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PROPERTY BARGAINS IN THE OFFING - BUT STUDY THE SALE CONDITIONS!
The current weaknesses in the property market have opened up excellent opportunities for bargain hunting to buyers with access to finance, particularly where sales are forced. But if you attend an auction, be sure to read and understand all the conditions of sale - you will be held strictly to them whether you do or not.
With an auction other than a sale in execution, the sale may be "subject to confirmation", in which event the seller will have a period of time (often 7 days) after the sale to decide whether or not to accept the highest offer.
In contrast, with an auction sale by the Sheriff of the Court - i.e. a sale in execution of a court order - the sale must be to the highest bidder, and must be "without reserve", i.e. a final sale is concluded "on the fall of the hammer".
Execution creditors will normally attend the sale and bid the price up to a level sufficient to cover the claim - but where a creditor is prepared for whatever reason to let the property go "for a song", a real bargain is in the offing. And, as happened in a case recently before the High Court, if the creditor's representatives fail in error to bid the price up, the sale is still final and binding. The end result in that case - the buyer paid only R50.000 for a house worth probably six times that.
RETRENCHMENT PAY: HOW MUCH?
Retrenchment is a traumatic experience for all concerned, and a costly one.
In summary (there are grey areas here, so take proper advice in doubt), retrenched employees must be paid: - - All outstanding salary or wages
- Any other benefits due in terms of the employment contract (e.g. pro rata bonuses, etc)
- Notice pay (where no notice period is worked)
- Any leave pay due
- Retirement benefits per the relevant fund, if applicable
- Severance pay*. The minimum severance pay is 1 week's remuneration for every completed year of continuous service ("remuneration" includes any payment in kind and also certain discretionary payments - take advice in doubt). This minimum may increase - often to 2 weeks' remuneration or more - where a higher rate is stipulated in, for example,
- The employer's standard retrenchment policies
- The particular employment contract
- An agreement reached during the consultation process leading to the retrenchment, etc.
* Note that severance pay is not payable if the employee, on being offered alternative employment, "unreasonably refuses" the offer.
The employee must also be given a certificate of service and (where applicable) his/her UIF card.
THE NCA AND A SPOT OF SILVER LINING FOR CREDITORS ...... BUT ONLY IF YOU DO IT CORRECTLY
In terms of the National Credit Act, a creditor cannot take legal steps against a defaulting debtor without first giving notice of default to him/her, proposing that the debtor refer the credit agreement to a debt counsellor or other competent authority. The potential for prolonged delay - and consequent prejudice to the creditor - is significant.
However some good news for creditors has come out of two recent High Court cases, which make it clear that the courts will not allow the process to be abused by debtors in a dishonest attempt to delay the inevitable. In both cases, a bank successfully applied for judgment against homeowner debtors, who tried - without success - to avoid judgment (and the consequent sale in execution of their bonded houses) by claiming to be "over-indebted".
Creditors need to note that the bank's meticulous compliance in each case with the Act's many formalities clearly contributed to its success - even a minor failure in this regard will prejudice your recovery attempts.
Debtors on the other hand should seek debt counseling as soon as they find themselves in financial distress, and should certainly never delay in reacting to any form of notice from a creditor. Once in court, you will have to: -- Prove that you are factually over-indebted, and
- Persuade the court to exercise its discretion not to grant judgment (just proving that you are over-indebted isn't enough at this stage), and
- Explain your failure to approach a debt counsellor on receiving the notice of default.
Particularly heartening for creditors will be the Court's comment in one of the cases that: "In any event my view is that the NCA does not envisage that a consumer may claim to be over-indebted whilst at the same time retaining possession of the goods which form the subject matter of the agreement. Such goods should be sold to reduce the defendant's indebtedness". Concluding that the debtor's defence was "merely a blatant stratagem to delay the plaintiff's claim and that it is not bona fide", the Court granted judgment for the creditor with a punitive costs order against the debtor.
