P1. Rental Agent Legal Obligations

The role of the rental agent

Rental Property Law places the agent in a dynamic position.

An agent is an extension of its principal

An agent can never represent both landlord and tenant in this transaction. As such, your duty lies with your landlord, so place a qualified tenant!

The relationship between landlord and agent is governed by:

  • Case law.
  • Legislation.
  • And contract.

Case law

NB – only cases decided by the SCA and Con-Court create law in South Africa.

Cases in the High Court of various provinces create law in those provinces and, at best, have persuasive influence in other provinces.

General themes through case law are:

  • An agent is a fiduciary position with his/her principal (Landlord)
  • The agent must act solely for the benefit of his/her principal and must disclose any conflict of interest (Mallinson v Tanner 1947).
  • The agent cannot make a secret profit out of the mandate (Jones v East Rand Gold Mining Co).

Legislation

The estate agents affairs act (code of conduct)

Section 2 of the CODE OF CONDUCT.

An agent must:

  • Not do or omit to do any act which is or may be contrary to the integrity of estate agents.
  • Protect the interest of the client (the Landlord) at all times to the best of his ability, with due regard to the interest of all other parties concerned.
  • Not willfully or negligently fail to perform any work or duties with such degree of care and skill as might reasonably be expected of an estate agent.
  • Convey to a prospective tenant all facts concerning the property as are, or should be reasonable in the circumstances, within his personal knowledge and which are, or could be, material to the prospective tenant.
  • Avoid conflicts of interest and disclose any potential conflict of interest to the tenant.

Section 5 of the CODE OF CONDUCT.

An agent must not:

  • Claim to be an expert or to have specialised knowledge in respect of any estate agency service if, in fact, he/she is not such an expert or does not have such special knowledge.
  • Wilfully or negligently make false statements as to any fact or make any harmful or misleading statements or use such marketing techniques.

The Consumer Protection Act

Section 40 of the CPA (AGENT TO TENANT).

An agent (on behalf of his landlord) must not:

  • Use physical force against a tenant, coercion, undue influence, pressure, duress or harassment, unfair tactics or any other similar conduct, in connection with:
  • Demand for, or collection of, rental payment; or the repossession of the property from the tenant
  • Directly or indirectly express or imply a false, misleading or deceptive representation concerning a material fact to a tenant.
  • Use exaggeration, innuendo or ambiguity as to a material fact, or fail to disclose a material fact if that failure amounts to a deception; or
  • Fail to correct an apparent misapprehension on the part of the tenant, amounting to a false, misleading or deceptive representation.

Examples include falsely stating (advertising) the property:

  • Has characteristics, accessories, uses, benefits, or qualities or is of a particular standard or quality.
  • Has or is proximate to any facilities, amenities or natural features that are not available or proximate.

Section 54 of the CPA (AGENT TO LANDLORD).

54(1) When a supplier (rental agent) undertakes to perform any services for or on behalf of a consumer (Landlord), the consumer has a right to:

  • The timely performance and completion of those services, and timely notice of any unavoidable delay in the performance of the services,
  • The performance of the service in a manner and quality that persons are generally entitled to expect,
  • The use, delivery or installation of goods that are free of defects and of a quality that persons are generally entitled to expect if any such goods are required for the performance of the services; and
  • The return of any property or control over any property of the consumer is at least as good a condition as it was when the consumer made it available to the supplier for the purpose of performing such services, having regard to the circumstances of the supply, and any specific criteria or conditions agreed between the supplier and the consumer before or during the performance of the services (NOTE: this could also include restoring after an outgoing inspection!)
  • If a supplier fails to perform a service to the standards contemplated in subsection (1), the consumer may require the supplier to either:
  • Remedy any defects in the quality of the services performed or goods supplied; or
  • Refund to the consumer a reasonable portion of the price paid for the services performed and goods supplied, having regard to the extent of the failure.

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