The applicant, Russel McKelvey, is the owner of Unit 24 in Clifton Mews and holds a registered section 27 exclusive use area (EUA). Common-property roads in the scheme were found to encroach on the EUAs of the applicant and certain other owners. At a Special General Meeting held on 22 February 2023, a resolution was unanimously adopted that owners whose EUAs were encroached upon should be compensated by the body corporate. The trustees did not implement that resolution and instead placed the matter before the Annual General Meeting on 19 July 2023 for a fresh vote. At the AGM, owners voted on three options: compensate the affected owners; do not compensate and instead create rights of way over the encroached portions; or refer the issue to CSOS. The majority voted for no compensation and for rights of way to be created. The body corporate also indicated an intention to amend the sectional title plan and cancel the existing EUA layout so that the encroached land could be incorporated into common property without compensation. The applicant challenged the AGM resolution as invalid, void, and as unreasonably interfering with his rights.
The relief sought by the applicant was granted. The adjudicator declared in effect that the AGM resolution of 19 July 2023 was invalid/void because it unreasonably interfered with the applicant's registered exclusive use rights. No order as to costs was made.
A registered section 27 exclusive use area constitutes a real right in immovable property. A body corporate or trustees cannot lawfully transfer, cancel, diminish, or convert that right, including by creating rights of way over it, through a general meeting resolution without the written consent of the owner and compliance with the requirements of section 27(4) of the Sectional Titles Act. Accordingly, a scheme resolution purporting to do so is invalid, void, and may be set aside under sections 39(4)(c) and 39(4)(e) of the CSOS Act as an unreasonable interference with individual rights.
The adjudicator made broader observations that community schemes are founded on self-regulation and that courts or tribunals should not lightly interfere with such governance arrangements. The adjudicator also referred generally to the contractual nature of scheme membership, citing Mount Edgecombe Country Club Estate Management Association Two (RF) NPC v Singh and others, and noted that a body corporate may pass later resolutions revoking earlier ones provided they comply with applicable rules and the law. These remarks provided context but were not the direct basis for the dispositive finding.
The matter is significant for South African community schemes and sectional title law because it confirms that a body corporate cannot, by majority resolution alone, extinguish, reduce, or convert a registered section 27 exclusive use area into a right of way or otherwise appropriate it for common use. It underscores the distinction between registered section 27 EUAs as real rights and rule-based section 27A rights as personal rights, and affirms that CSOS may invalidate scheme resolutions that unlawfully interfere with an owner's registered property rights.