ADJUDICATION ORDER IN TERMS OF SECTION 54

OF THE COMMUNITY SCHEMES OMBUD SERVICE ACT NO.9 OF 2011

Ref: CSOS5973/GP/23

In the matter between

WONDERPARK BODY CORPORATE Applicant

and

SAKHILE FORTUNATE NGCOBO Respondent

ADJUDICATION ORDER

EXECUTIVE SUMMARY.

 Relief applied for in terms of the CSOS Act:

Section 39 (1) (e)
(1) In respect of financial issues-
(e) an order for the payment or re-payment of a contribution or any other
amount.

 Date Adjudication conducted:

26 November 2023.

 Name of the Adjudicator:

Mamiki Mutlaneng.

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 Order:
Partly Granted.

INTRODUCTION

1. The applicant is Wonderpark Body Corporate (“the applicant”), a sectional scheme as

contemplated in Section 2 of the Sectional Titles Schemes Management Act No. 8 of
2011(“STSMA”), and a community scheme defined as such in terms of the Community
Schemes Ombud Service Act 9 of 2011 (“CSOS Act”), which is situated at 262 Rose
Avenue, Riverfalls Office Park, Doringkloof, Centurion, Pretoria, Gauteng.

2. The respondent is Sakhile Fortunate Ngcobo (“the respondent”), who is the registered
owner of Unit 224 within the community scheme, which is situated in 6th Avenue, Capital
Park, Centurion, Pretoria.

3. A letter under cover of an email was sent to the parties on the 6th of November 2023,
confirming that due to the current situation regarding the Covid-19 pandemic, the CSOS is
taking the appropriate precautions against the further spread of COVID-19 (Coronavirus)
and is adjudicating disputes on documents submitted, without the need to meet parties face
to face.

4. The parties were given 5 (five) business days to make submissions.

5. This is an application for dispute resolution in terms of section 38 of the Community

Schemes Ombud Service Act 9 of 2011 (“the CSOS Act”’). The application was made in the
prescribed form and lodged with the Community Schemes Ombud Service (CSOS) by way
of email.

6. The application seeking relief in terms of section 39 (1) (e) of the CSOS Act; is in respect of
financial issues for an order for the payment or re-payment of a contribution or any other
amount.

7. This matter is adjudicated in terms of the CSOS Act and Practice Directive on Dispute
Resolution, 2019 as amended and more specifically the amended Practice Directive dated
23 June 2020 which provides under paragraph 8.2:- “Adjudications will be conducted on the
papers filed by the parties and any further written submissions, documents and information
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as requested by the appointed Adjudicator”. The parties were requested to make written
submissions on or before 13 October 2023. The matter was referred to me on the 21st of
November 2023, and the adjudication was conducted on the 26th of November 2023.

PRELIMINARY ISSUES

8. No preliminary issues were raised.

RELEVANT STATUTORY PROVISIONS

9. Section 1 of the CSOS Act defines-

 "community scheme" as “any scheme or arrangement in terms of which there is shared use
of and responsibility for parts of land and buildings, including but not limited to a sectional
titles development scheme, a share block company, a home or property owner's
association, however constituted, established to administer a property development, a
housing scheme for retired persons, and a housing cooperative and "scheme" has the same
meaning.”
 "dispute" as “a dispute in regard to the administration of a community scheme between
persons who have a material interest in that scheme, of which one of the parties is the
association, occupier or owner, acting individually or jointly.”

10. Section 38 of the CSOS Act provides-

“Any person may make an application if such person is a party to or affected materially by a
dispute.”

11. Section 45(1) provides-

“The Ombud has discretion to grant or deny permission to amend the application or to grant
permission subject to specified conditions at any time before the Ombud refers the
application to an adjudicator.”

12. Section 47 provides-

“On acceptance of an application and after receipt of any submissions from affected persons
or responses from the applicant, if the Ombud considers that there is a reasonable prospect
of a negotiated settlement of the disputes set out in the application, the Ombud must refer
the matter to conciliation.”

13. Section 48 (1) provides-

“If the conciliation contemplated in section 47 fails, the Ombud must refer the application
together with any submissions and responses thereto to an adjudicator.”

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14. In terms of Section 50-

“The adjudicator must investigate an application to decide whether it would be appropriate to
make an order.”

