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You and Your Rights

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You and Your Rights

Please note that since this book was last published in 1997 some of the laws that have been referenced may have changed. We are doing our best to update the articles, however, it is advisable that you to consult an attorney before relying on any information contained herein.

Sectional Title

Buying part of a building

One of the principles of South African law of property is that the owner of land on which a building stands is also the owner of the building.

Because of this, it used to be impossible for, say, a man to own a single flat unless he was prepared to buy the whole block.

This position changed with the passing of the Sectional Titles Act, 1971 (which was repealed by the Sectional Titles Act, 1986). In terms of the Act, you can now own a part or section of a building, together with joint ownership of the land on which the building stands as well as common parts of the building that have been set aside for your exclusive use (in partnership with the other owners of flats in the block).

Your sectional title flat guarantees you security of occupation and enables you to invest in property. Also, many sectional title developments are conveniently close to schools, shops and places of employment. A sectional title flat - and other forms of high-density housing, such as cluster housing, duplexes and maisonettes - can be attractive alternatives to the traditional free-standing home.

The sectional title scheme

Because not every block of flats or building may be suitable for division into sections, the Sectional Titles Act does not allow the owner of a block to divide it in any way and at any time.

The owner must first get the approval of the local authority, which will not approve a sectional title scheme unless it is completely satisfied that the scheme does not conflict with any proposed or existing approved town-planning scheme.

Once a sectional title scheme has been approved, a draft sectional plan prepared by a land surveyor or architect must be submitted for approval to the Surveyor-General. If permission is subsequently given, the developer must apply to the Registrar of Deeds for the registration of the sectional title plan (which should give the name of the scheme).

The Act prohibits the selling, advertising for sale and granting of any options before the opening of the sectional title register and the registration of the sectional title plan.

On applying for the opening of the sectional title register, the developer can impose a condition conferring rights to the use of exclusive common property on the owner(s) of a particular section or sections of the block.

Once the scheme has been approved and the sectional title register opened in the Deeds Registry, the buildings on the land are deemed to be divided into sections and common property as shown on the sectional plan. If you owned a particular section, you would have exclusive rights to your section - that is, the dwelling unit in which you actually live. In the case of the corridors, lift shafts, parking lots, driveways and gardens, which also form part of the block (even though they are not part of the individual dwelling sections), each owner of an integral dwelling section has an undivided share in that common property.

The Act refers to a section, together with its undivided share in the common property, as a 'unit'. Ownership of the unit can be transferred from one person to another by an endorsement made by the Registrar of Deeds on the title deed. Sectional title property may also be bonded.

The body corporate

The Act creates what is known as a body corporate to control and manage the property and to attend to matters of common interest to all the flat owners.

When you buy a unit in the building, you become part of the body corporate as soon as that unit is registered in your name. In fact, a body corporate is simply the representative of all the registered or leasehold owners (not lessees or lessors of the block). The developer is a member of the body corporate only until the last unit is sold. Note, however, that a developer who retains one or more of the units or repurchases any of them will remain a member of the body corporate.

In law, a body corporate is viewed as a 'separate person' (juristic person) capable of suing and being sued in its own name. The Sectional Titles Act specifies certain duties that the body corporate must perform as regards the management, administration and maintenance of the common property and the insuring of the entire building against fire and other risks (for instance, public liability).

In terms of the Act, the body corporate must establish a fund big enough to pay for the repairs, upkeep, control, management and administration of the common property. Reasonable provision must also be made for future maintenance and repairs as well as for the payment of rates and taxes, other local authority charges on the building and land, and electricity, gas, water or sanitation bills. Income is derived from levies paid by owners of units in the building. (Until the purchaser of a unit becomes the registered owner or leasehold owner thereof, a 'levy' is paid in the form of occupational rent agreed to between the parties in the deed of sale.)

Lawns, gardens and playing facilities on the common property must be maintained and the building must be cared for in the mutual interest of the unit holders.

