The Algarve Body Corporate v Hanru Jacobs

The applicant, The Algarve Body Corporate (SS 988/95), is the body corporate of a sectional title scheme situated at Mount Fletcher Lane, Paulshof, Johannesburg, Gauteng. The respondent, Hanru Jacobs, is the registered owner of unit 7 in the scheme and therefore a member of the body corporate. The body corporate brought an application to the Community Schemes Ombud Service (CSOS) under section 38 read with section 39(1)(e) of the Community Schemes Ombud Service Act 9 of 2011 for payment of arrear levy contributions. The applicant alleged that the respondent had failed to make regular levy payments and that an amount of R5 525.98, inclusive of interest at 18% per annum, was outstanding. A contribution statement for unit 7 was submitted in support. The matter first went through the CSOS process, and after conciliation failed, a certificate of non-resolution dated 30 October 2023 was issued. The respondent did not respond to the applicant's statement of case or submissions despite notice in terms of section 43 of the CSOS Act and further opportunity to do so.

• Whether CSOS had jurisdiction under the CSOS Act to adjudicate the dispute concerning unpaid levy contributions.
• Whether the body corporate was entitled under the Sectional Titles Schemes Management Act 8 of 2011 and the applicable rules to levy contributions from the respondent as owner of a unit.
• Whether the evidence submitted by the applicant was sufficient, on a balance of probabilities, to justify an order under section 39(1)(e) of the CSOS Act for payment of arrear levies.
• Whether interest on the arrear levies was recoverable.
• Whether any costs order should be made.

The application was granted. The respondent was ordered to pay arrear levy contributions in the amount of R5 525.98 in full on or before 31 March 2024. No order was made as to costs.

A body corporate is entitled to recover duly imposed levy contributions from a unit owner through CSOS under section 39(1)(e) of the CSOS Act where it proves, on a balance of probabilities, the existence and amount of the arrears. Levies validly raised pursuant to the body corporate's statutory powers and trustee resolutions are enforceable, and an owner may not withhold payment because of disagreement with the underlying decision to impose them. Interest may also be charged where authorised by the applicable management rules and trustee resolution.

The adjudicator observed that levies are the 'lifeblood' of shared living schemes and that non-payment can seriously destabilise a scheme by prejudicing maintenance, repair, insurance, security and the collective investment of owners. The adjudicator also made general remarks that parties in section 54 adjudications are ordinarily expected to bear their own costs, with costs orders being more common in dismissals under section 53 for frivolous, vexatious or misconceived applications. No further obiter can be identified from the text.

This decision illustrates the CSOS's role as a statutory forum for the recovery of unpaid sectional title levies and reaffirms that body corporates may enforce levy obligations through section 39(1)(e) of the CSOS Act. It underscores the central principle in sectional title governance that levy payments are essential to the functioning and financial stability of a scheme and cannot be withheld merely because an owner disputes the desirability of the expenditure. The order also confirms that, where a body corporate provides documentary proof of indebtedness and the owner does not respond, CSOS may grant payment relief on the papers.