Managing Director at SSLR Attorneys Incorporated
Question: “I have a two-bedroom flat that I just got back from tenant after a month of going up and down with the agent as they could not get the tenant out at the end of the contract. The agent called me two weeks ago that the keys are ready for collection from their employee, who when I arrived at the complex informed me the key was with the caretaker. I then went to the flat to see how the flat looks like after they vacated but to my surprise, the flat was in a terrible state and vandalize. This is what I found:
- Although I was given the keys, not a single door had door handles on or any locking mechanisms. The entrance door was tied with a cable.
- The butler door, was damaged and it cannot be locked
- There was not a single globe in the flat
- Some of the windows were broken
- The stove was filthy in a terrible state.
- The kitchen cupboards were damaged with broken doors
- The bedroom cupboards were damaged with no handles
- Walls have holes in them
The list is just long for all the problems I found.
To add the cherry on top, when the tenant occupied the flat a year ago, she bridged the electricity meter. When I reported this to the agent, they told me they not responsible for electricity bill collection (and hence I installed electricity meter some years ago) and that there was no meter. This indicated that the inspection was not done before the tenant occupied the flat.
After realizing all this, I requested that the tenant be given notice but that never happened. I also went to Municipality to cut the electricity but that also never happened. As I write this message, the electricity bill is more than R15 000. I then followed with the agent that I need the tenants deposit money to pay the electricity bill but that also is a challenge.
My stance is that the agent should repair the flat as they took the administration fees monthly of which they did not look after my flat. Please, I will appreciate any advice on how to deal with this issue. Could you please assist on what action I should take?
Answer: Unfortunately, the answer here isn’t as easy as it seems, without having sight of the mandate agreement between the owner and the agent it is almost impossible to comment on the agent’s actions. It seems as if there was a management mandate, as the agent would be the one sending the invoices and collecting the rent.
At this point it is crucial to address the difference between procurement and management mandates; the first is an instruction to the agent to find and introduce the owner to potential tenants when the owner then places a tenant, the agent’s mandate is fulfilled. A management mandate is a wider mandate, where the agent has the same function regarding introduction to potential tenants as in the case of a procurement mandate, but has the extra duty to attend to both the entry and exit inspection, invoice and collect rent.
However, this is the full mandate, the agent isn’t obliged, in such a mandate, to institute action against the tenant for eviction or rental collection, this remains the owner’s responsibility. The agent is never obliged to maintain the premises, unless the owner concluded a different agreement with the agent, apart from the mandate, this can either be a service agreement or a power of attorney where the agent effectively step into the shoes of the owner.
To return to the question, assuming that the agent acted in terms of a management mandate, the agent did have the responsibility to attend to the entry and exit inspections. The agent did however not have the duty to evict the tenant or repair anything, but to simply report this to the owner. It is the obligation of the agent to compile comprehensive inspection reports to prove damages and in doing so, allow the owner to successfully claim the damages from the tenant.
It is further the agent’s duty to deduct the proved damages from the deposit before there is any refund to the tenant. I do agree that the agent in this matter could have communicated his responsibilities to the owner much better, ideally this should be done in-depth in the mandate. I see too often that owners and agents are so focused on getting a property listed as quickly as possible and then completely neglect to sign a mandate agreement, or even worse, an owner might refuse to sign a mandate agreement in fear of being bound to the agent for too long, however without a written mandate how can the parties possibly prove the terms of their agreement? The mandate is there to safeguard the owner, but also allow the agent to claim commission and other fees without a dispute at a later stage.
I will not say this is a case of an agent from hell, but rather a lack of communication (and possibly mandate) from hell.