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Advice to Body Coporates on Estate Agents

In: Business and Management

Submitted By EZISSI
Words 625
Pages 3
COMPLAINCE WITH THE PROVISIONS OF THE ESTATE AGENCY AFFAIRS ACT BY ESTATE AGENT AND MANAGING AGENTS

16. Applications for and issue of fidelity fund certificates and registration Certificates. 1) Every estate agent or prospective estate agent, shall, within the prescribed period and in the prescribed manner, apply to the board for a fidelity fund certificate, and such application shall be accompanied by the levies.

The Act defines an estate agent as any person, estate agent, managing agent who operates as such and is paid a fee, management fee or commission and requires the said person or company to have a valid certificate to operate.

In South Africa any person or company operating and or practising within a regulated industry or profession is required by law to have the necessary required license.

26. Prohibition of rendering of services as an estate agent in certain circumstances 1) No person shall perform any act as an estate agent unless a valid fidelity fund certificate has been issued to him or her and to every person employed by him or her as an estate agent and, if such person is - a) a company, to every director of that company; or b) a close corporation, to every member referred to in paragraph (b) of the definition of 'estate agent' of that corporation.

This means that any person or company that operates as an estate agent and or managing agent cannot operate as such without being registered and being issued with a fidelity fund certificate.

34A. Estate agent not entitled to remuneration in certain circumstances 1) No estate agent shall be entitled to any remuneration or other payment in respect of or arising from the performance of any act referred to in subparagraph (i), (ii), (iii) or (iv) of paragraph (a) of the definition of 'estate agent', unless at the time of the performance of the act a valid fidelity fund certificate has been issued - a) to such estate agent; and b) if such estate agent is a company, to every director of such company or, if such estate agent is a close corporation, to every member referred to in paragraph (b) of the definition of 'estate agent' of such corporation.

Therefore any company or person who operates as an estate agent without the required fidelity fund certificate is not entitled to payment.

The fidelity fund is that person dealing with an estate agent are protected by the Fidelity Fund should an estate agent, estate agency or managing agent misappropriate monies that have e been entrusted to them in terms of the Act.

It should be noted that the only persons practising as estate agents exempted from holding a fidelity fund certificate issued by the Estate Agency Affairs Board are attorneys as they are registered under the Attorneys Act, with the Law Society and thus hold fidelity fund certificate with the Law Society.
There is no other exemption under the Act for any company or person operating as an estate agent.

DUTIES OF TRUSTESS

The trustees are required to act in the best interest of the body corporate and as such they should acquaint themselves with the relevant laws such as The Estate Agency Affairs Act 112/1976 and the Sectional Tile Act.

Contrary to popular opinion that it is the trustees who have an unfettered right to lay down the law in a scheme, it is the owners in a general meeting who have the ultimate decision-making power in a scheme.
Where trustee breach their fiduciary duties by an act or omission that is grossly negligent or performed in bad faith, they can be held liable to the body corporate for any resultant loss suffered by the body corporate or any economic benefit derived by the trustee.

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