This article aims to discuss the necessity of open communication between yourself and your attorney especially when seeking and setting up a payment holiday plan.

Many people will at some point in their lives find themselves being involved in legal disputes. It goes without saying that litigating on a matter can take quite a while, especially if the matter is opposed.

In saying that, an attorney can become costly. The more time an attorney spends on your matter, the higher your legal bill.

Your financial situation can be either a short term or a long term problem. If it is a short term problem the restructuring of payments owing is much easier to do as opposed to a long term problem. It is however, important for you to maintain an open line of communication between yourself and your attorney. An attorney will only then institute legal action against you if you have not honored your commitments and/or if you haven’t advised them fully about your financial circumstances.

Your attorney may ask that you sign a contract for a certain period that limits your liability to pay them, this is known as a payment holiday. This is not to say that you are fully extinguished from ever paying your attorney again, but it is a contract that will stipulate the terms and conditions that will determine:

  1. When the amounts are due;
  2. What amounts are outstanding;
  3. If there is any discount available e.g. the use of a collections tariff as opposed to an attorney’s full hourly rate; and
  4. What interest, if any, will the debtor be liable for?

It is pertinent to note that a payment holiday plan will be based on the merits of a case, usually only used for a long term client and after a full financial assessment has been undertaken.

Be careful not to get a payment holiday plan confused with Pro Bono work. Most pro-bono work is work referred to attorneys by Pro Bono.Org in order to provide free legal assistance to those who cannot afford to pay for an attorney.  http://www.probono.org.za/.

In conclusion, to set up a payment holiday plan with your attorney you must apply your mind to the following:

  1. Be an existing client;
  2. You must notify your attorney immediately of any financial change;
  3. Share your financial history with your attorney;
  4. Negotiate a contract and decide which terms and conditions suit both parties;
  5. Honor your payments ( when the “holiday” is over); and
  6. Always keep the lines of communication with your attorney open.

For any legal assistance or advice kindly contact us on 031 003 0630 or email us on Charmaine@schwenninc.co.za.

Written by Jessica Schwenn.

#schwenninc #yougotschwenned #blogs #paymentholiday

  Residential properties : Securing your security deposit Section 5 of the Rental Housing Act (RHA) allows a landlord to take a deposit from a tenant before the tenant moves into the property. This amount must be stipulated in the lease agreement and is generally an amount that is equal to 1 month rental. The […]

Residential properties : Securing your security deposit

Section 5 of the Rental Housing Act (RHA) allows a landlord to take a deposit from a tenant before the tenant moves into the property. This amount must be stipulated in the lease agreement and is generally an amount that is equal to 1 month rental.

The RHA, requires that the landlord deposits the money into an interest bearing account, with a financial institution. A tenant has the right to receive a statement of interest earned. The tenant is therefore entitled to receive their deposit and all interest earned during the lease period at completion of the lease.  The tenant will have to provide FICA information for the landlord to invest the deposit amount.

As further protection, a tenant should ensure the landlord or managing agent is registered with the Estate Agency Affairs Board.

A landlord is entitled to deduct any expenses incurred from repairing any damage which may have occurred during the term of the lease from the deposit and interest.  This is normally provided for in the written lease agreement.

The tenant has the right to see all repair receipts to ensure the expenses are for genuine repairs that have been undertaken by the landlord. This does NOT include costs for general maintenance of the property which is for the landlord’s expense.

The Importance of a walkthrough inspection

A tenant should always do a pre lease inspection, noting any defects or faults prior to moving in and this should be reduced to writing and sent to the landlord or his agent as soon as possible, or within the time stipulated in the lease. A good idea would be to take photos as this would substantiate any claims of faults and will supplement any “snag lists’.

Some landlords often agree to fix faults at a later stage and this should be viewed with some suspicion as often the faults are not fixed and the landlords then blame the tenants for any damage. A tenant is not responsible for wear and tear and should not be forced to repaint the walls (unless the tenant has caused excessive wear and tear).

Exit inspection

A tenant must always insist on having an exit inspection and this should be done when the lease comes to an end. The tenant should ensure that the original snag list is presented and any additional evidence (photographic or otherwise) as well as any additional faults that have occurred during the lease period. A tenant who is intent on getting their full deposit and interest should view this inspection with a critical eye (by ensuring the property is cleaned, the walls washed and any holes patched up).

