New to Community Schemes - The Ultimate Guide to Understanding Sectional Title Schemes – Part One

Administrative Management, Sectional Title Management

By Ané de Klerk

It can be tough being the new kid on the (apartment) block. Whether you are looking to buy property situated in a sectional title scheme or have recently inherited or bought an apartment, you are likely seeing and hearing terminology that is completely new to you. Fear not – while the world of sectional title schemes can be complex and overwhelming, we are here to help you make sense of it all. In this three part series, I will discuss key concepts and principles, covering the basics of what a sectional title scheme is and the rules and regulations you need to follow. In the weeks to come we will cover meetings, finances and maintenance as well as how to resolve disputes. For now, let’s get started with the foundations of this type of property ownership.

Understanding the Concept of Sectional Title Ownership

Sectional title ownership is a type of property ownership where a building or buildings have been divided into sections and common property. While each section is owned by a separate person (or persons jointly) or entity (such as a company or trust), the common property is jointly owned by all of the section owners. This type of property ownership is a popular choice for those wishing to own property but who don’t necessarily have the time, know-how or desire to manage the maintenance of a stand-alone home or building. While we normally think of apartment blocks when we think of sectional titles, offices, factories, shops and so-called “cluster” homes could all be designed as sectional title schemes.

The Terminology

Some commonly used terms you will need to be familiar with include:

• Common Property: Areas within the sectional title scheme that are shared and used by (or in favor of) all owners. This could include roads, lawns, braai areas, clubhouses and/or a security guardhouse for example.
• Unit: The section (the part of the building you would traditionally live or work in), together with the undivided share in the common property owned by an individual owner.
• Exclusive use area: A part of the common property that has been designated for use solely by a particular owner, to the exclusion of others. Common examples include balconies and parking bays.
• Body corporate: All of the owners of units in the scheme collectively (In practice, people often mistakenly refer to the board of trustees as “the body corporate”).
• Trustees: People elected by the unit owners to represent the scheme and manage the body corporate’s affairs to the benefit of all owners.

Legislation

Sectional title owners must be mindful of the following legislation, which place certain obligations on them while also giving them certain rights:

• the Sectional Titles Act, 95 of 1986;
• The Sectional Titles Schemes Management Act, 8 of 2011 and the regulations thereto; and
• The Community Schemes Ombud Service Act, 9 of 2011 and the regulations thereto.

Management of Sectional Title Schemes – the Rules and Regulations

Sectional Titles Schemes must be managed in accordance with promulgated regulations and the prescribed and created and/or amended rules of the particular scheme. The Prescribed Management and Conduct Rules can be found in the regulations to the Sectional Titles Schemes Management Act, but it is important to remember that each body corporate has the power to amend these prescribed rules by passing a special resolution (to authorise the amendment of Conduct Rules) or unanimous resolution (to authorise the amendment of Management Rules) and subject to the approval of the Chief Ombud. It is vital that you obtain a copy of the sectional title scheme’s rules as these rules regulate a wide range of issues, such as:

• Use of common property
• Conduct of owners, tenants and visitors
• Election of trustees
• Keeping pets
• Parking of vehicles
• Payment of levies
• Meetings of owners and trustees
• The keeping and sharing of records
• Insurance obligations

It is important to familiarise yourself with the scheme’s rules to avoid potential misunderstandings and/or conflict.

Advantages and disadvantages of owning a sectional title

One of the main advantages of owning sectional title property is that the body corporate takes care of certain tasks and responsibilities that owners of freehold property would have to take care of themselves – for example, as a sectional title unit owner you would not have to organise for roof maintenance to be carried out, for the communal pool to be cleaned or for the beautiful shared lawn to be mowed. You may also get to enjoy certain facilities that you may otherwise find too costly, such as 24 hour security, a communal gym or tennis courts.

There are also some disadvantages to owning a sectional title property. Arguably the biggest is that you have less control over the property. For example, if you wanted to build a braai room onto your home, you would now need the approval of the vast majority of other owners of properties in the scheme before you even get to seeking municipal approval. The lack of absolute control also extends to finances – what you believe to be a reasonable amount to budget, and pay for, services such as cleaning and security may differ from the opinions of others in the scheme.

The payment of contributions levied to fund the communal expenses can be viewed as both an advantage and disadvantage – on the one hand you may like that you are able to pay a relatively small amount each month to receive the benefit throughout the year, but on the other hand, you may find paying a monthly amount to be a burden and would have preferred to cover the costs of things such as maintenance when they arise (an option you do not have in sectional titles).

Courtesy: The Advisory - Community Schemes Specialists

Specialist Community Scheme Attorney (BA, LLB), Ané de Klerk, is a Director of The Advisory, a boutique consultancy specialising exclusively in community schemes law. Her focus is legal education, which includes presenting seminars and running online and in-person training programs and courses.

FOR FUTHER INFORMATION:

Visit: www.theadvisory.co.za, or 

Email: [email protected]