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ESTATE AGENTS: PROTECT YOUR COMMISSION!
Estate agents need to take heed of a recent High Court case in which an agent's commission claim was rejected on two grounds.
An agent ("W") had initially introduced a buyer to a seller's property at a show house, but the buyer was - although keen to offer - at that time unable to do so (a) because the price was too high and (b) because of other financial commitments.
Later on another agent ("D") successfully negotiated a sale to the same buyer, after (a) the seller had reduced the price by R500.000, and (b) the buyer's other financial commitments had fallen away. The seller paid D her agreed commission, but refused to pay W the 6% commission she claimed - hence the litigation.
Firstly, W needed to prove a mandate from the seller. She was unable to provide evidence of an express mandate, so instead relied on a "tacit" mandate. That, held the Court, meant proving "unequivocal conduct, by inference if necessary, that the parties did contract in the terms alleged". Since W was unable on the facts to prove the terms of the mandate - specifically that the seller had indeed agreed to the commission rate she alleged (6%) - her claim had to fail.
Moreover, W couldn't show that she was the "effective cause" of the sale. At the time of the introduction by W, the buyer was certainly "willing"; but not "able" to buy. And although that was later rectified through negotiation via D, W couldn't prove that "the original introduction and visiting of the house was conclusive and dominating" in effecting the eventual sale.
Sellers: be alert to the danger of paying double commission in this sort of case - the courts have often awarded full commission to the introducing agent as well as to a later, intervening, agent. It was only on the facts of this particular case that the initial introduction was held insufficient to prove "effective cause", and in any event an appeal against the finding is apparently being considered.
Agents: you need to: - - Take a clear written mandate from the seller, setting out the terms of the mandate including the agreed rate of commission, and
- If you have introduced a buyer who is initially unwilling and/or unable to make an acceptable offer, don't give up. Follow up regularly in case circumstances change, and keep a clear paper trail in case you end up with a dispute.
THE WORLD CUP - SICK LEAVE SKIVING
Employers are going to be very suspicious if staff suddenly take "sick leave" just when a big World Cup game is on, and all concerned need to understand what the legal position is with sick leave. In summary:-- A medical certificate ("sick note") can normally only be required of an employee who takes more than 2 days' sick leave (i.e. 3 consecutive days or more), or where sick leave is taken more than twice in any 8-week period.
- Only original, unaltered medical certificates should be accepted; and checked for the basics, such as the name, address and qualification of the medical practitioner, name of the patient, date and time of the examination, description of the illness (doctor/patient confidentiality permitting), period of recommended leave, whether the inability to work is total or whether lighter duties could be performed, full signature by the practitioner, etc.
- Employers may question any medical certificate, and should certainly investigate any absence (certified or not) if there are grounds for suspicion (such as "Hey, what's Joe doing on the TV blowing a vuvuzela down at the stadium when he just called in with a migraine?"). Take advice on instituting disciplinary procedures (possibly even criminal charges for fraud) in the event of abuse.
If you are an employee wanting to watch a match during working hours without sacrificing your annual leave, ask the Boss to consider a bit of flexitime leeway. You can't force the issue, but from a staff morale perspective most businesses will probably try to be accommodating.
CC MEMBERS DUELLING? CHOOSE YOUR WEAPONS!
What do you do if member disputes are critically endangering your close corporation's business? First prize is for one of you to sell out to the other, but if you can't agree on a fair price, you need to force a resolution.
You have two courses of action to choose from, as illustrated in a recent Supreme Court of Appeal case. The CC in question held a very profitable pub, which was being managed by one of the members (the other member being described as a "sleeping partner", although in fact he turned out to be very much wide awake!). Allegations of misconduct, each against the other, led to differences between the members becoming so serious, and irreconcilable, that their relationship had "broken down irretrievably". The court was asked to make one of two orders: -- The "sleeping" member applied for liquidation of the CC on the grounds that, although it was solvent and profitable, it would be "just and equitable" to do so, to enable a liquidator to fully investigate the CC's financial affairs.