Rental Housing Act, Amendments

This Act sets out the following criteria for both the landlord and tenant:

  • Setting out the rights and obligations of the parties in a coherent manner;
  • Requiring the lease to be in writing;
  • The contents of a lease must include the following;
    • Names and addresses of all the parties to the agreement;
    • A description of the property;
    • The amount of the rental;
    • Reasonable escalation;
    • Frequency of payment;
    • The amount of the deposit;
    • The lease period and the notice period.

Failure to repay the security deposit and interest, for no legitimate reason, by the landlord is a criminal offence in terms of Section S 16 (aB) (RHA) and is punishable with a penalty or imprisonment not exceeding two years or both.

To ensure your lease agreement is complaint with all the necessary rights and obligations of both the landlord and tenant, contact us on 031 – 003 0630 or charmaine@schwenninc.co.za. #rentals #durbanlawyer #schwennlegacy #leaseagreements #newblogpost

Article written by – Barry Todd

 

CREDITORS, DON’T DISREGARD BUSINESS RESCUE SO SOON AS A WAY TO RETRIEVE YOUR MONIES.

It can be said that there has been an increase in business rescue processes in South Africa.

“Business rescue, as defined by the Companies Act 2008, aims to facilitate the rehabilitation of a company that is financially distressed by providing for the temporary supervision of the company and management of its affairs, business, and property by a business rescue practitioner”.
https://m.fin24.com/Entrepreneurs/Resources/Business-rescue-explained-20150119.

One of the main purposes of business rescue is to ensure that creditors be paid out what is owed to them – albeit less than the full amount of their claim.

Although many get disheartened by the decrease in the payback of the capital amount, the proceedings are almost identical but less extreme to that of liquidation proceedings.

“Liquidation is the process of bringing a business to an end and distributing its assets to claimants. It is an event that usually occurs when a company is insolvent meaning it cannot pay its obligations when they come due”.
https://www.investopedia.com/terms/l/liquidation.asp.

From a glance of the Companies Act, it suggests that although a business rescue plan may discharge a portion of the debt owed to concurrent creditors, it would be the same amount that one would get during the liquidation proceedings in any event. Therefore either way although you may retrieve less than the capital amount they theoretically do the same/similar jobs at the end of the day.

Section (1)(b)(iii) of the Companies Act states that a business rescue plan contemplates an outcome that would indeed be a better result for shareholders than it would have been during immediate liquidation.

However, just like many areas of law in South Africa, there has not been a real consensus by the courts whether the above can be stated as true.

In Oakdene Square Properties v Farm Bothasfontein, the Supreme Court of Appeal decided that it was not intended for the Act to promote an informal type of proceedings as a way of avoiding the consequences of liquidation.

If you are a creditor or a business owner looking for advice on business rescue and/or your options on the best returns possible for your money contact our offices on 031 003 0630 or email Charmaine@schwenninc.co.za.

 

Written by: Jessica Schwenn.

 

What is racism in the workplace?

 

In the news currently is the matter of a teacher that was suspended for posting pictures of children in her class, apparently segregated by race.

Another relevant case has just been decided by our Constitutional Court, where a man was dismissed for referring to a co-employee as a “swart man” – “Black man”.

How do you as an employer or employee regulate this in the workplace? Many refer to co-workers by race – is this racist and derogatory?  It is a real challenge and in this political climate a recipe for disaster.

Think of Adam Catzavelos who posted a “personal” video on the beach and what happened to him and his business. He was fired from a family business and the business has, to our knowledge, not recovered.  The ramifications are huge, especially with social media when things can go viral.

The case of Adam Catzavelos is very clear. His conduct was despicable.  But what of the teacher who posted the pictures – was her suspension valid?  The employee who was dismissed, was his dismissed fairly?

The Constitutional Court held that the CONTEXT of the words or action are what is important in determining whether conduct is racist or defamatory or derogatory.   Was the context intended to be or apparently racist?  Did it belittle the “victim” thereof?  Our history of segregation and apartheid is of great relevance in this.  Ordinary words or actions can be determined to be racist, based on the context and the heightened tensions around racism in South Africa.