The body corporate also has the power to do any of the following things:

  • Employ agents to carry out its duties;
  • Employ a person or people to look after the property;
  • Buy sections of the building itself and let them out;
  • Purchase extra land;
  • Designate part or parts of the common property to an owner or owners - provided the whole body unanimously agrees.

Warning - Protection for existing tenants

The Sectional Titles Act stipulates that flat tenants must be given time to find a place to stay should a developer decide to have their block divided into units and sold by sectional title.

Furthermore, the tenants must be given written notice of a meeting at which either the developer or an agent acting on behalf of the developer must inform them of the particulars of the scheme and their rights. All reasonable questions put by the tenants must be answered at this meeting, which must be held in the building or in another building within a reasonable distance.

These conditions are intended to ensure that the developer does not offer a flat for sale while it is occupied by a tenant - unless, of course, the developer has made a written offer to sell it to the tenant and the tenant has refused this offer within 90 days (or within 365 days in the case of a rent-controlled flat) or has not accepted the offer by the end of that period. 

Even if a tenant refuses the offer or the period in which it can be accepted has expired, the developer must wait another 180 days before offering to sell the flat to another person for a lower price. If, how-ever, the developer offers it to the tenant at the lower price and the tenant refuses, the flat can be offered to someone else after only 60 days.

Warning - Sectional title and rent control

A person who was in occupation of a rent-controlled flat on the date it was 'de-controlled', who is still living in it and whose monthly income is less than R2000 (or R1200 in the case of a single person) is known as a 'protected tenant'. Similarly, a lessee who is 65 years of age or older, whose income does not exceed a prescribed amount, is also protected. 

A tenant younger than 65 years of age who is occupying rent-controlled premises can be made to leave after a certain period of time has elapsed. This period is determined by the circumstances of occupation.

A developer can offer a flat for sale to a lessee only for the period stipulated in the Sectional Titles Act. Contravention of this provision is an offence. A protected tenant has a longer period than an ordinary tenant to decide whether to purchase a rent-controlled flat or not. After the periods set out in the Sectional Titles Act have expired, the flat may be sold to another tenant. In this case the new owner gives notice to the protected tenant. It is an offence to advertise for sale, make offers for sale or sell units in a block until a sectional title register has been opened at the Deeds Registry.

Control of the body corporate

PARTICIPATION QUOTA The size of flats in a block often differ considerably. Some people may have large, spacious flats while others have tiny ones. It is for this reason that the Act provides for unequal votes among members of the body corporate. Members with bigger units have greater voting powers than those with small apartments. This demarcation is known as the participation quota and it determines the value of the vote of the owner of a section and that person's share in the undivided common property. The participation quota also determines how large a share of the administration and maintenance expenses each owner must bear and, if the body corporate cannot pay its debts when it is called upon to do so, each owner's share of that debt.

The rules for determining the participation quota can be changed by a unanimous resolution of the body corporate.

TRUSTEES A trustee of a sectional title body has similar duties to those of, say, a director of a company - control over the day-to-day running of the business and the power in certain circumstances to make decisions on behalf of the body corporate. The number of trustees for a sectional title block is decided upon by the body corporate at a general meeting at which no fewer than two trustees should be present. Nominations must be in writing and must include the written consent of the person nominated.

Until trustees are elected, the developer (or a nominee of the developer) automatically assumes the position of chairperson of the trustees. Thereafter, the developer (or the developer's nominee) must stand for re-election if this person wishes to continue serving in this post. The majority of trustees must be owners or the nominees of owners. The trustees are allowed to appoint an alternative trustee, who need not necessarily be an owner of a unit, but who, nevertheless, will have the same status as other trustees.

Trustees hold office until the annual general meeting, at which point they must vacate their positions. They may, however, stand for re-election. A managing agent may not serve as a trustee.

Unless it is decided otherwise, trustees who are owners are not entitled to payment for their services. However, the body corporate may reimburse them for any reasonable expenses incurred. Trustees who are not owners may be paid at the rate agreed upon by the body corporate.

Generally, a trustee, agent or other representative of the body corporate is indemnified against liability for costs, losses, expenses and claims incurred in the performance of his or her duties - as long as these are not incurred through negligence.

