The Tribunal is a private initiative for the resolution of commercial lease (excluding residential leases) disputes by prior written agreement between the parties and should not be confused with the operation of the Rental Housing Tribunal being a statutory body requiring no prior agreement.
The Arbitration or Dispute Resolution clauses (which can be downloaded here) must be part of the Lease Agreement, either when it is signed or in a later Addendum thereto. Referral to the Tribunal may also take place at a later stage should an Arbitration Agreement (which can be downloaded here) be concluded in writing between the referring parties.
The agreements referred to above, give the Tribunal jurisdiction to appoint arbitrators to hear disputes.
The Proprietors are Gideon Pretorius, an admitted attorney specialising in property law and two Counsels being Advocate Chris Erasmus (SC) and Ben Ridgard from the Pretoria and Johannesburg Bars respectively. The independent Custodian of the TCP is Judge Willem van der Merwe.
The Arbitrators are 27 selected practicing Counsel from the Johannesburg, Pretoria, Durban and Cape Town Bars.This selection was personally done by Judge Willem van der Merwe.
The Arbitrators attended an Arbitration course in Commercial Lease Agreements presented by the University of Pretoria (Continued Education) under the leadership of Professor Chris Cloete.
The proceedings envisaged by the TCP are not one sided or in favour of the Landlord. Arbitration clauses, giving the power to Arbitrators to hear disputes, have two characteristics, to record the scope of disputes and secondly to stipulate the process. It is in the interest of both parties agreeing on the TCP Lease Arbitration that disputes relating to the Lease Agreement and/or the occupation of the premises be described in the widest sense as to avoid proceeding to arbitration on one aspect but referring another to Court. This would simply not serve the interest of justice. The clause therefore includes general disputes and specifically defined disputes such as disputed renewals, tenant installations, failure to meet payment arrangements all of which may not be recorded in the Agreement of Lease and matters relating to the Landlord’s Hypothec. These defined disputes should not be “perceived” as favouring the Landlord or any party for that matter, as they do not add or detract from the material lease terms. Procedurally the process also does not favour one party above the other and is aimed to be effective and fair. To have disputes heard within a period of three months is in the interest of all parties as documents, witnesses (and their memories) will be available as evidence at hearings. Should a Tenant or any party for that matter comprehend the aforegoing there should be no difficulty in them agreeing to and signing a Lease Agreement containing the TCP Lease Arbitration Clause.
The final TCP Annexure consists of the following:
- Lease Annexure – approximately 5 pages;
- and Deed of Suretyship – approximately 2.5 pages additional to the Deed of Suretyship
A decision was taken by the TCP (in line with other Arbitration forums) not to attach the Rules to the Agreement but to have such Rules readily available here on the website and elsewhere.
We are of the opinion that the costs are affordable and fair. The TCP took a decision to move away from any cost calculation using a percentage of the amount claimed to a fixed scale as recorded hereunder.
|Claim Amount||The claim amount includes the total amount claimed.|
|Fees in terms of Monetary Claims||Arbitration fees payable (excluding VAT) as per the tariff below.|
|Claim Amount||Fees in terms of Monetary Claims (excluding VAT)|
|R1 – R150 000||R12 000 – R6000 per party|
|R150 001 – R300 000||R14 000 – R7000 per party|
|R300 001 – R600 000||R16 000 – R8000 per party|
|R600 001 – R1 000 000||R18 000 – R9000 per party|
|Above R1 000 001||R20 000 – R10 000 per party|
Non Monetary Claims – R20 000.00, however (i.e. failure to maintain part of the leased premises by the Landlord, or eviction of the Tenant) where a non monetary claim is claimed with a monetary claim the amount of R4 000 plus VAT i.e. R2 000.00 per party shall be payable in addition to what is payable in respect of a monetary claim. (See the Terms and Conditions for more detail) The Arbitrators would also fall into certain cost brackets in relation to the value of any claim amounts. In meeting the requirements of fairness the TCP was senstive to the fact that the costs must be affordable to all parties.
Finally we are of the opinion that in the long run and taking all factors into consideration the TCP process as opposed to the court process would prove to be much more economical. The longer it takes to finalise a matter, the more expensive it becomes directly or indirectly.
The TCP derives its powers from the Arbitrations Act 1965 (Act No. 42 of 1965) (hereinafter referred to as the “Act”) as well as agreements concluded between contracting parties containing provisions by which disputes are referred to the TCP. Awards not being adhered to can be made Orders of Court in terms of the Act.
The TCP has certain industry specific advantages such as that Arbitrators have been trained in this specific industry, the TCP is further unique in that the full disclosure of documents and evidence prescribed at the outset of the TCP process is aimed to avoid a “cloak and dagger” approach to proceedings, the inquisitorial nature of the Arbitrator allowing him/her to call for evidence, strict guidelines regarding postponements and delays including cost awards as a deterrent for causing delays, guidelines on the filing of expert evidence (i.e. damages suffered by either party), the period within which the arbitration award must be given as well as the unique process with regards to the determination and awarding of costs by the Arbitrator.
It is standard in most arbitration provisions that the award of the Arbitrator will be final and binding. Allowing an appeal in the TCP process would effectively diminish the benefit of expedited justice. We are confident that the selected and trained Arbitrators will give quality awards that can only exponentially increase in quality with their exposure to the industry.