The deadline is looming for community housing schemes like townhouse complexes, retirement villages and residential estates to register and pay their levies to CSOS (the Community Schemes Ombud Service), which is the property sector’s newest dispute resolution body, advises specialist sectional title attorney Marina Constas.
Constas, who is a director of BBM Attorneys and a CSOS board member, notes that 32 000 community schemes have so far registered. With 818 dispute resolution applications received in the last quarter of 2017, she believes that the organisation is making its mark, and encourages community schemes not yet on board to register now. “Since South Africa has the fourth highest concentration of community schemes in the world, the implementation of the Community Schemes Ombud Service is a very positive development.”
Community schemes are all required to register with CSOS and pay a quarterly levy. “The deadline for registration and to have payments up to date is 30 March this year,” Constas explains.
Elaborating on the dispute resolution process offered, and the costs, she says that owners, tenants, bodies corporate, homeowners’ associations, share blocks and retirement villages may bring their disputes to the Ombudsman’s office. “The Ombud will decide whether the dispute must be dismissed, mediated or arbitrated. If the matter goes as far as arbitration, then the arbitrator’s award can be made as a Magistrates’ or High Court order. It can be appealed on points of law. The fee for applying to the Ombud to resolve a dispute is just R50. Once it reaches adjudication, R100 is payable. If the adjudication is outsourced by CSOS, the private adjudicator will be bound by a daily fee prescribed by CSOS. The CSOS amount payable is based on the development’s monthly levy approved at the AGM. The first R500 of the levy is exempt. Any amount over and above the R500 will attract a CSOS tariff of 2%, capped at R40 per month. In a welcome practice directive from CSOS, the fees and CSOS levy will be waived for any person receiving a Sassa grant, or any person residing in a frail care or mid care facility in a retirement village,” she outlines.
Constas notes that CSOS’s latest quarterly report provides some interesting insights into the complexity of community scheme living, and the role being played by the Ombud Service in making conflict resolution less painful and costly than it used to be. “Disagreements are bound to arise when people are living in close proximity, and as could be expected, most of the cases handled by CSOS in the final three months of last year came from sectional title schemes. Most of the individuals who applied for dispute resolution were aged over 50,” she reveals. Based on the CSOS report, the issues that proved the biggest bugbears for community scheme stakeholders between October and December 2017 were financial issues and disagreements about private and common areas.
Offering quality assurance of community schemes’ governance documentation is also an important aspect of CSOS’s role, she states. This includes ensuring the quality of the rules of existing schemes and approving the rules of new schemes. “Any unreasonable rules which are compiled by trustees will be scrutinised by the Community Schemes Ombud Service, which has the power to withhold a compliance certificate for the rules of the scheme. The legal office of the Ombud Service has indicated that any rules which conflict with the model rules will not be permitted,” she concludes.