DO I NEED A COHABITATION CONTRACT WITH MY PARTNER?

Cohabitation is a relationship between two people who choose to live together in a monogamous and stable environment. Couples who decide on cohabitation could do so, prior to getting married, as an alternative to marriage, or while they are still in the process of divorce and are already living with their new partner.

The differences between marriage and cohabitation are as follows:

  1. No legal protection if/when the partnership ends.
  2. Claiming maintenance after a separation could be more difficult/impossible.
  3. No court is required to end the relationship.
  4. Partners won’t necessarily inherit from each other.
  5. Cohabitants cannot insure each other’s property.

What happens if there is no written cohabitation agreement?

  • If there is no agreement on the dissolution of a relationship, a person is only entitled to retain the property which s/he has purchased and owns.
  • The couple would be entitled to share in the property proportionately in terms of the contribution which they have made to the relationship. Each person will need to prove what property they have acquired together in order to get back what they are entitled to.
  • If a dispute arises, a court may be approached for assistance.

How are couples protected in cohabitation?

  • In order to protect the couple in cohabitation, rights and obligations of the couple can be protected by way of entering into a cohabitation agreement. The agreement regulates the relationship during its existence and after it has come to an end.
  • A cohabitation agreement can be entered into verbally or in writing. It is recommended that such an agreement be concluded in writing and signed.
  • The agreement can be concluded at any time during the relationship.

A cohabitation contract

If two partners have decided to live together it would be beneficial to have a contract drawn up. These are some elements the contract could contain:

  1. Household expenses: Who is responsible for paying what and from whose account?
  2. Joint property: If you want joint assets rather than separate assets.
  3. Joint home: If you want a home to be registered in both names of the partners, however, the partners don’t have to have equal shares in the property.
  4. End of relationship: Deciding what will happen with each other’s assets after the relationship ends and whether or not one partner will be able to receive maintenance from the other.
  5. Children: If there’s a child, the parental rights and responsibilities should be set out, but this has to be done with legal advice first and should be registered.

Conclusion

Cohabitation can be successful in and of itself, but without a contract, there are no ‘safety nets’. This could prove a mistake in relationships where property or a child is involved.

Reference:

  • Anderson, AM. Dodd, A. Roos, MC. 2012. “Everyone’s Guide to South African Law. Third Edition”. Zebra Press.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

CO-OWNING PROPERTY WITH SOMEONE ELSE: THE UPS AND DOWNS

What is co-ownership?

Co-ownership is when one or more people jointly own the same property. In essence, it is when they legally share ownership without dividing the property into physical portions for their exclusive use. It is thus commonly referred to as co-ownership in undivided shares.

It is possible to agree that owners acquire the property in different shares; for instance, one person owns 70 percent and the other 30 percent of the single property. The different shares can be recorded and registered in the title deeds by the Deeds Office.

The benefits

On paper, it’s a great idea. For starters, the bond repayments and costs of maintaining the home are halved. However, there can be problems and although not every friendship or relationship is destined to disintegrate, there does often come a time when one of the parties involved wants to sell up and move on to bigger and better things.

The risks

If ownership is given to one or more purchasers, without stipulating in what shares they acquire the property, it is legally presumed that they acquired the property in equal shares.

The risks, the benefits and the obligations that flow from the property are shared in proportion to each person’s share of ownership in the property. For instance, one of the co-owners fails to contribute his share of the finances as initially agreed, resulting in creditors such as the bank or Body Corporate taking action to recover the shortfall.

Having an agreement

If two people own property together in undivided shares it is advisable to enter into an agreement which will regulate their rights and obligations if they should decide to go their own separate ways.

The practical difficulties that flow from the rights and duties of co-ownership are captured by the expression communio est mater rixarum or “co-ownership is the mother of disputes”. It is therefore important that, when the agreement the co-owners entered into does not help them solve disputes, certain remedies are available to them.

The agreement should address the following issues:

  1. In what proportion will the property be shared?
  2. Who has the sole right to occupy the property?
  3. Who will contribute what initial payments to acquire the property.
  4. Who will contribute what amounts to the ongoing future costs and finances.
  5. How the profits or losses will be split, should the property or a share be sold?
  6. The sale of one party’s share must be restricted or regulated.
  7. The right to draw funds out of the access bond must be regulated.
  8. A breakdown of the relationship between the parties.
  9. Death or incapacity of one of the parties.
  10. Dispute resolution options before issuing summons.
  11. Termination of the agreement.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

WHAT DOES THE DEEDS OFFICE DO?

