Introduction 

Did you know? There are more than 56 000 registered sectional title schemes in South Africa and this number is on the rise. 

First-time home buyers and younger buyers have been opting for smaller properties and more specifically properties in sectional title schemes in recent years as they are not only more affordable but also because they offer secure, lock-up-and-go options. 

Understanding Sectional Title Schemes 

Sectional title schemes are community schemes where land and buildings are divided into sections for sale or lease. The owners hold sole ownership over their section within the scheme, while jointly owning the common property. 

Three key legislations govern sectional title schemes, namely the Sectional Titles Act 95 of 1986 (STA), the Sectional Titles Schemes Management Act 8 of 2011 (STSMA), and the Community Schemes Ombud Service Act 9 of 2011 (CSOSA). These legislations govern the establishment, registration, and ownership of a scheme, specifying what the duties and functions of a body corporate are and also how the CSOS ombud functions, respectively. 

The Role of the Body Corporate 

At the heart of every sectional title scheme lies the body corporate association, which is a distinct legal entity. Every owner in the scheme automatically becomes a member of the body corporate. The members are responsible for electing trustees and a chairperson at the annual general meeting (AGM) to oversee the functions and powers of the body corporate, including the management of the common property and the establishment and maintenance of an administrative fund and a reserve fund. The administrative fund is made up of the levies paid by the owners in the scheme and is utilized to cover the operating costs of the common property. 

The Vital Importance of Levies 

Levies serve as the lifeblood of the body corporate, sustaining the presentation and functionality of the scheme. The levies paid by the owners cover a wide array of expenses, including repairs, maintenance, and insurance taken out in favour of the scheme. Therefore, timely and complete payment of levies is imperative to safeguard the integrity and value of their investments. These costs are determined at the AGM of the body corporate and are then divided proportionally between the owners. 

Addressing Non-payment of Levies 

In instances where owners default on levy payments, the body corporate must take appropriate measures to address the issue. This may involve entering into payment plans, seeking resolution through the Community Schemes Ombud Service, or resorting to legal recourse for levy collections. Such actions are crucial to ensuring the financial sustainability, proper maintenance, and continuity of the scheme.

Conclusion 

Ultimately, the effective functioning of a scheme relies on the collective commitment of its owners/members to fulfil their financial obligations. By paying levies promptly and in full, owners not only contribute to the upkeep of their shared spaces but also safeguard the value of their investments for the future. 

Article by Candice Van Rensburg (LLB) – Candidate Attorney

For more information contact Candice at 044 601 9900 or candice@rgprok.com .