SECTIONAL TITLE OWNERSHIP: UNDERSTANDING ROLE PLAYERS AND THEIR FUNCTIONS AND SERVICES

Laila Cassim | Conveyancing Supervisor

In our previous edition (https://www.albaraka.co.za/blogs/legalease-1-2024/sectional-title-ownership-understanding-the-basics,) we delved into the fundamentals of Sectional Title Ownership, shedding light on the intricacies of sectional title schemes, their legislative governance, and the importance of levies. This time, we turn our focus to one of the most pivotal role players in these schemes: the Owners.

As soon as the transfer of property is completed at the Deeds Office, new owners not only gain ownership of their sectional property but also automatically become members of the Body Corporate. Understanding the responsibilities and influence of owners within a sectional title scheme is crucial for the smooth operation and management of these communal living arrangements.

WHO CONTOLS A SECTIONAL TITLE SCHEME?

The Body Corporate is responsible for the control, administration and management of the Scheme.

WHAT IS "THE BODY CORPORATE"?

A body corporate is a legal entity made up of all the owners in the sectional title scheme. The body corporate exists to represent the owners and manage and control the building/complex by making sure that its financial, administrative, and physical needs are taken care of.

Every owner of a unit in a sectional title scheme is a member of the body corporate. This happens automatically when you become an owner. As a result, membership of the body corporate is compulsory (you cannot refuse to be a member of the body corporate).

An owner continues to be a member until they sell their unit/property in the sectional title scheme to someone else or on death.

At an Annual General Meeting of all the owners, Trustees are elected to act on behalf of the body corporate and to carry out the day to day running of the Scheme.

WHAT ARE THE ROLES AND RESPONSIBILITIES OF A BODY CORPORATE?

The primary role of a Body Corporate is to ensure that the common property is maintained and managed effectively. This includes the repair and maintenance of buildings, the upkeep of common areas, and the enforcement of rules and regulations. The Body Corporate is also responsible for the collection of levies, which are used to cover the cost of maintaining the common property.

In addition to these responsibilities, the Body Corporate is also responsible for the following:

  • To establish and maintain an administration fund which is reasonably sufficient to cover the estimated annual operating costs for the repair, maintenance, insurance, management, and administration of the common property.
  • To determine amounts that will be required for the operating costs by levying contributions payable by the owners of the units.
  • To open and operate a bank account, where the levies are paid into.
  • To register the complex with the Community Schemes Ombud Service and file all management and conduct rules.
  • To file their audited financial statements with the Ombud’s office, together with their budget for the following year.
  • To establish a reserve fund to cover the costs of future maintenance and repairs to common property. The suggested amount is 25% of the annual levy.

WHAT ARE THE RESPONSIBILITIES OF SECTIONAL TITLE OWNERS?

Owners have a responsibility to maintain and take care of their sections, as well as pay the body corporate levy. Owners should also be aware of and obey the Management and Conduct Rules of the body corporate.

WHAT KIND OF RULES APPLY IN A SECTIONAL TITLE SCHEME?

Because sectional title schemes are a form of communal or shared living, where lots of people live together in a building or complex, rules need to be made so that people act reasonably and do not negatively impact the living arrangements of others in the building/sectional title scheme.

There are two sets of rules that apply in a sectional title scheme. The first are management rules that apply to the trustees, and the second set of rules are conduct rules that apply to all the owners or tenants living in the building/sectional title scheme.

WHAT ARE MANAGEMENT RULES?

These rules describe the powers and responsibilities of the trustees and deal with the ways that the trustees manage the body corporate. The management rules (which can be found in the Sectional Titles Act) are prescribed for all bodies corporates and can only be changed by a unanimous resolution of the body corporate (this means that all the members of the body corporate must agree to the changes).

WHAT ARE THE CONDUCT RULES?

These rules determine the behaviour of the owners/tenants living in the Scheme. The conduct rules try to ensure that owners/tenants who live in the complex/Sectional Title Scheme do not use their sections or the common property in ways that negatively affect other owners or tenants’ rights to enjoy their own sections or the common property.

The trustees have a duty (as representatives of the body corporate) to enforce the conduct rules. These rules can be applied as they are provided for in the Sectional Titles Act or the members of the body corporate could decide to change these rules at a general meeting if they pass a special resolution. Some examples of issues that are determined in the conduct rules are:

  • Insurance payments
  • Vehicles
  • Laundry
  • Noise
  • Use of communal areas or activities on the common property
  • Security
  • Supervision of children and pets
  • Tenants or visitors.

As we continue to explore the dynamics of sectional title schemes, it becomes evident that the role of the Owners is foundational to the success of these communities. By actively participating in the Body Corporate and adhering to the established rules and responsibilities, owners contribute to a harmonious and well-managed living environment.

Stay tuned for our next edition, where we will delve into the roles of Trustees and Managing Agents, further unravelling the complexities of sectional title schemes and how each role player contributes to the overall governance and maintenance of these unique properties.

For further details or advice in this regard, it is best that you consult with a Legal Practitioner.