Trustees of Midrand Mews Body Corporate v Pauline Rakgadi Mokgethi

The applicant, the Trustees of Midrand Mews Body Corporate, brought an application under s 38 of the Community Schemes Ombud Service Act 9 of 2011 (CSOS Act) against the respondent, Pauline Rakgadi Mokgethi, the registered owner of unit 11 in the Midrand Mews sectional title scheme. The body corporate alleged that the respondent had fallen into arrears with levy contributions and related charges. It relied on the respondent’s levy history statement and supporting documents including an updated customer ledger, conduct rules, an interest and levy resolution, legal reminders, and a resolution authorising representation. According to the applicant, the respondent owed R32 018.37 as at 3 July 2023, comprising arrear levies and ancillary charges. Conciliation took place on 21 November 2023 but the dispute remained unresolved and was referred to adjudication. The respondent did not seek substantive relief and only indicated that she had requested and received monthly statements.

• Whether the CSOS adjudicator had jurisdiction under ss 38 and 39(1)(e) of the CSOS Act to order payment of arrear contributions and other amounts owed to a body corporate.
• Whether the applicant had provided sufficient proof that the levies and ancillary charges were due and owing by the respondent.
• Whether a unit owner’s liability for levies arises from ownership and resolutions of the body corporate under the Sectional Titles Schemes Management Act.
• Whether ancillary charges, including collection-related administration or legal costs, could lawfully be included in the amount claimed under the management rules and applicable law.
• Whether it was just and equitable to permit payment of the arrears by instalments and to suspend further interest during the instalment period.

The application was upheld. The adjudicator ordered that the respondent owed the applicant R32 018.37 and must pay that amount in 18 equal monthly instalments of R1 778.80. The first payment was to be made within 30 days of receipt of the adjudication order, with the remaining 17 instalments due on the first day of each succeeding month. No interest would accrue during the permitted instalment period, but upon default on any one payment the full balance would become immediately payable with interest. The order did not affect the respondent’s ongoing obligation to pay regular monthly levies and ancillary charges. No order as to costs was made.

A body corporate may obtain relief under s 39(1)(e) of the CSOS Act for payment of arrear levies and related amounts where it proves, by adequate documentary evidence, that the respondent as unit owner is indebted for contributions lawfully raised under the Sectional Titles Schemes Management Act and applicable management rules. Liability for levies attaches to ownership of a sectional title unit and becomes enforceable once properly determined by the body corporate. In the absence of evidence rebutting the body corporate’s records, an adjudicator may grant payment relief and may, in the interests of fairness, regulate the manner of payment by instalments.

The adjudicator observed that contributions levied on members are the 'life blood' of a body corporate and that defaulting owners are effectively subsidised by compliant members. The adjudicator also remarked that failure to pay levies was not condoned, but that practical fairness justified allowing instalment payments without further interest during the repayment period. There is also a passing observation regarding the account statement not reflecting interest, despite the final order stating that the amount included interest, which appears incidental rather than central to the determination.

The decision is significant in the community schemes and sectional titles context because it reaffirms that arrear levies may be recovered through the CSOS adjudication process under s 39(1)(e) of the CSOS Act, and that levy liability is an incident of ownership in a sectional title scheme. It also illustrates the evidential burden on a body corporate to prove arrears with documentary support, while recognising the practical discretion of an adjudicator to structure payment in instalments where fairness requires. The order further confirms that, where authorised, ancillary recovery-related charges may accompany the levy claim.