New laws for complexes and sectional titles in South Africa - what it means for residents

Legal firm Cliffe Dekker Hofmeyr has broken down what the new Sectional Title Amendment Bill means for South Africans who live in complexes.

The new bill was just passed by the National Council of Provinces and sent to President Cyril Ramaphosa to be signed into law on 27 October 2022.

According to Cliffe Dekker Hofmeyr, the bill effectively seeks to 'fill' the gaps which the Sectional Titles Act currently has, especially to make it more comprehensive without the need to refer back to other pieces of legislation such as the Deeds Registries Act.

The new bill will be called the Sectional Titles Amendment Act of 2020, and will come into operation on the date of publication in the Government Gazette, said Cliffe Dekker Hofmeyr.

When the act is passed into law, regulations governing scheme development, including extensions and common property, will also be in place. However, the amendments are primarily directed at complex managers and Home Owners' Associations across the nation.

Sectional titles are governed by three main laws in South Africa - the Sectional Titles Act (95 of 1968) which regulates the ownership, letting and use of sectional titles schemes in the country, the Sectional Titles Schemes Management Act (8 of 2011), which regulates the functions and powers of body corporates, and the Community Schemes Ombud Services Act (9 of 2011), which sets up and handles dispute resolutions.

The Sectional Title Amendment Bill is primarily in effect to "fill the gaps" left open by these laws.

For residents of sectional title schemes, the main impact will be how complex managers, body corporates and HOAs interact with the sectional titles. More direct impacts of the law come in when residents are lessees or when owners need to work with the body corporates in determining the use of the common property.

Notably:

• It will now be a requirement for developers to have a meeting with every lessee of a building in instances where part of such building is to be wholly or partially let for residential purposes, to answer questions put to the developer by the agents of the lessees;
• A certificate must now be issued by an architect or a land surveyor to comply with section 26(2) of the Spatial Planning and Land Use Management Act - ie, where land is only allowed to be used for the permitted purposes;
• Amendments can now be made to sectional plans in respect of exclusive use areas; and
• A developer to submit a plan for subdivision or consolidation to the surveyor-general for approval to subdivide, consolidate and to extend a section.

CDH outlined what Sectional Title Amendment Bill aims to do. It primarily seeks to amend the Sectional Titles Act of 95 1986 (Sectional Titles Act) so as to:

• Change certain definitions;

• Provide for the developer to answer questions put to it by the agents of lessees;

• Provide that a certificate issued by an architect or a land surveyor must also comply with section 26(2) of the Spatial Planning and Land Use Management Act 16 of 2013;

• Further, provide for the amendment of sectional plans in respect of exclusive use areas;

• Further, provide for the amendment and cancellation of a sectional plan upon an order of the court;

• To provide for the noting of a title deed in respect of the lapsing of a reservation in terms of section 25;

• Provide for a lease of part of the common property to be subjected to the rights of the holders of real rights, and it shall be necessary to obtain the consent of the holders of registered real rights;

• Amend the provisions relating to the alienation of common property;

• Further provide for the cancellation of a mortgaged section and mortgaged exclusive use area;

• Also provide for a developer to submit a plan for subdivision or consolidation to the Surveyor-General for approval to subdivide, consolidate or extend a section prior to the establishment of a corporate body;

• Extend the registration of subdivision of a section, the consolidation of sections, and the extension of sections to a developer;

• Provide for the filing of replacement documentation in respect of lost or destroyed documentation;

• Amend the provisions relating to the extension of a scheme and include reference to exclusive use areas where reference was previously omitted;

• Amend the provisions relating to participation quotas of sections and cross-reference the Sectional Titles Act with the newer Sectional Titles Schemes Management Act 8 of 2011, and regulate the membership of the sectional titles regulations board;

The new bill was originally introduced by the Minister of Agriculture, Land Reform & Rural Development to the National Assembly on 2 November 2020.

It was then passed by the National Assembly and transmitted to the National Council Of Provinces for concurrence on 16 November 2021.