The Deeds Office is responsible for the registration, management and maintenance of the property registry of South Africa. If you are planning on buying a house, it can be useful knowing about the Deeds Office. However, you would use the services of a conveyancer when buying or selling a house. Your estate agent should be able to recommend a conveyancing attorney to register your home loan and transfer a property into your name.

What is conveyancing?

Conveyancing is the legal term for the process whereby a person, company, close corporation or trust becomes the registered and legal owner of immovable property and ensures that this ownership cannot be challenged. It also covers the process of the registration of mortgages.

Steps taken by the conveyancer:

  1. The conveyancer lodges your title deed and other documents in the Deeds Office for registration. These documents will be individually captured on the system. If there is a bond, the conveyancer dealing with the bond will lodge the bond documents with the Deeds Office at the same time as the transfer documents. The transfer, bond and cancellation documents must be lodged in the Deeds Office at the same time to ensure simultaneous registration. If different conveyancers are dealing with registering the purchaser’s bond and cancelling the seller’s bond, then they will need to collaborate.
  2. The Deeds Office examiners go through the documentation that has been submitted, and make sure that it complies with the relevant laws and legislations.
  3. The examiners then inform the conveyancer that the deeds are ready to be registered.
  4. Registration takes place with the conveyancer and Registrar of Deeds present. The transfer of the property is then registered in the purchaser’s name. If there is a bond, it is registered at the same time.
  5. Upon registration, the purchaser becomes the lawful owner of the property. The title deed that reflects this ownership is given to the conveyancer by the deeds office after the registration. Unless a bond has been registered as well, in which case the title deed is given to the bond holder.

The time taken to register a property at the Deeds Office depends on various factors and a number of parties. On average, registering a property transfer takes six to eight weeks, although unforeseen difficulties can cause the period to be extended.

References:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

IS MY TENANT RESPONSIBLE FOR THE WORN OUT CARPET?

There are several damages a landlord can deduct from a tenant’s deposit. However, there are certain household items that will experience normal wear and tear over time. This is referred to as “fair wear and tear”.

Fair wear and tear is seen as damage or loss to an item at the property which happens as a result of ordinary use and exposure over time.

According to the Rental Housing Act, a landlord is free to claim compensation for damage to the property caused by the tenant, except for fair wear and tear.

It’s important to remember that the original condition and age of the item at commencement of the lease agreement needs to be taken into account, and therefore cost of depreciation of the item due to normal wear. Paint fades, doors and walls get scuffed with use, and everything wears or breaks over time, even with a tenant who really cares for the property, and one can’t hold a tenant liable for this.

If a tenant or landlord has a problem, they can go to the Rental Housing Tribunal to resolve it.

The Rental Housing Tribunal

The Rental Housing Tribunal is a useful resource for both landlords and tenants who are dealing with rental property disputes in different forms. Cases that the Rental Housing Tribunal deals with include:

  1. Tenants defaulting on their rent
  2. Failure to repay a deposit
  3. Invasion of a tenant’s privacy
  4. Overcrowding of a rental property
  5. Determining a fair rental amount
  6. Illegal seizing of a tenant’s property
  7. Discrimination against a prospective tenant
  8. A receipt for rent not being issued
  9. Unacceptable behaviour by a tenant
  10. Lack of maintenance and repairs to the property
  11. Illegally refuse a tenant access to the property or interrupt services
  12. Unacceptable living conditions

A general rule of thumb is that, if a tenant has damaged something that does not normally wear out, or the tenant has substantially shortened the life of something that does wear out, the tenant may be charged the prorated cost of the item. The landlord should take into account how old the item was and how long it may have lasted otherwise, as well as the cost of replacement.

Conclusion

Ordinary wear and tear to carpets should not count against the tenant, however large rips or stains would be considered damage. Any deduction for the tenant’s deposit should take into account the age of the carpets, compared with the expected total time of usage.

Reference list:

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

SUSPENSIVE CONDITIONS IN A DEED OF SALE: KNOW YOUR OBLIGATIONS

Imagine signing a deed of sale for your dream house and later discovering that the contract lapsed because you obtained bond approval one day too late. The situation could be worsened if the Seller receives a better offer for the house and accepts that better offer.

If a deed of sale is made subject to a suspensive condition, it will lapse if such condition is not fulfilled in time. This was confirmed in the case of Marais v Kovacs Investments 724 (Pty) Ltd [2009] 1 All SA 174 (C) (hereinafter referred to as “the Marais case”). There is then no contract for the sale of the property between the two parties and the Seller can sell the property to another purchaser.