15. Section 51 provides for the investigative powers of the Adjudicator:

“(1) When considering the application, the adjudicator may-
(a) require the applicant, managing agent or relevant person-
(i) to give to the adjudicator further information or documentation;
(ii) to give information in the form of an affidavit or statement; or
(iii) subject to reasonable notice being given of the time and place, to come to the
office of the adjudicator for an interview;
(b) invite persons, whom the adjudicator considers able to assist in the resolution of issues
raised in the application, to make written submissions to the adjudicator within a specified
time; and
(c) enter and inspect-
(i) an association asset, record or other document;
(ii) any private area; and
(iii) any common area, including a common area subject to an exclusive use
arrangement.”

16. The Ombud was of the view that the matter be escalated to adjudication due to failure
by the respondent to send written submissions in terms of section 43 of the CSOS Act,
accordingly, the dispute was referred directly to adjudication on the 21st of November
2023, in terms of section 48 of the CSOS, read with clause 21.5.7 of the Practice
Directive on Dispute Resolution.

SUMMARY OF RELEVANT EVIDENCE

Applicant’s Submissions

17. The applicant’s duly appointed managing agent in terms of the adopted trustees’
resolution, Malissa Naidoo of Pretor Group, submitted that this application is pertaining
to arrear levies in the amount of R 19 885.86 (Nineteen Thousand Eight Hundred and
Eighty Five Rand and Eighty Six Cents).

18. The managing agent further submitted that the required debt collection process was
facilitated with no success by them as authorised by the body corporate.

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Relief sought by the Applicant

19. That the respondent be ordered to settle all the arrear levies in full.

20. That the respondent be also ordered to pay for the recurring future levies every month.

Respondent’s Submissions

21. The respondent failed to make any submissions despite having been served with the
notice of the application on 6 October 2023; however, on or about 6 November 2023,
the respondent in his final submissions averred that he does not understand what this
application is about.

Relief sought by the Respondent

22. No relief was sought by the respondent.

EVALUATION & FINDING

23. I have perused all written submissions.

24. In evaluating the evidence and information submitted, the probabilities of the case
together with the reliability and credibility of the filed witness statements must be
considered.

25. The general rule is that only evidence, which is relevant, should be considered.
Relevance is determined with reference to the issues in dispute. The degree or extent
of the proof that is required is a ‘preponderance of probabilities’. This means that once
all the evidence has been tendered, it must be weighted up and determined whether the
applicant has discharged the burden of proving its case on a balance of probabilities.

26. Section 2(1) of the Sectional Titles Schemes Management Act1 (or the STSMA, as
referred to in paragraph 1 of the introduction) provides the following:
“With effect from the date on which any person other than the developer becomes an
owner of a unit in a scheme, there shall be deemed to be established for that scheme a

1
Act 8 of 2011.
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body corporate of which the developer and such person are members, and any person
who thereafter becomes an owner of a unit in that scheme is a member of that
body corporate”.

27. In BAE Estates and Escapes (Pty) Ltd v Trustees for the Time Being of the Legacy
Body Corporate and Another2, the court held that: “Although the subjection of
owners and occupiers in a sectional title scheme to conduct or management
rules, as well as the decisions flowing from their application, can be seen as
contractual in nature, these arrangements flow from the statutory authority
granted to homeowners’ association by the relevant legislation. Furthermore,
apart perhaps from those original owners of units who participate directly in the
formulation or approval of the management or conduct rules, the vast majority of
owners and occupiers of sections in such schemes have no choice but to accept
this regime if they wish to reside in a sectional title scheme.”

28. In law, every owner in a sectional title scheme, such as the respondent is the member
of the applicant’s scheme.

29. The unit owners like the respondent, in this instance, who default on levy payments are
effectively being subsidised by the other members of the body corporate who pay their
levies and ancillary contributions conscientiously every month.

30. The body corporate cannot perform its functions and duties in the absence of funds
from its owners/members.

31. The applicant is seeking the relief in prayer 19, that the respondent be ordered to settle
all the arrear levies in full.

32. In relation to normal contributions section 3 (2) of the STSMA provides:

“Liability for contributions levied under any provision of subsection (1), save for
special contributions contemplated by subsection (4), accrues from the passing
of a resolution to that effect by the trustees of the body corporate, and may be
recovered by the body corporate by an application to an Ombud from the persons
who were owners of units at the time when such resolution was passed.....”.

2
9728/2019) [2020] ZAWCHC 82; 2020 (4) SA 514 (WCC) (4 February 2020).
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33. In the case of the Body Corporate of Central Park v Mosa3, it was held that “The
wording of section 3 (2) of the STSMA eliminates any ambiguity in its meaning as
it specifies that “liability ...accrues from the passing of a resolution to that effect
by the trustees and may be recovered”.

