Directors of Six Fountains Homeowners Association v Maseko B.G (Owner of Unit 588)

The applicant, the Directors of Six Fountains Homeowners Association, brought an application under section 38 read with section 39(1)(e) of the Community Schemes Ombud Service Act 9 of 2011 (CSOS Act) against the respondent, Mr B.G. Maseko, owner of unit 588. The association alleged that the respondent was in levy arrears and initially stated that as at 1 May 2023 the respondent owed R103 134.71. The matter was referred directly to adjudication. The respondent did not file a formal response to the section 43 notice, but material before the adjudicator reflected that he disputed penalties and had lodged a separate CSOS complaint about allegedly unfair penalties, had previously made arrangements to pay R1 000 monthly, and had stopped payments after lodging that complaint. During adjudication, the adjudicator requested further information from the applicant under section 51, including a revised itemised levy statement, details of directors, a signed board resolution authorising the proceedings, a resolution authorising interest charges, approved conduct rules, proof of CSOS registration, confirmation that no parallel legal proceedings existed, and a managing agent service level agreement. The applicant failed to provide key requested documents and explanations, particularly regarding the revised levy statement and corporate authority to institute the proceedings.

• Whether the applicant had established entitlement to an order under section 39(1)(e) of the CSOS Act for payment of outstanding levies or other amounts.
• Whether the applicant had complied with procedural and evidential requirements, including providing a board resolution authorising the application.
• Whether the applicant's failure to comply with a section 51 request justified dismissal of the application under section 53(1)(b) of the CSOS Act.
• Whether the evidence before the adjudicator sufficiently proved the quantum and basis of the amount claimed.

The application for relief under section 39(1)(e) of the CSOS Act was dismissed in terms of section 53(1)(b) because the applicant failed to comply with the adjudicator's section 51 requirements. No order as to costs was made.

An adjudicator may dismiss a CSOS application under section 53(1)(b) where the applicant fails to comply with a requirement imposed under section 51, including requests for information and documents necessary to assess the claim. In a levy-recovery matter under section 39(1)(e), the applicant community scheme must adequately prove both its authority to institute proceedings and the factual and financial basis of the amount claimed.

The adjudicator made broader observations that CSOS is the primary forum for adjudicating community scheme disputes, citing Wingate Body Corporate v Pamba. The adjudicator also commented on the contractual nature of homeowners' association rules and owners' voluntary submission to them, citing Mount Edgecombe Country Club Estate Management Association Two (RF) NPC v Singh and Others. Additional references to CSOS circulars on levies, governance, audited financials, and impermissible rules regarding recovery of CSOS process costs were included, but these remarks were not necessary to the dismissal, which turned on non-compliance with section 51.

The matter illustrates that, although CSOS is the primary forum for disputes in community schemes and levy obligations are generally enforceable under scheme rules and governing documents, an applicant association must still strictly comply with procedural directives and evidential requirements. It is significant for showing that a levy-recovery application may fail where the association does not prove authority to litigate, does not provide an adequately itemised account, and ignores a section 51 request from the adjudicator.