Sectional title Management Rules versus Conduct Rules

Sectional title Management Rules versus Conduct Rules                                                                              

One form of property ownership in South Africa is known as sectional title ownership and is governed by the Sectional Titles Act no 95 of 1986 (STA), most recently amended in October 2016. Such fractional ownership allows for property investors to own a sectional title unit within, for example, a residential apartment building, known as a sectional scheme. Individual sectional title units along with the common property fall under the body corporate ‘umbrella’. There are a number of terms important in the sectional title context and these will be explored in future articles, but in this article we’d like to specifically deal with the two sets of rules that are implemented at the formation of a body corporate. These rules are ‘management rules’ and ‘conduct rules.’

Management rules need to be followed by all members of the body corporate, which is made up of all section owners within the sectional title scheme. The management rules outline how the building is to be controlled and administered. Such rules include*:

• the individual sections are to be used in a reasonable manner to the benefit of the building;

• no City law, bylaw, regulations etc should be contravened in terms of the building;

• alterations should be undertaken without detriment to the building or its occupants;

• the building’s exterior should be maintained harmonious.

Conduct rules outline the duties of a sectional title owner as well as occupiers of the building, in terms of their use and enjoyment of the common property. As per the recent amendments to the STA, conduct rules need to be registered with the Community Schemes Ombud Service (CSOS) in order for them to be enforceable. Such rules can include the following, although they differ from body corporate to body corporate*:

• no pets may be kept without permission being obtained from the trustees;

• refuse bins are to be maintained in a hygienic manner;

• nothing can be stored on balconies/patios/stoeps;

• no notices may be placed on sections without obtaining permission from the trustees;

• no flammables may be stored

• the control of pests in individual sections are the responsibility of the section owner.

In the context of residential letting of sectional title units, managing agents need to be in possession of the individual sectional scheme’s conduct rules. Before signing the lease agreement for a particular unit, the tenant needs to understand and agree with the conduct rules, which form an extension to the lease agreement. Rules such as not allowing pets in a section have a fundamental impact on a tenant’s decision to rent a unit and they cannot only become aware of these rules after signing the lease agreement.

As a member of a body corporate managed by Steer & Co, you as a property investor can take advantage of our residential letting services by contacting Teresa Hamilton (Teresa@steer.co.za) and her team who are well placed to offer you a comprehensive letting service. One of the many benefits of being an owner in a body corporate managed by Steer & Co and letting your property through us, is that we provide our letting team with the conduct rules necessary when concluding leases for sectional title units. Please contact Colin Fisher (Colin@steer.co.za) should you wish for us to provide you with a proposal for the comprehensive management of your body corporate.

* as taken from “What Rental Agents Need to Know About Sectional Title” booklet presented by Vivien Marks at a workshop on 2018-03-06.