ATTENTION ALL OWNERS REFUSING TO PAY THEIR LEVIES!
Yes, this is an urgent notice to you!
Your community scheme will not be able to survive another month and pay its suppliers, including the Local Authority if you continue to default on your levies!
This is the urgency of addressing arrear levies in every community scheme in South Africa.
When you buy into a community scheme—whether it’s a sectional title development, homeowners association, or retirement village—you cannot run away from your financial obligations. We all must pay our levies. You do not have to agree to it in writing; you become a member of the community scheme the minute it’s transferred into your name!
During my time at the CSOS, most disputes received were for arrear contributions.
Imagine a scenario where a once thriving community scheme is now dilapidated and run down. Nobody wants to live there, as there is no water or electricity supply, sewerage runs down the street, and the place reeks of filth. The community scheme became like this because owners did not pay their levies, and the municipality could not be paid; hence, all services were cut off from the community scheme. There are many of these community schemes across South Africa.
But you say this will never happen to my community scheme as other owners are paying their levies, and they can subsidise me in the meantime…
WRONG! They cannot; the budget is made up of all the owners’ contributions every year, and if you do not pay your contribution, then the community scheme will have to cut the necessary maintenance they so desperately need, all because you did not pay your levies.
Even worse, the trustees can raise a special levy to cover these costs because some unit owners are not paying their contributions towards the community scheme!
I believe levy defaulters should be handed over to the CSOS 60 (sixty) days after they become in arrears (Remember, the legislation is silent on the time period). This will benefit both the community scheme and the defaulter, as the defaulter can either arrange a payment plan with the trustees or pay the entire amount owed. It will be much harder for the scheme to take a defaulter to the CSOS when he is one year in arrears. Imagine the interest!
Scheme Executives must ensure that they have a signed resolution stating what will happen when a person is in arrears.
For instance:
- When exactly (time period) will defaulters be handed over?
- What interest will be charged on arrear accounts?
- Will we hand them over to CSOS or an Attorney – it’s each scheme’s prerogative to decide the route; CSOS is, of course, less costly, but the Scheme Executives can decide which way to go.
An absolutely fantastic prayer of relief that one can ask the CSOS is that if there is a tenant in the unit and the owner, who is defaulting on his levies, receives the rental every month, then the CSOS can order that the rental be paid into the Body Corporate account, but the tenant must be cited!
But remember this!
IT IS UNLAWFUL TO PREVENT ANY PERSON FROM ENTERING THE PREMISES THAT THEY OCCUPY!
Therefore, it’s very important to act now as Scheme Executives, take an active interest in the arrear levy roll of your scheme, and ensure that defaulters are handed over timeously to ensure that all dues are paid to the scheme!
At JW Consultants, we can assist you with the arrear collections in your respective schemes at a fraction of the cost.
Please get in touch with us today for assistance.
Johlene Wasserman
