Sectional title schemes aren’t exempt from lockdown rules

Sectional title schemes aren’t exempt from lockdown rules

MAIN IMAGE: Marlon Shevelew, specialist rental property attorney.

Marlon Shevelew

In light of the national lockdown, which has been precipitated by the COVID-19 pandemic, there has been widespread uncertainty regarding what trustees of sectional title schemes can do and what they cannot do.

I will endeavour to give some clarity as to what can and what cannot be done by trustees of sectional title schemes in light of the difficult situations that are being faced by trustees and owners alike in sectional title schemes. Specifically, I will consider 1) what trustees can do in response to the financial difficulties faced by many property owners, and 2) whether trustees are at liberty to pass resolutions contrary to Regulations passed in terms of the Disaster Management Act 57 of 2002.

Legislative framework of sectional title schemes

The operation of sectional titles is regulated by the Sectional Titles Schemes Management Act 8 of 2011 (STSMA). It sets out that the funds which are to be collected by the body corporate need to be reasonably sufficient to cover the estimated annual operating cost of the scheme, the cost of future maintenance and repairs, rates and taxes and other municipal charges for utilities, and insurance premiums. Ordinary levies must be raised pursuant to the passing of a budget at an annual general meeting. Special levies may be raised to cater for unforeseen events.

In terms of section 3 of the STSMA the trustees of a body corporate are enjoined to determine the funds necessary for a body corporate to operate, and to levy those amounts from owners. The liability of owners to pay levies accrues, in terms of section 3(2) of the STSMA, from the passing of a resolution to that effect by the trustees of the body corporate.

What can trustees do in response to financial difficulties?

It has been suggested in some corners of the internet that bodies corporate can accommodate owners who are finding it difficult to pay their levies by charging a reduced levy, by offering a payment holiday of sorts, and/or by passing a new budget.

One of the functions of the body corporate is to raise money by the levying of contributions on the owners in proportion to their respective participation quotas. In terms of section 7(1) of the STSMA this function must be performed by the trustees. A body corporate has no power to pass a resolution to the effect that it will not carry out one or more of its duties imposed on it by the STSMA. In short, collection of levies is a statutory duty, which cannot be circumvented by the making of a resolution.

The STSMA places duties on the trustees to manage the sectional title scheme and collect the funds required to carry out the obligations placed on them by the STSMA. A failure to collect these amounts would be a neglect of that duty. Trustees also do not have a discretion to determine levies aside from the making the calculation to determine each owner’s contribution to levy the amount required by the budget.

Furthermore, and in line with the above reasoning, trustees are also not empowered to reduce levies. Professor Graham Paddock writes in response to this very question that:

“The contribution is based on the approved budget and there no provision that allows it to be changed. Working the other way around, the trustees are given the specific discretion to increase the contribution under specific conditions and to raise a special contribution, under specific conditions. There is no provision for reducing the contribution.” (Article reference: Paddocks Press: Volume 12, Issue 10, Page 04, also available at https://www.paddocks.co.za/paddocks-press-newsletter/qa-2017-10/).

Trustees therefore cannot reduce or decline to collect levies; they have a statutory duty to do so, and any failure would be in breach of that duty. The only way that owners can end up paying reduced levies is if a new budget is passed which reduces the amount which is needed.

Effect of the Disaster Regulations

The regulations published in terms of the Disaster Management Act have caused massive disruption in the day-to-day lives of nearly every South African citizen. The lockdown, as the cumulative effect of the regulations is colloquially referred to, is of sufficient significance that for some it means that they are released from complying with contractual obligations.

The question arises whether the regulations do not possibly have the same effect in regard to sectional titles. The short answer is that they do not. The lockdown only operates to release parties from contractual obligations completely or partially where performance of those obligations becomes objectively impossible, which it has not done.

To what extent can sectional titles make their own rules?

At first glance the regulations would prevent residents of gated estates and sectional title schemes from making use of the common area except insofar as they fell within the exceptions listed in the regulations. There are many instances of people insisting that this cannot be the case for sectional title schemes.

This is despite the SAPS having confirmed that no walking of dogs or jogging, for example, is permitted under the regulations. I am of the opinion that the trustees of a body corporate will therefore not be entitled to make rules which permit use of the common area in contradiction to the Disaster Management Regulations.

CONCLUSION

In summary, trustees of a sectional title are bound by the STSMA to carry out the functions in terms thereof, they do not have a discretion in regard to this function. The lockdown does not detract from this duty. Sectional title schemes are also not exempt from the operation of the lockdown, and any rules passed which attempt to circumvent the regulations will not be valid.

End.

About the author: Marlon Shevelew is the director of law firm Marlon Shevelew and Associates Inc. Shevelew is a well-known expert authority on residential property law in South Africa.

Showing 29 comments
  • Kay Thompson
    Reply

    Hello Marlon
    Bruce Forrest of Meumann & White has given us his view of use of the common area during the lockdown. As all owners own an undivided share in the common area, he is of the opinion that we should be able to walk dogs and go for a walk around the complex as we would in our own gardens! Personally I would hate to see that happen but I would like to know if the Disaster Rules override all this!
    thanks!

  • E de Jager
    Reply

    Lock-down in sectional title schemes, specifically pet-friendly schemes, pose challenging hygiene situations for pet owners and distress for pets, unable to relieve themselves as someone trained them causing damage to interior and carpets of property.
    Pet friendly schemes should accommodate taking pets outside to relief themselves – this does not presume walks within the estate, merely taking the dog into communal garden for 3-5 min, no further than 500m from your apartment. Kindly attend to this matter.

  • Dave Farrer
    Reply

    Graham Paddock, writing in the Daily Maverick, states that: “the regulations in regard to the restriction of movement do not apply to private property as found in any gated village, only to places or premises normally open to the public”. He goes on to say that: “As the regulations stand, I consider the SAPS opinion to be wrong … If the minister wishes to deal specifically with restricting resident movement in the private property in community schemes, she can amend the regulations to do so”.

    Commenting on the article mentioned above, Brian Edwards (a non-practicing attorney) concurs: “the way the Minister of Police and some police leaders have pronounced is not in my opinion binding – only their personal opinion. The regulations, as I read them, say only we are confined to our “place of residence” – there is no definition of the term in the regulations. Apparently ministers have the right to issue clarifying “directives” and I have found no evidence of one in this case”.

    “In sectional title, you own a section and a share of common property, for residential purposes. This means that owners can use common property for access and recreation. And under the Sectional Titles Schemes Management Act trustees are not entitled to make rules confining owners to their sections” (Graham Paddock).

    Based on the above, unless a minister has issued a “clarifying directive”, residents in a sectional titles scheme may legally continue to use the common property and trustees may not make rules to prevent this.

    • Helene Meissenheimer
      Reply

      Hi Dave, I am aware that Graham Paddock holds a different opinion on this matter. Keep in mind a national state of disaster has been declared in the country and I concur with this author that one should be cautious to advocate behaviour that contradicts rules issued under the Disaster Management Act.

  • Dave Farrer
    Reply

    The intention of the regulations is to prevent the spread of the virus through person to person transmission. If it is both legal and safe to go for a walk in ones ‘front garden’ then I see no reason not to do so.

  • Dave Mc Naught
    Reply

    Your approach to the common property is totally wrong and I agree with Graham Paddock totally and have published my opinion elsewhere. Using common areas is in conformity with the Regulations and not contrary to them. Inasmuch as freestanding property owners may enjoy the full extent of their property up to the property boundary (not just their front door) só too can communal dwellers use their whole property, being joint owners of the common property. Nothing in the Regulations suggest anything to the contrary and it’s inconceivable that the Govt intended to treat communal livers different from freestanding property owners. The only regulation dealing with being in communal or public space is the social distancing Regulation which communal residents would naturally also be bound by.

  • Chris Phillips
    Reply

    I totally agree with Graham, Bruce and yourself Dave. I also do not believe that the Trustees have the authority to impose such restrictions on the members.

  • Nikee
    Reply

    Why is there no cleaning arrangements since lockdown? We are living in a compromised environment with the buildings left dirty for weeks … why are we still liable to pay full levy amount? Clearly levies should be reduced as there is no maintenance and cleaning of the property taking place.

  • Deborah Maphosa
    Reply

    l have a different issue regarding some of our members. Please kindly guide me how and where l can direct this question which is not a comment.

    • Helene Meissenheimer
      Reply

      Dear Deborah, your question is very vague. There are various representative bodies that you can contact re queries about section title developments such as the Community Scheme Ombudsman Services (CSOS) – don’t know if that could be helpful to you?

    • Mike
      Reply

      Trustees have a statuary responsibility to collect levies as determined by the budget as agreed at the AGM. They cannot change it, I think without a SGM called and duly voted for that purpose.

  • Deborah Maphosa
    Reply

    l need to understand due to some members who say we should not pay the City Council levies and yet the statement has been issued.

  • Kylie Grove
    Reply

    I urgently need advice. We live in a sectional title and pay our rent to the owner before the due date amidst the devastating financial implications due to this lockdown. Since yesterday my access in and out of the gate, as well as my husband’s, did not work. After two days of immense pressure I was informed by the body corporate management that the owner is behind with the levies and therefore I cannot get in or out and must sort it out with him!
    I am very sick, and had to go for more medical tests today. I cannot access my banking as due to fraud I had a new card issued and it has to be activated at an ATM. I did not know what I am going to feed my family tonight as I am locked in my house with no way of exiting. Is this legal??? Does the owner not qualify for some relief? And even if not, why was I not informed that I cannot go for my medical tests, get medicine, get food or do my financial errands. Are they allowed to cage me in as tenant? I am a human. Not some animal to be caged in because someone else is struggling financially due to a lockdown. What are my rights? Especially with regards to my health. I still can not exit the complex. If I have medical problems tonight I have no way of exiting to get assistance.

    • Helene Meissenheimer
      Reply

      Dear Kyle, this is terrible. Have you been helped? Who have you informed about your predicament?

  • Craig Pritchard
    Reply

    I am the Chairman of our Body Corporate whereby we have one owner who has been behind for months is tells us he cannot make his levy payments over this lockdown period. Do we as the BC need proof and can he just tell us he is doing this regardless of even asking?

  • J P Koen
    Reply

    If i add burgler bars to the outside of my sectional title unit (with the consent or the BC),who is responsible for the future maintenance of it ? The owner or the BC? Regards

    • Steve
      Reply

      I would suggest that is made clear prior to installation, as part of the permission granted.

      Usually, this is the reason rules require burglar bars be installed inside your unit, to ensure the maintenance and ownership requirements are clear – you are protecting your own property after all.

  • Neela Baidoo
    Reply

    Good Morning please advise if we can continue with our kitchen repairs as we do not have a kitchen sink water is leaking from our outlet pipes

  • Lyn Vickery
    Reply

    What are the rules for maintenance and garden services during the level 3 lockdown period? Can trustees label everything as an “emergency ” so that they can get work done?

  • Steve
    Reply

    Hi, may I enquire around the responsibilities and legal rights of the Trustees\Body Corporate to enforce the denial of any visitor to a section or unit within a scheme (we are in stage 3, advanced shortly)?

    Although I respect the laws and rules in place – is it the place of the Trustees to enforce this particular law at our entrance, and deny any owner any right to apply their own discretion as an owner of their own private area? As I understand the responsibility of the Trustees and Management Rules, this is to control the acceptable use of the Common Areas, and enforce the corona laws applicable to this, as well as Body Corporate business, such as AGM’s etc. However, does this include the parenting of each individual owner without their consent? Surely, ensuring COVID safety is applied when entering (masks, temperature, appropriate questions etc) would apply, but where is the authority given to them to extend this far?

    Thank you

  • Piet Cronjé
    Reply

    I agree that while the BC cannot make rules in contravention of COVID 19 regulations it could also not enforce such rules on individual properties and their owners/dwellers. The individual owner will decide who to allow into his/her house or not. Should anybody else in the sectional title complex view such visits as a contravention of the regulations, that person could lay a charge at the local police station but not with the body corporate who is not authorised in any way whatsoever to enforce a variety of laws outside that specified in the act for body corporates. What’s next: checking if our vehicle licenses are paid? Am I wrong? It seems that too many envy the powers af Me Zuma.

  • Rashi
    Reply

    Hi there, could you please advise as to whether in this pandemic, we’re allowed to put up a swing set for our children in our garden, due to the play area being off-limits? Could the body corporate amend the rules for this exception case? Kids, in any case, cannot play in public spaces, and therefore as parents, having them play withing their gardens would be the safest option.

    • Elize Verster
      Reply

      Hi there, is the BC in their rights to refuse visitors into a complex, now that the curvey has changed, now that you can go on a trip in your province and eat out in restaurants.

  • Netta
    Reply

    What if some owners just don’t pay their levies? They have received numerous notifications via email and whatzup and eventually, it has been handed over to attorneys for collection but there is still no outcome? Where is the trustees supposed to get the money from?

  • Amanda Steyn
    Reply

    Good Afternoon,

    I would like some advice. I am a trustee in a large sectional title complex. We have imposed the rules laid out by the President that there will be no visitors allowed in the complex. We now have a few owners protesting this saying we are infringing on their rights. What can we do and what can’t we do? I would appreciate assistance.

    • Helene Meissenheimer
      Reply

      Hi Amanda, that is a very good question. I will follow up on that – the answer will be published on Speakers Corner or as an article on the Property Professional website.

  • Piet Cronjé
    Reply

    Looking forward Helene. Apparently, the ombudsman has made some pronouncements which I have received but still need to study. I am not sure that the trustees are enforcement agents by law and neither do I think that the ombuds is entitled by law to turn them into enforcement agents – threatening them with a 5 year imprisonment penalty, it has been whispered.

  • Piet Cronjé
    Reply

    Reply 2 – also for Amanda Steyn
    The ombuds pronouncements it turned out were only about the common areas. I also studied a legal opinion for a BC on the right of the BC to regulate visitors and in fact preventing any owner from breaking the law. Once again, the legal opinion turned up to be many pages but no single substatial legal ground given. The BC, I repeat, in terms of the law, is not the sheriff, neither for the president nor for any ministerial department of government.
    Now that lockdown has been eased, it seems there may be some time to consider common sense legal questions to help us think more responsibly than under the lockdown that caught us all by surprise. The following three associated questions are probably a good start: When can the BC: a) take over an owner’s rights and responsibilities? b) ignore the difference between private and common property? c) manage the common property in such a way that the rights of the owner in his/her private area are rendered useless? These three questions are formulated in the COVID 19 situation but the fact that almost all BCs overstepped their powers, simply means that we do not yet have a mature culture on the specific roles and responsibilities of a BC inside a rule-of-law community.

  • Chandra Naidu
    Reply

    Good morning..
    Our AGM is coming up soon. Please advise on the simplest way to prevent tenants serving on the board of trustees?

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