Michelle Kruger obo Hamburg Body Corporate v ES Tebele

Michelle Kruger, acting on behalf of Hamburg Body Corporate as its duly appointed managing agent and representative, brought an application under the Community Schemes Ombud Service Act 9 of 2011 (CSOS Act) against ES Tebele, the registered owner of unit 12 in the Hamburg sectional title scheme in Mindalore, Krugersdorp. The body corporate alleged that the respondent had failed to pay levy contributions over a period of time. The outstanding amount claimed was R43 801.58, inclusive of interest at 24% per annum, as reflected in the application lodged on 18 May 2023. The matter proceeded through the CSOS dispute-resolution framework, including the issuing of a certificate of non-resolution after conciliation failed. The respondent did not file a response or otherwise participate in the proceedings despite being notified and given an opportunity to do so. The applicant provided a contribution statement and explanation for the levies raised, and sought an order compelling payment of the arrear levies.

• Whether the CSOS had jurisdiction under section 39(1)(e) of the CSOS Act to order payment of outstanding levy contributions owed by a unit owner to a body corporate.
• Whether Hamburg Body Corporate, represented by its managing agent, had established on a balance of probabilities that the respondent was liable for arrear levies in the amount claimed.
• Whether the body corporate was entitled to recover interest on overdue levy amounts in terms of the applicable management rules and trustee resolution.
• Whether any costs order should be made in the adjudication proceedings.

The application was granted. The respondent was ordered to pay arrear levy contributions of R43 801.58, inclusive of interest. Payment was to be made in 12 equal monthly instalments of R3 650.13, plus interest at 24% per annum, commencing on 1 February 2024 and thereafter on the first day of each consecutive month until the arrears were fully settled. The order stated that this arrangement did not affect the respondent's obligation to continue paying regular monthly levies and related charges. If the respondent defaulted, the full outstanding amount would immediately become due and payable. No order as to costs was made.

A body corporate in a sectional title scheme may obtain relief under section 39(1)(e) of the CSOS Act for payment of outstanding levy contributions where it proves, on a balance of probabilities, that levies were properly raised and remain unpaid by the unit owner. Interest on overdue levies may be charged where authorised by the applicable management rules and trustee resolution. A unit owner's non-participation in the proceedings does not prevent relief being granted if the applicant's evidence sufficiently establishes the debt.

The adjudicator observed that levies are the 'lifeblood' of shared living schemes because they fund maintenance, repairs, insurance, security, and protect the collective investment of owners. The adjudicator also noted, with reference to authority, that an owner cannot withhold levies merely because the owner disputes the necessity or financial wisdom of the decision to impose them. These comments are explanatory and contextual rather than strictly necessary to the order.

This adjudication illustrates the CSOS's role in enforcing bodies corporate's entitlement to recover arrear levies from sectional title owners through the statutory dispute-resolution process. It reinforces the principle that levy obligations are central to the functioning of community schemes and that a defaulting owner cannot simply avoid payment. The order is also practically significant because it confirms that CSOS may grant structured repayment relief while preserving the body corporate's right to immediate payment upon default.