- The "managing" member asked for an order transferring to him the "sleeping" member's membership against payment of R400.000 (or such other figure as the court considered reasonable).
The SCA, commenting that the court "retains a discretion" in this regard, confirmed the liquidation order granted by the High Court. The "transfer of membership" option failed because the managing member hadn't given the court enough information to enable it to determine a fair "financial adjustment" between the members.
If you are in dispute with your fellow member, take legal advice immediately. And if you want to avoid liquidation, provide the court with a fully-motivated valuation of the business.
EMPLOYERS: LODGE RECON RETURNS BY 31 MAY!
SARS has set 31 May as the deadline for submission of the new EMP501 "Employer Reconciliation Declaration" returns for the period 1 March 2009 to 28 February 2010.
Do not be late - SARS has warned that late submissions will attract heavy penalties and will prejudice your employees (their personal income tax returns can only be issued once EMP501s are lodged). Keep a copy of the return, with proof of timeous submission!
WHO CAN MAKE A WILL? AND WHO'S "OF SOUND MIND"?
Make sure that you have a properly-drawn will - and review it regularly. Our law requires only two things for you to have "testamentary capacity" -- That you be over the age of 16, and
- That you be mentally capable of appreciating "the nature and effect" of your will (more commonly, but less accurately, referred to as being "of sound mind").
That "mental capability" becomes critical in those unfortunate cases where the validity of a deceased person's will is later challenged by a disinherited heir or relative. In considering just such a case recently, the High Court set out "the main elements of the test for deciding the question of testamentary capacity" as being that, at the time of making the will, he or she must have been capable of: -- "………comprehending the nature and extent of his property", and
- "………recollecting and understanding the claims of relations and others upon his favour and upon his property", and
- "………forming the intention of granting each of them the share in the property set out in the will or excluding them from any share of his property, as the case may be."
Tell your lawyer upfront if there is any hint of a possible challenge to the validity of a will (on any grounds), so that preventative measures can be taken. For example, in this particular case the deceased was gravely ill, and had predicted that his will would be challenged. His attorney accordingly arranged for it to be signed in the presence of a medical doctor, who was accordingly able to testify effectively as to the deceased's capacity at the time of signing.
Note that if you are challenging someone else's will on the basis of testamentary incapacity, the onus is on you to prove it.
EVICTION DELAYS? CLAIM FROM THE LOCAL AUTHORITY
Any landowner saddled with illegal occupiers faces potentially crippling delays in the battle to evict them, the courts commonly delaying eviction until alternative accommodation is provided for destitute occupiers.
Relief in such cases has come in the form of a recent High Court decision to the effect that a local authority's failure to plan and budget for the provision of alternative housing for such occupiers (its policy being to assist occupiers of State land only) is unconstitutional - in regard to the rights of both occupiers and of private landowners.
In the result, the municipality was ordered to pay damages to the landowner, equivalent to the "fair and reasonable monthly rental" lost by it during the preceding 7 months. Moreover the eviction order was granted (delayed for 2 months), the municipality being obliged to either find housing for the occupants, or to finance their rental of other accommodation.
THE MAY WEBSITE: PHISHING E-MAILS - THE BAIT, THE HOOK, AND THE LANDING NET
The current upsurge in fraudulent "phishing" e-mails is catching more and more victims. Why? Because these mails are constantly morphing into new guises, they look totally genuine, and they are carefully worded to look urgent and compelling.
Don't take the bait! If you are "hooked and landed", your account will be pillaged before you can blink an eye. And you won't get much sympathy from your bank.
The problem is that we all think to ourselves: "I won't fall for that". But in the heat of the moment, threatened (as often happens) with suspension of your account if you don't respond immediately, it's all too easy to fall prey to some new variant of these sophisticated scams.
Protect yourself! Be fully informed in advance - read the SABRIC (South African Banking Risk Information Centre) article "Internet Banking Fraud" on its website at www.sabric.co.za/?pg=Internet+Banking+Fraud.
Have a Fantastic (and phishing-free!) May
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