News
Property owners, landlords raise concerns about draft law
View(s):- Govt. says it will suspend passage of Bill through parliament reportedly to facilitate feedback
- Some legal counsel say “conceptually it is not bad law” but insist changes needed to remove ambiguity, others say POB unnecessary
- FR petitions filed before the Supreme Court including by the Condominium Developers’ Association (CDA) due to be taken up tomorrow
By Namini Wijedasa
The Protection of Occupants Bill (POB) presented to parliament recently has caused alarm among landlords and property owners that renting or leasing out their premises now runs a higher risk of them not being able to dislodge tenants, even errant ones.
Some legal counsel argue that “conceptually, it is not a bad law” and might even be called progressive. But they insist it must be changed to remove ambiguities, lacunas and inconsistencies, some of which could be interpreted as contravening the constitution. 
Others call the POB unnecessary. They maintain that the Roman Dutch law anyway affords tenants protections; and that introducing this new legislation “confuses matters”.
The government now says it will suspend its passage through parliament, reportedly to facilitate feedback. The Bar Association of Sri Lanka is among those that will provide observations.
Meanwhile, fundamental rights petitions filed before the Supreme Court — including by the Condominium Developers’ Association (CDA) — are due to be taken up tomorrow. Given the government’s current position, however, lawyers hazarded that the Attorney General will notify the court that progress on the bill is in abeyance.
What does “lawful
occupation” mean?
The POB’s long title is problematic: a Bill “to prevent a landlord from ejecting persons from occupation of a premises; and to provide for matters connected therewith or incidental thereto”. This communicates that it is, in essence, a law to prevent ejection of tenants.
But the overriding concern among critics of the legislation is that “lawful occupation” is not defined.
Clause 2 of the bill provides that the provisions of the act shall apply to a person who “is in lawful occupation of a premises; and has been in undisturbed and uninterrupted occupation of such premises for a period of more than three months…”
Clause 13 defines “Occupation” in relation to a premises, or any part of a premises, as “having entered into occupation of such premises as a lessee or tenant under a lease agreement or tenancy agreement with the landlord, continues to be in occupation with the consent of the landlord for a particular period of time”.
But “the omission of a comprehensive definition for ‘lawful occupation’ …introduces a profound judicial ambiguity that threatens to subvert the Bill’s purported objectives”, the CDA’s petition states.
“While Clause 13 attempts to anchor ‘occupation’ to the existence of a valid lease and the landlord’s subsisting consent, the absence of a corollary definition for ‘lawfulness’ provides a lacuna for overholding lessees to exploit”.
Thus, an occupant who no longer has a contractual right to remain on a premises — either because the agreement has expired or through lawful termination — could use the protective mantle of the new law to stay on.
This would invite abuses of the process of law, the CDA warns, wherein the statute threatens to incentivize overholding (renters who continue to occupy a property after their lease agreement has expired or terminated, often without the landlord’s consent) tenants.
Fears are not unreasonable
“There is a real fear where landlords or owners worry that they will be entangled in litigation as something like this can be misinterpreted,” said Delan de Silva, Consultant Counsel at D L & F De Saram. He, too, said what amounts to “lawful occupation” in terms of the act is not clear.
The BOP, he held, was a timely act because there are people who’ve been displaced owing to wrongful eviction. “But the law has to be balanced,” he said. “There can’t be a one-sided definition where only the tenants and people who are occupying a property are safeguarded.”
Mr de Silva felt previous laws — such as the Rent Act of 1972 and the Recovery of Possession of Premises Given on Lease Act of 2023 — didn’t adequately reinforce tenants in situations where landlords were unreasonable.
“Imagine a family of four, and the landlord wants the property for some reason or another,” he explained. “He cuts the water and electricity and makes it difficult for the tenant to stay. Those kinds of things shouldn’t happen in the modern age. The law will curtail that, but it must strike a balance.”
The Roman-Dutch law does require a court order to evict a tenant. But, says Mr de Silva, under the POB, “You can’t do anything but go to court”.
“I’m not saying you, as a landlord, inflict pain or harm on tenants,” he maintained. “But you should at least be able to secure your property. There is a real fear. My clients are very worried or have concerns about renewing their tenancy agreements, or they don’t want to until this law is settled.”
“If they give a tenant their condominium apartment, will they have squatters?” he said, citing landlords from whom he has received feedback. “They (property owners) are worried they will have to go to court, spend money on litigation and also, during that period, not be earning any income, and they can’t do anything to take ownership of their property.”
The legislation must clearly demarcate how a tenant can use it, Mr de Silva said. Furthermore, cutting off essential supplies should not be criminalized — or be deemed an offence — under the act. “A landlord could have certain remedies to take control or possession of his property,” he asserted. “The act needs to define the scenarios under which it can be used. On that, it is silent.”
On a first reading, he observed, the POB is “like an open blanket for everything and anything”: “The definition, I think, is poor and needs to be looked at. And the safeguards given to occupants also need to be revisited.”
Justice Minister Harshana Nanayakkara told parliament this week that the POB was only a few pages long. This might be part of the problem. It should be more descriptive; And stakeholder consultation is crucial.
The CDA’s other concern
The CDA makes another point. Pulasthi Rupasinha, one of the counsel in the case, says there is a contradiction between the Apartment Ownership Law and the POB with regard to the provision of amenities.
In condominiums, Management Corporations purchase utilities — such as water and electricity — in bulk. They then subdivide it among the condo occupants. And while the Apartment Ownership Law provides a mechanism for services to be disconnected to ensure the financial viability of a Management Corporation, the POB prohibits the withholding of any “amenity, facility, or essential supply”.
“…a Management Corporation may be compelled to continue providing utilities such as electricity and water to a defaulting occupant at the expense of the other unit owners,” the CDA petition holds. “This constitutes an unreasonable and arbitrary deprivation of the property of the compliant owners, who are forced to subsidise the consumption of the defaulter to prevent the total disconnection of the entire complex by the utility providers.”
The provision of recreational amenities such as gymnasiums, swimming pools and clubhouses is governed by private contract and the payment of specific service fees. Again, the POB, “by ostensibly compelling the continued provision of these facilities, regardless of default, represents an unconstitutional interference on the rights of a developer and/or a Condominium Management Corporation”.
Like other petitioners, the CDA holds the POB to be unconstitutional and inconsistent with Articles 3, 4, 12(1) and 14(1)(g) of the Constitution, related to sovereignty of the people, exercise of sovereignty, right to equality and freedom to engage in lawful occupation.
Never, in practice
The POB has another provision that lawyers are certain will not happen in practice. It states that, “Any application for an order under this Act shall be heard and determined expeditiously, and the Court shall complete the hearing within three months from the date of the petition…”
It also states that, “Where the respondent [landlord] requests to be heard in opposition by way of an objection, the Court shall complete the hearing not later than nine months from the date the court received the statement of objection.”
“This will be limited to paper,” Mr de Silva predicted. “Because in actual reality, there are so many cases in the district courts that nobody is going to adhere to that. It is not going to work. For instance, Labour Tribunals were created for aggrieved parties to have immediate redress, and an amendment in 2003 says a case must be heard within four months. Even in labour matters, it takes about four to five years. In the District Court, I have not had an application or a case that is anything less than five years.”
There was widespread consensus, too, on that point.
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