Geyser disputes in ST – who pays? – Property24

A Property24 reader wonders if the body corporate’s actions regarding burst pipes and geysers are in accordance with the Act.

We live in a sectional title complex and our body corporate members are owners. There are always disputes in our complex about geysers, for example if a geyser bursts the body corporate would have it replaced and then claim from insurance. However, they would then claim the R500 excess from the owner. This decision was taken at an AGM. I was not present at that AGM, but I have a feeling that they bulldozed the decision via the ignorance of most of the owners.

They made a “rule” that owners have to pay for the replacement of a geyser’s valve should it fail and have to be replaced. They also have a “rule” that if a water pipe inside a wall starts leaking, the cost of repair is for the owner’s account. As all walls that carry water pipes, are outside walls, then surely such pipe replacements must also be insured? All the geysers are above the ceilings and not inside the units.

Is our body corporate’s actions in accordance with the Act? 

Carryn Durham, specialist sectional titles lawyer at Paddocks, advises:

Prescribed management rule (PMR) 68(1)(vii) made in terms of the Regulations to the Sectional Titles Act 95 of 1986 (“the Act”) provides an exception to the rule that the body corporate is primarily responsible to maintain, repair and, when necessary, replace elements of the scheme’s common property. PMR 68(1)(vii) states:

“An owner shall maintain the hot water installation which serves his section, or, where such installation serves more than one section, the owners concerned shall maintain such installation pro-rata, notwithstanding that such appliance is situated in part of the common property and is insured in terms of the policy taken out by the body corporate.”

It is therefore an owner’s responsibility to repair and maintain the geyser that serves his/her section.Even if a ‘hot water installation’ is part of the common property, and insured by the body corporate, it must be maintained by those owners who benefit from it. This rule can be amended by unanimous resolution of the body corporate. Each scheme needs to assess its own position in regard to geysers on the basis of their location and function in that scheme. It usually makes sense for owners to arrange for cover via the body corporate and then individually bear the portion of the premiums and any excess payments relevant to the geysers that serve their sections. 

PMR29 provides that the geyser must be insured to full replacement cost against bursting, subject to the trustees’ negotiation of excess premium and rate. So, the body corporate must insure the geyser against insurable events but the owner must maintain the geyser. Additionally, in terms of PMR 29(4) the owner of a section is responsible for any excess payment in respect of his/her section payable in terms of a contract of insurance entered into by the body corporate. Therefore the owner of the section that is served by the geyser is responsible for paying the excess.
The trustees can negotiate with the insurer for a lower rate where higher excesses are applied for geysers. In this way the trustees are acting in the best interest of all the owners, because they are negotiating the most appropriate terms and rates for the body corporate so that premiums remain reasonable and sustainable. The owners should have plumbers change anodes and check geysers for faulty valves on a regular scheduled basis. By doing this, they are maintaining their geysers and reducing costs all round.
With regard to the issue of leaking pipes the answer as to who is responsible for the cost of the pipes will depend on where the leak is situated and who the pipe serves. The first step is to establish where the pipe is leaking: it must be ascertained if the leak is inside or outside the median line of the sectional boundary wall. The body corporate has the responsibility to do this. If the pipe is on common property then the body corporate is responsible for the repair in terms of section 37(1)(j) of the Act.If at the point of the leak the pipe is part of the section it must be established if, at the point where the leak is, the pipe serves only that section or takes water to or from any other section and or the common property.If the leaking part of pipe only serves one section then the owner is responsible in terms of section 44(1)(c) of the Act. However, if the leaking part of the pipe serves more than one owner or the common property then the body corporate is responsible for the cost in terms of section 37(1)(p) of the Act.

A rule made at an AGM that the owners are responsible for the leaking pipes located in common property will not be valid. If the body corporate wants to make a binding decision it can make a rule under section 32(4) of the Act. The effect of this rule, once it is properly made and filed would be a variation of the effect of the participation quotas in regard to this type of expense.

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