"I'm being blackmailed ..
The car towing company has my car and won't release it unless I pay them R5000" is a regular complaint. Or, "my landlord has locked the door and won't let me fetch my furniture unless I give him my rent arrears" is another that leaves tenants in financial difficulties feeling helpless unless they pay the 'ransom' to get their goods back.
Lien and rent hypothec
This has some foundation in law and the legal principle involved is called a 'lien', which could be validly or invalidly exercised in various circumstances.
The important question is whether the person withholding the property has a valid lien.
A lien, or right of retention, is a legal right to keep possession of another person’s property as security for a debt connected to that property. It is not ownership, and it does not automatically justify any amount demanded.
A towing company may have a valid lien where it has lawfully towed, repaired or stored a vehicle and is owed payment for the relevant work or expenditure.
However, the amount and legal basis must be justified. A lien does not arise merely because a company has possession of a car, and whether a particular towing charge is recoverable depends on the circumstances and any applicable agreement or tariff.
A landlord’s position is different. South African law recognises a tacit hypothec or lien over qualifying movable property on leased premises for arrear rent. But the landlord cannot simply lock the tenant out and seize the furniture. The landlord must obtain a court order authorising attachment; the sheriff then attaches the property.
Invalid exercise of lien
If a lien is invalidly exercised, the person affected can seek the return of the property, challenge the claimed debt and, where appropriate, claim damages. Urgent legal advice is important, particularly where a vehicle, furniture or essential belongings are being withheld.
What do the courts say and can the 'hostage' ever win?
Court cases
In the South African case Gatter v Grand Tech Auto (Pty) Limited t/a Grand Tech Auto Body and Another (2022), the Gauteng High Court ruled on a major dispute regarding vehicle repair costs, storage fees, and the right of retention (liens).
Justine Gatter (the vehicle owner) brought an application against Grand Tech Auto and Sustainable Living Consultants CC.
Gatter took her BMW to the repairers for bodywork. She paid for some of the repairs but disputed the remaining costs, claiming she never agreed to the additional work or its price. Grand Tech Auto refused to return her BMW, asserting a lien (right of retention) over the vehicle. They demanded payment not only for the disputed repair costs but also for mounting storage fees accumulated while holding the vehicle hostage.
The court, presided over by Acting Judge Gilbert, tackled two vital questions regarding South African property and contract law: Can a mechanic or panelbeater claim a lien over a vehicle specifically for storage fees that accrue while they are exerting an initial repair lien?
Judge Gilbert famously held that a right of retention cannot exist in a vacuum. It must always be backed by a valid underlying legal claim, such as a breach of contract or unjustified enrichment.
Storage Fees Rejected
The court ruled that the workshop could not enforce a lien for storage costs. When a business exercises a lien and holds onto a car to force payment, they are keeping it for their own benefit to secure a debt, not for the owner’s benefit. Therefore, they cannot claim the owner was "unjustly enriched" by the storage, nor can they arbitrarily rack up storage fees to keep the vehicle indefinitely.
Release of the Vehicle
Like in a similar Old Mutual v Saider Towing case, the court determined that if the owner provides adequate security (such as paying the undisputed amount or putting money in a trust account), the workshop's right of retention is defeated and they must release the vehicle.