Posted by
WKH
on 18 Aug 22
Categories:
Legal & Insurance
In terms of the Stamp Duties Act, 1993, revenue stamps for a specified amount must be attached to the first page of the lease agreement.
Although the lessor must stamp the lease, most leases stipulate that the lessee has to bear the costs of the revenue stamps
Leases are stamped to raise revenue and not as a fromality to make the lease valid. Unlike the sale of land, a valid verbal lease agreement may be entered between the parties.
STAMP DUTIES ACT
Invalidity of instruments not duly stamped
12.Save as is otherwise provided in any law, no instrument which is required to be stamped under this Act shall be made available for any purpose whatsoever, unless it is duly stamped, and in particular shall not be produced or given in evidence or be made available in any court of law, except -
(a) in criminal proceedings; or
(b) in any proceedings by or on behalf of the State for the recovery of any duty on the instrument or of any penalty alleged to have been incurred under this Act in respect of such instrument:
Provided that the court before which any such instrument is so produced, given or made available may permit or direct that, subject to the payment of any penalty incurred in respect of such instrument under section 9(1), the instrument be stamped in accordance with the provisions of this Act and upon the instrument being duly stamped may admit it to be produced or given in evidence or made available.
Person making use of instrument not duly stamped to be liable for unpaid duty and penalty thereon
13. (1) Any person who for any purpose in connection with a business conducted by him or her keeps or retains, or who in any manner other than a manner contemplated in section 12 makes use of, an instrument which is required to be stamped under this Act but has not been duly stamped, shall be liable for the unpaid duty in respect of such instrument and any unpaid penalty incurred in respect of such instrument under section 9(1),
(2) The provisions of subsection (1) shall not be construed as relieving any person who under any other provision of this Act is liable for the duty or any penalty in respect of any instrument, from his or her liability to pay any unpaid amount of such duty or penalty, as the case may be.
CASE LAW REGARDING THE VALIDITY OF LEASE AGREEMENTS NOT STAMPED
Denker v Ameib Rhino Sanctuary (Pty) Ltd & others
'The High Court's approach as regards the effect of non-compliance with the Stamp Duties Act accords with the modern trend in interpreting a provision which places an obligation on a legal actor to do something. That approach is to consider if the legislative intent was to visit non-compliance with a nullity. The learned judge approached the matter on correct principle. He held:
"I am of the view that the existence of sections 12 and 13 [of the Stamp Duties Act] is an indication that the legislature did not intend that if a document is not stamped such failure would lead to a nullity of the document. I am of the further view that the court when faced with a document which is not stamped may order that the document be stamped in accordance with the Stamp Duty Act, 1993."'