After elections, the trustees will generally elect a chairperson at their first meeting. If a chairperson were to resign before completing a term of office, or is removed from this position by the body corporate, the trustees may choose another chairperson. If a chairperson is temporarily absent from meetings, the trustees may appoint an acting chairperson.

Decisions at meetings of the trustees are taken by a majority vote. Subject to any restrictions imposed at a general meeting of the body corporate, the trustees can administer and manage the common property and perform any of the duties of the body corporate and meet in any manner they deem fit.

They must, however, keep minutes of their proceedings and of general meetings of the body corporate. Money received and spent must also be carefully accounted for and properly audited accounts must be presented at each annual general meeting. Any unit owner or person authorised in writing by an owner can inspect the books of account at reasonable times.

There are a number of ways in which trustee vacancies can occur, including:

  • When a trustee hands in a written notice of resignation to the body corporate;
  • If a trustee is of unsound mind;
  • If a trustee has had his or her estate sequestrated (see insolvency);
  • If a trustee has been convicted of an offence involving dishonesty;
  • If a trustee is removed by a resolution of a general meeting of the body corporate;
  • If a trustee is disqualified in terms of the Companies Act from serving as a director of a company.

The body corporate has the right to appoint a replacement trustee at a general meeting.

Meetings of trustees

QUORUM A quorum is formed when 50 per cent of the trustees (but not fewer than two) are present at a meeting.

Any documents of the body corporate must be signed by a trustee and the managing agent, or, alternatively, by two trustees when a certificate is issued in respect of moneys paid to the body corporate on the transfer of a unit. If the number of trustees falls below a quorum, at least two remaining trustees may appoint or co-opt additional trustees to make up a quorum or to call a general meeting of owners.

MEETINGS A meeting of owners must be held within 60 days of the formation of a body corporate. Owners must be given at least seven days' written notice of the meeting, a copy of the agenda and an indication of the nature of the business to be conducted.

Trustees have the right to call a special general meeting whenever they think it is necessary. Fourteen days' notice of such a general meeting must be given. Other information on the meeting must include the venue (it must be in the magisterial district in which the scheme is located), the date, the time and the nature of the meeting. A meeting may be convened at shorter notice if all persons who are entitled to attend agree.

Holders of mortgage bonds over the various units, who have informed the trustees in writing of their interest in the units, must also be informed of general meetings.

A special general meeting called to pass a unanimous or special resolution must be convened within 30 days of notice being given to all members of the body corporate. In an emergency, a meeting may be convened in a shorter time. In blocks of 10 units or less, a quorum for a general meeting must consist of at least half of the persons entitled to vote, in person or by proxy. In a complex consisting of a maximum of 50 units, the presence of 35 per cent of the owners at a meeting is needed for a quorum; in a block of more than 50 units, 20 per cent of the owners will make up a quorum. If a quorum is not obtained within an hour of the start of a general meeting, the meeting will be adjourned by a week. If a quorum still cannot be formed, the persons present who are entitled to vote will constitute a quorum.

Voting is usually carried out by a show of hands, but any owner or person representing an owner by proxy can request a secret ballot. If a secret ballot is requested, the chairperson must lay down the procedure for the poll. If voting is equally split, the chairperson is entitled to a casting vote in addition to a deliberate vote.

Quick Tip - A diagram of your flat

When you become the owner of a sectional title flat you will receive a title deed in the form of a deed of transfer or a certificate of title as proof of ownership. However, you will not always receive a diagram of your newly-acquired property.

This diagram is filed with the sectional title plans registered at the deeds registration office.

If you wish to acquire or examine the diagram for your property, first check your title deed. It is usually kept by the financial institution from which you acquired your home loan.

If the diagram is not attached to the title deed, check in the description of the property for the diagram deed reference number and the reference number of the diagram itself.

When you have located the diagram you will be able to obtain a photocopy of it - or the township plan or sectional plan - relatively cheaply from the deeds registration office.

