BODY CORPORATE LEVIES
A brief overview on body corporate levies
Body corporate levies are often overlooked when buyers of sectional title units purchase property. Body corporate levies are the levies that a body corporate is entitled to charge to each individual owner of a sectional title unit in a complex.
In order to understand body corporate levies, you need to understand what a body corporate is. A Body corporate is administrative bodies made up of owners of a group of units in a complex or developed flats.
If you purchase immovable property which is a sectional title unit, that property will form part of a body corporate, and various responsibilities arise from that consequential “membership”.
Body corporates at their inception or any time thereafter can choose to manage themselves or they can appoint an agent or manager. These agents or managers perform all the functions on behalf of the owners. Relevant to this article is the collection of body corporate levies.
The owners of the body corporate must, in terms of section 39(1)(a) of the Sectional Titles Act 2 of 2009 as amended (“the Act”), establish a fund for purposes of, but not limited to the maintenance of these premises, payment of rates and taxes, other local authority charges, premiums of insurance and various other costs that need to be shared by the owners who share common expenses in respect of the premises.
Once the Fund for the body corporate has been established, each individual owner is legally bound by statute (the Act) to pay these levies. In terms of section 46(1)(h) an owner MUST:
…pay, when due, all charges (including contributions), expenses, and assessments that may become payable in respect of his or her section.
Body corporate levies are calculated by using the participation quota of each individual unit and dividing the annual budget of the body corporate by each unit (based on their quota), per month.
There are two types of levies. Administrative levies are for the maintenance of the property and can be viewed as normal levies. There are also special levies payable by owners as determined by the trustees. Special levies may include the painting of the premises.
What most owners want to know is whether they can be sued for these levies. The answer is yes. In terms of the regulating statute, these levies may be recovered by the body corporate by action in any court and the body corporate may recoup its legal expenses, collection commission, expenses, and charges incurred in relation to the recovery of arrear levies.
We strongly advise that you obtain professional advice from a legal practitioner who specializes in body corporate matters and the collection of monthly levies.