Stad Tshwane Metropolitaanse Munisipaliteit (voorheen bekend as Stadsraad van Pretoria) v Body Corporate Faeriedale

The respondent was the body corporate of the Faeriedale Sectional Title Scheme. A tree was cut down by employees of the appellant (City of Tshwane Municipality, previously City Council of Pretoria) which fell and caused damage to units 1 and 2 (including their roofs) and the boundary wall of the complex. The respondent instituted action in the Magistrate's Court for damages of R53,542.24 plus interest and costs. The body corporate had insured the property and the damage was ultimately repaired on instructions of the insurance company. The units were registered in the names of Mr Le Roux and Mrs Badenhorst respectively, not in the name of the body corporate. Only quantum and the respondent's right to claim the damages were in dispute at trial. The Magistrate found in favour of the respondent. The appellant appealed only against the finding that the respondent had locus standi to sue for damage to individual property (as opposed to common property). The Transvaal Provincial Division dismissed the appeal. The appellant then appealed to the Supreme Court of Appeal with leave.

• Whether a body corporate of a sectional title scheme has locus standi in terms of section 36(6) of the Sectional Titles Act 95 of 1986 to sue for damages in respect of damage to individual units (as opposed to common property)
• The proper interpretation of section 36(6)(c) and (d) of the Sectional Titles Act 95 of 1986
• Whether the body corporate's duty to insure buildings and repair damage extends equally to individual property as to common property
• Whether the respondent was bound by its pleadings which alleged it was the owner of the damaged property

The appeal succeeded with costs. The order of the court a quo was set aside and replaced with an order that the appeal to that court succeeded with costs, and the Magistrate's Court order was replaced with an order dismissing the plaintiff's claim with costs.

A body corporate of a sectional title scheme does not have locus standi under section 36(6) of the Sectional Titles Act 95 of 1986 to institute action as plaintiff for damages caused to individual units/sections (as opposed to common property). Section 36(6)(b) specifically grants locus standi for damage to common property, and the absence of any reference to individual property indicates that such standing was not intended to be granted. Section 36(6)(c) deals with matters for which the body corporate is liable and thus primarily concerns the body corporate's capacity to act as defendant, not plaintiff. Section 36(6)(d) requires that the matter arise from the exercise of the body corporate's powers or the performance or non-performance of its duties - damage caused by a third party's delictual conduct does not satisfy this requirement. The Sectional Titles Act does not impose on the body corporate the same comprehensive repair and maintenance obligations regarding individual property as it does regarding common property; individual owners bear primary responsibility for maintaining and repairing their own units under section 44(1)(c).

The court commented that an insurer does not always have the right to sue in the name of the insured against a third party. One requirement is that the insured must be entitled against the third party to the remedy which the insurer wishes to claim. Sometimes this is not the case (referring to Simpson v Thomson (1877) 3 App Cas 279 (HL) and Ackerman v Loubser 1918 OPA 31). The court also observed that section 37(4), which deems a body corporate to have an insurable interest in the replacement value of buildings, was clearly considered necessary to enable the body corporate to insure individual property - if the body corporate had been obliged by the Act to repair buildings, this provision would not have been necessary. The court noted that the parties had agreed that if the body corporate lacked standing to sue for damage to individual property, the appeal must succeed in full because no proof was led as to what portion (if any) of the damages related to common property, though this was a matter of agreement rather than a legal principle necessarily applicable in all cases.

This case authoritatively establishes the limits of a sectional title body corporate's locus standi to institute legal proceedings under section 36(6) of the Sectional Titles Act 95 of 1986. It clarifies that while a body corporate has clear standing to sue for damage to common property (s 36(6)(b)), it does not have standing to sue for damage to individual units/sections. The judgment provides important guidance on: (1) the interpretation of section 36(6) and the distinction between the body corporate's powers regarding common property versus individual property; (2) the respective obligations of the body corporate and individual owners regarding maintenance and repair; and (3) the proper identification of the 'matter' for purposes of determining locus standi under s 36(6)(c) and (d). The case has practical implications for sectional title schemes, insurers, and third parties who cause damage to sectional title properties, clarifying that claims for damage to individual units must be brought by the individual owners, not the body corporate.