What happens if I break my lease early?

You can usually get out of a fixed-term lease early. The Consumer Protection Act 68 of 2008 lets a consumer cancel a fixed-term agreement, including most residential leases, by giving 20 business days written notice. The landlord cannot refuse. What the landlord can do is charge a reasonable cancellation penalty, and claim any rent, utilities or damage you actually owe up to the point the property is re-let.

That is a very different thing from being liable for every month left on the lease, which is what many leases claim and many landlords believe.

Does the Consumer Protection Act cover your lease?

In most residential situations, yes. The Act applies where the landlord rents out property in the ordinary course of business, which covers professional landlords, letting agents and people who own one or more properties as an investment. It protects tenants who are individuals, and small juristic persons below the statutory threshold.

It may not apply where the landlord is a private person letting out a home as a genuine once-off, for example someone renting out their house while working abroad for a year. If the Act does not apply, your lease governs everything and cancelling early is a breach unless the lease has its own early termination clause. Read the lease first.

Note that the same 20 business days works both ways in a sense. A landlord can also cancel on 20 business days notice, but only after giving you written notice of a material breach and 20 business days to put it right.

How to cancel properly

1. Put it in writing. Email or a letter, not a phone call. State the property, the date of the notice, and that you are cancelling in terms of the Consumer Protection Act on 20 business days notice.
2. Count business days, not calendar days. Twenty business days is roughly a calendar month, but weekends and public holidays do not count, so work it out on a calendar.
3. Keep proof of delivery. A sent email with a read receipt, a signed acknowledgement or a courier slip.
4. Ask the landlord in writing what cancellation penalty is claimed and how it was calculated.
5. Keep paying rent until the notice period runs out and you have handed back the keys.
6. Arrange a joint outgoing inspection so your deposit comes back cleanly. See How long does a landlord have to return my deposit?.

Counting the notice period

Business days are Monday to Friday, excluding public holidays. If you deliver notice on a Monday, day one is the Tuesday. Twenty business days is four full working weeks, so notice given on the first Monday of a month with no public holidays ends on the Monday four weeks later, and you are liable for rent to that date. Over December and January, or around the April holidays, the same notice can run a week or more longer. Give notice early in the week and early in the month if you can, and state the end date you have calculated in your letter so there is no argument later.

A worked example

Names and figures are illustrative.

Ayanda has a 12-month lease on a Gqeberha flat at R7 000 a month, paid through a letting agency. Eight months in, she is transferred to another city. On Monday 2 February she emails the agency cancelling on 20 business days notice under the Consumer Protection Act. There are no public holidays in that period, so her notice ends on Monday 2 March and she pays rent to that date.

The agency writes back demanding the four remaining months, R28 000, as a "cancellation fee". Ayanda replies asking for a calculation of the landlord's actual loss. The agency advertises the flat in the second week of February and signs a new tenant from 16 March. The landlord's genuine loss is two weeks of empty rent, about R3 500, plus the agency's placement fee for the new tenant and a credit check, say R4 200 in total. A reasonable penalty in that range is defensible. A demand for R28 000 is not, and a Rental Housing Tribunal would be unlikely to uphold it.

Ayanda's R7 000 deposit is dealt with separately. After a joint inspection finds no damage, the landlord may set off the agreed penalty and must refund the balance with interest, together with the invoices for the placement fee and the credit check.

What a reasonable cancellation penalty looks like

The Act allows a "reasonable cancellation penalty" but does not fix an amount, and there is no set formula. What is reasonable is judged on the circumstances, including how much of the lease was left to run, how much notice you gave, the value of what remains under the lease, how easily the landlord can find a replacement tenant, and what is normal practice in the rental industry.

In practice this means a penalty covering the landlord's genuine re-letting costs, such as an agent's placement commission, advertising and the credit check on the new tenant, plus rent for the period the unit actually stands empty while a new tenant is found. On a lease with eight months left, cancelled with a month's notice in a market where the flat re-lets in three weeks, a penalty equal to eight months rent is not reasonable and a Tribunal is unlikely to allow it.

The landlord also has a duty to limit the loss. A landlord who does nothing to advertise the property and then bills you for six empty months has not acted reasonably, and that failure counts against the claim.

Clauses that do not save the landlord

A lease cannot take away rights the Consumer Protection Act gives you. So a clause saying you may not cancel at all, or that you forfeit the deposit automatically, or that the full balance of the rent becomes immediately payable, generally does not stand up against a consumer tenant. Neither does a clause forcing you to find a replacement tenant yourself, though offering a good replacement is a practical way to reduce the penalty and is worth doing.

Your deposit is separate from the penalty. It must still be accounted for and refunded with interest, less lawful deductions.

Documents to gather

• the lease, including the cancellation clause and any addendum
• your written notice and the proof that it was delivered
• the landlord's or agent's reply and any penalty calculation they sent
• evidence of when and where the property was advertised, if you can find it, such as a screenshot of the listing with its date
• proof of rent paid through to the end of the notice period
• the incoming and outgoing inspection reports and dated photographs
• utility statements showing the final readings
• the deposit statement and interest calculation when it arrives

Common mistakes and what they cost

Giving notice by phone. Without a written notice the landlord can deny receiving it, and the clock never starts. The cost is another month of rent, or more.

Counting calendar days. Twenty business days is not "the 20th of next month". If you move out before the notice has run, you owe rent for the gap.

Stopping rent during the notice period. You are still the tenant until the notice expires. Unpaid rent in that window is a clean deduction from your deposit and can be listed as a default.

Leaving without an inspection. With no joint outgoing inspection the landlord may be treated as accepting the property as fine, but if you were not available for one you lose that protection and every mark becomes arguable.

Paying the full balance because the lease says so. Many tenants pay a demand that would not survive a Tribunal hearing. Ask for the calculation first.

For landlords, not advertising. Every empty week you did not try to fill is a week you will struggle to recover.

Tenant's rights and landlord's rights

The tenant may: cancel a fixed-term lease covered by the Act on 20 business days written notice; be charged only a reasonable penalty; have the deposit accounted for separately with interest; propose a replacement tenant; refer an unreasonable penalty to the Rental Housing Tribunal for free.

The landlord may: claim rent to the end of the notice period; claim a reasonable penalty covering real re-letting costs and actual empty weeks; deduct proven damage and unpaid utilities from the deposit; decline a proposed replacement for a sound reason such as a failed credit check; cancel the lease for a material breach after proper notice.

If you and the landlord cannot agree

• Write a short letter setting out what you accept you owe and what you dispute.
• Refer the matter to the Rental Housing Tribunal in your province. It is free, and unfair practices in the way a lease is cancelled fall squarely within what it hears.
• For amounts up to R30 000, the Small Claims Court is free and quick, and neither side uses lawyers.
• Legal Aid South Africa on 0800 110 110 can direct you if you cannot afford advice.

If you are the landlord

You are not powerless, but you cannot simply hold the tenant to the whole term. Respond to the cancellation in writing, set out the penalty with a calculation and supporting invoices, advertise the property promptly and keep the evidence that you did, and account for the deposit properly. A documented, proportionate penalty is far more likely to be paid, and far more likely to survive a Tribunal hearing, than a demand for the full balance.

Related reading: Can my landlord increase rent mid-lease?.

LawMatch is not a law firm and this page is general information, not legal advice about your lease.