Consumer Information

Author/Parties: 
Mamodupi Mohlala, CEO Estate Agency Affairs Board; Jan le Roux, CE Rebosa.
3 September 2020

Court case looming over penalty/fee dispute?

The Estate Agency Affairs Board (EAAB) and industry watchdog Rebosa remain at loggerheads over the legal merits of penalising estate agents with hefty fees upon re registration with the EAAB after a period of absence and the registration fees required for principals.

Mamodupi Mohlala, CEO of the Estate Agency Affairs Board (EAAB) responded scathingly on the comments made by Jan le Roux, CE of Rebosa in a recent article in Property Professional. Le Roux argued that the penalties charged by the EAAB in instances where agents neglect to advise the EAAB on leaving the industry and re-joining a couple of years later are illegal. The latter is based on a legal opinion sent to Mohlala.

Says Mohlala: “From the onset, we must express that we have become accustomed to being persistently and unduly accused by the CE of Rebosa of not conducting ourselves correctly as the EAAB. It would be of great assistance to Rebosa that it seeks relevant information before peddling incorrect statements against the EAAB”. She quotes the relevant regulation and continues: “The Regulations are unambiguous that every registered estate agent who has been issued with a Fidelity Fund Certificate and has ceased, or will cease to operate as an estate agent in a particular year, has an obligation to inform the Board of the EAAB in writing of such.”

Le Roux comments: “Ms Mohlala misses the point entirely. What she quotes applies to estate agents whereas my argument is that the individual she penalises during the period of absence is not an estate agent during that period. Quoting the regulation is irrelevant. Ms Mohlala can rest assured that we did our homework. We will comment publicly on public errors – in this instance the EAAB’s public announcement of their ‘magnanimous’ accommodation of ‘transgressors’.

This by the looks of it has merit. The Act defines what an estate agent is and the EAAB licenses an estate agent to trade. Surely, the EAAB cannot licence nor penalise someone not “holding himself out as an estate agent”?

Also, the EAAB penalises such individuals by charging a fee per month, hence somebody who was absent for four years will pay twice as much as somebody absent for two years. It seems indefensible to charge individuals different penalties for the same single offence, namely not notifying the EAAB of the intention not to renew.

The other matter Le Roux addressed was the current Schedule of Fees 2019/2020 “specifically with regards to the registration of principals. The determined fee is R1200, yet the Schedule of Fees incorrectly states R1958. The EAAB can only charge fees in accordance with the regulations”.

Mohlala responds as follows: “Thus, whenever, a principal estate agent seeks renewal of their Fidelity Fund Certificate, the applicable fixed renewal fee is an amount of R1200.00. However, other rates or fees are not subject to the gazetted schedule and as such, are revised annually using the inflation rate and subject to the approval of the Board. One such instance is where a non-principal estate agent seeks to upgrade his/her status to that of a principal. In such a case, the upgrade fee is an amount of R 1958.00. Therefore, had Rebosa sought clarity on the published SCHEDULED FEES published on the EAAB website, they would have received information explaining the difference between the application of the gazetted fees and non-gazetted fees and saved everyone from reading misplaced and misleading information”.

On this Le Roux responds that “Once again, we did our homework. Ms Mohlala is mistaken as the Regulation is clear on what principals can be charged. The EAAB incurs costs with the issue of all certificates, not just that of principals. If this practice was acceptable a similar charge could have been levied on an intern “upgrading” to full status. The EAAB is charging an illegal fee to increase it’s income”.

In the article Le Roux said both matters were “raised on several occasions with the EAAB and a legal opinion in respect of both instances was communicated to the CEO of the EAAB on 2 July this year – neither an acknowledgement of receipt nor any response has been forthcoming as yet.”

The dispute being unresolved, Le Roux believes that this will end up in court.

The original article can be viewed in the Property Professional / here: