Directors of Falcon View Homeowners Association v M.T. Ntebe and S.P. Mgakelana

The applicant, the Directors of Falcon View Homeowners Association (FVHOA) NPC, is the governing homeowners association of Falcon View HOA in Hartbeespoort, North West. The respondents, M.T. Ntebe and S.P. Mgakelana, are the registered owners of unit 678/103 within the scheme. FVHOA alleged that the respondents had failed to pay monthly levies and related ancillary amounts, including CSOS levies, as required by the scheme’s rules and management provisions. A final letter of demand dated 9 August 2023 was sent to the respondents, but payment was not made. When the application was lodged, the arrears were stated as R9 558.43, but in final written submissions the applicant updated the amount due to R11 350.84 as at 1 November 2023. The respondents filed no submissions despite being invited to do so. The matter proceeded on the papers under the CSOS Act.

• Whether the respondents, as owners within the Falcon View HOA, were bound by the HOA’s rules and management provisions requiring payment of levies.
• Whether the applicant proved on a balance of probabilities that the respondents were in arrears and liable for payment of R11 350.84 in levies and ancillary amounts.
• Whether relief should be granted under section 39(1)(e) of the Community Schemes Ombud Service Act 9 of 2011 for payment of a contribution or other amount due to the association.
• Whether any order should be made regarding costs and the manner of payment of the arrears.

The application was granted. The respondents were ordered to pay R11 350.84 to the applicant in four equal instalments of R2 837.71, commencing on 1 December 2023 and thereafter on the first day of each subsequent month until 1 March 2024. The order expressly did not affect the respondents’ ongoing obligation to pay regular monthly levies and ancillary charges. No interest would accrue during the permitted payment period, but if the respondents defaulted, the full outstanding amount would become immediately payable. No order as to costs was made.

An owner of property within a homeowners association is bound by the association’s MOI and rules upon acquiring ownership, and is obliged to pay levies and ancillary charges lawfully raised under those rules. Where the association proves, on a balance of probabilities, the existence of arrear levies and compliance with its internal rules and collection process, and the owner provides no contrary version, relief under section 39(1)(e) of the CSOS Act for payment of the outstanding amount is competent and should be granted.

The adjudicator observed that levies are the 'lifeblood' of a homeowners association and that the directors cannot perform their functions in the absence of funds from members. The adjudicator also noted generally that, apart from original owners who may participate in formulating rules, most owners in community schemes effectively accept an existing regulatory regime if they choose to reside there. These remarks supported the reasoning but were not necessary to the dispositive order.

The matter illustrates the enforcement powers of the Community Schemes Ombud Service under section 39(1)(e) of the CSOS Act in relation to unpaid levies in a homeowners association. It reaffirms in the community schemes context that owners are bound by the association’s governing instruments and cannot avoid levy obligations once they become owners in the scheme. The adjudication also reflects the practical approach of CSOS in granting payment orders on the papers where the association’s claim is properly documented and uncontested.