Welcome to part 2 of this blog series! In this series, we consider whether you can cancel your residential lease before it expires. And if so, when and how you can actually do this. This question becomes relevant in a situation where you have to relocate to another city because of work, but you are in the middle of your residential lease period. Or imagine your relationship ending with your partner leaving where you cannot afford rent without your partner’s contribution. These are just two examples.
Answering the question of when and how you can cancel your residential lease really depends on the law that applies in the circumstances. In our first part of this series, we considered how your contract might affect your right to cancel and we also looked at when and how the Rental Housing Act gave you a right to cancel your lease agreement. If you have not read the first post, we recommend that you read it before your read this post. You can read post 1 here. In this post, we continue looking at the relevant law.
How do you cancel your residential lease? Consumer Protection Act
The Consumer Protection Act (CPA) applies to the supply of goods and services in South Africa. Under the CPA, the supply of residential accommodation is defined as a service. This means that residential leases fall under the application of the Consumer Protection Act. There are only two exceptions to this rule. First, when the residential lease is concluded between two juristic persons and the lessee has an annual turnover or asset value of more than R 2 million. Second, when the landlord is not leasing out the property in the ordinary course of business.
In short, the CPA gives you, the consumer (lessee), the right to cancel the lease for any reason at all by giving your landlord 20 days written notice of the cancellation. The landlord is then entitled to charge you a reasonable cancellation penalty. We have written a detailed post on how the CPA works in this regard in another post, and you can read that here. Lastly, the CPA states that where its provisions conflict with any other laws, the law that gives you, the consumer (tenant) the most protection will be the law that applies.
How do you cancel your residential lease? Common law
The common law becomes relevant if you and your landlord have not reached an agreement regarding certain terms on your lease. It provides the default position for those areas where no specific provision has been made in the lease. For example, you and your landlord might have forgotten to agree on the number of days written notice required to be able to terminate the lease before its agreed upon end. The common law provides the default position if this happens.
The common law position on this matter is that the notice must run for the duration of a calendar month. That is, from the first of a particular month to the last day of that month. It cannot run from the middle of one month to the middle of another. Also, the common law states that the notice periods coincide with rental payment intervals. So if you pay rent every month, your notice must be given at least one month before you cancel.
So many laws! Which one applies?
Because there is so much law on the matter of canceling your residential lease it can be hard to figure out which law applies to your situation and how many days notice you need to give. Where there is legislation (Rental Housing Act, Consumer Protection Act) to deal with a particular problem, it trumps the common law. And the legislation that more specifically applies to a specific situation will trump the legislation that applies more generally. But remember also, that the CPA (which is not specific to leases) says that where its provisions conflict with another law, the law that provides the most protection to the consumer will apply. Things can get confusing!
If you are unsure of which provisions apply to your situation and you want to cancel your residential lease, we recommend seeking legal advice. Don’t act before you know what you are allowed to do, otherwise you could be putting yourself at risk of breaching your contract. If you require assistance, please do not hesitate to contact us at [email protected].