Michael Warwick Heny OBO Settler Sands Body Corporate v Esther Jacobs

Michael Warwick Heny, representing Re/Max Kowie Managing Agents on behalf of the trustees of Settler Sands Body Corporate, brought a dispute-resolution application under section 38 of the Community Schemes Ombud Service Act 9 of 2011 (CSOS Act) against Esther Jacobs, the owner of section 63 in the Settler Sands sectional title scheme in Port Alfred. The body corporate alleged that Jacobs had failed over time to make regular levy payments and that arrear levy contributions in the amount of R6 391 remained outstanding. The applicant stated that requests for payment had been made, internal remedies had been exhausted, and the trustees had resolved to proceed through CSOS to recover the debt. The respondent did not respond to the request for submissions under section 43 of the CSOS Act dated 12 May 2023, nor did she take the further opportunity to file final written submissions. A certificate of non-resolution was issued on 25 July 2023 after conciliation failed, and the matter proceeded to paper-based adjudication.

• Whether the CSOS had jurisdiction under section 39(1)(e) of the CSOS Act to order payment of outstanding levy contributions.
• Whether the applicant body corporate had established, on a balance of probabilities, that the respondent owed arrear levies of R6 391.
• Whether the evidence submitted by the applicant was sufficient to justify an adjudication order for payment of levy contributions.
• Whether any order as to costs should be made in the circumstances.

The application was granted. The respondent was ordered to pay arrear levy contributions of R6 391 to the applicant on or before 31 October 2023. No order as to costs was made.

A body corporate may obtain relief under section 39(1)(e) of the CSOS Act for payment of arrear levy contributions where it establishes, on a balance of probabilities, through adequate supporting documentation, that levies were duly raised and remain unpaid by the owner concerned. An owner is not entitled to withhold payment of levies merely because the owner disputes the underlying decision or wisdom of imposing them.

The adjudicator observed that non-payment of levies can seriously destabilise a scheme and negatively affect the collective interests and investments of all owners, since levies fund essential shared expenses such as maintenance, insurance and security. The adjudicator also remarked generally that cost orders are more commonly made in dismissals under section 53 of the CSOS Act and that parties will usually bear their own costs in section 54 adjudications.

The adjudication illustrates the CSOS's role as a statutory forum for the recovery of arrear levy contributions in community schemes and reaffirms the principle that owners in sectional title schemes are obliged to pay duly raised levies. It underscores the financial importance of levy compliance for the sustainability of body corporates and confirms that, where a body corporate submits sufficient documentary proof and the owner does not meaningfully dispute liability, CSOS may grant payment relief under section 39(1)(e) of the CSOS Act.