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Trustees – and sectional title laws

Most complex residents have complaints about domineering and interfering trustees, but according to specialist sectional title attorney Marina Constas, some overzealous trustees may be falling foul of the law.

“It is undoubtedly a tough job being a trustee; definitely not a walk in the park. In terms of the new sectional title legislation, those who hold this office are being held to higher standards, with greater levels of accountability, and a greater chance of being sued in their personal capacity should they breach their fiduciary duty. Perhaps it is this increased pressure that is leading to a more urgent need for some trustees to lay down the law in their schemes. In doing so, however, many are actually breaking the law.”

Constas, who is a director of BBM Law, stresses that trustees may not reduce or cut a resident’s electricity due to arrear levy payments. They also may not authorise the managing agent to do so. “This is illegal as the body corporate is not the supplier of the electricity. Any owner who is dealt with in this way could obtain a spoliation order against both the body corporate and the managing agent. The only way to legally go about cutting electricity is by obtaining a court order,” she cautions.

She warns that trustees may not withhold residents’ access to other services, either, and cites the case of overreaching trustees deactivating an owner’s access card to enter the scheme, for being in arrears with his levy. “This owner was made to sign in at the gate, as visitors are required to do. We took the matter to court on behalf of the owner and won, with the owner gaining his access card back.” 

Trustees who insist on adding fines and untaxed legal fees onto owners’ accounts are also exceeding their powers, she states. “The new legislation, the Sectional Titles Schemes Management Act, prohibits any charges apart from the capital levy, interest and amounts rendered for goods supplied or services rendered being placed on a levy account.”

While Constas notes that the latest laws may present trustees and managing agents with an administrative headache by compelling them to operate separate expense accounts for owners, she says that the law is patently clear, and must be adhered to.

“Unreasonable rules compiled by trustees must be dealt with by owners, and amended if necessary. In fact, any unreasonable rules which are compiled by trustees should not only be examined by owners at a general meeting, but will also be scrutinised by the Community Schemes Ombud Service, which has the power to withhold a compliance certificate for the rules of the scheme. The legal office of the Ombud Service has indicated that any rules which conflict with the model rules will not be permitted.. An attorney is useful in assisting the parties to put together a case and to prepare the parties with a hearing at CSOS.  Always good to consult an attorney first who can guide the matter.”

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