Trustees of Elwood Body Corporate v ME Mashaba and KM Mkhonto

The applicant, the Trustees of Elwood Body Corporate, is the body corporate of a sectional title scheme situated at 199 Uys Street, Rynfield Ext 106, Benoni, Gauteng. The respondents, ME Mashaba and KM Mkhonto, are the registered owners of Unit 77 in the scheme. The body corporate brought an application under s 38 of the Community Schemes Ombud Service Act 9 of 2011 seeking relief under s 39(1)(e) for payment of arrear levies and ancillary charges. The matter first went to conciliation on 2 October 2023, but remained unresolved and was referred to adjudication under s 48 of the CSOS Act. The applicant submitted an updated customer ledger, a resolution authorising representation, the CSOS application, conduct rules, an interest and levy resolution, and legal reminders. It alleged that, as at 22 November 2023, the respondents owed R33 034.38 in levies, interest, CSOS levies, administration costs, debt collection charges and related ancillary amounts. Despite being afforded an opportunity to respond, the respondents filed no submissions.

• Whether the body corporate proved, on a balance of probabilities, that the respondents were indebted for arrear levies and ancillary charges in the amount claimed.
• Whether the applicant had placed sufficient supporting documents before the adjudicator to justify that the claimed amounts were due and payable.
• Whether the ancillary charges, including interest, administration costs, legal reminders and debt collection charges, were lawfully recoverable under the STSMA, the management/conduct rules, and applicable resolutions.
• Whether relief should be granted under s 39(1)(e) of the CSOS Act for payment of the outstanding amount.
• Whether it was just and equitable to permit payment of the arrears by instalments rather than immediate lump-sum payment.

The application was upheld. The adjudicator ordered that the respondents are indebted to the applicant in the amount of R33 034.38 and must pay that amount in 12 equal monthly instalments of R2 752.87. The first payment must be made within 30 days of receipt of the adjudication order, and the remaining 11 instalments on the first day of each succeeding month. No interest accrues during the permitted payment period, but if the respondents default on any instalment, the full outstanding balance becomes immediately payable with interest. The order does not affect the respondents' ongoing obligation to pay regular monthly levies and ancillary charges. No order as to costs was made.

A body corporate is entitled under the STSMA and s 39(1)(e) of the CSOS Act to recover arrear levies and properly authorised ancillary charges from unit owners where it proves, through supporting records, rules and resolutions, that the amounts are due and payable. Liability for levies is an incident of ownership in a sectional title scheme. Interest on arrears and reasonable collection-related charges are recoverable where authorised by the management rules, trustee resolutions, and applicable law. In the absence of contrary evidence, uncontested documentary proof may suffice to establish indebtedness on a balance of probabilities.

The adjudicator commented that defaulting owners are effectively subsidised by compliant owners because levies are the 'life blood' of a body corporate and the scheme cannot function without such funds. The adjudicator also remarked that, although the respondents' non-payment was not condoned, it was fair and practical to allow repayment by equal monthly instalments. These observations, while explanatory of the remedy, were not essential to the finding of liability.

The matter is significant in the community schemes context because it reaffirms that a body corporate may use the CSOS adjudication process to recover arrear levies and related charges from unit owners, provided it places adequate documentary proof before the adjudicator. It also confirms the principle in sectional title law that levy liability attaches to ownership and that properly authorised interest and collection-related charges may be recoverable. The order further illustrates CSOS's pragmatic remedial approach by allowing repayment in instalments while preserving the body corporate's right to enforce the debt on default.