Court case looming over penalty/fee dispute?

Court case looming over penalty/fee dispute?

MAIN IMAGE: Mamodupi Mohlala, CEO Estate Agency Affairs Board; Jan le Roux, CE Rebosa. 

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.

Showing 6 comments
  • rocco du plessis
    Reply

    Th EAAB has, over many years become a very user-unfriendly and excessively over-regulated and a very expensive organisation. If this was not so, they would not have resorted to unfair practices by applying different standards to newcomers to the industry and attempt to get more black agents joining with less strenuous (and unfair ) minimum standards. Why always “minimum standards” to people of colour. What a slap in their faces and an insult to their intelligence. Also, if it was not so, new blood in this obsessively “strangled” industry would be plentiful, not with the average age of current practicing agents fast approaching the 60 mark. Its a dying industry and the EAAB will probably implode sooner or later, before or after Ms Mohlala’s retirement. Where there is no vision, Ms Mohlala, both agents and especially the EAAB will perish. Your hawkish stance with allegedly little understanding of the bigger picture proves this. New blood and dynamic leadership is urgently needed at the EAAB.

  • Debbie Wall-Smith
    Reply

    Charge a rejoining fee, but to charge penalties with no correspondence warning the person there will be penalties is not reasonable. Reason should prevail. I have had two agents not returning to the industry because of the penalties. I paid the penalties for one who lasted only 6 months. It is a tough business and with the current economic climate, people will return but there should be a reprieve for at least 6 months.

    • Antoinette
      Reply

      100% spot on!

  • Antoinette
    Reply

    I as an intern agent was NEVER informed by the EAAB nor the previous organisation that I only interned with for 3 months that I had to deregister. No notification from the EAAB nor from the company. Essentially I was on a 3 month probation. When I wanted to rejoin the industry in the residential area as an intern I was promptly told by the EAAB board at the time (July 2020) that I owed them in excess of R2500 to have a FFC issued in the new name! That is daylight robbery. It is like saying well you did not renew your passport and have not travelled for the past year so we will penalise you for not renewing your passport. What absolute lunacy and I surely hope that the judicial system sees through this. You are taking advantage of the uninformed and NOT clearly stating on any documentation or communication that agents need to deregister themselves. It stinks of malfeasance.

  • Sue
    Reply

    I was charged almost R18000 for an absence of 4 years after a final audit was done in 2016 and I advised that I would not be operating in the industry anymore and de-registered online. I received no notification of my de-registration and kept on getting audit reminders every year and still sent emails every time telling them I am not in the industry anymore. Now it has been a constant battle to get back again due to fine, having taken my Principal status away and being made an intern again. It;s absolutely ludicrous!!!

  • Cleopatra
    Reply

    My husband passed away 3 yrs ago, and I find myself needing to return to work selling properties to be able to sustain myself.
    I have been a principal estate agent for many years and stopped +- 12 yrs ago.
    However, reading about all the ridiculous fees being charged it seems relatively impossible to apply for reinstatement!!

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