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Wednesday Sep 11, 2013

Property 'agent' must provide proof of mandate

A person has the right to bring legal action and the right to proceedings as the landlord, owner or relevant interested party to the contract. A resolution of the directors of a company, members of a close corporation or of trustees sets out the authority given to a person (an agent) to act on their behalf.

A person representing an entity (tenant or landlord) at the Rental Housing Tribunal is required to provide proof of its authority and the extent of its mandate. In the absence of such authorisation, the agent does not have the legal standing ( locus standi).

Landlord-tenant disputes can be resolved between parties themselves and they should be encouraged to do so.

Where an 'agent' (for example an attorney, a community organisation or an estate agent) acts for a party, it is incumbent that the agent places the interest of the client above its own.

The agent must have a clear mandate or instructions within which decisions can be taken to end a dispute.

What happens when an agent, without proper authorisation, enters into negotiations and even concludes an agreement?
The authorisation or a mandate must be examined within the context of locus standi.

Let us look at a few examples to understand the serious implications in the event of an incorrect mandate or a fraudulent misrepresentation. Example one: A body corporate terminates a lease agreement and then proceeds to evict the tenant.

The landlord who is an owner of one unit (flat), has been informed that the tenant has become a nuisance and the other owners and tenants have had enough.

However, the landlord does not terminate the lease agreement, neither does she instruct the body corporate to act on her behalf.

While the landlord should have taken action, first, by placing the tenant on terms, allowing the tenant to rectify the breach of agreement and thereafter to proceed with the cancellation of the agreement because of the tenant's failure to remedy the breach, the body corporate cannot act as the landlord, unless mandated to do so.

The body corporate can take action against the landlord/ owner for not adhering to the provisions of the Sectional Titles Act. Example two: An organisation represents a group of tenants regarding a maintenance and rental dispute.

After concluding an agreement, the landlord is unable to enforce the terms because not all of the tenants mandated the organisation to act for them.

During negotiations the landlord should have asked for proof of representation from the organisation's spokesperson.

Often, a written document with an instruction from the tenants, containing their details and signature, may suffice.

The extent of the mandate is also important, that is to say: parties are informed that the representative can take decisions and even finalise a settlement agreement or that there are restrictions under which the representative is mandated.

Take the above examples as being played out before a court or better still, at the provincial Rental Housing Tribunal.

A party that appeared before the tribunal subsequently informs the tribunal that during the hearing proceedings, the person who claimed to have represented the party was not mandated or authorised to act.

The tribunal is asked to hear the matter again or to change its ruling based on 'evidence' to be presented by the party itself.

Unfortunately for the aggrieved party, the ruling (judgment) cannot be reviewed or new information examined because once the tribunal gives its ruling, it becomes functus officio. In other words, the case is closed and the tribunal has no authority to re-examine the case and to give a new judgment.

The party has to approach the high court in terms of section 17 of the Rental Housing Act to have the proceedings of the tribunal reviewed.

A proper mandate and the tribunal itself asking for one at the commencement of the hearing will assist parties in the finalisation of their case.

Sayed Iqbal Mohamed
Chairman, Organisation of Civic Rights.
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