Examples of suspensive conditions are obtaining bond approval before a certain date, or the sale of the Purchaser’s current property before a certain date. It is very important for both the Seller and Purchaser to take note of the wording of these conditions and ensure that they understand them.

The following is an example of the wording of a suspensive condition relating to a bond, also sometimes referred to as a “bond condition”:

This Deed of Sale is subject to the Purchaser obtaining bond approval from a financial institution for the amount of R1 500 000 before 2 December 2013, failing which this agreement will lapse.

In the above example, if only R1 400 000 is approved before 2 December 2013, in other words R100 000 less than the required amount, then the condition is not met and the contract will lapse. Similarly, if a bond is approved for R1 500 000 but only on 5 December 2013, then the condition is not met in time and the contract will lapse, as was decided in the case of Meyer v Barnardo and another 1984 (2) SA 580 (N).

The parties can however agree to extend the time during which the suspensive condition must be fulfilled. Such extension must be in writing and signed by both the Seller and Purchaser as per the requirements of the Alienation of Land Act 68 of 1981. It must also be done before the time limit of the suspensive condition expires. In the above “bond condition” clause example, this would mean that the parties would have to sign the extension before 2 December 2013 to prevent the Deed of Sale from lapsing. In the Marais case the court held that even if the suspensive condition had been inserted in the contract for the exclusive benefit of the Purchaser, the Purchaser would have had to communicate his intention to waive the requirement before it lapsed.

In the Marais case the parties entered into a written agreement of sale with a suspensive condition that a bond in the amount of R10 149 072 needed to be obtained by 15 August 2005. The Purchaser, however, only obtained a mortgage bond in the amount of R9 650 000, which was granted on 2 August 2005. The respondent’s attorneys argued that the suspensive condition had been substantially fulfilled because the shortfall was, in their opinion, only a “minor shortfall” and therefore an insignificant amount compared to the purchase price. The court did not agree with this and found that it could not be said that the parties intended the suspensive condition to be fulfilled in any way other than what was expressly stipulated in the Deed of Sale. The court found that the contract had therefore lapsed.

If a suspensive condition will not be fulfilled in time, rather take the necessary precautions beforehand to avoid a lapsed Deed of Sale. We advise that you contact a professional for advice in this regard.

Reference list:

  • Kontraktereg, UNISA 2004
  • Self-Study Conveyancing Course for Attorneys, Gawie le Roux, 2013
  • Alienation of Land Act 68 of 1981
  • Marais v Kovacs Investments 724 (Pty) Ltd [2009] 1 All SA 174 (C)
  • Meyer v Barnardo and another 1984 (2) SA 580 (N)

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

MY NEIGHBOUR’S NOISE IS A NUISANCE

So it’s the third night this week you can’t sleep because your new neighbour seems to enjoy playing loud rock music with his band late at night. Normally you wouldn’t mind. However, being kept up till 2am every morning is affecting your productivity at work. You talk with your neighbour, but he doesn’t seem to see a problem. What now?

If a neighbour has a birthday party or is celebrating the festive season, then their behaviour would be considered reasonable. However, if the behaviour of a neighbour has become disruptive or abnormal to the extent that it affects your ability to enjoy your property, then the law supports your concern.

What does the law say about loud neighbours?

There are Noise Control Regulations under the Environment Conservation Act (Act 73 1989). These regulations clearly state that no person (including your neighbour) is allowed to:

Operate or play a radio, television, drum, musical instrument, sound amplifier, loud speaker system or similar device that produces, reproduces or amplifies sound, or allow it to be operated or played so as to cause a noise nuisance.

The regulations also give local authorities (i.e. your municipality) the ability to enter premises without prior notice, on condition it’s at a reasonable time of the day. This would be to inspect the premises and take any action if necessary.

However, before you run off to sue your neighbour it must first be considered whether or not the noise they are producing is reasonable or unreasonable. If you live in a congested city, for instance, noise pollution is common, but a residential area is expected to be quieter.

What makes your neighbour a nuisance?