"THE CHEQUE'S IN THE POST" - A RISKY BUSINESS!
The safest way to pay a creditor these days is probably electronic transfer or bank deposit, but the riskiest must be the "cheque in the post" - the chances of interception and theft (even of restrictively crossed cheques) are so high that what used to a common form of payment is now a rarity.
As a creditor, do not in any way authorise or request payment by posted cheque, unless you are happy to bear the risk of loss (the risk is yours as soon as the cheque is posted). Rather insist that your customers make payment direct into your bank account, and/or that - if they choose to pay by cheque - they do so at their risk entirely. Take advice if you aren't sure that your credit documentation covers you adequately in this regard.
As a debtor, if you post a cheque and it is stolen, you will still have to pay the creditor all over again unless you can prove a prior, clear agreement (actual or implied) by the creditor to take the risk. Don't assume that a creditor has consented to your paying by cheque just because your cheques have always been accepted in the past - failure to object cannot amount to an agreement to accept the risk.
And, per a recent High Court case, this principle applies to all modes of delivery, not just post. Thus in the case in question, a cheque was intercepted after it was forwarded via a document delivery service (akin to a courier service), and risk was held to have remained with the debtor because it had chosen the method of delivery.
REGISTER YOUR IN-HOUSE SECURITY GUARDS NOW!
The Constitutional Court has determined that security guards must be registered as such even when they are in-house, non-uniformed, unarmed employees who only perform security duties "from time to time when needed". The case in question involved the employment of general farm workers to operate access-control booms and security patrols to curb theft on two commercial farms.
As the Court held that "the plain meaning of a security service cannot extend to a security activity that is merely a by-product or once-off incident of the core activity", there may at times be grey areas as to whether specific employees need to be registered. Employers should seek advice in doubt - failure to register such employees when required is a criminal offence (indeed in the case in question some of the workers and their managers were arrested by the police).
Where registration is required, the effect is that: -- Your guards must be over 18 years of age,
- They must be citizens or permanent residents (employers of foreign nationals take note!),
- All minimum wage and training requirements per the code of conduct for security service providers are applicable.
THE "ANTHRAX POWDER" HOAX, AND THE POLICE STRIKE BACK
Hoax reports to the police have always attracted condemnation from all quarters - in squandering scarce police resources, they notoriously put us all at serious risk.
The good news is that in future, perpetrators face not only criminal charges, but also damages claims from the police for any monetary loss that they suffer as a result.
That is the upshot of a new High Court declaration relating to an incident way back in 2001 when a woman, with the intention of causing panic amongst her colleagues at work, placed an envelope containing white powder in a toilet. A colleague who discovered the envelope suffered "severe nervous shock" believing that she had been a victim of anthrax poisoning, and the police wasted considerable time and resources on a futile investigation.
Any victims of such a hoax should also take advice on claiming their own damages from the perpetrator.
THE JUNE WEBSITE: JOB HUNTERS, BEWARE YOUR "NET REP"!
More and more South African businesses are researching potential employees on the Internet before hiring them.
Beware - if and when you find yourself job hunting, your chances of being hired could be scuppered if this "cyber vetting" unearths anything negative about you!
Check and manage your "Net Reputation" constantly. Virtually anything, even from years ago, could come back to bite you - that long-forgotten "party picture" on your photo-sharing website, or the joke about your first boss which you posted on Facebook for the amusement of your colleagues ...... the list is endless.
But don't just dwell on "negatives". Pro-actively ensure that any form of Internet search highlights your "positives" - your strengths, your capabilities, in fact anything that you would like a prospective employer (or client) to turn up in their search results.
"BigHospitality" on their website at http://jobs.bighospitality.co.uk/careers have a useful action list to get you going - and don't forget to diarise regular follow-ups!
Have a great June, and (unless you want a very grumpy Dad on the 21st), don't forget Father's Day!
Note: Copyright in this publication and its contents vests in LawDotNews(law.news)
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