Functions and powers of body corporates

Throughout the South African sectional title property industry, problems arise regularly because body corporates are not fully aware of the extent of their functions and powers – and quite often fail to exercise them as the law requires.

This was said recently by Johalna Minnaar, National Sales Manager for the Rawson Property Group.

“The Sectional Title Act 95 of 1986,” said Minnaar, “has clearly defined the roles of body corporates – but it is widely accepted in our sector that, although these are understood in principle, many members and their trustees often lack in-depth knowledge of the laws to which they are supposed to be working.”

The functions of a body corporate, said Minaar, are generally better understood than the powers which they confer.

These powers, said Minnaar, are:

1.) To appoint agents and employees if it is deemed that they are necessary to the welfare of the scheme.

2.) To purchase or in other ways acquire and take transfer of mortgages, to sell units or to let or hire them out when necessary.

3.) To purchase, hire or acquire moveable property for the use of owners so as to enhance their enjoyment of the scheme and/or to better protect it.

4.) To establish and maintain the scheme’s common property, lawns, gardens and recreational facilities for the benefit and use of all residents.

5.) To borrow money where it is deemed necessary to improve the scheme’s ‘performance’.

6.) To secure the repayment of any money owed to the scheme and the interest payable on it, particularly with regards to unpaid contributions and levies. The body corporate can also mortgage any property vested in it.

7.) To invest any money paid into the scheme’s administrative fund for the repair and upkeep of the common property.

8.) To enter into an agreement with local authorities for the supply of electricity, water, gas, fuel, sanitary and other services.

9.) To enter into an agreement with any owner or occupant of a section for the provision of amenities or services by the body corporate to such people. This includes the right to let a portion of the common property to any such person.

10.) To do all that is necessary to enforce the rules regarding the control, management and administration of the scheme.

Minnaar commented that these powers are broader than most people realize and only a minority of the trustees of schemes exercise their powers to the full.

“What has been a headache to owners and tenants alike are the rules regarding pets. In two cases recently, a sale was made with the house rules stating that pets are allowed ‘with permission’. This was obtained, but while the transfer was in process the body corporate decided to reverse this decision and ban pets. This has huge repercussions because the owners bought here on account of being allowed pets. It has to be pointed out that changes like these can only be made at board meetings and with a majority vote. Most importantly, changes can only become effective once registered in the house rules of the scheme in the Deeds Office.”

Article from: www.rawsonproperties.com

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