There are several factors that determine if a neighbour is a “nuisance”. Some of them include:

  1. Excessive loud noise.
  2. Bad odours.
  3. Constant movement of inhabitants.
  4. Smoke, gas or fumes.

However, as mentioned earlier, it’s important to recognise the circumstance of the noise or disruption. Living in a residential area with rowdy neighbours hosting consistently late parties could be considered a nuisance. When judging the actions of your neighbour you should consider the following:

  1. Whether it is temporary or over a long period.
  2. Where the property is situated.

If it’s the festive season, then a lot of festive music and many guests is considered normal. In circumstances such as that it may just be better for you to let it go and wait for the festive season to pass. Being overly sensitive and irritable is not a reason to sue someone.

What can you do?

The first step of any neighbourly dispute should be to approach your neighbour and ask them to stop what’s causing the nuisance, such as telling them to turn down the music. Matters that can’t be resolved peacefully can be brought to a court and an interdict can be obtained against the neighbour.  Legal advice is always beneficial when pursuing legal action so as to determine whether your complaint is valid or whether you’re just too sensitive.

An interdict is a court order that will command the neighbour to stop doing whatever is the cause of the nuisance. The nuisance causing neighbour can also be sued for any damages caused from the nuisance, such as broken property or health problems.

Reference:

Anderson, AM. Dodd, A. Roos, MC. 2012. “Everyone’s Guide to South African Law. Third Edition”. Zebra Press.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

TROUBLE WITH THE NEIGHBOURS

You and your neighbour have been good friends for years; your children have grown up together and you have always thought of him as a reasonable man, but lately you’re not so sure. His trees’ branches overhang into your property, blocking your gutters with leaves, not to mention the root system creeping closer to your home’s foundation. When you confront him, he flatly refuses to do anything about it, since they are, after all, trees he and his wife planted when they bought the property 30 years ago!

The question in everyone’s mind is, what can I do about my neighbour’s trees and plants that are causing damage to my property and discomfort to me? He most certainly has the right to do on his property as he pleases, but what about my right to use and enjoy my property? Surely his enjoyment cannot be at the cost of someone else?

Trees with lateral root systems are often a culprit in neighbourly disputes. In the case Bingham v City Council of Johannesburg 1934 WLD 180, the municipality planted trees along the footpath for beautification purposes. The problem was that they chose to plant oak trees, which have strong lateral root systems that drain the soil surrounding them. The flowers and shrubs in Bingham’s garden died as a result of this, and even worse, the strong root system was making its way to the foundation of his home. Due to the threat to the property (the house) the court ordered the municipality to remove the trees.

In Vogel v Crewe and another [2004] 1 All SA 587 (T) the issue regarding roots was also discussed in court.  Vogel and Crewe were neighbours and Crewe was of the opinion that a tree planted about two metres from the wall, separating the two properties, was the cause of all the problems on his property. According to him the tree’s root system was causing damage to the boundary wall and leaves from the tree were falling into his swimming pool and blocking his gutters and sewage system. The court’s approach was based on an objective test of reasonableness. They took into account the benefits of protecting the tree, being its visual pleasure, shade, and the oxygen it produced, as opposed to the trouble it was causing Crewe. Crewe was not able to prove that the problem with the leaves in his swimming pool, gutters and sewage system was caused by the tree in question, and the court found that the wall separating the two properties could easily be repaired. No drastic action, like removing the tree, was necessary and Crewe failed in his application.

From the above it is clear that the court will only order the removal of a tree should the roots pose a real and immediate threat of damaging the property. They will not order the removal of overhanging branches for the shedding of leaves.

In Malherbe v Ceres Municipality 1951 (4) SA 510 A it was confirmed that should a neighbour’s tree branches overhang or the roots spread into your property and the owner refuses to remove same, you may chop them off on the boundary line.

Hopefully you will be able to resolve tree-related issues with your neighbour in a courteous way, and remember, you also have the right to enjoy your property.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

TRUSTEES OF BODY CORPORATE NOT ALLOWED TO DISCONNECT ELECTRICITY OR WATER SUPPLY TO A SECTION AS A DEBT COLLECTION MEASURE

The default of levy payments is a frequent problem for the trustees of body corporates as well as the managing agent. It is the way in which the defaulting owner is treated and the outstanding debt collected, that will make the difference between a functioning, financially stable sectional title scheme or an impending disaster zone.

In these testing economic times, monthly levy payments are sometimes considered by owners of sectional title sections to be an optional expense in making ends meet on a tight budget. Once an owner has got away with defaulting on one payment, habitual default becomes easy, and more so if the trustees and management agent are slow to react to the failure to pay. The problem is worsened by the fact that the monthly levy is carefully calculated prior to the annual general meeting to be the minimum amount possible, in an attempt to accommodate the owners. However, these small monthly levies could easily accrue over a few months to a significant amount, aggravated by interest and reflected as a substantial outstanding debt.

