The applicant, Johannes Oosthuizen, was an owner in the Orange Grove sectional title scheme. At the respondent body corporate’s annual general meeting on 1 April 2023, the members resolved to increase the monthly levy to R900 with effect from 1 May 2023. The applicant objected to the increase and complained that the levies were being charged equally to all units rather than according to participation quota. He initially raised other complaints, including issues relating to dogs and meeting minutes, but later amended his CSOS application so that the only relief sought was under section 39(1)(c) of the Community Schemes Ombud Service Act 9 of 2011, namely an order declaring the contribution incorrectly determined or unreasonable and directing its adjustment. The respondent, through its chairperson, contended that the levy increase was discussed and approved at the AGM by a vote of 7 to 1, that the scheme faced financial pressures including cash-flow problems and infrastructure expenses, and that the applicant was in arrears. However, no evidence was produced that the body corporate had lawfully adopted a special resolution, with the necessary written consent of adversely affected owners, to depart from levy contributions based on participation quota.
The adjudicator declared that the respondent’s method of calculating and charging monthly levies equally across all units was not in accordance with section 11(1) of the STSMA. The trustees were directed to adjust the levy calculation and charge members according to the participation quota schedule reflected on the sectional plans, with effect from 1 April 2024. No order as to costs was made.
Under section 11(1) of the Sectional Titles Schemes Management Act, owners’ contributions to a body corporate must be levied in proportion to their participation quotas unless there is a valid variation in terms of section 11(2), which requires a special resolution and the written consent of any owner adversely affected. A mere AGM vote approving a uniform monthly levy amount does not lawfully justify equal levies for all units where participation quotas differ.
The adjudicator remarked that the applicant’s alleged information from CSOS that levies may increase by only 10% per year was incorrect. The adjudicator explained that while Prescribed Management Rule 21(3)(b) limits trustees acting by written resolution to a 10% increase at year-end, members at an AGM may impose a larger increase if justified by the budget. The adjudicator also noted that allegations relating to assault and other ancillary disputes were irrelevant to the adjudication.
The decision is important in sectional title and community schemes law because it reaffirms that body corporate levies must ordinarily be raised according to participation quota, unless the statutory requirements for a valid deviation are met. It underscores that even where a majority of members support a levy amount at an AGM, that does not by itself lawfully authorise equal contributions across unequal units. The ruling also clarifies the distinction between trustee-imposed interim increases under prescribed management rules and member-approved increases at an AGM.