Typically, landowners create duets on land that cannot be subdivided for various reasons. Instead, landowners establish a sectional title register with only two units. These may be two separate dwellings, or they may be semi-detached and are commonly known as duets or semi’s.
Often, landowners prefer establishing these small sectional title schemes to subdivision due to cost implications, as it might be cheaper and faster to establish a sectional title scheme.
The problem is that many of our clients who live in these duet houses are under the impression that the Sectional Title Act 95 of 1986 (“STA”) and the Sectional Titles Schemes Management Act 8 of 2010 (“STSMA”) are not applicable to them. This, however, is not the case. Duet houses, like any other unit or section, are strictly administered by the STA and STSMA. Owners often don’t realise that all the areas outside the dwelling form part of the common property. The effect thereof is that swimming pools, lapas, driveways, and garages/parking bays/carports should be registered as exclusive use areas.
Attorneys often encounter delays in property transfers as a result of owners not being aware of this and the effect it has on their ownership.
Typical problems that arise are:
- The Local Authority was never notified of the existence of the scheme, or the Local Authority is only charging one owner for the rates and taxes.
- The rates and taxes payable in respect of the scheme are in arrears, which will affect both owners.
- Extension of buildings or exclusive use areas without plans.
- Rules affecting the owners.
- Signing of the 15B(3) Certificate by the conveyancer.
In terms of the STSMA:
- A Body Corporate is deemed to be established on the date of transfer of the first unit into the name of the purchaser thereof (Section 2 STSMA).
- The developer must convene the first meeting within 60 days from the date of the first transfer (Section 2(8) of the STSMA).
- The homeowner who established the sectional title scheme will be regarded as the developer of the scheme, and a fine and/or imprisonment may be imposed if the so-called developer fails to convene the first meeting.
- By operation of law, both owners will be part of the Body Corporate, and in terms of the STSMA, both owners will be the trustees.
Local Authority Bills
- Bills issued in only one owner’s name instead of the Body Corporate should be charged for the common property.
- Two rates accounts plus the Body Corporate account, but nobody received and paid the Body Corporate account – causing arrears in rates and taxes and consumption. Effectively, it comes down to levies.
- Pre-paid water and electricity meters.
Extension of Buildings or Exclusive Use Areas
- Owners are mostly unaware that extensions of buildings or exclusive use areas need to adhere strictly to the STA and will require the consent of their neighbour due to the fact that both owners are members of the Body Corporate.
- If any extension occurs on the common property, for example, a swimming pool, lapa, or extra garage, all bondholders’ consents will be required – in other words, the mortgagee of the neighbour will also have to consent.
- Should the section be extended, and the extension affects the Participation Quota by more than 10%, the bondholders’ consent of the neighbour will also be required for the said extension.
- Amended building plans will have to be lodged with the Local Authority – to be drawn up by an architect.
- An amending sectional title plan will have to be drawn by a surveyor and approved by the Surveyor-General.
- The owner will then have to bring a formal application for the extension of the building or for the Body Corporate for registration of an exclusive use area, which application will be lodged, which is not ideal.
Rules
- The rules governing all the Body Corporate form part of Annexures 1 & 2 of the STSMA.
- If the standard rules are not customised for the specific scheme, the standard rules will apply, which is not ideal.
- All amended rules need to be filed and registered with the Ombud.
- Any amendments after registration of the scheme need to be approved by both owners, after which the rules can only be filed and registered with the Ombud and will only be effective upon issuing of a Certificate of Compliance from the Ombud.
- The rules for these types of schemes need to be more specific, for example:
- Maintenance of gardens, swimming pools, etc. – each party to pay its own costs.
- Walls, electric fences, driveway common to both properties, maintenance, etc.
- Visitors
- Noise levels
- Use of buildings
- Pets
Levy
Both owners need to sign a Certificate in their capacity as members of the Body Corporate to certify that no moneys are outstanding and/or payable to the Body Corporate prior to the conveyancer being able to sign the 15B(3) Certificate.
SSMA Read with CSOS Act
The scheme needs to comply with both Acts, for example:
– Maintenance plan
– Insurance
– Reserve fund
In Conclusion:
Property Practitioners need to familiarise themselves with the rules, levies, plans, comprehensive rates accounts, etc. when listing duets.
Banks are calling for approved plans, financials, etc. more regularly now, and this can present a huge delay when the plans and/or rules are not up to date.
