Ashley Eaton v Trustees of the Carriage Way Body Corporate

The applicant, Ashley Eaton, is the registered owner of a unit in the Carriage Way Body Corporate. Her levy account fell into arrears during 2020. On 22 September 2022, she received a notice reflecting arrears of R7 357.17. She disputed both the balance and the manner in which interest was levied, contending that the body corporate charged interest at 2% per month on arrears in a way she regarded as unfair, excessive, and confusing, particularly where the account was allegedly less than 30 days overdue. She also alleged that the respondent failed to provide her with a copy of the body corporate conduct rules and that when she queried her account she was referred to attorneys. The respondent, the Trustees of the Carriage Way Body Corporate, maintained that levies are payable in advance on or before the first day of each month, that it was authorised under the STSMA and prescribed management rules to levy interest on overdue amounts pursuant to trustee and AGM resolutions, and that the conduct rules had already been supplied as part of a welcome pack and were also available online. The dispute was referred to adjudication under the Community Schemes Ombud Service Act after conciliation failed.

• Whether the contribution or interest levied on the applicant's overdue levy account was incorrectly determined, excessive, unreasonable, or otherwise unlawful under section 39(1)(c) of the CSOS Act.
• Whether the respondent body corporate complied with the STSMA and prescribed management rules in levying interest on overdue contributions.
• Whether the respondent wrongfully denied the applicant access to the body corporate conduct rules, justifying relief under section 39(7)(a) of the CSOS Act.
• Whether the final notice and collection process followed by the respondent complied with PMR 25 and PMR 21(3).

The application was dismissed. The adjudicator ordered, in terms of section 53(1)(a) of the CSOS Act, that the relief sought by the applicant under sections 39(1)(c) and 39(7)(a) be dismissed as misconceived. No order as to costs was made.

A body corporate is entitled to levy interest on overdue contributions where the levies are properly raised under section 3(2) and (3) of the STSMA and the interest is authorised by written trustee resolution in compliance with PMR 21(3), provided the prescribed notice and collection procedures under PMR 25 are followed. Where the evidence shows that conduct rules were supplied or made reasonably accessible to an owner, relief under section 39(7)(a) of the CSOS Act for wrongful denial of access to documents is not warranted.

The adjudicator made general observations about the standard of proof in adjudication proceedings, namely that matters are determined on a balance of probabilities with reference to relevance, credibility, and probabilities. The adjudicator also noted the general statutory duties of a body corporate to establish and maintain administrative and reserve funds and to notify members of their contribution obligations after the AGM. No substantial obiter beyond these explanatory remarks appears from the order.

The decision illustrates the application of the CSOS Act and the STSMA to disputes about levy arrears, interest on overdue contributions, and access to scheme governance documents. It confirms that a body corporate may lawfully charge interest on overdue levies where properly authorised by trustee resolution and AGM processes and where the prescribed management rules are followed. It also shows that a complaint of denied access to rules will fail where the scheme can show that the rules were made available through ordinary governance channels or during the dispute process. While not a High Court precedent, it is useful in community scheme adjudications concerning compliance with PMR 21 and PMR 25.