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Hi Padocks Press Fan (aka community scheme intellectual),
We’ve got a wealth of information for you in this month’s newsletter:
- New Courses: Save on the following courses: Sectional Title Scheme Manager, Home Owners’ Association Manager and Start & Manage your own Managing Agency
- Affiliate Program: Exclusive to Managing Agents
- Informative Article: Maximising your chances of a successful CSOS application
- Controversial Article: Jennifer challenges CSOS
- Member Article:
Reluctant Leaders
- Paddocks Club Q&A: Free advice
- Books: Improve your life
NEW COURSES
We’re running three new and improved courses to help you succeed in community scheme management. Click below for more information and pay now to save R1000 with the Early Bird Discount.
• Sectional Title Scheme Manager, 8 weeks, 28 Aug - 22 Oct
• Home Owners’ Association Manager, 10 weeks, 25 Sept - 3 Dec
• Start & Manage your own Managing Agency, 8 weeks, 9 Oct – 3 Dec
MANAGING AGENT AFFILIATE PROGRAM
Managing Agents can join our lucrative affiliate program that will benefit you, your business and your portfolio managers.
Simply email jeff@paddocks.co.za with the subject line “AFFILIATE” and we’ll be in touch with more details.
INFORMATIVE ARTICLE:
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Maximising your chances of a successful CSOS application
Working with Prof. CG van der Merwe, Graham has analyzed numerous CSOS adjudicators' orders in order to prepare the Paddocks CSOS Casebook series of ebooks. Drawing on this experience, in this article he provides advice to owners, trustees, and tenants seeking a favorable outcome from their application to the Community Schemes Ombud Service (CSOS) for an adjudication order to resolve a dispute. By following these suggestions, applicants can enhance their chances of obtaining the best possible result.
Read article by G. Paddock
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CONTROVERSIAL ARTICLE:
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Is the Chief Ombud legally entitled to do this?
On 14 March 2023 the Community Schemes Ombud Service issued a Draft Practice Directive proposing 12 new prayers for relief and orders in respect of section 39(7)(b) of the CSOS Act, which, if the Draft Practice Directive is finalised, will purport to expand the scope of adjudication orders provided for in section 39 of the CSOS Act.
Jennifer Paddock challenges the CSOS’s jurisdiction to implement this Practice Directive.
Read article by J. Paddock
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PADDOCKS CLUB MEMBER ARTICLE:
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Reluctant Leaders: A Successful Sectional Title Leadership Transition
In the intricate world of sectional title schemes, ensuring effective leadership is pivotal. This article recounts an intriguing and genuine case study of a small sectional title scheme confronted with a unique challenge: the election of a chairperson from a group of newly elected, yet reluctant, trustees. It examines the problem-solving approach adopted by these trustees and how they navigated their way through this predicament, offering valuable insights into shared leadership dynamics within a body corporate.
Read article by A. Boersma
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LEGAL ADVICE THAT COSTS LESS THAN A CUP OF COFFEE PER DAY
Paddocks Club is the most affordable way to get quick (24hr turnaround) advice from legal experts on sectional title/HOA issues. Join for as little as *R200 month to month, no lock-in.
JOIN PADDOCKS CLUB
Here are two recent Q&A’s from Paddocks Club:
1) Can trustees decline an owner’s extension?
Question:
"
I have a Body Corporate where an owner is wanting to extend their section by 22sqm. They have drawn plans and presented them to the trustees. The trustees however will not approve the extension. I advised that it should be presented at the AGM for owners to vote. They have advised that they do not feel the need as trustees can decline.
I am concerned that the dismissal is unfair – can you please point me in the direction of the STSMA to advise the trustees or advise if they are correct?"
Answer:
Section 5(1)(h) STSM Act provides that if the Body Corporate authorises a section extension application by special resolution, the Body Corporate must approve the section extension.
In this case, the trustees are not entitled to decline the section extension application without taking it to the body corporate to vote on by special resolution. And if the body corporate does approve the section extension application by special resolution, the trustees will not be able to reject it.
For more information please see Graham’s writing on section extensions in the Sectional Title Survival Manual.
2) Can we re-allocate reserve funds from the approved budget?
Question:
"When our Reserve Fund budget was approved at our AGM in October 2022, we had allocated R174 000 for one line item, based on a quote we had received in 2020. However, we now find that the work is going to cost R279 220. We have the option of postponing the work, or of allocating the amounts budgeted to other line items (which are not urgent) to this work. The total Reserve Fund budget for this financial year is R342 332. The trustees would like to proceed with the work as it is the most pressing item on our maintenance list.
What process do we need to follow? Do we email the owners and see whether the majority would support revising the Reserve Fund budget before the end of the financial year and before the next AGM, to enable us to proceed with this large project? Or do we have to call a SGM?"
Answer:
PMR 9(c) places a positive obligation on the trustees to “apply the body corporate’s funds in accordance with budgets approved by members in general meeting”. So, generally, the trustees are not entitled to deviate from the approved reserve fund budget. However, PMR 24(5)(b) may provide a solution as it allows the trustees to deviate from the approved reserve fund budget if the trustees resolve that such payment is necessary for the purpose of an urgent maintenance, repair or replacement expense (see the categories listed in PMR 24(5)(b)(i)-(iv) for more info).
If the expense can be justified by the trustees as urgent maintenance/repair/replacement, they can resolve to spend the money from the reserve fund despite it being a deviation from the approved budget. However, if they do this, they must ensure that the amount spent does not exceed the amount necessary for the purpose for which it is expended, it must not exceed any limitation imposed by the body corporate on expenditure or be contrary to any other direction/restriction [PMR 24(6)], and the trustees must report to the owners on any such expenditure asap after it is made [PMR 24(5)(iv)].
BOOKS TO IMPROVE YOUR LIFE
“The worth of a book is to be measured by what you can carry away from it” - James Bryce
With winter setting in, now is a great time to read by the fire and gain the knowledge you need to enhance your community scheme life.
BEST SELLING BOOKS
GOT AN ISSUE?
We’re here to help. Visit paddocks.co.za and checkout our articles and resources, or email info@paddocks.co.za and one of our legal consultants will get back to you.
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