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LIVING IN THE WORLD OF SECTIONAL TITLE

15 Sep

LIVING IN THE WORLD OF SECTIONAL TITLE CAN FEEL TO THE NEW HOME OWNERS AS LIVING ON A DIFFERENT PLANET.

When you purchase a flat as we all call them you are actually purchasing a unit. The Sectional titles Act No95/1986 defines ‘unit’ as a section together with its undivided share in common property apportioned to that section in accordance with the participation quota of the section. Quite a mouthful so let’s unpack this.
Your section is a flat (it can be a garage or storeroom too). When you purchase your flat you automatically become the owner of an undivided share in the common property which is jointly owned with the other owners in the complex. Common Property is the driveways, the lifts, the passageways etc and it cannot be split up hence the owners own it jointly in proportion to the square metres of their flat. This is the participation quota (PQ) and the total of each owner’s PQ adds up to 100%.
Now apart from the section (flat) one can also own Exclusive Use Areas. Exclusive Use Areas are often misunderstood and it is very important to understand the nature of the Exclusive Use Area. Exclusive Use Areas that are reflected on the main Sectional Title file as a Yard Y1, Parking Bay PB1 or Storeroom S1 for example are exclusive use areas that are registered in an owner’s name under a separate title deed which we call a Notarial Deed of Cession (just another name for a title deed). These types of exclusive use areas can be bonded/mortgaged by a Bank. They will be transferred formally into your name with your flat and we use the word ceded.
However one also gets exclusive use area rights which confer rights of exclusive use and enjoyment of parts of the common property upon the various owners in the complex. This is done in terms of the Rules of the Body Corporate but these exclusive use area rights are not capable of being mortgaged. Often the exclusive use areas in terms of the Rules of the Scheme are misinterpreted and misunderstood. The exclusive use areas in terms of the Rules of the Scheme are imposed in terms of section 27A of the Sectional Titles Act according to a layout plan drawn to scale and will include a schedule indicating to which member of the body corporate each such area is allocated.
These 27A exclusive use area rights are not found on a deeds office printout or an estate agent’s Comparative Market Analysis. They are filed at the deeds office and records thereof should be kept at the managing agent’s office that is charged with the administration of the scheme. It is best to get a conveyancer’s report on the scheme to ascertain the nature of the exclusive use areas to be safe. Finally the 27A Rules exclusive use area rights do not formally get transferred by the conveyancer to the purchaser like the aforementioned cession, rather a record is kept by the managing agent of each owner who has these exclusive use area rights. When a unit is sold these exclusive use area rights are affected and the managing agent merely updates their records to show that there is a new owner who has the same exclusive use area rights as the previous owner.
As an owner of a unit in the scheme you automatically become part of a Body Corporate which is the name used for the totality of all the owners of the scheme and so the functions and the powers of the Body Corporate become a joint responsibility of all the owners despite many of the functions and responsibilities being delegated to the Trustees (or the Managing Agent).
Owners in a Body Corporate need to be aware of their responsibilities which inter alia include:
● Advising the BC of the change of ownership
● Use the section for the original purpose as designated on the sectional title plan
● Insure the contents of your flat
● If upgrades or renovations have been affected to the inside of the flat then an owner ought to increase the building insurance for his/her particular section and pay any additional insurance due.
● Comply with all the relevant local and municipal law applicable to the Scheme including adherence to the Management and Conduct Rules
● Use the Common Property without a disturbance or interference with others
● Ensure the best quality of tenants ensuring that the tenants, their guests,their staff comply with the BC Rules. In this regard owners should ensure that their rental agents are handed a copy of the BC Rules and that it is very prudent to make these Rules a part of the Lease Agreement thus bringing the tenants up to speed with the Rules.
● Pay all levies and contributions on time. A debit order is often completed with the Managing Agent, but a stop order for these payments can be done.
● Attend all the AGM and special meetings; if not appoint a representative on your behalf called a proxy.
● Attend Trustee meetings if you wish to, to discuss matters of concern where an owner may speak but not vote at the Trustee meeting.
● familiarize yourself with the Sectional Titles Act especially if you are a Trustee and seek legal advice especially where the body corporate wants to perform something of a legal nature.
● Choose a qualified managing agent capable of running with sectional title affairs and who has experienced portfolio managers.
Should you be in the market for a sectional title unit please do not hesitate to contact Meyer De Waal or Mark Witzmann who can address any questions you may have and assist you in making Life a bit easier in the World of Sectional Title.

Prepared by Mark Witzmann mark@oostco.co.za
021- 461 0065 http://www.oostco.co.za

With special thanks and collaboration with

Shirley Baillie, the author of KEY WORD ACCESS TO THE SECTIONAL TITLES ACT AND PRESCRIBED RULES, which, with its comprehensive INDEX comprising 24 pages of “key words”, with relevant clause number/s & corresponding page number/s will immediately allow you to find any and all aspect/s that you require. http://www.sectionaltitlesact.co.za

Contact Shirley – 021- 554 5643 0r 082 446 4267 sbaillie@worldonline.co.za

Apart from saving you time, it makes your Sectional Title life simpler,
more professional in your role as owner or trustee and empowers you to take control of your investment.

 
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Posted by on 15/09/2014 in Content

 

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