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ORGANISATION OF CIVIC RIGHTS
March 10, 1995
We wish to make
the following submissions in respect of Tenants' rights:-
Theme Committee
4
(Fundamental Rights)
We are of the view that Tenants' Rights should be
guaranteed in the Constitution. This should be enforceable against individuals
as well as the state.
Theme Committee 5
(Judicial and Legal
System)
Ad 2. We believe that Landlord-Tenants' courts would play a
fundamental and specialised role. Ad 6. Through specialised structures,
e.g.
Landlord-Tenants' courts.
Explanation [from page 26 Grassroots
Perspective of Tenants' Rights in South Africa.
Published by the Organisation
of Civic rights. Durban 1994]
LANDLORD-TENANT COURTS
The Housing
court is a judicial reform with a progressive specialised court system dedicated
to prompt
and efficient action. It is the solution to the high legal costs,
bureaucratic red tape, procedural and
motion delays, presenting an equitable
system for landlords and tenants. It is a solution to the
overloaded and
overworked justice system.
A cursory glimpse of some of its
features:
* It has statutory and common law jurisdiction
* Its jurisdiction is wide and concurrent with the district, supreme and
appeals courts
* Its far reaching substantive jurisdictions include:-
- review
decisions of the rent control board
- private rental housing,
public/state/federal housing
- powers to enforce orders, sentences and
judgments
- powers over housing code violations and broad jurisdiction over
criminal
and civil disputes
* Judges are appointed in the
same manner as their peers in other courts
* Speedy, fair, efficient and
sensitive resolution of housing disputes
* It allows small claims and has
housing specialists who work with landlords
and tenants.
* These
courts contribute towards decent housing, arrest the spread of urban
blight, maintenance of proper housing standards.
A few examples of these
courts are the Boston Housing Court (1972), the Hampden County Housing
Court
(1974) and the Los Angeles Landlord-Tenant Court (1977).
We do have
confidence that the Constitutional Committee will be able to ensure the need to
include
the rights of tenants.
Details on the OCR is enclosed herewith as well as the following documents:
1. Grassroots Perspective of Tenants' Rights in South
Africa 2. Legal Handbook
Book on Tenants' Rights 3. Submission on white paper to Ministry &
Department of Housing 4. Newsclippings
Thank you in
anticipation,
Sayed-Iqbal Mohamed
Chairperson
in the service for better
and just living conditions
ENQUIRIES: ANILLA SOMA (MRS) GEN.
CO-ORDINATOR/ CLAUDETTE WAGNER (MRS) ASST.
O-ORDINATOR
ORGANISATION OF CIVIC RIGHTS
Incorporating the
Durban Central Residents’ Association (DCRA) & its
subcommittees
SUBMISSIONS BY THE ORGANISATION OF CIVIC
RIGHTS
(OCR) TO THE DEPARTMENT OF HOUSING & TO THE,
MINISTER OF
HOUSING IN RESPECT OF THE WHITE
PAPER DEALING WITH A NEW HOUSING POLICY
AND
STRATEGY FOR SOUTH AFRICA
Allow us on behalf of die tenants and
the homeless communities we serve and who are directly elected and represented
on the OCR's
executive and sub-structures to commend the government on its WHITE
PAPER. The housing policy and strategy envisaged marks a dramatic
and resolute
break from the past undemocratic and apartheid policy. The inclusion of a
people-orientated approach deserves further
compliment.
On the rights and
obligations of tenants and landlords the WHITE PAPER, unfortunately, has made
just one or two scant fleeting remarks.
We therefore make the following
submissions in earnest and with the hope that urgent cognisance is taken of the
need to formulate
policy, strategy and law regarding tenants and
landlords.
Granted that there exists consultation between the state and
civil society through the National Housing Forum (NHF) and the eight
Joint
Technical Committees (JTCs). OCR has established that neither the NHF nor the
JTCs have recognised, for argument’s sake,
the existence of
tenants.
Hence, there appears to be no policy development on specific
priorities.
It is our humble submission that the state is pursuing its
objective of adequately addressing
the housing back-log and new household
requirements must simultaneously develop a national
policy framework
recording the rights and obligations of tenants and landlords. The
failure
to do so will impact negatively on the State's housing policy and
strategy.
The further submissions below form part of our detailed
discussion on the rights of tenants
in South Africa and submissions made to
the Housing Ministry on August 25, 1994.
1.
1.1 Tenants occupy 113 of the country's total housing
stock.
1.2 Tenants are in urgent need of security of tenure, improved
living conditions and to have related matters attended to swiftly and
with
justice. This would necessitate an overhauling existing laws governing
landlord-tenant relationships.
1.3 The present housing crisis will not be resolved immediately and it is
therefore absolutely
necessary to ensure the rights of tenants. Hence, it is
necessary to place the responsibility of overseeing and enforcing the rights
of
tenants with specialised structures. Landlord-Tenant Courts and Dispute
Resolution Centres are two such examples.
2. FACTORS NEGATIVELY
AFFECTING TENANTS
2.1 The OCR's on-going grassroots activities and its
contact with bodies nationally, reveal
growing problems and hardships which
may be summed up in the following major categories:-
2.1.1 AFFORDABLE
RENTS: the average family cannot afford the ever increasing rents;
2.1.2
PENSIONERS as well as other tenants are being displaced in increasing numbers;
such
displacement may be due to conversion or demolition;
2.1.3 EXPLOITATION: Landlords have superior bargaining power over tenants who
are:-
2.1.3.1 forced to pay premiums [goodwill/keymoney]
2.1.3.2 faced with arbitrary evictions
2.1.3.3 faced with retaliatory actions when they complain
2.1.3.4 compelled to accept exorbitant rent hikes
2.1.3.5 forced to live in substandard, unsanitary and uninhabitable
conditions
2.2 Existing housing legislations do not provide
adequate protection to tenants. Where protective measures do exist, these are
blatantly
violated and not enforced by the relevant government
departments.
2.3 There is little or no focus on the hardships experienced
by tenants which is intensifying because of the socioeconomic conditions.
Rentals cannot be written off or reduced. Tenants cannot choose affordable
rentals. Neither can they withhold nor reduce rentals.
Yet, rentals are
calculated on the "open market" when in practical and logical terms, there is no
"market-related" basis.
2.4 There are other relevant factors negatively
affecting the rights of tenants:-
2.4.1 Government structures are not
geared to handle violations of existing residual rights
of tenants.
2.4.2
The State Attorneys office is overworked, understaffed and consequently not
interested
in criminal prosecution.
2.4.3 Existing legislations do not
provide easy and reliable access to government departments.
Tenants cannot
therefore be assured of the enforcement of their rights.
2.4.4 It is
too expensive and time consuming for tenants to claim their rights through
the
present legal system.
3. PROPOSALS:-
3.1 It is
therefore proposed that all interested groups and relevant departments,
including the
Ministry of (National) Housing, the Ministry of Justice,
National Housing Forum, Constitutional
Committee, inter alia, be part of
the restructuring of tenants'-landlords' rights;
3.1.1 In this respect,
the OCR hopes to present recommendations for revised rent control laws and
related matters; submit proposals
for the establishment of Landlord-Tenant
Courts, its structures and recommendations for the rules and procedures relating
thereto.
3.2 The following is therefore proposed for the medium to long
term [estimated period being
18-24 months] which OCR is willing to undertake
as a project :-
3.2.1. Developing guidelines for restructuring of rent
boards and rent control boards.
3.2.2. Developing a landlord-tenants'
Bill of Rights
3.2..3. Developing a legal framework to introduce:-
(a) Landlord-tenant's courts
(b) A revised rent control legislation
(c) Dispute-Resolution centres
3.3 THE FOLLOWING PROPOSALS, IF
POSSIBLE, TO TAKE EFFECT IMMEDIATELY :-
3.3.1 The reconstitution of all
rent boards. New members to be appointed through a process similar to the
selection, interviews and
appointments of members to the SABC board. Such an
approach would ensure, inter alia, impartiality, competence and
efficiency.