The employee who referred to his co-employee as a “swart man” (black man) did so in anger – he allegedly burst into a meeting demanding that the black man’s vehicle be removed from his parking immediately or there would be consequences.

For employers, if such an incident occurs in your workplace, you need to carefully consider our current society tensions and test the context of the incident.

For employees and the general public, be aware of Government efforts to curb racism and hate speech and think carefully. Do not act in anger and measure your words.

If you are an employer – contact us to assist you to put the necessary policies and procedures in place for these situations. We can also assist in sensitising your staff to the actions which could be considered discriminatory or racist.

 

Contact : Charmaine Schwenn

Charmaine@schwenninc.co.za

031-003 0630 / 083 789 7638

PARENTING COORDINATORS – WHO ARE THEY AND WHAT ARE THEIR POWERS?

 

The term Parental Coordination is a form of alternative dispute resolution that is used in high conflict divorce and custody matters that must be headed by either a mental health professional or a family law professional. This type of alternative dispute resolution is usually used either pre or post divorce proceedings.

The appointment of a Parenting Coordinator is done by either:

  1. A court order;
  2. A parenting plan ; or
  3. By way of a settlement agreement between the parties.

The order or agreement will list the powers and authority of the coordinator and this order is thereafter binding on all parties.

It is paramount to remember that the High Court is the upper guardian of children and therefore can make any decision if it is in the best interests of the child or children.

Although a parental coordinator is a ground breaking integral part of the court system there are however limitaions to keep in mind.

The first limitation is that a coordinator cannot be appointed unless there is some sort of agreement in place that provides for a framework that will assist the parties in how to comply with same.

If an order is not complied with then just as any other breach of a court order, an enforcement of the order can be to comit the person to prison for their contempt.

The second limitation is that the orders need to be in the best interests of the children which must include basic frameworks for things such as:

  1. Care and contact of the child;
  2. Guardianship; and
  3. The termination, extension and supervision of parental responsibilities .

Therefore it is important to remember that the coordinator is a facilitator that makes sure that all the provisions of the order are complied with. They do not create the provisions as this would be considered going against the judicial oversight and tresspasses on the courts exclusive jurisdiction which is entrenched in section 173 of the Consitution. This can be seen as the Third limitation.

The fourth and last limitation is that:

  1. The coordinator can only be involved where there is chronic conflict or unwillingness bewteen the parents to come to an agreement;
  2. Mediation between the parties must have been attempted and must have been unsuccessful or was inappropriate- this is usually in cases of domestic violence where restraining orders are involved; and
  3. The coordinator must be a qualified person whose fees are reasonable and fair.

The Courts therefore favour this approach because of the inherent jurisdiction that is enrenched in the Constitution.

It can therefore be said that we should get used to the increasing appointments of parental coordinators.

For any assistance in a divorce and mediation do not hesitate to call us on 031 003 0630 or 083 789 7638 or email us at charmaine@schwenninc.co.za.

WHAT IS FICA and WHY WE NEED IT?

 

FICA stands for The Financial Intelligence Centre Act, which came into effect on 1 July 2003.

 

FICA was introduced to fight financial crime, such as money laundering, tax evasion, and terrorist financing activities. FICA brings South Africa in line with similar legislation in other countries.

 

FICA is essentially a means to ensure that an institution is required to ”get to know the client”. Financial institutions, like banks or other organizations such as attorneys firms or estate agencies do this by keeping proper records of their clients, requesting particulars and keeping a proper record of where the funds are coming from and where they are going.

 

It is therefore a legal requirement for financial institutions to FICA their clients in order to prevent financial crimes. The Act, places an obligation on the banks/attorneys firms to FICA their clients and it is a criminal offence for them not to do so.

 

The failure to FICA clients can lead to a prision sentence (ranging from 5 to 15 years) and or a fine (ranging from R 1 000 000 to R 10 000 000) depending on the offence, hence the

 

Some offences that are punishable under the Act, include, but not limited to;

 

  • Failure to identify persons involved in a contractual obligation
  • Destroying or tampering with records
  • Failure to advice Centre of a suspicious client/person
  • Failure to report cash transactions
  • Failure to report suspicious or unusual transactionsWe have therefore drafted a list of requirements that should be given or requested to your friendly attorney firm (that would be us) or other institution.For individual:
  1. Copy of client’s ID book;
  2. Utility bill – no older than 3 months and showing clearly the clients’ physical address;
  3. SARS document where clients’ SARS registration number is clearly visible.

