LIFESTYLE

#Complexlife: Do You Know What You’re Buying Into?

Townhouse complexes are popular among safety-conscious South Africans, but they come with their own restrictions.

11/09/2017 06:37 SAST | Updated 11/09/2017 07:01 SAST
Gordon Webber
Security was among the considerations residents of townhouse complexes in Gauteng identified as factors that influenced their decision to stay there, according to research by students of the University of Pretoria. Other factors included “affordability, a secure investment, unit size, well-maintained outdoor spaces, and the income groups in the complex”.

Can the body corporate deny you access to your townhouse complex if you're not up to date with payments?

Marina Constas, the author of the book "Demystifying Sectional Title", says living in a townhouse complex means that "you are restricted in certain ways, and by buying into the concept, you agree to be contractually bound by the rules".

However, this does not mean that you cannot challenge certain rules.

Says Constas: "You cannot have a clause that states that the body corporate can cut electricity or water, or deny you access to the scheme if an owner is in arrears. You need a court order to cut electricity."

Complex rules also cannot forbid ritual slaughter. "The [Community Schemes Ombud Service] ombud [see graphic below] has said that as long as an owner complies with all bylaws and the Meat Safety Act, ritual slaughter will be permissible."

Before you buy

Constas, a director at law firm BBM Inc., says in her experience, "many owners" are not aware of what exactly they are buying into when they choose property in a complex. "They fail to properly read the management and conduct rules of their scheme, and often come to blows with the trustees as a result of miscommunication and misunderstanding," she says.

"So, for example, a buyer could bring a pet into the scheme, where the rules prohibit [this]. Owners also forget that in a scheme, where you have common property areas, you cannot simply build on and extend your unit, or [make] alterations that may have an impact on the structure and aesthetics of the scheme."

She says disputes about noise and pets as well as the illegal extension of units are typical examples of issues that lead to legal action.

Another source of conflict is levies. This includes how levies and special levies are calculated, levies in arrears and illegal charges on accounts.

Constas is aware of a case in which an owner set alight the car of the chairperson of the body corporate because he believed there were illegal charges on his account. "He was completely frustrated by the delays in revising his account."

There are other options. The Community Schemes Ombud Service provides an "alternative dispute-resolution service".

Wanda Lubelwana, the ombud service's manager for marketing, communication and stakeholder relations, says any person in a community scheme -- which includes townhouse complexes -- can approach the service, provided that they have exhausted internal dispute resolution mechanisms.

'Security! My neighbour snores'

Among the disputes the ombud service has settled through conciliation (see below) is a dispute about a neighbour's snoring.

Ms RR* had complained to complex security about her neighbour's "loud snoring". Her neighbour, Ms MS*, believed it was unnecessary to involve security in the matter and that this had "defamed her character".

Following a conciliation session, it was agreed that the snoring neighbour would move to another room in the house while seeking medical attention. This would happen on a trial basis because she needed to determine if the change was acceptable to her fiancé.

Not quite "happily ever after". But it's a start.

*Not their real names.

Graphics24

FAQs

What is the Community Schemes Ombud Service?

It is the regulatory authority for all community schemes in South Africa. It provides an alternative dispute resolution service.

What is a community scheme?

A community scheme refers to any scheme or arrangement where there is shared use of and responsibility for parts of land and buildings, including sectional title schemes, home- or property-owners' associations, retirement villages, share block companies and housing cooperatives.

What is conciliation?

It is the resolution of a dispute that is facilitated by an independent conciliator, who is appointed by the Community Schemes Ombud Service's chief ombud, who then assists the parties in arriving at a mutually agreeable solution.

What is adjudication?

An independent adjudicator -- appointed by the chief ombud or selected by both parties from the list provided by the chief ombud -- will, after investigation of the matter, determine how the dispute is to be resolved, and makes a binding decision or order.

How do I submit an application?

Visit this link to get started or visit one of the ombud service's offices.

Worth knowing about the new act

The Sectional Titles Schemes Management Act came into effect in October last year. Here are some of its key provisions:

The body corporate (all owners)

  • The body corporate must establish and maintain a reserve fund, which is not less than the amounts prescribed by the minister [of human settlements] in the regulations. "An inordinate number of trustees find themselves in financial difficulty with the building being run from hand to mouth on a monthly basis. This reserve fund will ensure that a building does not fall into disrepair and that the body corporate, at every annual general meeting, [applies] its mind to the collection of money for this fund and the maintenance plans for the building," says Marina Constas, a director at law firm BBM Inc.
  • The body corporate must prepare a written maintenance, repair and replacement plan. It must detail, among others, major capital expenses expected to require maintenance, repair and replacement within the next 10 years as well as timelines for repairs. Examples are painting and waterproofing.
  • The body corporate may, by ordinary resolution, give consent for a structure or building improvement if it is satisfied that the change does not require other approval, for example by a city council. An example might be enclosing a balcony.
  • Every body corporate, no matter its size, has to be audited.
  • A proxy is not allowed to act for more than two members of the body corporate at a general meeting.

Trustees

  • Non-owners can be trustees.
  • An owner who is in arrears with their levies or in breach of the conduct rules can still be nominated as a trustee.
  • Action can be taken against a trustee for any loss that the body corporate suffers or any economic benefit received by the trustee.
  • A trustee automatically ceases to hold office if they are sentenced to imprisonment without the option of a fine or if they are removed from an office of trust because of fraud or the misappropriation of money.

