STSMA Governance & Sectional Title Regulations

Sectional title management is the day-to-day and strategic administration of a sectional title scheme (complex, estate, or block of flats) on behalf of the Body Corporate.

1. Purpose of This Guide

This guide is designed to:

• Train Trustees to lawfully and confidently manage a sectional title scheme

• Help Owners understand how the Body Corporate operates and what to expect

• Reduce disputes through clarity, transparency, and compliance

This guide applies to South African sectional title schemes governed by the Sectional Titles Schemes Management Act 8 of 2011 (STSMA).

2. The Legal Framework (What Governs Your Scheme)

2.1 Primary Legislation

• Sectional Titles Schemes Management Act 8 of 2011 (STSMA)

• Prescribed Management Rules (PMRs) and Conduct Rules

• Community Schemes Ombud Service Act (CSOS Act)

Trustees and owners are legally bound by these laws and by the scheme’s registered rules.

3. What Is the Body Corporate?

3.1 Automatic Legal Entity

The Body Corporate comes into existence automatically when the first unit is transferred (STSMA section 2).

3.2 Main Responsibilities of the Body Corporate

Under STSMA section 3, the Body Corporate must:

• Control, manage, and administer the common property

• Establish administrative and reserve funds

• Maintain and repair common property

• Insure the buildings to full replacement value

• Enforce the scheme’s rules

4. Trustees: Role, Powers, and Duties

4.1 Who Are the Trustees?

Trustees are owners or representatives elected at the AGM to manage the scheme on behalf of the Body Corporate.

4.2 Trustee Authority

• Trustees act collectively, not individually

• Decisions must be made by proper resolution

• Authority flows from STSMA section 7 and the PMRs

4.3 Fiduciary Duty

Trustees must:

• Act honestly and in good faith

• Avoid conflicts of interest

• Act in the best interests of the Body Corporate

Trustees can be personally liable for reckless, negligent, or unlawful decisions.

5. Owners: Rights and Responsibilities

5.1 Owner Rights

Owners have the right to:

• Vote at general meetings

• Inspect Body Corporate records

• Receive financial statements

• Enjoy peaceful use of their section and common property

5.2 Owner Responsibilities

Owners must:

• Pay levies on time (STSMA section 3(2))

• Maintain their section

• Comply with conduct rules

• Not damage common property

6. Meetings Explained (AGM, SGM & Trustee Meetings)

6.1 Annual General Meeting (AGM)

The AGM must:

• Be held once every financial year

• Approve budgets and levies

• Elect trustees

• Appoint managing agents, auditors, and insurers

6.2 Trustee Meetings

• Handle operational decisions

• Must be minuted

• Require quorum and majority decisions

6.3 Special General Meetings (SGM)

• Called for urgent or specific matters

• Can be requested by owners

7. Financial Management Made Simple

7.1 Levies

Levies fund:

• Day‑to‑day expenses (admin fund)

• Long‑term maintenance (reserve fund)

7.2 Reserve Fund (Mandatory)

Under STSMA section 3(1)(b):

• Every scheme must have a reserve fund

• Minimum contribution rules apply

7.3 Transparency

Owners are entitled to:

• Approved budgets

• Annual financial statements

• Levy schedules

8. Maintenance & Repairs: Who Is Responsible?

8.1 Body Corporate Responsibility

Generally includes:

• Roofs

• Exterior walls

• Foundations

• Shared pipes and cables

• Lifts, gates, and security systems

8.2 Owner Responsibility

Generally includes:

• Inside the section

• Fixtures serving only one unit

• Exclusive use areas (unless rules state otherwise)

Always check the scheme rules and plans before deciding responsibility.

9. Managing Agents: What They Do (and Don’t Do)

9.1 Role of a Managing Agent

Managing agents:

• Carry out instructions from trustees

• Handle administration and finances

• Do not replace trustee decision‑making

9.2 Accountability

• Trustees remain legally responsible

• Managing agents act under mandate

10. Rules, Behaviour & Enforcement

10.1 Why Rules Matter

Rules regulate:

• Noise

• Pets

• Parking

• Use of common property

10.2 Enforcement Process

• Written warnings

• Fines (if allowed by rules)

• CSOS dispute resolution if unresolved

11. Disputes & CSOS

11.1 When Disputes Arise

Common disputes include:

• Levy arrears

• Maintenance responsibility

• Trustee conduct

• Rule enforcement

11.2 CSOS Role

CSOS provides:

• Conciliation

• Adjudication orders

• Affordable dispute resolution

12. Practical Tips for Trustees & Owners

✔ Read the rules annually ✔ Ask for clarity before conflict ✔ Keep communication professional ✔ Attend AGMs ✔ Understand the difference between opinion and law

13. Summary: Shared Responsibility

A successful sectional title scheme requires:

• Informed trustees

• Engaged owners

• Transparent management

• Legal compliance

When trustees and owners understand their roles, conflict reduces and property values are protected.

This guide is educational and does not replace legal advice. For complex matters, consult a sectional title specialist or attorney.