There are deeds registries in Cape Town, Port Elizabeth, King William's Town, Kimberley, Vryburg, Pietermaritzburg, Pretoria, Johannesburg and Bloemfontein.

Duties of owners

Because the owners of the various units live closer to each other than they would have had they been living in free-standing homes, certain limits have been placed on their rights. For instance, if you're an owner, the body corporate can force you to comply with its rules - by application for a Supreme Court interdict if necessary. Other rules that you may have to observe include:

  • Allowing any person authorised in writing by the body corporate to inspect your section at reasonable hours and to enter it for maintenance purposes;
  • Maintaining your section and using the common property without unreasonably interfering with the use and enjoyment of it by other owners or persons lawfully on the premises;
  • Not using your section or permitting it to be used in a manner that creates a nuisance for the occupier of another section;
  • Notifying the body corporate of any change of ownership - for example, if you transfer ownership to another person or mortgage your section;
  • Carrying out any work ordered by a competent public or local authority in respect of your section.

The body corporate can make other rules governing your conduct as an owner of a unit. However, if they do not, rules set out in a schedule to the Sectional Titles Act will apply. Generally, in terms of the rules in the Act, you are bound to heed the instructions of the trustees in the follo-wing circumstances:

  • You cannot keep or do anything on the common property after being instructed not to do so by the trustees. For instance, you cannot keep an animal in your section or on common property if you have been asked not to do so;
  • You cannot do anything that will increase the insurance premium payable by the body corporate. For example, you cannot store an inflammable substance in your section;
  • You cannot allow your section of the building to be used for any purpose that may be injurious to its reputation.

Note that you are, generally speaking, not bound to improve the common property. If, however, a special resolution is passed at a general meeting of the owners to improve the common property, you will be bound by the will of the majority.

Warning - Checking the building

When you buy a home under sectional title, it is just as important to check the whole building as it is to check your particular part of it.

Remember that as an owner you will be jointly liable for the upkeep of the building. It would therefore be unwise to buy a flat in a block clearly in need of major repair. A serious defect affecting the entire building - such as damp or structural cracking - could be very expensive to repair and your levy would probably be increased to meet the cost of renovations. In some cases double levies are charged for a certain period in order to carry out particular improvements, such as the installation of a new lift or security system and painting.

Conversion of share block to sectional title

If you're a share-block schemeI member, you can acquire title to the unit you occupy only if the scheme is converted to sectional title. Both the Share Blocks Control Act, 1980, and the Rent Control Act, 1976, make provision for rights in a flat under the share-block system to be converted to sectional title - provided it complies with all the other requirements of the Sectional Titles Act and provided the local authority approves.

If at least 30 per cent of the members of a share-block scheme wish to apply for the opening of a sectional title register, or if the directors wish to make application, a general meeting of shareholders must be called.

If the building is mortgaged, the bondholder's consent to the proposed conversion must be obtained. Shareholders must be given full particulars of the proposed scheme at the meeting.

A resolution to open a sectional title register in place of the share-block scheme can proceed only with the support of at least 50 per cent of the members who, together, hold at least 30 per cent of the total votes of company members.

Disclaimer :: You and Your Rights
Although we have gone to great lengths to ensure the accuracy of the information contained in this database, it is important to remember that laws, government departments, interest and taxation rates are constantly changing. If you have a particularly difficult problem you are advised to consult a qualified legal authority. The publishers, editors and their representatives cannot accept responsibility for any act or omission arising from consulting the information contained herein.
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General Disclaimer: The content of Legal City does not constitute legal, tax or financial advice, nor does it necessarily reflect the views of our management, staff, shareholders, associates, contributors, authors or suppliers. Even though every endeavour has been made to ensure the accuracy of this information we cannot be held responsible for any errors and/or omissions. By using this web sitebridey you agree to accept and abide by our terms and conditions.
This web site and all its content is copyright © 2000-2014, Legal City CC • Web site managed with qPortal Content Management v 4.0.0 • This page loaded on July 25, 2014 at 12:58:11 am, SA Standard Time.