Before you buy any property with occupants in or on it -

1. Establish the basis of their occupation – take advice upfront to be sure that you can evict them in need, and

2. Factor into your cash flow projection a safety margin for holding costs, sufficient to cover delays whilst you follow eviction procedures.

In terms of PIE (the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act), once an unlawful occupier has been in place for over 6 months, a court may order eviction only “if it is of opinion that it is just and equitable to do so after considering all the relevant circumstances”.  At best, the procedure is complex and time-consuming.

Now the Constitutional Court has held that a local municipality must find alternative accomodation for unlawful occupiers before their eviction from State land can be effected.  Earlier judgments confirm that this procedure applies equally to privately-owned land.  That means delay – possibly substantial - for owners and developers, whilst they wait for the local authority to comply with its constitutional obligations. 

There might also be an even greater danger than mere delay.  In some circumstances you could end up buying a property lumbered with an unlawful occupier whom you just cannot evict at all.  That’s exactly what happened in a recent High Court case, where the Court ruled in favour of a long time occupier of a house who, although an “unlawful occupier”, was in essence the innocent victim of a series of bungles by previous owners. 

The eventual owners were held to be at least partly to blame for their own misfortune, the Court commenting: “I cannot believe that they decided to buy the property without physically inspecting the property. They must also have realised that somebody was occupying the property. They should have made the necessary enquiries” (the occupant thought, with some reason, that she was the owner of the property – and would doubtless have made that clear to the buyer if only she had been asked!). 

If there’s an occupant or occupants in place, do your homework before you buy!