Trustees can raise levies before AGM

2015-08-06 06:00

RECENT amendments to the Sectional Titles Regulations, published in June in the Government Gazette, sees the welcome return of the power of trustees to increase levies before the AGM by up to 10%.

This is according to Martin Bester, managing director of Intersect Sectional Title Services, who says this mitigates the cash flow implications of increases that are effected at the beginning of the financial year, but only accounted for in the levies after the AGM, usually some four months later.

Bester says the newly included management rule 4Aa, states: “After the expiry of a financial year and until they become liable for contributions in respect of the ensuing financial year, owners are liable for contributions in the same amounts and payable in the same instalments as were due and payable by them during the expired financial year.

“Provided that the trustees may, if they consider it necessary, and by written notice to the owners, increase the contributions due by the owners by a maximum of 10% excluding capital expenditure to take account of the anticipated increased liabilities of the body corporate. Such increase shall be ratified or changed after the Annual General Meeting by the trustees once the body corporate has approved or amended the schedule of income and expenditure.”

Bester says other amendments made to the Sectional Titles Regulations include that the title deed of any real right registered over land is to now be included within the sectional titles register. All documents and correspondence placed in a sectional title file must now be endorsed with a deeds registry date endorsement upon filing.

“Management rule 7 (Annexure 8 of the Sectional Titles Act), which deals with the nomination of trustees, has also been amended to restrict any person from being nominated to act as a trustee if they are in arrears with levy contributions or in persistent breach of the rules (Rule 64), and even restricts any member from nominating a trustee if that member themselves is in breach of Rule 64,” he says. - Property24

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