Sectional Title - Extension of sections in Sectional Title schemes in South Africa

EXTENTION OF SECTIONS IN SECTIONAL TITLE SCHEMES

The Sectional Titles Amendment Act, No.11 of 2010 was published on 7 December 2010 and within these amendments, Section 24 (6) (d) - which deals with the extension of sections in Sectional Title schemes - was addressed.

Martin Bester, the Managing Director of Intersect Sectional Title Services, who sits on the board of the Residential and Sectional Title Committee of SAPOA and is a committee member of the Sectional Title Regulations Board, explains that, as before, under Section 24, any owner wishing to extend his or her section needs to apply to the body corporate for approval.

“On receiving this approval, which must be in the form of a special resolution of the members, the owner must arrange a draft sectional plan of extension which is then submitted to the Surveyor General for approval.”

“The amendments for Section 24 (6) (d) (i) now prescribe that a land surveyor or architect as opposed to a conveyancer, as was previously prescribed, must confirm that the proposed extension does not exceed the 10% extension threshold, currently in place.”

“Should the extension exceed the 10% threshold then amended Section 24 (6) (d) (ii) prescribes that a conveyancer must provide a certificate confirming that all mortgagees have consented to the registration of the sectional plan of extension of that section,” says Bester.

“Lastly an insertion had been made (Section 24 (6A)), which states that should the extension deviate by more than 10% then the applicant must inform, by registered post, all mortgagees and provide certain prescribed details to them. Should the applicant not receive an objection to the notice, within 30 days of the date of posting, it will be deemed that the mortgagee consents thereto.”

SECTIONAL TITLES AND INSURANCE ARE YOU COVERED?

If you have premises within a sectional title development are you sure that you are sufficiently covered by your insurance in case of damage or loss?

Many people are under the mistaken impression that the body corporates’ insurance policy covers movables such as furniture and curtains as well as the buildings, common property, and all fixtures within the sections. However – this is not the case.

According to Martin Bester, the Managing Director of Intersect Sectional Title Services, who sits on the board of the Residential and Sectional Title Committee of SAPOA and is a committee member of the Sectional Title Regulations Board, many clients are not only under the mistaken impression that they are covered by the body corporate insurance but also that they are covered if they take out personal insurance, or home owners insurance, even though they are in a sectional title development.

“Prescribed Management Rule 29(1)(a) places a duty on the trustees to ensure that the buildings and all improvements to the common property are insured from the very beginning, and thereafter renewed every year. The onus for insurance on moveable items falls on the individual residents.”

“At Intersect we advise our clients to have the buildings and improvements professionally valued every three to four years, so as to ensure that the replacement values applied are reasonable and accurate.”

Bester says that excesses are also often a topic of debate in sectional title. “Prescribed Management Rule 29(4) deals with this and basically prescribes that the excess is payable by the owner(s) of the section(s) that suffers the loss or damage. Should the loss or damage occur on the common property then the body corporate is liable.”

A substantial amount of insurance claims in sectional title developments are water damage claims. Damage as a result of water ingress, burst water pipes, burst geysers and storm or rain damage are typical sources. “Routine or preventative maintenance can reduce the risk of these incidents and thereby reduce or contain the claims at a scheme.”

“Maintenance such as inspecting, cleaning and fastening gutters, downpipes and drains as well as annual checks on the roofs and flashing and water heaters are all good ideas and schemes with swimming pools should be conscious of their obligations towards health and safety and ensure that suitable liability cover is in place.”

“Keeping a handle on the claims and claims history is a good idea as the insurance premium could be affected by this,” concludes Bester.

IF IT’S BROKEN, WHO’S GOING TO FIX IT? SECTIONAL TITLE AND THE MEDIAN LINE

In sectional title the common boundary between any section and another or between any section and the common property is the median line of the dividing floor, wall or ceiling, as the case may be.

Questions have often been raised in the past as to who is responsible for the repairs and maintenance, and the costs thereof, of doors and windows and any part of the building that falls within these boundaries.

Martin Bester, the Managing Director of Intersect Sectional Title Services, who sits on the board of the Residential and Sectional Title Committee of SAPOA and is a committee member of NAMA and the Sectional Title Regulations Board, explains that on 7 December 2010, the Sectional Titles Amendment Act, No. 11 of 2010 was published and in this amendment the median line was established as the centre of any door, window or other aperture, in a section’s wall, floor or ceiling.

“Therefore, regardless of where the door or aperture is situated in the wall, it will be deemed to be the centre and therefore form part of the boundary of the section.”

“This will hopefully guide trustees with regards to the repairs and maintenance obligations of doors and windows,” says Bester, who states that more often than not the 50/50 rule of thumb applies, but that some sectional title schemes have adopted rules, by means of a special resolution, to establish responsibility in this regard.

Source: Martin Bester (Intersect Sectional Title Management)

Courtesy: The EAAB - Estate Agency Affairs Board

 

“Redressing the Past, Building the Future and Guiding the Real Estate Business towards Professionalism”

It is apparent, therefore, that the CPA could conceivably have severe implications not only for landlords, property developers and business owners but also estate agents and commercial- and business brokers.

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