On 14 March 2013 amendments to the Sectional Titles Act of 1986 were gazetted and thereby became operational one month later.
Of particular relevance to owners and occupiers in sectional title schemes are the amendments to Annexure 8 (the Prescribed Management Rules or PMR) of the Act. The following is a summary of these amendments and the everyday application thereof.
PMR 7, which deals with the manner in which the trustees of a body corporate are to be elected, was amended so as to exclude nominees who are, at the time, in persistent breach of the Conduct Rules (notwithstanding a written warning to refrain from same); and further to exclude any nominee who is indebted to the body corporate.
The amendment to PMR 7 applies predominantly to nominees who are also owners or even occupiers within the body corporate as only they could be indebted to the body corporate or in breach of its rules, however, the Act (viz PMR 5) does not require that a trustee need be either.
The next amendment sees the insertion of PMR 13 (g). PMR 13 (a-f) deals with the disqualification of trustees. PMR 13 (g) now provides further for any trustee indebted to the body corporate for a period in excess of 60 days to be disqualified should he/she fail to settle same within a period of 7 days of being notified to do so.
Lastly PMR 31 (4A) was replaced by PMR 31 (4B). PMR 31 (4A) allowed the trustees to, at their discretion, increase the levies charged by up to 10% at the beginning of the financial year. This generally would form part of the proposed budget and be ratified by determination at the AGM.
I am not particularly keen on the deletion of PMR 31 (4A), as this allowed the trustees to effectively ensure that the levies for the financial year were in line with the expenses and budget for the applicable year (provided the levy increase required was < 10%), whereas the AGM is typically 3 to 4 months after the beginning of the financial year. This simply means that should a body corporate require a levy increase within a financial year, the 1st quarter of the financial year is missed and the resultant increase could be greater or it could result in backdated increases which are a particular problem in commercial or VAT registered schemes.
PMR 31 (4B) on the other hand basically provides for the trustees to make special levies or contributions on the members for expenses or costs, over and above those already provided for in the approved budget, and for same to be payable in whichever manner the trustees deem fit. So no major changes there then.