34. Clause 1 of the trustees’ resolution adopted on 11 July 2023 under the heading
“Liability of Contribution” provides that “The levies and charges for the financial
year as calculated in accordance with the estimate of income and expenditure
and as approved by the members at the Annual General Meeting held on the 4
July 2023 is due and payable from date of this resolution and shall be payable in
advance on or before the 1st day of each month in monthly instalments over a
period of twelve months in accordance with the levy schedule attached hereto.

The reserve fund levy contribution due by each owner in terms of his and/or her
participation quota, as budgeted for and as approved by the members at the
Annual General Meeting held on the 4 July 2023, is due and payable from the date
of this resolution and shall be payable in advance on or before the 1st day of each
month in monthly instalments over a period of twelve months in accordance with
the levy schedule attached hereto”.

35. The High Court in the case of the Body Corporate Kleber v Sehube and Another4
held that the liability to pay levies arises when the resolution to pay is raised.

36. Section 3 (1) (a) of the STSMA provides that “A body corporate must perform the
functions entrusted to it by or under this Act or the rules, and such functions include-
(a) to establish and maintain an administrative fund which is reasonably
sufficient to cover the estimated annual operating costs-
(i) for the repair, maintenance, management and administration of the
common property (including reasonable provision for future maintenance
and repairs);
(ii) for the payment of rates and taxes and other local municipality charges for
the supply of electricity, gas, water, fuel and sanitary or other services to
the building or land;
(iii) for the payment of any insurance premiums relating to the building or
land; and

3
[ZAGPJHC] A3064/2021 of 24 November 2021.
4
(GJ) (unreported case no 2021/A3094).
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(iv) for the discharge of any duty or fulfilment of any other obligation of the
body corporate”.

37. Clause 21 of the scheme’s conduct rules under the heading “Financial year, functions
and powers” provides the following:
“The body corporate may, on the authority of a written trustee resolution-
(a) levy members with a special contribution if additional income is required to
meet a necessary expense that cannot reasonably be delayed until provided
for in the budget for the next financial year.
(b) increase the contributions due by the members by a maximum of 10 per cent
at the end of a financial year to take account of the anticipated increased
liabilities of the body corporate, which increase will remain effective until
members receive notice of the contributions due by them for the next
financial year; provided that the trustees must give members notice of such
increased contributions by notice in terms of rule 25, with such changes as
are required by the context.
(c) charge interest on any overdue amount payable by a member to the body
corporate, provided that the interest rate must not exceed the maximum rate
of interest payable per annum under the National Credit Act (2005) Act No 34
of 2005) compounded monthly in arrear)”.

38. Prescribed Management Rule (“PMR”) 21 (3) (c) provides the following:
“The body corporate may, on the authority of a written trustee resolution
charge interest on any overdue amount payable by a member to the body
corporate; provided that the interest rate must not exceed the maximum rate
of interest payable per annum under the National Credit Act (2005) Act No 34
of 2005), compounded monthly in arrear”.

39. It is clear from the above prescribed management rule that the applicant must pass a
resolution as to the interest rate that will be charged on overdue contributions. The
determination of the applicable interest rate is a decision reserved for the applicant.

40. The managing agent furnished the adjudicator with the trustees’ resolution, wherein the
interest rate to be charged on the arrears was determined and it reads as follows:
“It is resolved that any defaulting owner will be held liable for the costs of such
legal action on the attorney and client scale.

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The trustees resolve that the current interest rate is set at 1.5%, (equating to 18%
per annum) which interest shall be calculated daily and capitalised monthly on all
amounts outstanding including, inter alia, debt collection charges, attorneys’
charges, insurance contributions, CSOS contributions, debt control and
administrative letter charges, electricity, water, sanitation, gas contributions (if
levied separately) at the beginning of each month when contributions and other
charges are payable, but is subject to change from time to time in accordance
with the provisions of and limitations or requirements imposed by the applicable
legislation”.

41. In Zikalala v Selma Court5, the court held as follows: “[20] Management rule 25
expressly grants to the body corporate the power to impose levies and
contributions from owners. Where an owner fails in the obligation to pay such
amounts, the body corporate is empowered to take action to recover such
amounts, including interest and costs...”