3.3.2 The establishment of an ombudsman to investigate
tenants' complaints;
3.3.3 The establishment of Dispute Resolution
Centres which would:-
3.3.3.1 Arbitrate, mediate and make referrals to
courts and welfare institutions. It would take up issues of unreturned rent
deposits,
unfair withholding by a recalcitrant tenant, need for repairs,
arbitrary evictions;
3.3.3.2 These centres could be an extension of rent
boards, staffed by qualified personnel.
3.3.4 Moratorium on exemptions of
dwellings from rent control;
3.3.5 Moratorium on the displacement of
tenants. Such displacement may be due to proposed/impending demolition,
conversion of rented
accommodation for non-residential use or 'upmarket"
refurbishment or property development schemes, such as Sectional Tide and Share
Block Schemes;
3.3.6 Moratorium on arbitrary evictions and c-evictions
based on retaliatory and discriminatory
reasons.
3.3.7 The "freezing" of all rentals for a period of 18 months where
exploitation exists;
[Explanatory Note: The reconstituted rent boards or an
ombudsman could investigate tenants'
complaints.
3.3.8 The
introduction of rental subsidy for tenants experiencing hardships. 'These will
include
pensioners and the unemployed.
4. Legislation is needed
urgently to protect tenants from racial discrimination.
- Recognition,
by law, of all properly constituted democratic tenants'
committees.
[Explanatory Note: Most tenants' committees are ignored or dismissed by
landlords as not
having locus standi. Often, punitive action is
taken against members of tenants' committees.
Sayed-Iqbal
Mohamed
Chairperson
in the service for better & just living
conditions
February 28, 1995
A GRASSROOTS PERSPECTIVE OF
TENANTS’ RIGHTS IN SOUTH AFRICA
By Sayed-lqbal Mohamed
As a
project for the Organisation of Civic Rights
Published by
Sayed-lqbal Mohamed
P.O.Box 4787, Durban, 4000, South Africa
Tel. 304 6451
Fax. 301 0026
Code: National 031; International 2731
COPY RIGHT (C)
Sayed-lqbal Mohamed April 1994
ISBN 0-9583886-1-X
Members of
Parliament and the media are free to print or report information contained in
this document, either in whole or in part,
on the strict understanding that the
author or the Organisation of Civic Rights is
acknowledged.
ACKNOWLEDGEMENTS
My sincere thanks and
gratitude to all those who through their valued assistance made this especially
ASHOKA (persons locally and
overseas), Scott Leckie (Centre on Housing Rights
and Evictions-:COHIZE, Netherlands), Liz Coetzer (Central Statistical Services:
CSS, Pretoria) and Annagret Mphahlele. My sincere thanks to Mr J. Smalberger of
the CSS, who made important information available
and took the time to correct
my tabulations and tables. I am also indebted to Shireen Mohamed and Salim
Osman for their valuable
time for having read, this document and for having
provided constructive criticisms and invaluable suggestions. A special thanks
to Navi Naidu for patiently and diligently typing and overseeing its
printing.
Many thanks to the Royal Netherlands Embassy [Pretoria] whose
financial assistance made this document, which forms part of OCR's tenants
rights project, possible. Grateful thanks to all tenants to whom this document
is pivotally linked and whose rights will some day
be realised, God
willing!
CONTENTS
INTRODUCTION
OVERVIEW
Multi-party
Negotiations
Feudalistic Tenurial Relationship
The Rent Control
Debate
BRIEF BACKGROUND TO THE OCR
HOUSING IN SOUTH
AFRICA
Bird's Eye-View of Basic Amenities
Tenure in South
Africa
Table 1: Type of Dwelling/Ownership
Percentage Distribution of
Persons by Dwelling Type
Tables 2, 3 & 4: Dwelling Types Occupied by
Different Ethnic Groups
Table 5: Percentage of Ethnic Groups According to
Terms of Occupancy
Conclusion
THE FOUCHE COMMISSION
REPORT
The Fouche Commission Report
Subjoining of Overseas
Report
Conclusion
LANDLORDS’ CAMPAIGNERS:
SAPOA
Conclusion
MARKET-RELATED RENTALS
Estate
Agents
Fallacious Approach
Classical Theory of Supply &
Demand
Conclusion
RENT CONTROL
Historical
Development
Modern Development
First Generation Rent
Control
Second Generation Rent Control
Campaign for the Abolition of
Rent Control
Is Rent Control Responsible for Undermaintained
Dwellings?
A CASE STUDY: SURVEY OF
DEVELOPMENTS IN THE
USA
Rent Control
Landlords' Challenges
"Just Cause
Eviction”
Landlord-Tenant Courts
GENERAL COMMENTS &
PROPOSALS
Tenants' Courts
Factors Negatively Affecting
tenants
PROPOSALS
REFERENCES
UN Resolution On Forced
Evictions
INTRODUCTION
This document gives a
grassroots perspective of the rights of tenants which seem to be ignored by all
major political parties.
The housing crises is not new nor the plight of
tenants who are exploited by unscrupulous landlords. Available information
indicates
that as early as the 1860s in Cape Town, housing shortage led to
overcrowding. Official records in 1916 showed that rent racketeering,
low wages
and high rents were rife.
In the 1920s town planning schemes particularly
in Cape Town were being modelled after the European garden/village principles
which
were also adopted in Europe and the U.S.A. Cities were divided into
separate zones, displacing workers who were already burdened
by low wage and
were prevented from owning accommoda‑tion. Segregated residential areas
and squatter settlements emerged in
the war years in the Cape and in
Johannesburg as a result of the failure by the municipalities and central
government to provide
housing. By the late 1940s it was possible to see
segregated cities and townships.
The foundation for residential
segregation which was laid by Cecil John Rhodes a century ago (Glen Grey Act of
1894) was followed
through by various local powers. His "liberal"
segregationist policy and those of Lord Shepstone and his son, H.C. Shepstone
[secretary
of Native Affairs] were adopted by the municipalities of Cape Town
and Durban successfully and later received full support from the
central
government of the Nationalist Party. The result of separate development and
ban‑tustans made people homeless, forced
overcrowding and escalated rents
by creating an artificial scarcity of land. In short, the liberals and the
nationalist party govern‑ment
further oppressed the disadvantaged
masses.
Today, almost a third of the country's population are living in
rented accommoda‑tion. As tenants, their rights are almost
non-existent.
What exists, is usually ignored or not enforced. The voice of landlords and
their agents have always pressured the
government into introducing "reform"
whereby "quick, easy and high" profits could be made. Tenants are considered a
"commodity",
housing is contextualised as the most appropriate "market" and
rentals the most suitable means to becoming rich.
This "document" is a
short and humble attempt to put forward the case of tenants and possible
immediate and short to long term solutions
for both tenants and landlords. Any
shortfall is solely mine.
Sayed-lqbal
Mohamed
Chairperson
Organisation of Civic Rights
in the service for
better and just living condition
April
1994
OVERVIEW
' Inadequate and insecure shelter,
wherever it exists, will lead to social and political instability and will
hamper physical and
economic development.'
HABITAT: GLOBAL STRATEGY FOR
SHELTER TO THE YEAR 2000
Shelter is a basic need. Shelter for the
homeless and affordable housing which includes tenurial security, easy access to
employment
and basic amenities, is an international need. More than 1
billions[1] people in almost
all countries are inade‑quately housed or are homeless.
Rented
accommodation, inner city slums, informal settlements, displacement through
forced evictions, conversion of residential stock
and exorbitant rentals, are
characteristics of South African cities as they are of "first" and "third world"
cities. The struggle
locally is no different from those of tenants
internationally. In the United States of America for instance, the courts have
refused
to recognise housing as a fundamental right.
MULTI-PARTY NEGOTIATIONS
In South Africa people are eagerly
awaiting a new dispensation. The homeless, tenants and informal residents
("squatters") in particular
have great expectations and high hopes of positive
improvements to their housing needs and tenancy. There is, however, negligible
or no focus on the rights of tenants. At the Multi-Party Negotiating Process a
clause on EVICTION -the only reference [howbeit indirect]
to tenants, in the
Chapter of Fundamental Rights of the Technical Committee, Seventh Report (July
29, 1993) was subsequently removed.
This clause was in line with the United
Nations resolution on Forced Evictions, protecting those who are faced with
forced evictions
and in need of security of tenure.
