The Gauteng High Court in Johannesburg has dismissed an application by a residential communities body seeking a broad ruling to legitimise the practice of charging estate agents accreditation fees to operate in gated residential estates. The judgment makes clear that the lawfulness of such fees under the Property Practitioners Act must be assessed on the specific facts of each matter rather than by a blanket exemption.
What the court decided
The court was asked to issue a declaratory order that charging accreditation fees by homeowners’ associations, governing bodies and body corporates does not constitute an undesirable business practice as set out in regulation 35 read with section 63 of the Property Practitioners Act (PPA). That application was dismissed.
As a consequence, the prohibition on accreditation fees enshrined in the Property Practitioners Regulatory Authority’s (PPRA) guidance remains in place and disputes over such fee arrangements will be evaluated on their individual merits and context.
Reaction from the industry and government
Seeff Property Group said it welcomed the court’s outcome. Samuel Seeff, chairman of the Seeff Property Group, argued the charging of accreditation fees is anti‑competitive and restricts fair business conduct under the Consumer Protection Act. He said the practice denies sellers and landlords the right to appoint the property practitioner of their choice.
“Limiting this places the seller or landlord at a disadvantage as they are unable to exercise their property, and consumer rights by appointing a property practitioner of their choice to sell or rent their property,” Seeff said.
The office of the Minister of Human Settlements, Thembi Simelane, said she had noted and welcomed the judgment delivered by the Gauteng High Court, Johannesburg.
Why this matters to sellers, landlords and agents
The ruling affects three groups in the residential market: homeowners’ associations and bodies corporate that impose access or accreditation requirements; property practitioners who must comply with those estate rules to work within gated communities; and sellers or landlords who may be limited by estate rules in choosing an agent.
- For sellers and landlords: The decision reinforces the principle that owners should be able to appoint the property practitioner of their choice unless a specific, lawful justification exists for restricting that choice.
- For property practitioners: Agents charging that estates demand accreditation fees will need to challenge specific practices on a case‑by‑case basis rather than rely on a single broad judgment in their favour.
- For estates and bodies corporate: The ruling removes any easy pathway to a general legal endorsement of accreditation fees, meaning estates must ensure their rules comply with statutory and regulatory provisions.
Legal and regulatory context
The dispute engaged provisions of the PPA, specifically regulation 35 and section 63, which address undesirable business practices and the conduct expected of property practitioners and related bodies. The PPRA has published guidance and a prohibition regarding accreditation fees, which industry players such as Seeff have supported as necessary to prevent anti‑competitive conduct.
The court’s dismissal of the declaratory application does not outlaw all estate rules governing access or conduct. Instead it emphasises judicial scrutiny on the facts presented in each dispute and on whether any particular requirement amounts to an undesirable business practice or an unlawful restriction of consumer choice.
Practical next steps for affected parties
Agents and property owners who believe they have been disadvantaged by accreditation fees should consider the following:
- Document any demands for accreditation fees and the purported basis for those fees in estate rules or by‑laws.
- Seek legal advice to test whether a specific fee or rule is unenforceable under the PPA, the Consumer Protection Act or PPRA guidance.
- Engage bodies corporate or homeowners’ associations to request clarity and justification for fee structures and to explore alternative dispute resolution where appropriate.
What remains unclear
The High Court’s ruling does not provide a comprehensive list of circumstances in which accreditation fees will be lawful or unlawful. That will be decided in future disputes as individual facts are presented. Practitioners and estates should therefore anticipate further litigation or regulatory enforcement to clarify the boundaries of permissible conduct.
The outcome places a premium on transparency and on the careful drafting and justification of any estate rules that affect market access for property practitioners. It also underscores the continued role of the PPRA and consumer protection frameworks in policing the property market.
The judgement represents an important moment for Gauteng’s residential market, where gated estates are numerous and often operate their own rules. Agents, owners and estate administrators will need to adapt their practices to a legal environment that demands detailed, fact‑based examination of any restrictions on trade.
