21 Jan 2013
When buying into sectional title schemes or estates run by homeowners’ associations (HOA) (which is what is prevalent when units in an estate are sold under full title), one has to be aware of the conduct rules of the scheme, and the relevant parties need to ensure that the rules are known to all those concerned.
This is according to Lanice Steward, managing director of Knight Frank Anne Porter, who says it is the responsibility of the agent to provide the purchaser with the HOA or body corporate rules before the signing of the purchase agreement, and it is then the responsibility of the buyer to read, accept and understand these rules and the implications thereof.
In a recent court case covered in a Smith Tabata Buchanan Boyes newsletter, Kingsmead Office Park Owners Association sued Shasri Investments cc for unpaid levies to the amount of around R200 000, and although this case is a commercial one, the same principle applies to residential property, says Steward.
Each purchaser in this scheme, in terms of the provisions in the sales agreement, was obliged to become a member of the scheme and pay levies which would go towards the maintenance and upkeep of the office park.
The owner refused to pay his levies as he claimed that he did not enjoy the same benefits as other owners in the scheme. He said he did not have, for example, the benefit of the perimeter fence and a park that was contained within the office block development. Further development to the scheme was planned which could include Shasri’s erf in the perimeter fencing and grant it access to the central park, but these had not been finalised.
The courts held that the levies had to be paid and that the buyer, Shasri, was contractually bound to pay the levies owed as he had signed a document in which he became a member and would be bound by the articles of association.
This is of particular importance, says Steward, when it comes to pet ownership, general conduct, noise levels, parking bay allocation and the number of people allowed in each unit.
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