An example of a
forced-eviction law is that of the House of Assembly's Develop‑ment and
Housing Act, No 103 of 1985 which grants
the head of its department
to:-
‑* "enter upon and take possession of the property" occupied by a
tenant [38 (b) (i)]; &
* "employ such force as may be necessary to remove from the property the
tenant... and his possession" [38 (b) (i)];
* It may do all of the above "without having obtained any judgment or order
of court" [38 (b)].
A tenant is therefore denied the right to be
heard.[2]
FEUDALISTIC
TENURIAL RELATIONSHIP
The South African tenant-landlord law is still
feudalistic and very little hope exists for its improvement as we move towards a
democratic
process. It is therefore not at all surprising that the rent control
law is seen as "interfering" with the landlords' common law
rights. In feudal
England, the tenants were responsible for all main‑tenance under the
agrarian society they lived in, while
farmers (landlords) were preoccupied with
rentals.
In addition to the Socio-Economic conditions affecting tenants,
the government's segregated policies exacerbated the plight of tenants.
Even
where it introduced reform to satisfy the landlords' lobbying groups like the
South African Property Owners' Association (SAPOA)
and the Institute of Estate
Agents (IEA) it took cognisance of situations, submissions and complaints from a
"white" perspective
as is evidenced from its Housing Commissions. The Fouche
Report of 1977 is one example of such a commission's deliberations which
is
critically reviewed in this paper.
All investigations into housing while
it may even include an apology for or a shift from the apartheid legacy [the De
Loor's Task
force Report], has done almost nothing constructive to alleviate the
needs of the poor and destitute tenants. A holistic approach
is needed to
address the rights and security of tenure of tenants.
On the contrary,
the government through decades of partiality or "affirmative action" policy (i)
introduced rent control particularly
to protect "white" families of soldiers
returning home, (ii) provided housing for poor "whites" together with subsidy,
and (iii)
controlled black urbanisation, restricted access to land and
conse‑quently created an artificial escalation in land and housing
costs.
THE RENT CONTROL DEBATE
The rent control debate is not unique
to South Africa. It is universal. Studies and reports against rent control are
usually motivated
by property groups. Without substantial proof, inner city
decay and landlords becoming poor and destitute are attributed to rent
control.
It ignores the landlords' superior bargaining power; argues the case for
"market" rentals and the negative impact on the
supply and quality of housing.
These are evaluated in this paper within the South African context.
Developments in the area of
rent control and landlord-tenant relationship in the
United States of America is taken as a case study.
With the phasing out
of dwellings from rent control over the years, the government expressed hope
that the private sector will get
involved in the provision of housing. On the
contrary, the rental housing stock is being rapidly depleted by large scale
conversion
to non-residential use or up-market units by landlords. This has
resulted in the displacement of increasing numbers of average income
families.
OCR's experiences together with those of other
organisations involved in tenants' rights nationally, show the ruthless
exploitation by landlords.
In many instances, their actions may be described as
criminal in terms of the United Nations resolu‑tion.
Tenants are
forced to pay premiums (goodwill/keymoney), arbitrarily evicted, faced with
retaliatory actions when they complain, compelled
to accept exorbitant rent
hikes and are forced to live in substandard, unsanitary and uninhabitable
conditions. With the ever decreasing
stock of rented accommodation it is
virtually impossible to find alternative accommodation.
Exploitation by
unscrupulous landlords is the norm. Tenants cannot turn to the government who
is unable to provide sufficient, affordable,
suitable accommoda‑tion to
the millions of people inadequately housed, living in overcrowded
condi‑tions, are homeless
or subjected to substandard/uninhabitable
conditions.
This memorandum is a brief and perhaps a desperate attempt to
put into perspec‑tive, from grassroots experience, the scenario
of tenants
rights, landlord-tenant relationship and matters incidental
thereto.
BRIEF BACKGROUND TO THE OCR
The Organisation
of Civic Rights (OCR),[3]
formerly the Durban Central Residents' Association is a paralegal, grassroots
organisation. It is a non-aligned NGO with an issue-based
orientation. It has
been involved in community issues which include the protection and enforcement
of tenants rights for the past
ten years.
Over the years its Vocational
involvement extended to the urban and peri-urban areas of the Durban Functional
Region [DFR].
Its activities include:
* representation on behalf of tenants in matters against unscrupulous
landlords, rent board hearing, pensioners' plight;
* representation on behalf of informal residents and the homeless;
* arranging legal representations;
* crime prevention;
* the establishment of recreational facilities;
* setting up flat and street committees;
* arbitration/mediation between parties.
* research and publications
[4]
HOUSING IN SOUTH
AFRICA
There is an urgent need to improve basic amenities such as
sanitation, access to electricity and water supply. The urgency is greater
in
respect of access to land and housing. According to the Central Statistical
Services (CSS) 48% of South Africans (excluding the
TBVC
states[5]) lived in houses, 24%
in traditional dwellings (huts) and 9% in shacks and other informal settlements
(1991).
By 1990, 63% of the total population was urbanised. The urban
population was 22 million and the rural population was 16 million according
to
the De Loors Task Force Report. According to the CSS, in 1991, ninety one
percent "whites" were urbanised, 83% "coloureds", 96,2%
"indians" and 42,7%
"blacks".
Among
"blacks"[6] 15,8% (3,4
million) were living in shacks and other informal settlements in 1991 in
comparison to 3,9% in 1985. This increase was
the result of urbanisation.
Other estimates vary from between 3,4 million (1991) to 10 million (1992)
"blacks" living in informal
settlements. The Urban Foundation in 1990 estimated
7 million people in informal housing in urban and metropolitan
areas.
BIRD'S EYE-VIEW OF BASIC
AMENITIES[7]
In 1992 it was
estimated that 23 million South Africans did not have access to domestic
electricity. Of the 275 townships (excluding
the ten homelands), households in
50 townships had no electricity at all and all households in 8 townships were
electrified. There
were other varying proportions of households without
electricity e.g. 90-99% of households were without electricity in 93 townships,
80‑89% in 27 Townships, 50-59% in 20 townships.
Twelve million
South Africans did not have access to a reasonable quality of water supply. Of
the rural inhabitants, 7,7 million
did not have adequate water supply and about
9 million urban dwellers. Fifteen million urban dwellers and 14,2 million rural
population
did not have adequate sanitation. Only about 3,8 million rural
in‑habitants had access to adequate latrine
facilities.
TENURE IN SOUTH AFRICA
The TOTAL HOUSING
STOCK according to CSS estimates in 1991 was ap‑proximately 3,6
million. Fully and partly paid dwellings constituted 54,5% of the total
housing stock, 34% were rented dwellings and 10,5% were free dwellings.
One out
of every four houses was fully paid for. Excluding shacks and other informal
dwellings, 1 963 280 were dwellings fully
& partly paid for, 1 224 412 were
rented 376 922 were free dwellings and 34 903 were unspecified, amounting to a
total housing
stock of 3 599 518. The TOTAL HOUSEHOLDS were 5 317 357.
The AVERAGE HOUSEHOLD SIZE was 5,3 ("whites" 3,3; "coloureds" 5,5;
"indians" 5, 1; "blacks" 6,2). One out of every three households
consisted of 6 or more persons and about one twelfth contained a person living
alone.
Table 1
Type of Dwelling/Ownership (urban and
non urban)
Houses Flats Town/Cluster Retirement Total
Housing
house dwelling stock
Own
Dwelling 1 721 854 75 077 154 423 11926 1 963 280 54,5%
Rented
731 931 307 866 172 094 12 521 1 224 412 34%
Free
Dwelling 334793 19352 18643 4134 376922 10,5%
Unspecified 27
116 4 352 3 102 333 34 903
-------------------------------------------------------------------------------------------------------
2 815694 406647 348263 28914 3599518
--------------------------------------------------------------------------------------------------------
Of
a population of 30,9 million (1991) which excludes the TBVC states, almost half
the population lived in houses. Approximately
one tenth lived in shacks and
other informal settlements.
