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Month: November 2018

FIRST-TIME HOME BUYER?

FIRST-TIME HOME BUYER?

Buying a property is a rather big deal, which is why you should be sure that you are able to afford it before you end up running into debt. Owning your own home is a very rewarding experience, but there are usually some obstacles along the way. Follow the steps the below to be sure that your new home is your dream home.

  1. Make sure you have a healthy credit score

Your credit score lets banks know how well (or badly) you manage your debt. A good credit score improves your chances of getting a home loan.

In order to build up your credit score, make sure you pay all your bills on time, every time. Clear as much of your debt before applying for a home loan. If you don’t have a credit card, you should apply for one to aid your score. Check your status by getting a credit report from a credit bureau.

  1. Save up for a deposit

Having a deposit saved makes you more attractive to sellers, agents and banks, which means, if you have a deposit ready, you have a higher chance of getting your loan approved. A deposit also means that your loan repayments will be lower; you’re in a better position to negotiate an interest rate if you have a deposit since there is a lower risk for the bank.

  1. Look out for any additional costs

There are a number of additional costs that are incurred when buying and taking ownership of a house, and these may come as a shock to a first-time buyer.

Make sure to account for additional buying costs such as the loan initiation fee, transfer duty, loan registration costs and conveyancing fees. Also ensure that you take additional homeownership costs into consideration, e.g. loan repayments, homeowner’s insurance, municipal rates and taxes, water and electricity, maintenance, and security.

  1. Ensure the price is worth it

You should make sure that there are no damages to the property. Be sure to check for any leaks, as it might become a costly and annoying long-term problem.

If you’re planning to make this your forever home, you might want to consider what facilities are available nearby in case mobility becomes a problem. Is there a doctor close by? Are the transport links good?

Conclusion

From this it should be clear that buying a house is a rather complex activity that necessitates a lot of thought, calculating, and logical reasoning. It is advised to obtain the help of a professional to be absolutely sure that the money you end up paying is worth all the possible obstacles that you may encounter.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

THE CANNABIS JUDGMENT: IS IT LEGAL NOW?

THE CANNABIS JUDGMENT: IS IT LEGAL NOW?

Cannabis has historically been criminalised in South Africa. It has, until recently, been a criminal offence to possess, cultivate or use cannabis. However, this position has been drastically altered by a ground-breaking unanimous judgment by the Constitutional Court in the case of Minister of Justice and Constitutional Development and Others v Prince.

This case came before the Constitutional Court as part of confirmatory proceedings in terms of section 167(5) of the Constitution after the Western Cape High Court declared certain sections of the Drugs and Drug Trafficking Act and the Medicines and Related Substances Control Act inconsistent with the right to privacy as enshrined in section 14 of the Constitution. The Court furthermore ordered Parliament to cure this constitutional defect within 24 months.

The right to privacy can be defined as the right to live and enjoy one’s life with a minimum of interference. Deputy Chief Justice Raymond Zondo who penned the Constitutional Court’s judgment agreed with this definition when he stated that, “It can legitimately be said that the right to privacy is a right to be left alone.” This case thus essentially raised the question of whether or not the State can interfere with what you do in private if such private act does not adversely affect others. The Court found the privacy argument convincing and accordingly found that the prohibition of the mere possession, use or cultivation of cannabis by an adult in private for his or her personal consumption is inconsistent with the right to privacy provided for in section 14 of the Constitution.

It is important to note that the Court did not legalise cannabis as a substance. It was merely decriminalised to the extent that adults may now grow their own cannabis and use it in a private space. The Court, with reference to the cultivation thereof, stated:

“An example of cultivation of cannabis in a private place is the garden of one’s residence. It may or may not be that it can also be grown inside an enclosure or a room under certain circumstances. It may also be that one may cultivate it in a place other than in one’s garden if that place can be said to be a private place.”

The Court did not, however, state what would constitute a private space for purposes of using or cultivating cannabis. It is thus unclear whether or not a private space is limited to one’s dwelling or whether it can include spaces such as motor vehicles or other privately-owned spaces such as restaurants or festival grounds. This is thus something that Parliament will most probably clear up when enacting the legislation as discussed above.

It is of utmost importance to note that the commercialisation of cannabis has not been legalised. It is thus still a criminal offence to cultivate cannabis for commercial purposes or to trade with cannabis. The Court stated in this regard that, “[D]ealing in cannabis is a serious problem in this country and the prohibition of dealing in cannabis is a justifiable limitation of the right to privacy.” The right to privacy as it relates to the use of cannabis is furthermore limited in that the use thereof in the presence of children or non-consenting adults are also still prohibited and thus a criminal offence.