Owners

  • An owner has to notify the body corporate of any change of ownership or occupancy of his/her unit.
  • Tenants and occupiers (including guests, visitors and family members) are bound by the conduct rules. The owner must take "reasonable steps" to ensure that they stick to the rules.
  • An owner does not have to get consent from the trustees to install a locking or safety device to protect the unit against intruders or a screen to prevent the entry of animals or insects. But, says Constas, "there may be policies within the scheme regarding what burglar bars need to look like in order to conform with the aesthetics of the scheme. It would be dangerous to go ahead and fit your own style security gate, in a certain colour, without checking first."
  • The external appearance of a unit or exclusive use area cannot be changed without written consent of the trustees.
  • The owner or occupier of a unit must not make noise and must take responsible steps to ensure that their visitors don't behave in a way likely to interfere with the peaceful enjoyment of another unit or another person's peaceful enjoyment of the common property.

Source: Marina Constas, a director at law firm BBM Inc.

The complex isn't well run. What can I do?

Twitter user Chantal MacKay wants to know how to go about changing the managing agent of a complex.

"[The] complex isn't well run. [There are] no rules. [It's] just unkempt," she tweets. MacKay says the neighbours fix their cars in the complex and that she suspects that drugs are being sold on the premises.

We asked Zerlinda van der Merwe, attorney at Paddocks, a specialist sectional title and home owners' association law firm, for advice.

First things first. If the complex is a homeowners' association, the answer would depend on the association's governance documents -- its constitution or memorandum of incorporation.

If it is a sectional title scheme, the Sectional Titles Schemes Management Act 8 of 2011 applies.

In a sectional title scheme, the legal relationship exists between the owner of a unit and the body corporate, represented by the trustees. If you are a tenant, you would need to ask the owner of the unit to deal with the trustees and the managing agent.

"In terms of the act, it is the trustees of the scheme who are required to ensure that the provisions of the act and the rules of the body corporate are adhered to. However, the trustees may delegate their powers, duties and functions to the scheme's appointed managing agent. In turn, the trustees will need to ensure that the managing agent fulfils these powers, duties and powers," says Van der Merwe.

The role, responsibilities and functions of the managing agent would be contained in the management agreement, entered into between the body corporate -- represented by the trustees -- and the appointed managing agent.

"Should the appointed managing agent and/or trustees [fail to] undertake or perform their powers, functions and duties in the best interests of the members of the body corporate [all owners], both of these management structures may be removed and replaced," says Van der Merwe.

One or more of the trustees may be removed from office by an ordinary resolution of the members of the body corporate, taken at "a duly convened and quorate general meeting".

A management agreement with a managing agent may be terminated:

  • By the body corporate, on two months' notice, if the cancellation is first approved by special resolution passed at a general meeting; or
  • The body corporate or the trustees may, by ordinary resolution, cancel the management agreement in terms of its cancellation or termination terms.

Q&A: Coenie Groenewald, chief operating officer of the National Association of Managing Agents (NAMA)

1. What steps can a tenant or owner take if they are not satisfied with the way in which a complex is run and believe the managing agent is at fault?

The managing agent is appointed either by members [of the body corporate] or by the trustees. Therefore, the first port of call will always be the trustees, who should address any issues reported with the managing agent to find an amicable solution.

If there are grounds to investigate serious matters and the trustees do not act, the owners can request the trustees to convene a special general meeting. At least 25% of the owners have to support such a request in writing.

The aggrieved owner can also lodge a formal complaint with the Community Scheme Ombud Service.

Be mindful that, although tenants have a little more protection with the ombud service, there is no relationship between the tenant and the body corporate. [A tenant would therefore have to first raise such issues with the owner.]

2. A HuffPost SA user gives two examples of issues she would like the managing agent to deal with: Her neighbours fix cars in the complex, "basically running a business". Someone who is doing work for the complex "is selling drugs" on the premises. How would an owner determine if these issues are indeed the responsibility of the managing agent?

The scheme should have presented its rules to the Community Scheme Ombud Service for lodging and filing. The repairs to cars should be addressed to the managing agent and the trustees, who should enforce the rules.

It may involve the ombud service or legal action if no response or resolution is found.

The trustees should be alerted to the alleged drug dealing and perhaps the intervention of the [police] should be obtained. It is not a matter that is resolved within the rules but, if found guilty, labour-related action may follow.

3. If an owner raises an issue with the managing agent, which falls within its responsibilities, and the managing agent fails to respond or deal with the issue, what can they do?

Report it to the trustees for intervention and action.

4. Is there a code of conduct for managing agents?

NAMA members have a code of conduct, which is currently being updated. The standard codes as set up by the Estate Agency Affairs Board apply.

5. What is the process for changing the managing agent if performance is not satisfactory?

The trustees or owners [could do so] by resolution and two months' notice. This is, however, a broad manner and existing agreements should always be considered.

All information and advice provided by NAMA or any representative of NAMA is provided as general information or advice and should only be used as such. The use of such information or advice is at the users' own risk and should not be considered as a formal opinion or be considered as legal advice or legal opinion of any kind. NAMA will not be held liable for any damages, losses or causes of actions of any nature whatsoever arising from use of the information or advice given.

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