Covid-19: Struggling to pay - or collect - the rent?
South Africa is facing a deep and prolonged economic downturn amidst the Covid-19 outbreak.
Many tenants who were formerly in good standing will soon be unable to pay their rent.
Many leases don’t have a “force majeure” (aka “Act of God”) clause to cover for events such as Covid-19.
In other words, it’s a breach of contract, if a tenant becomes unable to pay.
But these are extraordinary times; landlords and tenants may come to an amicable agreement while the crisis persists.
The Money Show’s Bruce Whitfield interviewed Julian Scher (Partner & Property Lawyer at Strauss Scher Attorneys) about rental payment problems caused by Covid-19.
In most commercial leases you should find a clause that deals with events beyond the control of the parties… A classic example is if the building is destroyed…Julian Scher, property lawyer - Strauss Scher Attorneys
Read the lease… if there is nothing in it, then we fall back on common law… it, unfortunately, doesn’t recognize hardship as a result of the Covid-19 environment…Julian Scher, property lawyer - Strauss Scher Attorneys
In my view, Covid-19… performance is still possible…Julian Scher, property lawyer - Strauss Scher Attorneys
For more detail, listen to the interview in the audio below.
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