Lusanda Malari v Trustees of Magenta Body Corporate

The applicant, Lusanda Malari, is the registered owner of Unit 89 in Magenta Body Corporate, a sectional title scheme in Centurion. He fell into arrears with levy payments due to financial difficulties. According to his submissions, the body corporate, through its management by Pretor Group (Pty) Ltd, repeatedly handed his account to attorneys, who added legal charges to his levy account. He complained that these legal charges were exorbitant, unexplained, and imposed without engagement with him. He sought an order directing the respondent to remove the legal charges from his levy account so that he could pay the underlying arrear levies. The respondent filed no response. The matter came before the CSOS adjudicator after conciliation failed.

• Whether the body corporate was entitled to debit the applicant's levy account with legal charges incurred in collecting arrear levies.
• Whether, under Prescribed Management Rule 25(5), legal costs may be charged to a member's account without the member's consent or the authority of a judgment or order.
• Whether legal costs must be taxed or agreed before they become recoverable from a member under Prescribed Management Rule 25(4).
• Whether the applicant was adversely affected by the imposition of legal charges without prior consent or proper authority.

The application was upheld. The respondent was ordered to claim and recover from the applicant only the levies and interest, if applicable, and not legal costs unless it has the member's consent or the authority of a judgment or order by a judge, adjudicator or arbitrator, and the bill has been taxed by the taxing master. No order as to costs was made.

A body corporate may recover arrear levies and applicable interest from an owner, but it may not debit the owner's account with legal costs incurred in collection proceedings unless those legal costs are recoverable under the prescribed rules: specifically, the owner must have consented or there must be authority in the form of a judgment or order by a judge, adjudicator or arbitrator, and the legal costs must be taxed or agreed before they are due and payable.

The adjudicator's broader discussion of unanimous resolutions under section 10(2)(a) of the STSMA, adverse effect on members, and the Marine Sands case's reasoning on increases in levy burdens appears to go beyond what was strictly necessary to decide the narrow issue of whether legal costs could be debited to the applicant's account under PMR 25(5). The judgment also made general observations about fairness, audi alteram partem, and protecting owners from burdens imposed by a scheme without proper process.

The decision affirms an important protection for sectional title owners in CSOS proceedings: a body corporate may not unilaterally load legal fees onto an owner's levy account unless the requirements of the STSMA rules are met. It underscores the application of PMR 25(4) and 25(5), and aligns CSOS adjudication with higher-court authority that legal costs must be agreed, taxed, or otherwise properly authorised before they are recoverable. The case is significant in practice because levy-collection costs are frequently disputed in sectional title schemes.