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Q: What are the differences between a body corporate and a home owners association?

A: Some of the differences between a body corporate and a home owners association are:

 

Body corporate

Home owners association

Governed by:

Sectional Title Act Management Rules – registered with Deeds Office

Constitution House Rules – not registered but approved at AGM

Levies:

Paid according to size of unit

Fixed amount, depending on budget

Budget includes:

  • Administration fee
  • Municipal account – excluding rates
  • Bank charges
  • Insurance on building/open areas
  • Maintenance on buildings
  • Cleaning/garden services
  • Administration fee
  • Municipal account – excluding rates
  • Bank charges
  • Insurance – road/gate/wall
  • Maintenance on communal area
  • Cleaning/garden services

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Q: Who is responsible for painting common property?

A: Section 37(1)(j) of the Sectional Titles Act 95 of 1986 (hereafter 'the Act') determines that it is a function of the Body Corporate to properly maintain the common property and to keep it in a state of serviceable repair. Section 39(1) of the Act states that the trustees shall perform and exercise the functions of the Body Corporate.

We believe that painting of common property is maintenance as contemplated in section 37(1)(j). The trustees are empowered to make the decision to paint the walls subject to any restriction imposed or direction given by the owners at a general meeting.

Many people wrongly think that painting a building requires a special resolution (75%) by the owners. As indicated above, this is not the case. It only requires a trustees' resolution. This misconception could arise because the owners think of it as an improvement as contemplated in Management Rule 33 in annexure 8 to the Act. Improvements, whether luxurious or non-luxurious are, in our opinion, only applicable in the case of new structures of a permanent nature erected on the common property, such as new security fencing or a new swimming pool.

If no restriction is imposed or if direction is given by the owners at a general meeting, the trustees may decide to paint the walls by way of a vote of the majority of the trustees. The trustees are furthermore entitled, in accordance with Management Rule 31 (4), to impose a special levy to fund the expense.

Tertius Maree & Associates
Attorneys / Conveyancers / Notaries
Stellenbosch
PO Box 12284, De Boord, 7613

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Q: Wat as warmwatersilinders lek of bars?

A: Bestuursreël 68(1)(vii) bepaal dat die eienaar van ’n deel verantwoordelik is vir die instandhouding van ‘n warmwatersilinder wat sy deel bedien, selfs al is die apparaat op gemeenskaplike eiendom gemonteer. Aangesien ‘n eienaar veantwoordelik is vir die instandhouding van ‘n warmwatersilinder, sal die eienaar ook aanspreeklik wees vir gevolgskade wat voortspruit waar ‘n warmwatersilinder bars, en die eienaar versuim het om die warmwatersilinder na behore in stand te hou.

Bevoorbeeld, waar 'n warmwatersilinder op die dak van 'n gebou bars en die eienaar van die betrokke deel het versuim om dit in stand te hou, sal die eienaar aanspreeklik wees vir die gevolglike waterskade aan die woonstelle na benede, asook aan die inhoud van hierdie woonstelle.

Bestuursreël 29(1)(a)(vi) bepaal egter dat die regspersoon versekering in plek moet stel ten opsigte van die gebeurlikheid beskryf as "bars of oorloop van watertenks, -toerusting of pype." Dit word egter nie voorgeskryf dat versekering uitgeneem moet word vir gevolgskade van die gemelde gebeurlikheid nie. 'n Versekeringsmakelaar het my egter daarop gewys dat polisse wat deur versekeraars aan regspersone uitgereik word, gebruiklik ook versekering teen gevolgskade insluit. My waarnemings sedertdien bevestig hierdie kommentaar. Versekering vir gevolgskade is egter nie verpligtend nie.

Normaalweg egter is versekering vir gevolgskade ook in plek en sal eienaars dan beskerm wees teen eise vir gevolgskade wat gely word wanneer 'n warmwatersilinder bars.

Soms gebeur dit eger dat weens 'n nadelige eisegeskiedenis, 'n versekeraar weier om verdere dekking te bied ten opsigte van die bars van warmwatersilinders, en dat eienaars dus die risiko loop om self eise op grond daarvan te betaal. Eienaars is wel in staat om individueel versekering uit te neem teen gebeurlikhede, maar sal waarskynlik dieselfde probleem as die regspersoon ondervind, vanwee die swak toestand van die warmwatersilinders.

Ek is egter deur 'n vooraanstaande versekeringsmaatskappy ingelig dat alle risiko's versekerbaar is, maar teen 'n verhoogde premie en/of bybetaling.

Trustees kan wel hiervan kennis neem, en in gedagte hou dat premies deur die regspersoon betaalbaar is. Die bybetalings ten opsigte van warmwatersilinders is egter betaalbaar deur die eienaar van die deel wat deur die toerusting bedien word.

Indien 'n gebou onderverseker was en dit dus 'n verdere betaling deur die betrokke eienaar noodsaak om die skade te dek, het die eienaar nie 'n verweer nie, maar moet die eienaar die bykomende bedrag betaal.

Tertius Maree & Associates
Attorneys / Conveyancers / Notaries
Stellenbosch
PO Box 12284, De Boord, 7613

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Q: How should trustees protect themselves?

A: The trustees of a body corporate are generally unpaid volunteers, elected by owners to effectively run the scheme on behalf of all the owners. As with all positions of responsibility, trustees can be held personally responsible for acts of negligence arising from their duties as trustees. This serious financial threat should not be taken lightly.

How could this type of liability arise?

Let’s say that owners alert trustees to a maintenance problem, such as a loose tile on the roof of the complex. They do nothing to address this maintenance problem and eventually the tile falls from the roof and causes R100 000 damages to a parked vehicle (or worse, kills somebody). The body corporate will be held liable for the damage because the damage was cased by their property. As the loss arose from poor maintenance, insurers will not meet the claim in terms of the policy.

Losses resulting from poor maintenance are excluded from the cover provided, as the insured has a duty to adequately maintain the property and prevent losses where possible. The body corporate is, however, still legally liable for the resultant damages and this amount must be paid to the injured third party. The only way to settle this loss is to collect the amount from owners via a special levy raised from all owners. As owners can legitimately argue that they had timeously advised the trustees of the potential problem that eventually resulted in the loss, it is the trustees’ negligence in failing to address the problem that resulted in the loss. In this case, the trustees could well be liable for the loss in their personal capacities.

For trustees to protect themselves from claims that could result because of their failure to carry out their duties properly, it is important that adequate Trustees’ Liability insurance, which covers the negligence of trustees, is in place. This cover would pay the legal costs involved in defending a claim and ultimately the claim itself.

When cover for the body corporate assets are arranged, this cover can also be arranged. Several insurers have compiled specialised sectional title cover that includes basic cover to indemnify the trustees.

Tertius Maree & Associates
Attorneys / Conveyancers / Notaries
Stellenbosch
PO Box 12284, De Boord, 7613

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Q: Who coordinates repairs and maintenance?

A: Our clients are able to notify us 24/7 about emergency repairs by calling our emergency hotline. Urgent repairs are attended to as quickly as possible. Other maintenance requests are given high priority. Due to the high volume of properties we handle, we secure excellent rates from our trusted vendors.

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NEWS

Important amendments to the Deeds Registries Act 47 of 1937 and the Sectional Titles Act 95 of 1986 are expected to be published in the Government Gazette by the end of 2010, before the conclusion of the current parliamentary session.

SERVICES

We manage the core areas that largely determine the success of a body corporate or home owners association.