Sectional Titles

 

What Does It Mean to Be a Sectional Title Owner?

When a person purchases a freehold property, he/she/they become the owners of the property with full title. The ownership of the building and land vests within the title holder. When a person purchases a sectional title unit, they become owners of the unit and the undivided share in the common property of the scheme. 

Know the Difference Between a Section and The Common Property

It is important for a sectional owner to know which parts of a scheme form part of a section and which parts form part of the common property.

  1. A sectional owner has exclusive ownership of his section whereas he only has a form of collective ownership over the common property. The sectional owner has greater authority and power of use and enjoyment in respect of his section (unit) than with regard to the common property.
  2. The cost of maintaining his/her section(unit) is the responsibility of the sectional owner whereas the maintenance of the common property is the responsibility of the Body Corporate.
  3. The participation quota of a residential section is calculated on the basis of the floor area of the section in relation to the floor area of all the residential sections. It is therefore important to know which parts of the building should be treated as part of a section for this purpose.
  4. If a sectional owner decides to procure individual insurance for his section, it is important to know which property is covered by such insurance and this would affect his premium and risk.

The Body Corporate

The Body Corporate consists of the aggregate of sectional owners which forms the central administrative body provided by the legislature for the management of a sectional title scheme. The Body Corporate is an essential part of every sectional title scheme for the management of the scheme.

What is important to note is that the Body Corporate is a juristic person created by statute. A body corporate:

  • has a legal personality;
  • can acquire rights and liabilities and own assets apart from its members;
  • has perpetual succession’; and
  • can sue and be sued in its own name as far as permitted by law.

Although Body Corporates have a legal personality, it can only have the legal status and powers conferred by it by the Sectional Titles Act and the Sectional Titles Schemes Management Act. It can only operate within the legal framework of the legislation in question. If the legislation clearly and exhaustively deals with the matter concerned.

Funds and Contributions

A Body Corporate is required to establish an administrative fund and a reserve fund, reasonably sufficient to cover its expenses. The Body Corporate has to make a budget for the repair, upkeep, management and administration of the common property, payment of taxes and other local authority charges for electricity, gas, water, fuel, sanitary and other services to the building/s and land, any premiums of insurance, and sufficient for the discharge of the duties it may have. The trustees of the Body Corporate may pass a resolution in respect of special levies and the interest rate charged on arrear levies. It has become increasingly prevalent that Body Corporates have adopted higher interest rates as a penalty. If a member of the Body Corporate believes that the Body Corporate is not fulfilling it’s duties, he/she may take issue with the payment of levies.