Daily News Tuesday October 28 2013
Confusion surrounds service bills
By law, landlord must pay
THE payment for water and electricity
consumption can result in conflict between tenant
and landlord or the letting agent.
The landlord is responsible for payment to the municipality when these service charges
are included in the rentals.
Services supplied by local authority to the property relates to the owner of the property or
to its occupiers.
For the occupiers to be liable there must be an agreement either between the owner and
the occupier or between the occupier and the local authority.
In the absence of such an agreement, it is implied that the owner would be burdened with the payment for services.
The Constitutional Court handed down a judgment in 2005 that ultimately holds the owner responsible for all outstanding amounts regarding consumption charges due to the local authority even if the account is in the tenant or non-owner occupier’s name.
In Mkontwana v Nelson Mandela Metropolitan Municipality 2005 (1) SA 530 (CC), the court held that there were measures owners and the municipality could use to prevent non-payment that resulted in the accumulation of consumption charges.
Municipalities were legally responsible to send out regular accounts, develop a culture of payment, disconnect the supply of electricity and water in appropriate circumstances, and take appropriate steps for the collection of amounts due.
“The owner’s ability to protect her own interest by ensuring that consumption charges are kept within reasonable limits
depends to some extent on the nature of the relationship between her and the occupier. If that occupier is on the property with the knowledge and consent of the owner, the latter can, amongst other things, choose the occupier carefully and stipulate that proof of payment in relation to consumption charges be submitted monthly on pain of some sanction including ejectment.”
Parties transpose their obligations in a written lease contract or even agree orally that the tenant would pay for certain services such as water and electricity.
Mkontwana case
The owner or landlord usually required the tenant to have the water and electricity account in her name so that the tenant is directly contracted to the local authority and liable for the payment of the consumption charges.
This provides security to municipalities, since they do not have to bother with defaulting tenants who failed to settle the debts with the municipality and subsequently ‘disappear’. Since July 1, 2012, a new tenant in the eThekwini region cannot have an account for municipal services in their name.
Some landlords and their agents state the municipal service charges due on an invoice or piece of paper.
A tenant has the legal right to examine the original consolidated municipal bill before making payment.
The landlord is also obliged to present proof of payment to the tenant once the tenant has paid the amount requested.
Where water and electricity charges are included in the rental, the landlord is still under duty to disclose proof of payment to the tenant when requested to do so.
Some landlords and their supervisors have used this new policy to force tenants out of their property, to pay a rental increase or to ‘punish’ tenant activists by closing the account.
There are instances of landlords failing to pay the service charges resulting in the disconnection of water and electricity supply.
This has caused hardships to tenants who are unable to go to court to enforce their rights to uninterrupted services and to claim compensation for breach of contract.
Municipalities have secured their interests by consolidating accounts and have the power to disconnect for an owner’s debt incurred on the property occupied by the tenant or another property.
Such is the power of a consolidated account that burdens tenants when the landlords’ municipal debts are not paid on properties not even occupied by their tenants.