Percentage distribution of persons by
dwelling type:
48,2% Houses
23,6% Traditional dwellings (huts)
9,1% Shacks
5,8% Hostels/hotels & boarding houses
5,6% Town/clustered semi-detached houses
4,2% Flats
2,9% Other
0.2% Old aged homes
0,3% Retirement dwelling
The three tables below show dwelling type
occupied by different ethnic groups.
Table
2
Houses Flats Townhouse Retirement Total
Cluster
house Dwelling Dwellings
"whites" 1 054 806 256
612 91 323 21 876 1 424
617
"coloureds" 378806 63073 94789 802 537470
"indians" 115202 35171 36818 580 187771
"blacks" 1266880 51791 125333 5656 1449660
--------------------------------------------------------------------------------------------------
2815694 406647 348263 28914 3599518
--------------------------------------------------------------------------------------------------
Table
3
HOUSES Own Rented Free Unspecified
"whites" 792824 227392 32
4888 2 103
"coloureds" 200549 105 215 70 315 2
726
"indians" 81687 27 521 5 514 481
"blacks" 646795 371
803 226 476 21
806
-------------------------------------------------------------------------------------------------------------
1 721 855 731 931 334 793 27 116 2 815
695
--------------------------------------------------------------------------------------------------------------
Table
4
FLATS Own Rented Free Unspecified
"whites" 56976 192
550 6 036 1 050
"coloureds 5170 54 785 2
505 613
"indians" 3552 31 024 423 172
"blacks" 9379 29
507 10 388 2
517
---------------------------------------------------------------------------------
75 077 307 866 19 352 4 352 406 647
---------------------------------------------------------------------------------
Seventy seven percent of "whites" lived in houses in
comparison to 60% "indians", 64% "coloureds" and 38% "blacks". Thirty three
percent "blacks" live in traditional dwellings, 15,8% in shacks and other
informal settlements, 7% in hostels, hotels & boarding
houses. Sixteen
percent "indians" lived in flats, 11% "whites", 10% "coloureds" and 1%
"blacks".
The TOTAL AVERAGE PERSONS PER HOUSE was 5,3
["whites" 3,7; “coloureds" 5,6; "indians" 5,2; "blacks" 6,6.1 The
TOTAL AVERAGE PERSONS PER FLAT was 3,2 ["whites" 2,2;
"coloureds" 5, 1; "indians" 4,5; "blacks" 4,7.]
Table
5
Percentage of ethnic groups according to terms of
occupancy
Houses Flats Shacks Hostel
Traditional
hotels Dwellings
board/houses
“whites 77% 11% 0,1% 4% 0,1%
“indian” 60% 16% 0,6% 0,6% 0,1%
“coloureds” 64% 10% 3% 1,6% 1%
“blacks 38% 1% 12,6% 7% 33%
CONCLUSION
About
one third of the total housing stock were rented (1,2 million). Of these,
approximately 300 000 were flats, 3/4 million were
houses, 170 000 were town and
cluster houses and 12 500 were retirement units. Regarding ownership, 75 000
flats were owned, 1,7
million houses, 150 000 town and cluster houses and 12 000
retirement units. Tenants therefore form a crucial part but without recognition
of their rights and solutions to problems related to their tenancy.
Two
recent studies[8] showed that
racial inequalities in respect of housing continued. The studies looked at 1986
to 1992 during which period it was found
that more houses were built for
"whites" at an increased average size (from 150 m2 to 180 m2) and value. The
average value and number
of houses for "blacks" and "coloureds" declined with
the average size decreasing from 90 m2 to 55 m2 and from 105 m2 to 70 m2
respectively.
FOUCHE COMMISSION REPORT
The Fouche
Commission which was formally appointed on June 27, 1975 laid the foundation for
the rapid and massive decontrol of dwellings
in South Africa. The government
under pressure from an influential group lobbying for the "free-market rights"
of property owners,
established a Commission under the chairmanship of Mr L.
Fouche to investigate the excessive costs of housing. This was the main
reason
for the enquiry into housing.
However, rent control became one of the
additional terms of reference but with the expressed acknowledgement that its
abolition was
beyond the Commission's scope of enquiry. The Commission
therefore directed itself to examine the whole ques‑tion of rent
control
and the provisions of the Rent Control Act (No. 80 of 1976) in relation to how
it affected "white" tenants vis-a-vis landlords.
This approach there‑fore
disregarded the majority of tenants and, its recommendations, subsequently led
to the rapid reduction
of the number of units subject to rent
control.
The South African Property Owners' Association's (SAPOA)
evidence which the Commission considered substantial and its documentation
useful were biased and flawed. Its evidence could not be tested by tenants or
tenants' groups and was "white" oriented. It represented
the concern of those,
whose main preoccupation were the maximising of profits in the townships through
its development schemes and
through tenants in urban areas.
The
Commission took cognisance of a statement made in Parliament by the
Mini‑ster of Community Development (on May 25, 1975)
wherein, inter
alia, he made reference to the housing backlog:-
".... Apart
from that there is no real backlog, taking an overall view of the situation as
far as the whites are concerned, and the
major housing backlog in regard to
Coloureds and Indians is being made up at the present juncture, and the shortage
will be eliminated
more rapidly as it is possible to provide my department with
funds...”
Did the Commission reflect the state of affairs as it was
at the time of writing its report? It most certainly did not do so regarding
rent control. As for the housing backlog and the "rapid elimination" of future
shortages, the following is self evident (the information
was taken from the
Race Relations Survey):-
In 1973 the housing backlog excluding Group
Areas removals (Race Relations Survey 1973) stood
at:
"indians" 13950
"coloureds" 26725
"whites" 6450
Housing
Requirements for the period 1982-90 (according to Mr D. Mullins, who was a
senior planner of the Department of Constitutional
Development and Planning,)
were:-
"indians" 80000
"coloureds" 180000
"blacks" 1 792 500
[including 501 000 backlog]
"whites" 250000
The South African
Housing Trust estimated the housing backlog for 1992 at 1,8 million units in the
urban areas, excluding the TBVC
homelands (Race Relations Survey 1993). In
fact, the government's " rapid elimination" worked conversely.
The South
African Housing Trust estimates the housing backlog for 1992 at 1,8 million
units in the urban areas, excluding the TBVC
homelands (Race Relations Survey
1993). In fact, the government’s rapid elimination” worked
conversely.
SUBJOINING OF OVERSEAS REPORT
The
Commission subjoined to the report a "document" by Professor Milton
Fried‑man and Professor George J. Stigler wherein they discussed
the housing crises of San Francisco and rent control. It seems this essay was
taken from the Institute
of Economic Affairs' compilation of six essays on rent
control. The above essay was written in 1946 and together with the others
represent the interests of the economi‑cally dominant group. It appears
that the essay was submitted by SAPOA as an annexure
to its
memorandum.
It also made very brief reference to several overseas
countries: a) The United Kingdom, (b) the U.S.A., (c) Sweden, (d) The
Netherlands
and, e) Federal Republic of West Germany.
While it conceded
that subsidy operated with rent control in overseas countries, it could find "no
assistance therein that would be
of use to it because the system of
subsidisation of rentals by the State applies in all these countries, and this
is something the
Commission cannot recommend for South Africa. "
It is
not clear why the Commission made reference to these countries or annexed to its
report Friedman & Stigler's essay which
were three decades old and
represented a biased view. Furthermore, the report did not give a
contextualised discussion but made
cursory statements about overseas countries.
This created an impression that rent control was being phased out by
"first-world"
countries without having any reference to the conditions and
provisions of housing.
CONCLUSION
The Commission
ignored the very purpose of the Department of Community Development which was
established in 1961 to oversee a national
segregated hous‑ing policy. A
severe housing shortage resulted within ten years of its enthusiastic policy
implementation.
Fifty percent of the newly built housing by 1970 were used to
resettle "indians" and "coloureds" who were uprooted under the Group
Areas Act.
The Department of Bantu Administration and Development's programme of relocation
into "homelands" of one million people
in the 1960s aggravated the existing
critical housing shortage.
It did not approach the rent control matter
objectively and with honesty. It buckled under pressure exerted by prominent
influential
groups who were, and still are, determined to have rent control
abolished.
