High Court Ruling on Estate Agency Board welcomed – Emma Louise Powell

DA MP says Board failed to issue hundreds of FFCs to agents within legislated timeframe

DA welcomes the High Court Ruling on Estate Agency Board

16 March 2021

The Democratic Alliance (DA) welcomes the ruling of the Gauteng High Court today, brought on an urgent basis by the Real Estate Business Owners of South Africa (REBOSA).

The order found that the Estate Agency Affairs Board (EAAB) failed to issue hundreds of Fidelity Fund Certificates (FFCs) to estate agents within the legislated timeframes.

The court ordered the entity to issue all outstanding certificates, due in December 2020, within 8 days.

It is illegal for an estate agent to practice without being in possession of a valid FFC.

The late issuing of FFCs has persisted for years, with the entity blaming these ongoing delays on estate agents’ individual failures to comply with administrative requirements.

As per today’s judgement, it is clear that the overwhelming majority of agents subjoined to the application were not at fault.

On 24 November 2020, anticipating yet another set of lengthy delays for the December 2020 deadline, the DA put EAAB CEO, MamodupiMohlala-Mulaudzi to terms in Parliament, requesting a guarantee that all compliant FFC applications would be issued on time.

Mohlala-Mulaudzi proceeded to give Parliament this guarantee, noting that: “In this financial year, we give a firm undertaking that all fidelity fund certificates that are compliant and that meet all the requirements will be issued by the 31 December 2020.”  

Today, the Gauteng High Court found that this had not happened and ordered the entity to issue all outstanding certificates, due in December 2020, within 8 days.

High Court Judge Kathree-Setiloane further found that the EAAB’s ‘sustained breach of its statutory duties and its failure to acknowledge any wrong was a sufficient basis to justify an order of costs’.

The court has also instructed the entity to disclose the total amounts currently held in its suspense account.

This is a victory for estate agents, hundreds of whom have been unable to operate in recent months due to the EAAB’s endemic governance failures under its current leadership.

The High Court ruling comes shortly after Minister Lindiwe Sisulu ordered a forensic investigation into the EAAB’s fidelity fund.

The DA eagerly awaits the outcome of both this and a previous investigation initiated by the Minister on our request, into the entity’s VAT charges on levies.

Issued by Emma Louise Powell,DA Shadow Minister of Human Settlements, 16 March 2021