In shared living environments such as residential and commercial sectional title schemes, the establishment of body corporates is central to effective property management. These entities, comprising all sectional title owners within a scheme, manage common property, enforce rules, and oversee shared resources. 

However, shared ownership often breeds conflict—over levies, maintenance duties, or governance matters. Historically, resolving these disputes required costly and protracted litigation. Recognising the need for a more accessible forum, the Community Schemes Ombud Service (CSOS) was established under the Community Schemes Ombud Service Act of 2016 to provide impartial and cost-effective dispute resolution. 

This article explores common body corporate disputes, owners’ legal rights, and the critical role of CSOS in fostering fairness and transparency within sectional title schemes. 

Understanding Body Corporate Disputes 

Body corporate disputes typically fall into two main categories: 

• Financial and Administrative Disputes: Disagreements over levy calculations, alleged misuse of funds, poor record-keeping, or lack of transparency in financial reporting. 
• Physical and Operational Disputes: Conflicts over maintenance of common property, unauthorised structural alterations, or enforcement of scheme rules. 

Because body corporates wield quasi-governmental powers, disputes can be highly contentious. An impartial body like CSOS is therefore essential to address these issues fairly and efficiently, offering a specialised alternative to litigation. 

Owners’ Legal Rights Against a Body Corporate 

While body corporates are entrusted with managing schemes, their powers are limited by law. Owners retain several statutory rights under the Sectional Titles Schemes Management Act (STSMA) and its regulations. Awareness of these rights is key to safeguarding owners from unfair conduct. Key rights include: 

• Access to Financial Records: Owners may inspect budgets, financial statements, and levy expenditure reports. Refusal to provide these can be challenged through CSOS. 
• Challenge Unfair Levies: Levies must be calculated fairly and in line with participation quotas. Excessive or miscalculated levies may be referred to CSOS. 
• Participate in Decision-Making: Owners vote on key resolutions at general meetings; major decisions require proper owner approval. 
• Fair Rule Enforcement: Rules must be applied consistently and without discrimination. Unreasonable or procedurally unfair rules can be challenged. 
• Accountability of Trustees: Trustees must act within their mandate and in the scheme’s best interests. Owners can call meetings to remove trustees or escalate complaints to CSOS. 

These rights serve as checks and balances, empowering owners to demand transparency and accountability from their governing structures. 

The Role of Community Schemes Ombud Service 

While these rights exist, enforcing them often requires an independent forum. CSOS provides such a platform, offering affordable, specialised dispute resolution and promoting sound governance in community schemes. Its key functions are: 

• Mediation and Dispute Resolution: CSOS facilitates negotiation between parties, preventing escalation into costly litigation. 
• Adjudication and Compliance Enforcement: It can issue binding orders, enforce the STSMA and scheme rules, and direct parties to comply with legal obligations. 
• Education and Awareness: CSOS educates owners, trustees, and managing agents about their rights and duties, reducing disputes through improved legal literacy. 
• Policy Development: It contributes to law reform and policy initiatives, strengthening the regulatory framework for community schemes. 

Through these functions, CSOS promotes fairness, transparency, and legal compliance in sectional title governance. 

Internal Dispute Resolution Mechanisms 

Before approaching CSOS, owners must first exhaust reasonable internal remedies. The STSMA requires schemes to adopt management and conduct rules that serve as a first line of defense against disputes. Common internal mechanisms include: 

• Rule Enforcement by Trustees: Trustees must consistently apply scheme rules to maintain order and prevent disputes. 
• Fines (with Due Process): Schemes may impose fines for rule breaches, but only if these are clearly defined and procedurally fair. 
• Negotiation: Informal discussions between affected parties can resolve conflicts quickly and should be documented. 
• Mediation or Conciliation: A neutral third party may help parties reach non-binding yet mutually acceptable settlements. 
• Arbitration: An arbitrator can issue a binding decision, which remains a viable option for complex disputes. 
• Appointment of a Manager or Administrator: In severe cases of mismanagement or deadlock, schemes may appoint a professional manager or apply to court to appoint an administrator. 

These internal steps encourage early, amicable resolution and show CSOS that reasonable efforts were made before escalation. 

Conclusion 

As communal living becomes increasingly common in South Africa, body corporates play a pivotal governance role—yet they are also prone to conflict. The Community Schemes Ombud Service has become indispensable in safeguarding fairness, transparency, and accountability in sectional title governance. 

By offering mediation, enforcing compliance, and contributing to policy development, CSOS not only resolves disputes but strengthens the long-term governance of community living. A sound understanding of owners’ rights, coupled with effective internal dispute mechanisms and CSOS remedies, is essential for protecting property interests and fostering harmonious communities. 

Written by Ross Hendriks, Specialist Employment and Labour Law, SchoemanLaw Inc