The nationwide lockdown due to the COVID-19  pandemic has created many challenges for South Africans. These challenges are wide-spread and are affecting every sphere of our society. One of these challenges includes the uncertainty with regard to the consequences of inability to fulfil legal obligations due to the lockdown.

A lease is defined as an agreement whereby the lessor agrees to make property available for temporary use and enjoyment by the lessee, in exchange for the payment of rental by the lessee. The payment of rental by the lessee is a legal obligation, just as the lessor has the legal obligation to make the property available and to maintain the condition of the property during the currency of the lease. In the event that obligations are not fulfilled, this results in breach of the contract. In the event of breach, the aggrieved party has certain remedies available to her. However, just as any good legal rule, there are exceptions to breach.

One of these exceptions are called “supervening impossibility”. This is a South African Common Law principle; and it essentially means that performance has become objectively impossible due to ‘vis maior’ (a superior major force which cannot be controlled) or ‘ causus fortuitus’ (accidental occurrence) event that is unforeseen. Supervening impossibility operates in the instances where a lessee’s full use and enjoyment of the property has been limited,  interfered with or disturbed. Thus it is an objective test, and it is determined on a case by case basis. Certain factors will determine objectively impossibility such as:

• The nature of the contract
• The relationship of the parties
• Circumstances of the case
• Nature of impossibility

Now, simply being unable to pay your rental is not regarded as supervening impossibility, and will not hold as an exception to breach. However, in a situation such as the COVID-19 lockdown, there may be remedies available to lessees. As mentioned before, the doctrine of supervening impossibility only applies where a lessee’s full use and enjoyment of the premises has been interfered with. So, if a lessee can prove that her use and enjoyment of the property has in some way been negatively directly affected due to the COVID-19 lockdown, then a remission in rental will be available to the lessee. However, unfortunately; simply not earning an income in this time is not sufficiently closely linked to the lease agreement itself, and therefore does not qualify as an exception. Discussions can be entered into between lessor and lessee to negotiate a possible relief for the mean while; however, the lessor is not obliged by law to receive diminished rental or no rental.

The last resort the lessee’s have is to look at their lease agreement. Standard lease agreements include what is called a “force majeure” clause. This is a French term that basically means unforeseeable circumstances. These clauses modify the common law position and allows for suspension of performance (rental) where performance is not necessarily objectively impossible. These clauses normally then instruct parties to negotiate on the terms of performance for the period of temporary force majeure.

With all of this said, we at Neumann Van Rooyen are ready and equipped to assist you with your legal concerns, and duly experienced to navigate through these uncharted legal waters.

Keep safe.

References

Ramsden QS Supervening Impossibility of Performance in the South African Law of Contract 1983.