"Bad" landlord-tenant relationship referred to as one of the
adverse consequences of rent control by SAPOA, affected dwellings not
ever
subject to rent control. This is evidenced from OCR cases as well numerous
press reports and is contrary to SAPOA’s contention.
In fact, landlords
in wielding "absolute" power generally dis‑play an arrogant attitude.
Accommodation is offered on a "take-it-or-leave-it"
basis. Threats of eviction,
deplorable living conditions because of little or no maintenance, exorbitant
rent hikes, are the results
of this superior-bargaining power. In reality,
tenants cannot negotiate the conditions of a lease agreement and do not have
security
of tenure.
The Fouche Commission's report and subsequent
implementation of a massive phasing out programme of rent controlled dwellings
was a
destructive and callous engineering of the Nationalist dominated
government.
LANDLORDS' CAMPAIGNERS
South African
Property's Owners Association (SAPOA)
The South African Property's
Owners Association (SAPOA) and the Institution of Estate Agents (IEA) were two
prominent campaigners
for the abolition of the rent control legislation. This
law discriminated against landlords as being the worst form of price control.
It prevented, the argument continued, the private sector from building
accommodation.
SAPOA and the IEA gave evidence before the Fouche
Commission (which was appointed in 1975) and subsequent commissions set up to
investigate
housing matters. In a press statement on September 11, 1977 Mr Don
Kennedy, the execu‑tive director of SAPOA said:
' Since the
establishment of SAPOA 11 years ago, it has fought a continuous battle to rid
the country of rent control, which is regarded
by leading economists such as
Milton Riedman, as the worst form of price control. '
The government
however, decided not to abolish rent control but to phase out dwellings in three
stages. The decision not to abolish
rent control led to more "tension" between
the government and those who represented the interest of landlords and property
developers.
Mr Nigel Mandy of SAPOA who contended that they had first hand
knowledge, lambasted MPs who opposed the government's plan to abolish
rent
control.
Mr Mandy said that these MPs could not see the wood from the
trees (Sunday Tribune, April 23, 1978). His contentions summarised
SAPOA’s
evidence to the commission that rent control, inter
alia,
* inhibited the construction of new rented units
*
prevented proper maintenance and upgrading and consequently prevented increased
rentals
* created an artificial depression of capital values on which loans
were based.
SAPOA, however, seemed to have ignored the following
(i) Dwellings built after May 31, 1966 were not subject to rent
control
(ii) Tenants did not have bargaining power and were in need of
protection against arbitrary and unjust evictions, exorbitant rent
hikes and to
keep in cheek the "power" of those whose primary interests were "maximising
profits".
(iii) Rent Control was not the same as price control.
Mr
Peter Strachan, national president of the IEA pleaded the case for property
owners who were financially worse off than their tenants
(January 18, 1981). Mr
Levitt, SAPOAs Natal Regional Chief pledged to fight for the scrapping of rent
control (August 28, 1981).
Dwellings not subject to rent control [from
May 31, 1966] and those decontrolled (between October 20, 1949 to May 31, 1966)
show no
evidence of up-grading and proper maintenance. In OCR's ten years of
landlord-tenant involvement of having represented and worked
in approximately 30
000 units - 25% rent controlled, 15% decontrolled and 60% not subject to rent
control, general maintenance was
poor or non existent.
Tenants are
“fleeced" by high rents and do not have security of tenure. Key-money is
the norm in flats not subject to rent
control. In a few cases, landlords of
rent controlled buildings have charged key-money as well. Dwellings are
converted to "up-market"
apartments, to sectional title, for non-residential
use, thereby displac‑ing tenants.
There is no evidence of the
private sector's substantial contribution to rented accommodation in spite of
rent control not affecting
buildings after May 31, 1966. In fact, the private
sector's ownership housing schemes show a dismal scenario of cheap quality
housing,
poor building standards, pathetic workmanship and high profits. In one
instance, a leading utility company not for gain, had to
repay R9 million
profits which was discovered after months of investigation by a particular
government department.
CONCLUSION
It would be fitting
to place on record the response of the country's leading spokesperson for
landlords, SAPOA, to my request for
information on rent control and
housing:
" We are not involved in housing per se and, therefore, would be
unable to assist you in your objective analysis of the housing scenario.
“
"May I suggest that you contact the Institute of Estate Agents
who deal with area in which you are interested. "[March 11,
1992].
“We regret to advise firstly that SAPOA is an Association
dealing with commer‑cial and industrial property only, and,
does not,
therefore, carry any statistics dealing with residential property. " [January
18, 1994]
If SAPOA was not involved in housing per se, its
campaign for the abolition of rent control was grossly immoral. Perhaps their
interests have changed since their initial input
but what has also changed, for
the worse, is the exploitation of tenants by unscrupulous landlords. SAPOA
played a major role as
the landlords' bastion against the rights of tenants,
particularly the poor and the elderly.
"MARKET-RELATED"
RENTALS
"Ninety percent of all millionaires became so through
owning real estate.”
Andrew Carnegie
Opponents of rent control "calculate" rentals
on the "open market". Even the rent boards place emphasis on "market-related"
rentals
to arrive at a "fair and reasonable" value. In September 1977 at a
meeting of quantity surveyors in Durban, Professor WH.Malan,
chairman of a rent
board, said that rent boards should endeavour to determine as accurately as
possible the market value of the premises.
Rentals are
"calculated" or "arrived at' as if rented accommodation is a
commodity.
An "expert" entrepreneur whose statistics on rentals
nationally are used by various estate agents refused to respond or communicate
when asked certain questions relating to rentals. It appears that regular
"research" on "market trends" are made available to estate
agents. Extensive
comparable categories of private rented accommodation of major cities provide a
"guide" by which rentals are adjusted
accord‑ingly.
ESTATE AGENTS
Major estate agents did respond to questions put to them. Below, a
summary of the responses received:-
Question 1:
Where and when did the concept of market-related rentals originate?
Answer:
(i) as old as mankind
(ii) When landlords attempted to get a reasonable return
(iii) When tenants had the option to choose the property for
renting.
Question 2: How is rental calculated as being
market-related?
Answer:
(i) By demand - what the tenant is prepared to pay sets the market.
(ii) Similar sized dwellings in the same area in terms of average
rental
(iii) The landlords' costs and maximum returns in relation to the
state of the economy.
Question 3: What qualification is required
for the person or institution assigned the task of making such a
calculation?
Answer:
(i) Experienced estate agent
(ii) Landlords- who is provided with guidelines by the agent
(iii) No
qualification is required if it is accepted that the tenants set the
market.
Question 4: Is this concept a reasonable
one?
Answer:
(i) Reasonable - because it has been working for years in a free market
situation
(ii) No - because of the current fluctuating economy.
Question
5: Is there an alternative "method" or 'concept' to calculate rentals? If
yes, please state the alternative(s).
Answer:
(i) Not if there is a true democratic society
(ii) No specific method - a combination of experience in the property
market.
(iii) Unaware of acceptable alternative method.
FALLACIOUS APPROACH
The above vague and inconclusive responses
show how flawed the approaches to rented accommodation are. The very
institutions and
advocates of market-related rentals are using speculative
techniques. Rentals and rented accommodation are considered synonymous
with
basic commodities.
The entire edifice of rental-market is built on the
classical theory of supply and demand. It is not the public/tenants who set the
market but the landlords and their agents. It is not a buyer's or renter's
market but the landlord's monopoly. To take this debate
further let us examine
other aspects of landlord-tenant relationship and consequential
matters,
Property [land and building] is perhaps the best investment,
producing income as well as being a capital gain. As an asset it can
be easily
mortgaged. For approximate‑ly thirty three years property prices in South
Africa and inflation rates have been more
or less equal. Tenants' incomes on
the other hand were and still are far below the inflation rate.
Even in
rent control dwellings or persons "protected" (in terms of decontrolled
dwelling) on the grounds of income, age and uninterrupted
occupation, rentals
determined by rent boards are excessively high. The rent boards have to ensure
a "fair" return on the landlord's
investment. Rentals of widows and pensioners
are determined by the board, in certain instances, being double their total
income.
CLASSICAL THEORY OF SUPPLY &
DEMAND
Housing and rented accommodation cannot be related to the
classical theory of supply and demand. Inherently linked to this theory
are
factors such as perfect competition, choice and freedom. In relation to rentals
these are fallacious concepts contrived by monopolises.