 

For Companies and CC’s

 

  1. the registered address of the close corporation or company;
  2. the name under which the close corporation or company conducts business;
  3. the address from which the close corporation or company operates, or if it operates from multiple addresses –
    • the address of the office seeking to establish a business relationship; and
    • the address of its head office;
    • the full names, date of birth and identity number or nationality (as may be applicable), concerning –
    • the manager of the company; and
    • each natural person who purports to be authorised to establish a business relationship or to enter into a transaction with the accountable institution on behalf of the company; and
    • the full names, date of birth, identity or registration number, nationality, address and / or legal form, as may be applicable, concerning the natural or legal person, partnership or trust holding 25%  or more of the voting rights in the company.

 

Documents required for companies

  1. identity document; or if a person cannot produce an identity document, another document bearing a photograph of the person and their names, date of birth and identity number;
  2. a document issued by the South African Revenue Services bearing the person’s name and the relevant number;
  3. a utility bill (no older than 3 months) or copy thereof;
  4. Certificate of Incorporation (form CM1) and Notice of Registered Office and Postal Address (form CM22) – Companies.

Documents required for Closed Corporations

  1. identity document; or if a person cannot produce an identity document, another document bearing a photograph of the person and their names, date of birth and identity number;
  2. a document issued by the South African Revenue Services bearing the person’s name and the relevant number;
  3. a utility bill (no older than 3 months) or copy thereof;
  4. Founding Statement and Certificate of Incorporation (form CK1) and Amended Founding Statement (form CK2) if applicable – Close Corporations.

For Partnerships:

  1. the name of the partnership,
  2. the names, date of birth, identity or registration number, nationality, addresses and / or legal form, as may be applicable, concerning, every partner, including every member of a partnership the person who exercises executive control over the partnership;
  3. each natural person who purports to be authorised to establish a business relationship or to enter into a transaction with the accountable institution on behalf of the partnership.

Documents required for Partnerships

  1. identity document for all partners; or if a person cannot produce an identity document, another document bearing a photograph of the person and their names, date of birth and identity number;
  2. a document issued by the South African Revenue Services bearing the person’s name and the relevant number;
  3. a utility bill (no older than 3 months) or copy thereof;
  4. Partnership agreement.

For all your contract/property needs, contact our offices on 031 003 0630 or charmaine@schwenninc.co.za

DIVORCE PROCEEDINGS SUMMARY:

There are two courts in South Africa that deal with Divorces. One is the High Court and the other is the Regional Court. However, most divorces go through the High Court.

A court has the jurisdiction or right to hear the divorce due to the fact that the parties/ party are domiciled within the area of the court and if they are an ordinarily resident within the area of the court.

There are two types of divorces. One is Unopposed which is the most popular as it is quicker, cheaper and an agreed settlement agreement is reached. The other is an opposed divorce which will go to trial which could take a number of years.

 

How do I start the divorce proceedings?

If applicable, we try to settle the matter and a settlement agreement is concluded between the parties. This is normally done at a round table meeting with both parties and their attorneys. They will then agree to what will be put into the settlement agreement and or parenting plan.

The formal process starts with a summons, which we draw and issue at court.

This document sets out the names of the parties, where the marriage took place, how the marriage has irretrievably broken down, if there are any children from the marriage and the prayer sought e.g. maintenance, divorce order, medical aid expenses to be paid etc.

Once issued at court, we then send the summons to the sheriff to be served on the other party (“Defendant”). This must be personal service.

The Defendant would have 10 days to serve their Notice of Intention to Defend, which is filed if the matter is not settled and if they intend to oppose the divorce.

The divorce can be settled at any time during the process, but we are happy to run it as an opposed matter if it cannot be settled.

Once that is all agreed on, a Notice of Set Down will be served and filed giving a date for the divorce proceedings where the divorce should be granted.

