San Martinho Body Corporate SS151/1991 v Hidianete Rita Viana Romao

The applicant, San Martinho Body Corporate SS151/1991, is the body corporate of a sectional title scheme and a community scheme under the Community Schemes Ombud Service Act 9 of 2011 (CSOS Act). The respondent is the registered owner of unit 150 (door 909) in the scheme at 10 Leicester Road, Bedford Gardens, Ekurhuleni, Gauteng. The body corporate alleged that the respondent had fallen into arrears on her levy account. According to the applicant, arrear reminders, a final demand, and notice of referral to CSOS were sent, but the respondent did not remedy the default. The applicant’s managing agent, acting under trustee authority, sought an order under s 39(1)(e) of the CSOS Act for payment of the outstanding amount. The applicant produced a signed mandate authorising the managing agent and an up-to-date levy history statement reflecting arrears to February 2024 in the amount of R55 246.05, inclusive of levies, ancillary charges, CSOS levies and interest. The respondent made no submissions in response to the claim.

• Whether the CSOS adjudicator had jurisdiction under the CSOS Act to determine a levy-recovery dispute between a body corporate and a unit owner.
• Whether the applicant proved on a balance of probabilities that the respondent was indebted to the body corporate for arrear levies and ancillary charges.
• Whether the body corporate was entitled to recover interest on the overdue amounts in terms of the applicable trustee resolution and prescribed management rules.
• What payment order should be made in circumstances where the respondent did not contest the claim or enter into a payment arrangement.

Application upheld. The adjudicator found for the applicant and ordered that the respondent owes the applicant R55 246.05 in respect of arrear levies and ancillary amounts, including CSOS levies and interest, up to and including February 2024 (the order text inconsistently refers once to February 2023, but the evidence and relief sought indicate February 2024). The amount must be paid in 12 equal monthly instalments of R4 603.84 commencing on 1 March 2024, with the remaining instalments due on the first day of each consecutive month thereafter. Interest was held to be included in the outstanding amount. The order does not affect the respondent’s ongoing duty to pay regular monthly levies and ancillary charges. If the respondent defaults on any one instalment, the full balance becomes immediately due and payable. There was no order as to costs.

A body corporate in a sectional title scheme is statutorily obliged under the STSMA to establish and maintain the funds necessary for the scheme’s administration and maintenance, and is therefore entitled to require owners to pay levies and related contributions. Where the body corporate proves, on a balance of probabilities, through uncontested documentary evidence such as a levy account history and proper authority to act, that an owner is in arrears, a CSOS adjudicator may order payment of the arrear levies, ancillary charges and lawfully charged interest under s 39(1)(e) of the CSOS Act. A respondent’s failure to dispute the claim permits the adjudicator to accept the applicant’s version where it is supported by the evidence.

The adjudicator observed that owners who do not pay levies in full and on time are effectively subsidised by owners who pay conscientiously, and that a body corporate cannot perform its functions without funds from unit owners. The adjudicator also repeated judicial observations from prior case law that interest on arrear amounts is intended to compensate for the depreciation in value of money and is the 'lifeblood of finance in modern times'. These remarks provided context and policy justification for levy recovery and interest, but were not strictly necessary beyond the finding that the debt and interest were recoverable.

The matter illustrates the CSOS’s role as an accessible statutory forum for the recovery of arrear levies in sectional title schemes. It reaffirms that body corporates have a statutory duty under the STSMA to raise and collect levies and may recover outstanding levies, ancillary charges and interest from defaulting owners. The order also demonstrates that where a respondent fails to answer a CSOS claim, the adjudicator may accept the applicant’s uncontested evidence if it establishes liability on a balance of probabilities. It is a practical example of enforcement of prescribed management rules and trustee resolutions concerning interest on arrears.