The judgment is very vague as to how much cannabis a person may possess. However, it is advisable in this regard not to cultivate or possess large quantities of it since the Court stated that:

“In determining whether or not a person is in possession of cannabis for a purpose other than for personal consumption, an important factor to be taken into account will be the amount of cannabis found in his or her possession. The greater the amount of cannabis of which a person is in possession of, the greater the possibility that it is possessed for a purpose other than for personal consumption.”

It is clear from the above that there is still a lot of legal uncertainty regarding the legality of cannabis use. Vishnu Naidoo, a national police spokesperson, said that the relevant authorities are currently busy formulating a directive to its members as to what they should do when encountering someone who has cannabis in his or her possession. This will give us some certainty, but complete legal certainty will only be attained once Parliament has done its job.

Reference List:

  • Minister of Justice and Constitutional Development and Others v Prince
  • https://www.dailymaverick.co.za/opinionista/2018-09-18-concourt-cannabis-judgment-what-was-the-reasoning-and-what-does-it-mean/

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

WHY IS IT IMPORTANT TO DEAL WITH COLLATION IN YOUR WILL?

WHY IS IT IMPORTANT TO DEAL WITH COLLATION IN YOUR WILL?

The South Africa common law presumption of collation (collatio bonorum) is alive and well.

This presumption is rooted in the belief that a testator intended that there should be equality in the distribution of his estate among his descendants (“children”). Collation is the process by which the inheritance of certain descendants (heirs) of the deceased is adjusted to consider any substantial benefits received from the testator during his lifetime.

Collation is achieved by adding to the inheritance the amount due by each heir. The new total shall then be divided between all the heirs. An heir cannot, if he refuses to collate, enforce legal remedies to claim his share of the inheritance.

Collation further takes place by operation of law and therefore applies automatically to your will, or if you have failed to execute a will it applies to your intestate heirs.

If you, therefore, intend to release any of your descendants (heirs) from this obligation to collate it should be clearly expressed in your will, by adding the following paragraph: –

“I direct that my children need not collate any of the gifts or sums of money they received from me during my lifetime and I remit collation so far as they are concerned.”

Or if you specifically intend for one of your descendants (heirs) to collate it should be clearly expressed in your will, by adding the following paragraph: –

“I record that during my lifetime I advanced to my son, Piet Louw sums totalling in all R300 000 (three hundred thousand rand) to enable him to qualify as an attorney and I direct that he collates that sum with my estate before he is paid his inheritance in terms of this will.

An heir who is obliged to collate has the choice of restoring the property he has received or permitting a deduction equal to the value he received at the time of the gift.

Considering the above it is imperative to have your true intentions reflected in your will and to enlist the services of an estate specialist to assist you with your estate planning and the drafting of your will.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

BEFORE SIGNING A LEASE

BEFORE SIGNING A LEASE

Tenants often take the signing of a lease agreement lightly and don’t read carefully through the terms and conditions. A proper lease agreement will ensure that both parties’ rights are protected. Landlords must ensure that they include all the necessary information in a lease agreement, while tenants must make sure that all the points discussed with the landlord are included in the lease, instead of just assuming that they are.

Enquire about costs and duration

The monthly rental cost and duration of the lease (including specific dates) must clearly be stated in the lease agreement to avoid any confusion regarding this matter. The lease agreement should also clearly indicate how and when any increases in rent will take place. If the landlord doesn’t provide you with this information, ask him/her to give it to you in writing so you can keep it on record.

The lease should also clearly explain any deposits (e.g. the rental deposit) that have to be paid, as well as the terms and conditions regarding the refund of deposits. All other variable usage expenses (like water or electricity) that the tenant will have to pay should also be clearly stated.

Some rental properties include utilities within the monthly rental cost, while others don’t. Some properties might offer on-site gym memberships, for example, which could save you money. Before you sign the lease to a property, ask your landlord what is included in the rental rate.

Get information regarding changes to the property

Once the landlord has agreed to rent out his property to you, make sure that you document any pre-existing damages to the property and its amenities before you sign the lease. Ask whether these damages can be fixed at the landlord’s expense.

Both the landlord and the tenant are responsible for the maintenance of the property. The responsibilities of both parties should be clearly stated in the lease agreement. The lease agreement should also indicate how the tenant must report any problems that require repair.

Make sure which amendments can be made to the property. Rather know the rules and stick to them, instead of making an alteration and then finding out afterwards that your landlord is unhappy with it. Just imagine your landlord’s disgust after finding out that you’ve repainted his freshly white-painted walls red!

Conclusion

Tenants should be sure to understand the contents contained in the lease agreement and that they understand all the clauses, terms and conditions to avoid any surprises later. While renting a property isn’t as much of a financial commitment as buying a home is, tenants should remember that a lease is nevertheless a legally binding document, meaning that they should make sure that they agree with everything contained therein before they sign it.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)