeared many were gainfully employed.

Their circumstances also had to be balanced against those of the company which had expressed fears that the residents might be attempting to force it into liquidation so they could live in their units free of charge for an extended period.

In granting the eviction orders, the judge also agreed with submissions by advocate Dave Phillips, for Sohco, that the boycott was not borne of economic hardship or inability to pay and the actions of the residents were depriving other deserving people of living on the estate.

He ordered the residents to pay the costs of the application.

The company has obtained similar eviction orders against rent defaulters in its Portview (Albert Park) and Valleyview (Hillary) projects.

In the former, Judge Dhaya Pillay said the fact that residents could be homeless "was a consequence of their own conduct" because they had withheld rent for three years "in bad faith".

The 96 residents involved in that matter were also ordered to pay the costs of the application.

The Valleyview eviction ruling went on appeal but was rejected by the Constitutional Court.

The Mercury

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