Trustees of Outeniqua Village Body Corporate v Mmakgabo Maphoto

The applicant, the Trustees of Outeniqua Village Body Corporate, a sectional title body corporate, brought an application under section 38 of the Community Schemes Ombud Service Act 9 of 2011 (CSOS Act) against the respondent, Mmakgabo Maphoto, the registered owner of unit 37 in the scheme. The dispute concerned the respondent’s failure to pay monthly levies and ancillary charges due to the body corporate. The applicant alleged that despite written demands and internal attempts to secure payment through phone calls, text messages and email, the respondent remained in arrears. The applicant submitted a statement of account showing arrear levies of R11 508.06, together with utility costs, CSOS levies and interest charged at 2% per month pursuant to a trustees’ resolution dated 19 April 2022. The respondent filed no submissions in response. The matter was determined on the papers without an oral hearing.

• Whether the CSOS had jurisdiction to grant relief under section 39(1)(e) of the CSOS Act for payment of arrear levies and ancillary charges.
• Whether the applicant proved on a balance of probabilities that the respondent was indebted to the body corporate for unpaid levies and ancillary amounts.
• Whether the body corporate was entitled to recover ancillary charges and interest arising from the respondent’s default, based on the applicable statutory framework and trustees’ resolution.
• What payment order should be made in respect of the arrears.

The application succeeded. The adjudicator ordered that the respondent is indebted to the applicant in the amount of R11 508.06 in respect of levies and ancillary amounts charged as at 8 December 2023. The respondent was ordered to pay that amount in 7 equal monthly instalments of R1 644.01, commencing on 1 April 2024, with the remaining instalments payable on the last day of each succeeding month. The order was stated not to affect the respondent’s ongoing obligation to pay regular monthly levies and ancillary charges. Interest at 2% per month would accrue on any outstanding amount in the event of default, and on any default the full amount would become immediately due and payable. No order as to costs was made.

A sectional title body corporate is entitled, under the STSMA and CSOS Act, to recover unpaid levies and authorised ancillary charges from an owner where it proves the indebtedness on a balance of probabilities. Once validly determined in terms of the scheme’s governance structure, levy contributions become due and payable monthly, and CSOS may grant payment relief under section 39(1)(e) of the CSOS Act. In the absence of contrary evidence, documentary proof such as account statements and resolutions may be sufficient to justify an adjudication order for payment.

The adjudicator observed that owners who default on levy payments are effectively subsidised by other members who pay conscientiously, and that the body corporate cannot perform its functions without contributions from owners. These comments explain the policy rationale for enforcing levy obligations, but were not independently necessary beyond the finding that the debt had been proved. The order also contains an apparent drafting error in clause 50.6, which states, 'In the event that the Applicant fails to make payment in accordance with this order,' when the context indicates that the respondent was intended.

The matter illustrates the CSOS adjudication process for recovery of arrear levies in sectional title schemes and confirms the enforceability of owners’ statutory obligations to contribute to body corporate funds. It is a practical example of the use of section 39(1)(e) of the CSOS Act to obtain an enforceable payment order for levies and ancillary charges. The decision also reinforces the principle that a body corporate’s financial sustainability depends on compliance by all owners, and that uncontested documentary evidence may suffice to establish indebtedness on a balance of probabilities in CSOS proceedings.