It is therefore
untenable and illogical to speak of "market forces" in relation to accommodation
for the following reasons:-
* Rent control is not the same as price control because rent control exists
of necessity. This necessity is a crisis which affects
the supply and price of
available housing stock.
* The housing shortage is exploited by unscrupulous landlords. The shortage
itself is not created by tenants "consuming" more housing
while there is an
undersupply.
* Rentals do not drop if tenants decide not to pay or to sleep
on the streets.
* Tenants cannot "choose" rentals. Tenancy is not like consumership where
“choice" affects price. In fact, it is the very absence of choice
which necessitates protection and control from unscrupulous landlords.
* Although in 1961, 1976 and 1985 because of political unrests "whites"
emigrated thereby creating a superficial glut, "dumping" of
properties-the
renting of surplus at low rentals, did not take place.
* The contract of lease implies the freedom and consensus to agree or
disagree on the terms and conditions of the lease. In practice
there is no
freedom and consensus be‑cause the landlord wields superior bargaining
power. He or she imposes, restricts and
controls the terms and conditions.
* If we were to accept that rent is the difference between the produce of a
superior piece of land and land which is inferior, how
do we relate this to
rented accommoda‑tion?
* Property rights demonstrate that those who own property have the power to
(i) manipulate the "market" and (ii) subject people to
live under appalling
conditions at exorbitant rentals on a "take-it or leave it' basis.
* OCR's case examples of Umbilo, the CBD and various "townships" show how the
private sector operates in the absence of rent control:
substandard
accommodation, slum conditions, conversions, excessive rents and arbitrary
evictions.
* Rentals of several pensioners in central Durban of rent controlled flats
are higher than rentals of tenants living in flats not
subject to rent control.
The latter rentals may be considered very high even by real property
economists.
CONCLUSION
Housing/tenant laws and policies
have therefore resulted from the tension caused by unscrupulous landlords and
the private sector
who exploit the housing crisis. Human beings are
conceptualised as mere chattels and it is out of necessity that some form of
"protection"
be given. This would therefore prevent unwarranted rent increases,
arbitrary and retaliatory evictions and excessive rentals.
There seem to
be a "clandestine agreement" at price-fixing. Rentals are not deter‑mined
by prospective tenants, it is set by
landlords and their representatives. The
latter are concerned with profiteering in a "market" where housing needs have
not been
satisfied for at least nine decades (in terms of official
records).
President Roh Tae Woo of the Republic of Korea on June 19,
1989, aptly summarised the market-related rental argument. He said that
at a time when people are faced with a serious housing shortage,
land and houses should never be considered the objects of real estate
speculation and the sources of unearned income.
RENT
CONTROL
HISTORICAL DEVELOPMENT
There are many fallacious arguments
about rent control. It is claimed that rent control was created by legislators;
its origin is
linked to the First World War. Property groups, institutions,
politicians and organisations representing landlords' interests consider
it to
be disastrous.
Economists who oppose rent control often analyse it from a
"Fundamental Theorem" which concerns itself with social desirability.
This
theorem looks at housing as a commodity with producers and consumers working in
perfect competi‑tion, under certain conditions,
leading to an efficient
allocation of resources. Government intervention (by imposing rent control)
interferes with market forces,
resulting in landlords sustaining losses,
subsidising rentals and prevented from new constructions. Rent control is
therefore a
"bad" social policy.
The basis of market forces is to allow
for the acquisition of money and its increase through competition which is a
necessary component.
It is not logical to concep‑tualise tenants as
consumers and deal with rented accommodation in terms of market forces. As
for
landlords becoming poor, there is no empirical evidence to show a correlation
between landlords being reduced to poverty and
rent control. Nor is there proof
for the contention that the supply and quality of rented accom‑modation
are adversely affected
by rent control. Factors such as the cost of labour,
inflation, the monopoly of the building industry and financing prevent new
construc‑tion.
Rent control exists because of necessity not because
of legislators. In ancient Rome rent control was necessary to protect the
Jewish
communities from discrimination. It existed in Spain in the 1500s
because of the critical housing shortage. Natural disasters like
the plague in
Paris in the 16th century and an earthquake in Portugal (1755) necessitated rent
control.
MODERN DEVELOPMENT
Most countries introduced rent control to
protect tenants from exploitation during and after the two World Wars. A
critical housing
shortage, generally due to soldiers returning home and building
materials being used for military projects necessitated emergency
war measures.
During peace time, the continued under supply of housing, exorbitant rents,
deplorable conditions of buildings, rising
inflation and popula‑tion
growth necessitated the control of rentals and security of tenure.
(I) FIRST GENERATION RENT CONTROL
In South Africa rent control
was introduced in 1920 and was modelled on the English rents legislation. The
housing crisis brought
about by the First World War led to temporary emergency
war measures to protect tenants. Rentals were controlled and arbitrary
evictions
curbed. The imposition of emergency rent control measures affected
Europe, the United States of America, Australia, most of Africa
and
Asia.
From 1920 to 1975, in fifty five years, the South African rent
control laws underwent approximately thirty amendments. The Rent Control
Act,
No 80 of 1976 con‑solidated the law controlling rentals and providing
security of tenure. It applies nation-wide although
all dwelling units in
formerly "white" areas are no longer subject to rent control.
(II) SECOND GENERATION RENT CONTROL
At May 31, 1966 rentals
were frozen retrospectively for the periods October 21, 1949 to May 31, 1966.
The freezing of rentals operated
unfairly for bona fide landlords. In
the 60's and 70's the South African government introduced amend‑ments
which replaced rent freezes. Landlords were permitted to increase
rentals to allow for a "fair and reasonable return" on their investments.
However, there is absolutely no provision in law to take into account the
tenants' hardship status. Consequently,
there is no such thing as a low rent
determination.
CAMPAIGN FOR THE ABOLITION OF RENT CONTROL
The 70's also saw a
concerted campaign by property groups to have rent control abolished. The
government gave-in to this biased pressure
to a very great extent which resulted
in:-
(i) A blanket phasing-out of rent control in three stages: 1978,
1979 and 1980 of dwellings built between October 21, 1949 to May
31,
1966.
(ii) In 1986 rent boards were abolished country-wide, creating
shock waves. Landlords increased rents most excessively, served eviction
notices and resorted to harassment. Sitting tenants and particularly pensioners
were the main victims. While the Rent Control Act
was not abolished there was
no mechanism to enforce it. Consequently, there was no "protection" against
exorbitant rent hikes, arbitrary
evictions and exploitation.
Attempts by
the OCR to resolve the impasse failed because the Tricameral depart‑ments
of the government were unable to do anything.
OCR mobilised support nationally
and simultaneously made an urgent application to the Supreme Court. The
application resulted in
rent boards being reintroduced
nationally.[9]
(iii) A
further large scale phasing-out took place from February 1987 of almost all
dwellings in predominantly "White" areas. This
process was completed just
before the abolition of the Group Areas Act and other discriminatory
Laws.
All dwellings built after May 31, 1966 were not subject to rent
control.
IS RENT CONTROL RESPONSIBLE FOR UNDERMAINTAINED
DWELLINGS?
Rent control, it is argued, imposes below market-related
rentals. This leads to landlords reducing operating and maintenance costs,
resulting in the deterioration of accommodation. While rent freezes produced
disastrous consequences, it must be differentiated
from second generation rent
control laws. From the 60's the rent control laws were flexible, taking into
consideration the landlords'
needs. Today, rent boards have gone to the extent
of imposing market-related rent increases.
Landlords who fail to maintain
their dwellings use rent control as an excuse. Their primary objective is
profiteering and they do
not show any concern over the poor
conditions.-
* There are numerous cases before the Natal rent board where
"slum" conditions exist and the board, notwithstanding visible evidence,
increase rentals. The board is not prepared to reduce rentals or withhold an
increase to "compel" the landlords to maintain their
buildings.
* Slum
conditions co-exist with exorbitant rentals in dwellings not subject to rent
con‑trol. There are many cases taken up
by the OCR through the Courts as
well as with various government bodies.
