Question:
My mother and I have owned a flat in a sectional title building in Johannesburg for many years and have never defaulted on our levies. I recently learnt that two tenants in the block respectively owe R22 000 and R13 000 in outstanding levies.

What legal advice do you have to offer me? As an owner I am very concerned as I do not want our building, which has always been very pleasant, to degenerate. I believe that 95 percent of the owners regularly pay their levies. If the money is not recovered from the defaulters is it possible that the rest of us could suffer by having power to the whole building cut off? How can we remedy this situation?

Answer:
The local authority will not cut off the power to the scheme's building unless the body corporate fails to meet its financial obligations to the local authority in this regard. What normally happens is that the body corporate continues to meet its payments to the local authority despite the fact that there are owners in arrears with levies. In effect, all non-defaulting owners therefore subsidise those in arrears. This is clearly an inequitable situation which needs to be rectified immediately.

If the trustees have not already set a rate of interest to be charged on arrear levies they should do so in terms of prescribed management rule 31(6). The trustees should also hand these owners to a debt collecting attorney who will institute action against them to recover the arrear amounts.

The trustees are obliged to collect levies from all owners in the scheme and if they refuse to do anything about the current situation I suggest that you rally the support of owners holding 25 percent of the participation quotas in the scheme to request the trustees to call a special general meeting in terms of prescribed management rule 53. If the trustees fail to call the meeting within fourteen days of being requested to do so then the owners themselves are entitled to call the meeting. At this meeting the owners should direct the trustees in terms of section 39(1) of the Sectional Titles Act to hand the defaulting owners over to a debt collecting attorney and to set a rate of interest to be charged on arrear amounts if they have not already done so. If the trustees fail to comply with the owner directives imposed upon them at the meeting then the owners will be entitled to declare a dispute with the trustees in terms of prescribed management rule 71 and if after fourteen days it has not been resolved either party may demand that the dispute be referred to arbitration for resolution.

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