Lease terminology simplified

For many first time tenants, entering into a lease agreement is a contractual obligation laced with complicated jargon.

This is a basic Translation Guide for tenants often caught unawares of the language around fine print.

Inception Date: This is the date agreed on by the tenant and landlord when the lease will start and the tenant moves into the property. 

Termination Date: This is the date agreed on by the tenant and landlord in advance on when the lease will end and the tenant leaves the property. It is important to note that when there is a fixed term (set time period) for the lease agreement, for example six, 12 or 24 months, the tenant will have to leave the property when that time frame is over. However, at the end of the initial term, the tenant and landlord can renegotiate a further fixed term or agree to a month-to-month lease with a calendar months’ notice.

The Cancellation Date: Is the date when the lease is cancelled early, usually by the landlord as a result of a material breach by the tenant. Once the lease is cancelled, the landlord can demand the tenant leaves the property immediately. However, this is usually impractical because the tenant would not have secured alternative living space and is generally frowned upon by the Rental Housing Tribunal. It is more reasonable and better practice to give the tenant 2 weeks’ notice to vacate. 

Cancellation: This refers to the early cancellation of a fixed term lease agreement. A landlord has the ability to cancel a lease agreement should the tenant breach the lease terms, for example non-payment of rent and the failure to meet the demands set by the landlord in terms of the lease agreement. Should the tenant pay the arrear rent subsequent to cancellation of the lease, the lease still remains cancelled. Should the landlord decide to allow the tenant to remain in the property, a new lease agreement would have to signed by both parties. 

It is important to note that tenants also have the right to cancel a fixed term lease agreement by giving 20 business days notice. The tenant’s right to cancel is provided in the Consumer Protection Act – but only applies to leases signed after the 1^st April 2011 and the tenant would still be liable to pay a reasonable penalty. 

Eviction: This is a court order. Should the tenant fail to pay rent and landlord has cancelled the lease, and the tenant remains in the property, the landlord applies to the court for an eviction order. However, an eviction can only be carried out once due legal process has been followed. 

Spoliation: This refers to an act by the landlord which prevents the tenant from having peaceful undisturbed access to the property. Commonly, spoliation happens when the tenant has not paid their rent and the landlord retaliates by disconnecting utilities or locks the tenant out of the property. The tenant can apply to the court for an urgent interdict. Courts take the act of spoliation very seriously and will hear the matter on the same day and have been known to order costs to the tenant. 

Criminal Offence: In terms of the Rental Housing Act, which regulates residential rentals, it is a criminal offence for the landlord (or his agent) to lock a tenant out of the property or disconnect utilities. Only a service provider such as Eskom, City Power or the Municipality may disconnect utilities for non-payment. 

Michelle Dickens is the Managing Director of TPN Credit Bureau, developers of the only trusted rental payment profile database of its kind in South Africa. The TPN database combines information from TPN and other highly valuable sources, such as Experian and TransUnion, to provide the most comprehensive behavioural profiles on tenants and prospective buyers in the property industry today. For more information visit   http://www.tpn.co.za/.