These non-payers place severe financial restraints on the cash flow of a body corporate which is largely dependent on the timeous monthly payments by all its members to fulfil its monthly obligations to, inter alia, municipalities regarding water and common area electricity usage, security, and general upkeep of the property. If the body corporate does not have large financial reserves on which it can rely in the event of default by its members, the impact of the default can be severe and can cause unnecessary hardship for other owners. There are known instances of special levies raised in order to assist the body corporate in its financial hardship.

Many trustees and managing agents, in order to recover outstanding amounts, revert to taking the law into their own hands by cutting off the water and electricity supply to such members’ sections or units. Some have even passed rules which allow for such actions. Justifications for these actions by trustees and management agents are abundant, but none of these are legally sound or will stand in court.

By withholding the water and/or electricity supply to the section, whether or not it is allowed for in the rules, the trustees and management agent not only disregard the owner’s constitutional rights to access to water as well as the provisions of the electricity act, but also specific stipulations of the Sectional Title Act, Act 95 of 1986 as amended (“the Act”) and confirmed in case law. Such trustees and managing agents expose themselves and the trustees in their personal capacity, to an application by the owner and/or the occupier, against the spoliation of such services, or access with a court order for immediate re-connection. The body corporate or management agent may not interfere with water and electricity services rendered to a section or unit. The penalty will be a cost order, if not granted on a punitive scale, red faces, and a lot to answer to at the next annual general meeting.

The Act clearly stipulates in Section 37(2) that trustees must approach by action any court, including the Magistrate’s court, for recovery of any and all contributions levied under the provision of Section 37(1), which include monthly levies, special levies, interest, and legal costs on attorney and client scale.

The trustees and managing agent have no choice herein. Prompt debt collection action taken against any owner immediately on default, will be the best defence. Therefore the trustees must ensure that the appointed management agent either has a proven track record or a detailed collection policy prior to appointment of such agent. We all know that the wheels of justice turn slowly, and that it can take months for the default judgement to be granted and the warrant issued. By delaying the collection process the outstanding levy account increases exponentially, together with the burden on paying owners.

Therefore, the trustees themselves should keep a watchful eye on monthly payments and ensure that defaulting owners are immediately contacted by the management agent and, if they persist in the default, handed over to competent attorneys for collection. The sooner, the better. The old adage “absentee landlords gather no crops” is fitting, and trustees should ensure that the management agents attend to defaulters speedily and effectively in the interest of both their own property investment and that of the other owners in the sectional title scheme.

For further reading, see the judgement by Blieden J with Serobe AJ concurring in Queensgate Body Corporate vs MJV Claesen delivered on 26 November 1998 in the Witwatersrand Local Division, case number A3076/1998, and case law referred to therein.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

PAY YOUR LEVIES, OR ELSE…

Dear Mr Lawyer

I am the owner of a sectional title, and I have paid my levies every month as required, until the water started seeping through the ceiling of my enclosed balcony into my section when it rains. The leak was clearly emanating from a defect in the common property. I asked the body corporate on numerous occasions to repair the defect, yet after four months of writing letters and sending emails the body corporate still has not done anything to honour this simple request. As a frustrated owner I resorted to desperate measures and employed a contractor to repair the property defect. I settled the bill myself.

May I withhold my levies for a period to set off the money that is owed to me by the body corporate?

Dear Mr Owner

Although this action may sound reasonable, the right to stop paying or to set off a debt against levies is not legally justified and owners are not, under any circumstances, entitled to simply withhold levies.

There is no provision in the Sectional Titles Act 95 of 1986 or the rules that gives an owner the right to withhold levy payments. Even if an owner incurs expense in performing an emergency repair to the common property, and believes that the body corporate owes him money, the owner may only set off the debt against the levies once it becomes liquid.

An amount can only be liquid once it has been agreed upon. An owner cannot set off the amount he believes he is entitled to deduct. The trustees, judge or arbitrator must have confirmed the amount.

