Trustees of Villa Terezina Body Corporate v Trustees of the Marco Giuseppe Gianoglio Family Trust (IT 125/2014)

The applicant, the Trustees of Villa Terezina Body Corporate, is the body corporate of a residential sectional title scheme in Umhlanga, Durban, established under the Sectional Titles Schemes Management Act 8 of 2011 (STSMA). The respondent, the Trustees of the Marco Giuseppe Gianoglio Family Trust (IT 125/2014), is the registered owner of Unit 11 in the scheme. The body corporate alleged that the respondent had failed and/or refused to pay levies, contributions and other charges due to the scheme. At the time of the application, the applicant claimed arrears of R81 252.02/R81 252.05, calculated from September 2020 to September 2022. The applicant explained that any legal fee debits that might have offended prescribed management rule 25(5) had been neutralised by corresponding credits so that no interest accrued on them. The respondent did not file a substantive defence to the indebtedness, but an email from Ms Liza Roets stated that the matter had been resolved and that current levies plus additional amounts toward arrears would be paid. The adjudicator requested an updated invoice and, after scrutinising the account, found that two payments totalling R9 000.76 had not been reflected and that January 2023 levies of R2 935.00 were not yet due. Deducting those sums from the updated claim of R83 843.06, the adjudicator determined the amount actually due as R71 907.30 as at 9 December 2022.

• Whether the respondent, as owner of a unit in a sectional title scheme, was liable to pay outstanding levies, contributions and charges to the body corporate under the STSMA and prescribed management rules.
• Whether the body corporate was entitled to relief under section 39(1)(e) of the Community Schemes Ombud Service Act 9 of 2011 for payment of arrear contributions and related amounts.
• Whether legal costs included in the levy account were recoverable where they had not been taxed or agreed as required by prescribed management rule 25(4).
• Whether the adjudicator could grant additional relief under section 39(7)(b) of the CSOS Act in the absence of an order proposed by the Chief Ombud.
• What amount was properly due and payable on the evidence before the adjudicator after accounting for unreflected payments and charges not yet due.

Relief under section 39(1)(e) of the CSOS Act was granted. The respondent was ordered to pay R71 907.30 to the applicant within 30 days of delivery of the order. Relief under section 39(7)(b) was refused. No order as to costs was made.

An owner of a unit in a sectional title scheme is obliged under the STSMA and prescribed management rules to pay levies and contributions lawfully raised by the body corporate, and the body corporate is entitled under section 39(1)(e) of the CSOS Act to obtain an order compelling payment of arrears proved on the evidence. Legal costs are not recoverable from the owner unless taxed or agreed as required by PMR 25(4). An adjudicator cannot grant relief under section 39(7)(b) unless such order has been proposed by the Chief Ombud. The amount ordered must be confined to sums actually due and supported by the accounting evidence, excluding uncredited payments and charges not yet due.

The adjudicator made broader observations that non-paying owners are effectively subsidised by compliant members and that such defaults place unfair pressure on the body corporate's ability to administer the scheme. The order also noted, by reference to authority, that the legislative framework does not permit trustees to compromise levy debts in a manner inconsistent with their statutory obligations. These comments, while supportive of the decision, went beyond what was strictly necessary once the indebtedness and the permissible amount had been established.

The matter is significant in South African community schemes jurisprudence because it reaffirms the strict statutory duty of sectional title owners to pay levies and the corresponding duty of a body corporate to collect them in full for the benefit of the scheme. It also illustrates the limits on recoverability of legal costs under prescribed management rule 25(4), the need for accurate levy accounting, and the restricted scope of section 39(7)(b) of the CSOS Act. The decision aligns CSOS adjudication with High Court authority emphasising that bodies corporate may not simply compromise lawfully due levies outside the statutory framework.