42. Consequently, I am satisfied that the applicant has discharged the onus of proving, on a
balance of probabilities that the respondent is indeed in arrears with levies in the
amount of R 19 885.86 (Nineteen Thousand Eight Hundred and Eighty Five Rand
and Eighty Six Cents) stipulated in the respondent’s statement of account.

43. On 26 November 2023, the adjudicator exercised powers bestowed upon her by section
51 (1) (a) (i) of the CSOS Act and requested to be furnished with the respondent’s latest
statement of account and same was received.

44. The managing agent furnished the adjudicator with a copy of the expired debt
collector’s certificate confirming that the managing agent was indeed a registered debt
collector as required by the Debt Collectors Council until 19 July 2023; and therefore,
they were entitled to charge debt collection fees until the expiry date of the said
certificate.

45. The applicant is seeking the relief in prayer 20; that the respondent be ordered to pay
for the recurring future levies every month.

46. Section 38 (3) (a) of the CSOS Act specifically states that the application to CSOS for
dispute resolution must include statements that set out the relief sought by the

5
(AR255/2020) [2021] ZAKZPHC 81 (23 September 2021).
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Applicant, and in addition, the relief sought must be within the scope of one or
more of the prayers for the relief contemplated in section 39 of the Act.

47. The Western Cape High Court in the case of Trustees for the Time Being of the
Avenues Body Corporate v Shmaryahu and Another6, held that “the character of
the various types of substantive relief that an Adjudicator is empowered to grant
in terms of the Act appears from the provisions of section 39”.

48. The adjudicator is not empowered in terms of the applicable legislative framework to
make an order as per the relief sought by the applicant in prayer 20.

49. The High Court in the matter of Kingshaven Homeowners' Association v Botha
and Others7 found that an adjudicator is empowered to refuse to grant relief that is not
within the jurisdiction of the CSOS.

50. CSOS is a creature of statute, and the adjudicator is bound to make orders that are
competent and enforceable in terms of the Act.

51. Accordingly, the nature of the relief sought by the applicant in prayer 20 does not fall
within the scope of the prayers for relief contemplated in Section 39 of the CSOS Act;
therefore I am inclined to refuse prayer 20.

COSTS

52. There is no order as to costs.

ADJUDICATION ORDER

53. In the circumstances, the following order is made:-

53.1 The relief sought by the applicant against the respondent insofar as it relates
to prayer 20, is hereby refused in terms of section 54 (1) (a) of the CSOS Act
as it does not fall within the ambit of section 39 of the CSOS Act.

53.2 The relief sought by the applicant against the respondent is granted insofar
as it relates to prayer 19.

6
(A31/2018) [2018] ZAWCHC 54 2018 (4) SA 566 (WCC) (10 May 2018) add paragraph [17],
7
(6220/2019) [2020] ZAWCHC 92 (4 September 2020).
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53.3 The respondent, the registered owner of the unit within the community
scheme, is liable to the applicant with the arrear levies in the amount of R
19 885.86 (Nineteen Thousand Eight Hundred and Eighty Five Rand
and Eighty Six Cents) inclusive of interest and debt collection fees charged
thereon.

53.4 The respondent is ordered to pay the amount of R 19 885.86 (Nineteen

Thousand Eight Hundred and Eighty Five Rand and Eighty Six Cents) in
12 (twelve) equal monthly instalments of R 1 657.16 (One Thousand Six
Hundred and Fifty Seven Rand and Sixteen Cents).

53.5 The first payment shall start on the 1st of January 2024, thereafter, payment
of the 11 (eleven) outstanding instalments must be made on the 1st day of
the succeeding months.

53.6 No interest shall accrue to the outstanding amount within this period
allowed for the payment.

53.7 The above order does not affect the usual regular monthly levies and
ancillary payments required to be made by the respondent.

53.8 In the event of the respondent defaulting on any 1 (one) payment as

ordered above, the full amount due to the applicant shall become
immediately due and payable by the respondent.

53.9 No order as to costs.

RIGHT OF APPEAL

54. Section 57 of the CSOS Act, provides for the right of appeal-

“(1) An applicant, the association or any affected person who is dissatisfied by an adjudicator's
order, may appeal to the High Court, but only on a question of law.

(2) An appeal against an order must be lodged within 30 days after the date of delivery of the
order of the adjudicator.

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(3) A person who appeals against an order, may also apply to the High Court to stay the
operation of the order appealed against to secure the effectiveness of the appeal.”

DATED AND SIGNED AT JOHANNESBURG ON 26 NOVEMBER 2023.

___________________
MAMIKI MUTLANENG
ADJUDICATOR

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