* Landlords of rent controlled
dwellings deliberately allow deterioration to force out tenants so that they can
relet at higher rentals
and in return for "Key-money". They are aware that the
rent boards are ineffective or unconcerned.
'here are instances of
multi-millionaire landlords charging up to R10 000.00 as goodwill or key-money.
The tenants either pay up-front
or are asked to pay the previous tenants'
"arrears". Certain landlords even have "Instalment Schemes" whereby a tenant
pays a fixed
amount in addition to the rental, until he/she has paid several
thousand rands.
A CASE STUDY: SURVEY OF DEVELOPMENTS IN THE U. S.
A.
A cursory reference to developments in rent control and related
laws regulating landlord-tenant relationship in the USA, including
debates, show
the pathetic under-development of the South African scenario. Various other
"reforms" have been enacted through the
courts such as tenants remedies for
substandard housing, the Uniform Residential Landlord-Tenant Act, Landlord
Security Deposit Act,
just cause eviction, implied warranty of habitability.
Most of these changes and reforms have come about as a result of organised
tenants' action.
RENT CONTROL
The First World War saw the introduction of a
voluntary programme of rent and eviction controls except for Washington D.C. and
New
York city which adopted mandatory local rent controls. The Second World War
led to nation-wide rent and eviction controls which
were abandoned about ten
years later. In the remainder of the 1950's and in 1960's inflation and
critical housing shortage led to
(peacetime) rent controls. The high rates of
inflation in the 1970's and 1980's once again saw the resurgence of rent
control.
Today, rent control laws exists in six states covering over 200
localities. More than 10% of all rented units are subject to rent
control.
Rent Control laws are enacted either through Local Ordinance (by the City
Council or by voters using the ballot), State Statute (which covers the
entire state) or State Enabling Legislation (which authorises local
governments). Rent Control laws are enacted because of excessive rents due to
severe housing shortage. It
also, as a corollary, protects tenants from
arbitrary, discriminatory or retaliatory eviction and from unwarranted rent
in‑creases.
However, it is considered counter-productive by
conservative economists and judges, having a negative impact on the supply and
quality
of accommodation. A poll among American economists on the other had
showed that fewer than two percent believed that the quantity
and quality of
housing available is reduced by a ceiling on rents.
LANDLORDS' COURT CHALLENGES
Landlords who in the late 1980's
challenged the legality of rent control, being the first challenges in 40 years,
were unsuccessful.
The Courts upheld the government's right to intervene
because of the existence of monopolistic or near monopolistic conditions.
Rent
regulations were necessary to protect tenants and did not violate the
constitutional and statutory rights of landlords.
The changes in law are
largely the result of organised tenants' movement struggling for the rights of
tenants. The struggle still
continues against the Feudal English origin of
landlord-tenant relationship. The landlord-tenant relationship is still the
domain
of the restrictive law of property instead of being governed by the law
of contracts which is more flexible.
Some of the positive changes through
the Courts have led to advances in the rights of tenants. In 1970 a major
victory was the Javins
v First National Realty Corp case (428 F 2nd 1071 D.C.
Cir. 1970) which recognised the landlords obligation to maintain (the premises
let) in decent, safe, sanitary and habitable
condition: "an implied warranty of
habitability." This changed the traditional property law view which required the
tenant to pay
rent regardless of the condition of the land.
Tenants also
have recourse to various remedies, e.g. through code enforcement which requires
administrative action or instituted by
themselves. In the case of the
landlord's breach of the warranty, rent abatement, withholding and even rent
strikes can be used
where these are recognised by the states. Tenants are also
protected from the landlord's retaliatory action (e.g. eviction for complaints
about substandard conditions or violation of other housing codes). "Just cause
eviction" and "Landlord-Tenant courts" are two significant
developments in the
USA which are essential to understand how backwards and deficient our legal
system is.
"JUST CAUSE EVICTION"
Despite large numbers of tenants still
subjected to insecurity of tenure because of the arbitrary powers by landlords
to terminate
a tenancy or refuse/fail to renew a tenancy, a positive direction
is emerging. The courts have started to look at the residential
lease as a
contract and not as a conveyance of property.
The belief and practice
that landlords may evict for no reason at all or for a good or a bad reason is
being discredited. Landlords
are being prohibited from evicting for retaliatory
or discriminatory reasons. An opposite principle, that of the tenants'
presumptive
right to a stable and continuous occupation is gaining
ground.
LANDLORD-TENANT COURTS
The Housing court is a judicial reform
with a progressive specialised court system dedicated to prompt and efficient
action. It is
the solution to the high legal costs, bureaucratic red tape,
procedural and motion delays, presenting an equitable sys‑tem
for
landlords and tenants. It is a solution to the overloaded and overworked
justice system.
A cursory glimpse of some of its features:
* It has statutory and common law jurisdiction
* Its jurisdiction is wide and concurrent with the district, supreme and
appeals courts
* Its far reaching substantive jurisdictions include:-
- review decisions of the rent control board
- private rental housing, public/state/federal housing
- powers to enforce orders, sentences and judgments
- powers over
housing code violations and broad jurisdiction over criminal and civil
disputes
* Judges are appointed in the same manner as their peers in other
courts
* Speedy, fair, efficient and sensitive resolution of housing
disputes
* It allows small claims and has housing specialists who work with landlords
and tenants.
* These courts contribute towards decent housing, arrest the spread of urban
blight, maintenance of proper housing standards.
A few examples of these
courts are the Boston Housing Court (1972), the Hampden County Housing Court
(1974) and the Los Angeles Landlord-Tenant
Court
(1977).
GENERAL COMMENTS & PROPOSALS
1.
TENANTS COURTS
Since exploitation of tenants are worsening by the day
it is imperative to oversee and enforce the rights of tenants through
specialised
structures. Tenants' Courts is one such example.
The
OCR has already conducted preliminary investigations of the
tenants/housing laws and the legal systems of various countries. The United
States of America's Housing/ Landlord-Tenant Court system and laws relating to
Landlord-Tenant is suitable to the South African scenario.
The Rent
Stabilization Law of New York city is a recent example of an equitable rent
control system.
2. FACTORS NEGATIVELY AFFECTING
TENANTS
2.1 The OCR's on going grassroots activities in
and around Durban covering approx. 30 000 units/flats [4 000 homeless
individuals and 15 000 informal
residents] and its contact with bodies
nationally, reveal growing problems and hardships which may be summed up in the
following
four major categories:-
2.1.1 RENTS: the average family cannot afford the ever
increasing rents;
2.1.2 PENSIONERS as well as other tenants are being displaced
in increasing numbers;
2.1.3 EXPLOITATION: Landlords have superior bargaining power
over tenants who are:-
2.1.3.1 forced to pay premiums [goodwill/keymoney]
2.1.3.2 faced with arbitrary evictions
2.1.3.3 faced with retaliatory actions when they complain
2.1.3.4 compelled to accept exorbitant rent hikes
2.1.3.5 forced to live in substandard, unsanitary and uninhabitable
conditions
2.2 Existing housing legislations do not provide
adequate protection to tenants. Where protective measures do exist, these are
blatantly
violated and not enforced by relevant government
departments.
2.3 There is little or no focus on the hardships
experienced by tenants which is intensifying because of the socioeconomic
conditions.
Rentals cannot be written off or reduced. Tenants cannot choose
affordable rentals. Neither can they withhold nor reduce rentals.
Yet, rentals
are calculated on the "open market" when in practical and logical terms, there
is no "market-related" basis.
2.4 There are other relevant factors negatively affecting the rights
of tenants:-
2.4.1 Government structures are not geared to handle violations of
existing [residual] rights of tenants.
2.4.2 The State Attorneys office is overworked, understaffed and
consequently not interested in criminal prosecution.
2.4.3 Existing legislations do not provide easy and reliable access to
government departments. Tenants cannot therefore be assured of the
enforcement
of their rights.
2.4.4 It is too expensive and time consuming for tenants to claim
their rights through the present legal system.
2.5 There was
acknowledgment by the previous government that people could not pay more than
25% of their income towards rental in subsidised
ownership housing. What about
tenants in private sector housing who do not even get a subsidy and are forced
to pay exorbitant rentals?