And if the matter is opposed?

It will have to go to trial.

If a matter is indeed opposed, the Defendant will then sent his notice of intention to defend. As stated above they have 10 business days to defend, however, if they live outside of the court’s jurisdiction they have 14 working days if they live within 150km from the court and a month if they live more then 150km from the court.

The matter is ultimately set down for trial which is the set down date for argument. Both parties will have to be present with their legal representatives and give evidence before a judge.

Once that is done and after argument judgment will be made.

 

How we can help you.

At Schwenn Incorporated, we can help you through your divorce process and give the necessary advice. Contact us at Charmaine@schwenninc.co.za or call us on 0310030630.

www.schwenninc.co.za

 

WHICH NEW LAWS CAN WE EXPECT UNDER RAMAPHOSA’S RULING?

 

According to the Parliamentary Monitoring Group since January 2018, 41 Bills were in the “queue” in parliament, waiting to become enacted Legislation. Many may be finalized in this term of presidency.

To name a few here are some of the proposed bills to be finalized:

SMOKING LAWS:

These new laws are plan on banning smoking in all public spaces including:

  1. No in-door smoking including the removal of designated smoking areas;
  2. No outdoor smoking including the removal of designated smoking areas;
  3. When outside smokers must be at least ten meters away from any entrances;
  4. The removal of all branding and signage’s from cigarette packages; and
  5. Cigarettes may no longer be displayed by retailers.

Cigarettes will therefore be sold but not advertised. The packaging will only contain the brand name and warning labels.

DRINKING LAWS:

Aside from the total ban of alcohol advertising the following will also be put into place:

  1. The legal age to consume alcohol will now be increased to the age of twenty one years old as opposed to eighteen years old;
  2. The distribution and manufacturing of alcohol cannot be less then five hundred meters away from schools, places of worship, rehabilitation areas as well as residential areas; and
  3. Any unlicensed persons selling or distributing alcohol will have to pay damages in respect to any and all alcohol.

HATE SPEECH LAWS:

With the rise of the many racist comments that have been made public in this social media age, it is clear that something needs to be done.

To protect everyone’s race, religion and gender under the Constitution, new laws will come out to sanction hate speech. This punishment may even be used against petty insults. Other laws like internet censorship and congestion tax are also on the forefront of Parliaments promulgation list which we could be facing in the near future.

Want to know how laws are made? Have a look here :

https://www.parliament.gov.za/how-law-made

For any information regarding where you stand among the new fast approaching laws contact us at Schwenn Inc on 031 003 0630 or email us on Charmaine@schwenninc.co.za.

 

 

NOT PAYING MAINTENANCE COULD LAND YOU IN JAIL

 

A Durban businessman was convicted and received a four and a half year prison sentence by the Krugersdorp Magistrates Court for failing to pay maintenance to his wife and children.

Maintenance is the financial assistance of someone else and is usually made an order of court. According to the Times Live, the father is a director of a big restaurant franchise and lived the high life while the mother and children were living in abject poverty.

The man and his ex-wife divorced and in terms of the divorce settlement the man had to pay R24 000 every month for five years to his ex-wife and R10 000 every month for child maintenance for their children.

The man defaulted in just three months after the High Court order and according to Times Live, the evidence before the court was that the man had been living the high life and concealed his assets.

Defaulting in maintenance payment means that the person is in contempt of a court order and can be criminally convicted, as was in this case. The consequences for non-payment can be:

  • a court order for civil execution
  • a warrant for execution in terms of section 27 of the Maintenance Act
  • a garnishee order in terms of section 28 of the Maintenance Act

After a three year legal battle, the ex-wife got a writ of execution and the man’s property was attached which allows the wife to sell them and recover more than a million rand.

The Krugersdorp Magistrate refused to grant the man leave to appeal the conviction and refused to hear an application for bail pending a petition to the Chief Justice for permission to appeal.

The judgment passed by the lower court is quite unusual for such an offence, however the general public has become weary of maintenance defaulters.

In light of there being so many maintenance defaulters and in trying to curb that, an amendment was made to the Maintenance Act to include parent’s maintenance obligation as part of their credit profile. So as from September 2015, people with arrear maintenance can get bad credit records and get blacklisted.