Know Your Body Corporate Rights

Know Your Body Corporate Rights

Private Property South Africa
Lea Jacobs

Investors who buy into a sectional title scheme need to understand that as owners, they are automatically part of the decision-making process, regardless of how active or inactive they are on the body corporate.

Professor Graham Paddock has written a book entitled ‘Sectional Title Meetings Handbook’, an essential guide for anyone who requires a better knowledge and understanding of how sectional title meetings should be handled. Sectional title meetings are often complex and the better owners understand the rules governing the meetings and the essential role they themselves will play, the easier the process.

Over the next few weeks, in an effort to enlighten sectional title owners, we will be taking a closer look at Professor Paddocks’ book, highlighting what is legally required in terms of the various meetings as stated in the Sectional Titles Act and the prescribed rules.

Bodies corporate can have two types of meetings. On the one hand, a meeting could take place where all owners are requested to attend or alternatively, the meeting could comprise elected trustees only.

“The prescribed management rules make detailed provision for quorums, the minimum number of participants who must be present or represented at a meeting before they can proceed to carry out its business.”

This basically means that depending on the nature of the meeting and the business at hand, the Act dictates that a certain number of members of the body corporate need to be present at the meeting. In the book, Paddock states that meetings can be formal or informal, although one does expect the annual general meeting (AGM) to be formal and for the chairman to insist on a relatively strict form of proceedings. On the other hand, a meeting of trustees will most likely be semi-formal, with the chairperson only insisting on strict formality when this is required to control a meeting.

In the case of an AGM, the trustees are obligated to call and hold an AGM within four months of the end of each financial year. Paddock says that in most instances, a body corporate’s financial (fiscal) year runs from the first day of March to the last day of February, unless it has been changed by the body corporate or the trustees. Once all financial records for the body corporate have been prepared and audited and the trustees have considered the statements, 14 days’ notice is given to all members of the body corporate, informing them of the upcoming AGM.

The notice for the AGM must include, among other things, the insurance schedules, estimates of income and expenditure, audited statements and the trustees’ report. This is to ensure that owners receive a full overview of the sectional title’s previous years’ business.

Owners who are unable to attend an AGM or a general meeting are entitled to appoint another owner, trustee or a representative, even one who is not associated with the body corporate in any way, to act as their proxy. “A proxy shall be appointed in writing under the hand of the appointer, or his agent and shall be handed to the chairman prior to the commencement of the meeting,” says Paddock. “Only owners, their proxies or other duly appointed representatives are entitled to vote at a general meeting of owners.”

An owner is not entitled to attend or take part in a meeting where his or her proxy is present. As a representative of the owner, the person nominated as proxy has full voting rights on behalf of the sectional title unit holder.


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