If Mr Owner does withhold his levies without the amount being liquid, he is subject to the following sanctions in terms of the prescribed rules:

  • Firstly, the trustees are entitled to charge interest on arrear amounts at a rate determined by them, and so the defaulting owner may receive a larger account, due to the interest on his arrears, than if he had paid his levies.
  • What is more, The Sectional Titles Act imposes a positive obligation on trustees to recover levies from defaulting owners. Not only does the Act empower them to charge interest, the scheme attorneys will most likely issue summons against the defaulter for all costs that the Body Corporate may incur in recovering any arrears.
  • Secondly, the prescribed management rules provide that, except in the case of special and unanimous resolutions, an owner is not entitled to vote if any contributions payable by him in respect of his section have not been duly paid. Therefore, an owner who withholds his levies is unable to vote for ordinary resolutions in respect of the section that he is withholding levies on.

Mr Lawyer, how does an owner deal with a situation where he believes the body corporate is liable for payment?

A dispute must be declared with the Body Corporate by written notice of the dispute or query to the trustees. The trustees or Body Corporate then have 14 days from receipt to resolve the dispute. During this period, the parties should meet to try and resolve the dispute. If there is no resolution after the 14-day period, either party may demand that the dispute be referred to arbitration. The arbitrator must make his/her recommendations in settlement of the dispute within 7 days from the date of commencement of the dispute. The decision of the arbitrator shall be final and binding and may be made an order of the High Court.

It is clear that prescribed processes are in place according to which disputes and related issues can be settled. Not only will this ensure that you act within the legal guidelines, but it will also eliminate unnecessary frustration.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

INFORMAL “DECISIONS” BY HOMEOWNERS’ ASSOCIATIONS

Many homeowners’ associations have strict requirements concerning the aesthetic appearance of buildings on the estate. These include fences and other smaller additions that are not always considered by the homeowner to be building projects in terms of the rules, the Memorandum of Association (MOA) or the Memorandum of Incorporation (MOI). The owners then fail to submit plans and/or drawings for formal approval by the trustees or directors of the association.

Some homeowners knowingly attempt to avoid the prescribed formal process and merely invite a trustee or director for an informal discussion, explaining with waving arms the envisaged building project, be it a fence or a pergola. The nod of approval by the trustee is then held by the homeowner to be “approval” of the planned project.

The courts have ruled as follows with regard to the “consent” granted by a trustee at an informal meeting with the homeowner, where the MOA or MOI of the homeowners’ association clearly dictates a procedure for approval of any building or improvement:

  1. In order for a trustee or director to sign off a plan in his official capacity, a trustee must properly inform himself of the issues which affect the complex as a whole and not simply have regard to his or her inter-personal relationship with the homeowner. In order to be properly informed, a trustee must ordinarily make a decision in committee with the benefit of debate. His decision must consciously have regard to the MOA or the MOI, whichever case it may be, and the long-term interests of the members. Failure by the trustee to do so will imply that the trustee has not applied his mind to all the relevant issues. It may be possible to impute acceptance by a person both in his individual and official capacity.
  1. The nature of the relationship established between homeowners under a MOA or MOI to which each subscribes, constitutes an agreement in terms of which each homeowner submits contractually to the decisions of a body of elected trustees to whom they have conferred the right and power to make binding decisions on matters that affect their relationship inter se, or which generally affect the estate.
  1. It is further important to take note of whether written consent has been granted by the trustee, as such an action by the trustee would be an additional consideration to establish whether a formal decision will be deemed to have been made.

See specifically Hoosen & Others NNO v Deedat 1999 (4) SA 425 (SCA) and Khyber Rock Estate East Home Owners Association v 09 of Erf 823 Woodmead Ext 13 CC, a judgement by his honourable acting justice Spilg in the Witwatersrand Local Division in case number 7689/2006.

An informal discussion regarding the building plans of the homeowner can thus not be deemed as a formal decision made by the trustees of the homeowners’ association, if the homeowner failed to follow the prescribed procedure.

In the event that a homeowner indeed deems the informal consent as a “decision” made by the trustees of the homeowners’ association, the courts will not interfere with the decision made by a homeowners’ body save under recognised grounds of judicial review as applied to a voluntary association whose members have bound themselves to its rules, which include the conferring of decision-making functions on an elected body of trustees. (Turner v Jockey Club of South Africa 1974 (3) SA, SA Medical & Dental Council v McLoughlin 1948 (2) SA 355 (AD) and Marlin v Durban Turf Club & Others 1942 AD 112).

Trustees and directors should therefore take care when having informal discussions with homeowners and insist on the due process, in terms of the rules, the MOA or the MOI, to be followed to the letter. Rather avoid commenting or voicing an opinion except at the appropriate forum – the formal meeting of the trustees or directors where the item is noted on the agenda in compliance with the association’s prescribed formal requirements.

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted. (E&OE)