2.6 The present housing crisis will not
be resolved immediately and even after providing adequate, suitable affordable
housing, the rights
of tenants cannot be ignored. It is therefore absolutely
necessary to ensure the rights of tenants. Hence, it is necessary to place
the
responsibility of overseeing and enforcing the rights of tenants with
specialised structures. Landlord-Tenant Courts is one
such example. The OCR
is willing to undertake the task of presenting a "blueprint" on Tenants'
Rights.
3. PROPOSALS
3.1 IT IS THEREFORE PROPOSED FOR THE MEDIUM AND LONG TERM
THAT:-
3.1.1 All interested groups and relevant departments, including
the Depart‑ment of Justice and the Ministry of Housing
be part of the restructuring of tenants' rights;
3.1.2 In this
respect, the OCR hopes to prepare rules and procedures relating to
Landlord-Tenant Courts and to present a draft on Tenants'
Rights, rent control
law and related matters.
3.2 THE FOLLOWING IS PROPOSED FOR THE INTERIM:-
3.2.1 The reconstitution of all rent boards. New members to be
ap‑pointed through a process similar to the selection, interviews
and
appoint‑ments of members to the SABC board. Such an approach would
ensure, inter alia, impartiality, competence and
efficiency.
3.2.2 The establishment of an ombudsman to
investigate tenants' com‑plaints;
3.2.3 The establishment of Dispute Resolution Centres which
would:-
3.2.3.1 Arbitrate, mediate and make referrals to courts and
welfare institutions. It would take up issues of unreturned rent deposits,
un‑fair withholding by a recalcitrant tenant, need for repairs,
arbitrary evictions;
3.2.3.2 These centres could be an extension of rent boards,
staffed by qualified personnel.
3.2.4 Moratorium on exemptions of dwellings from rent
control;
3.2.5 Moratorium on the displacement of tenants. Such
displacement may be due to proposed/impending demolition, conversion of
rented
accommoda‑tion for non- residential use or "upmarket"
refurbishment or property development schemes, such as Sectional
Title and
Share Block Schemes;
3.2.6 Moratorium on arbitrary evictions
and evictions based on retaliatory and discriminatory
reasons.
3.2.7 The "freezing" of all rentals for a period of 18
months where exploita‑tion exists;
[Explanatory
Note: The re-constituted rent boards or an ombudsman could investigate
tenants' complaints.
3.2.8 The introduction of rental
subsidy for tenants experiencing hardships. These will include
pensioners and the unemployed.
3.3 THE FOLLOWING ARE PROPOSALS IN RELATION TO SPECIFIC
MATTERS:
3.3.1 OUTSTANDING MATTERS
3.3.1.1 The buildings mentioned hereunder [which affects
ap‑proximately seventy tenants] were presented for
investigation, with OCR’s recommendations, to the previous Ministry of
Housing:- (i) Himalaya House, (ii) Douglas Lane, and (iii)
Goodwill;
3.3.1.2. OCR is willing, should there be a
need, to re-submit the memoranda in respect of the above matters.
3.3.2 THE NATAL RENT BOARD
The OCR further proposes the immediate suspension of the Natal Rent
Board pending an investigation of:-
3.3.2.1 Present rent
board members, other officials and employees whose appointments were
racistly base.
3.3.2.2 The recalcitrant and intimadatory
attitude of the rent board members towards OCR and tenants, particularly
during rent board
hearings and during inspections in
loco.
[Explanatory Note: Ever since OCWs
legal success of having rent boards re- introduced nationally in 1986, its
subsequent victories, including
the re- introduction of rent control in
Warwick Avenue in 1993, board members and officials have adopted a
"vicious"
attitude. This has prejudiced tenants' cases.
3.3.2.3
The incompetence, bias, negligence and corruption resulting in hardships
for pensioners and various other cases;
[Explanatory
Note: In regard to the aforementioned, OCR has af‑fidavits,
audio- cassettes and witnesses in support of these
allegations.
3.3.3 SPECIFIC INDIVIDUAL MATTERS
3.3.3.1 The buildings listed hereunder have recently come before
the OCR's for investigation and
representation.
3.3.3.2 OCR recommends that the Housing
Ministry, perhaps through an ombudsman, or some similar structure,
investigate the above matters
with the view to ensuring the rights of
tenants. The Im‑position or re-imposition of rent control is one way
of
ensuring the rights of tenants.
[Explanatory Note:
Rent control can be reimposed or imposed by the State President or by the
Minister of Housing. The provisions of the
Rent Control Act, 1976 as
amended, empowers the said persons to do so.
3.3.3.3 These
buildings [which affects approximately eighty tenants] are:-
(i) Bailey Court, 30 Syringa Avenue, Durban
(ii) Sharon Keys, 174 Darby Road, Overport, Durban
(iii) Cavalcade Mansions, 25 Carlisle Street, Durban
(iv) Arnleigh, 186 Victoria Embankment, Durban
(v) Crystal Court, 89 Lorne Street, Durban
(vi) Albertyn Court, 159 Albert Street, Durban
(vii) Bute Gardens, 20 Bute Lane, Wentworth, Durban
(viii) Eaglemount, 45 Thorne Road, Wentworth,
Durban
[Explanatory Note: Attempts to resolve the problems
with the landlords were not successful. The tenants are exploited by being
charged high
rents for undermaintained dwellings. The general
condi‑tions of these buildings are in appalling state of
disrepair.
Racism is also practised by supervisors and landlords.
3.3.3.4
Legislation is needed urgently to protect tenants from racist
discrimination.
3.3.3.5 Recognition, by law, of all
properly constituted democratic tenants'
committees.
[Explanatory Note: Most
tenants’ committees are ignored or dis‑missed by landlords as
not having locus standi. Often, punitive ac‑tion is taken
against members of tenants' committees.
[1] . The united Nations
commission on Human Rights’ Resolution [1993/77] on forced evictions which
was unanimously adopted in
Geneva on March 10, 1993. The said Resolution is
annexed on this document as
“A”
[2] . Mrs.
Patricia Poole’s plight is the most recent example. OCR is presently
involved in preventing her forced
eviction.
[3] . For details refer
to OCR Information Leaflet 93/94. For an in-depth information on the OCR refer
to Dr. Maharaj B., Civic Organisations
in the Apartheid Inner city: A Case Study
of the Durban Central Residents’ Association. August 1993.
[4] . For example: Durban
Homeless Community, DCR Survey 1993. Tenants’ Rigths
Handbook.
[5] . The ten homelands
for 1991 were Transkei, Bophuthatswana, Venda, Ciskei [these for are referred to
as the TBVC (“independent”)
states,], Kwazulu, Gazankulu,
KwaNdebele, KaNgwana, Lebowa and Qwaqwa [self-governing regions]. Unless
otherwise stated. the
population or percentage excludes the TBVC homelands. The
1991 population and statistics are used unless otherwise stated. The
population is as follows: “blacks” 21 646 471, “whites 5 068
110, “coloureds” 3 285 718 and “indians”
986 620 =
totaling 30 986 920. The TBVC homelands: 6 750 700. The total South African
population for 1991 was therefore approximately
37 737
620.
[6] . In South Africa, a
country divided by more than 300 years of oppression and decades of legislated
racism, it is impossible not
to distinguish between ethnic groups. In fact, in
most cases it is imperative and crucial to make such distinctions to understand
the wide disparity, inequality and injustice. Hence, the so-called ethnic
nuances: “whites”, “coloureds”,
“blacks” and
“indians”. Ideally, and perhaps in the future, South
Africans or Azanians or Africans would suffice as a term of
reference for the family of the human race who inhabit the southern most tip of
Africa.
[7] . I have referred to
the Race Relations Surveys as the source for the statistical information on
basic amenities. for the rest
I am deeply indebted to the Central Statistical
Services, especially to Mr. J. Smalberger who made important information
available
and took the time to correct my tabulations and
tables.
[8] . Race Relation Survey
1993.
[9] . OCR exhausted all
administrative channels and finally took a “test-case” to Supreme
Court against government ministers
and Mrs. Naidoo’s landlords: MOTTAMMA
NAIDOO VS LAPA MUNIK NO, Case No. 6769/86.
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