In an appeal judgment (Reitz 21 CC v Siebrits and Others (A91/2023) [2024] ZAGPPHC 70 (31 January 2024) (saflii.org)) the lease agreement dealt with rental of student accommodation.  The lessee sought remission of the rent because the Covid-19 regulation allegedly prevented him from occupying the premises.  It was found that the regulations did not make occupation impossible and the lessor has done its part by offering vacant possession of the accommodation.

The agreement included a clause protecting the lessor in the case of premature cancellation of the lease by the lessee in which case a certain amount was payable by the lessee to the lessor.  The lease included a clause which protected the lessor in the event of it being unable to provide the lessee with vacant possession for a period, for example if the previous lessee were to overstay. This clause prevented the lessee from cancelling the lease or claiming damages in those circumstances.  

There was no similar provision dealing with a claim by the lessee as a result of the inability of the lessee to exercise their rights of occupation on the leased premises.  The court said that it was probably deliberately omitted.

The court found that the Covid-19 regulations did not prohibit the lessee from occupying the leased premises.  It restricted the possibility to commute between Pretoria and Potchefstroom. That did not mean that the execution of the contract by both the lessor and the lessee became impossible.  The obligation of the lessor is to provide vacant possession to the lessee of the leased apartment against payment of the agreed rental.  That remained possible.  The decision of the lessee not to commute to Potchefstroom where he could have taken occupation of the leased premises did not amount to impossibility of execution of the contract. 

The court held that the lessor was entitled to enforce payment of the rental.  The action by the lessee to hand back the keys and the remote control of the apartment was an unlawful act of repudiation of the agreement. 

In a February 2024 judgment (Lilfam Holdings (Pty) Ltd v Mike and Ian Consulting (Pty) Ltd and Another (2021 / 3377) [2024] ZAGPJHC 129 (8 February 2024) – Law Library ) an order was sought for the arrear rental claim against the defendants and confirmation of the cancellation of the commercial lease agreement between the plaintiff and the first defendant in a summary judgment application.  It was argued that the Covid-19 disruptions excused the lessee from its obligations in terms of the lease agreement, or at least delayed them. 

The lessee relied on impossibility of performance claiming that the Covid-19 hard lockdown and subsequent travel restrictions meant it could not trade sufficiently to generate enough income to fulfil its obligations in terms of the lease agreement given that many of the lessee’s customers being from other African countries were not permitted to travel into or out of South Africa for many months. 

It was common cause that the lessee was in breach of the lease agreement, that Covid relief, although not compulsory, had already been given to the lessee, and that the lessee was not entitled to additional time in which to make payment of its obligations where it had already failed to do so. 

The court said that the Covid-19 “hard lockdown” could be a circumstance of supervening impossibility of performance where both parties to the commercial lease agreement are absolved of their obligations unless the lease agreement provides otherwise.  The court referenced clause 4.4.5 of the lease agreement providing that the lessee could not hold the plaintiff liable for any damage suffered as a result of the access to the rented premises being restricted or denied and said “it thus appears that the lease agreement may have excluded the defence of supervening the possibility of performance”. 

The court held that “even if the lease agreement did not exclude supervening impossibility of performance, the first defendant (the lessee) would still not be relieved of his lease obligations during the remaining period of the Covid-19 restrictions after the hard lockdown” because any supervening impossibility of performance did not endure for the entire period corresponding with the relevant no-payment of rentals. 

Accordingly the court granted summary judgment.