Warning for people who own property in complexes or estates
South Africans living in complexes or estates could lose more than just their homes if they fall behind on levy payments.
Bodies corporate are now turning to the courts to recover mounting arrears, which could result in cars and other belongings being seized.
Attorney Johlene Wasserman from VDM Incorporated, who specialises in sectional title law, told Daily Investor that defaulting on levies can have serious legal consequences.
"Water and electricity supplies are being throttled, and they're facing the very real threat of sewage and garbage disposal services being stopped altogether," said Wasserman.
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She added that many community schemes are "on the brink of collapse" as unpaid levies pile up, leaving once-thriving estates in disrepair.
According to the Community Schemes Ombud Service (CSOS) 2023/24 Annual Report, 15,587 dispute applications were recorded, with over 62% linked to financial issues such as levy arrears and interest disputes.
"CSOS itself attributes the surge to the tough economic climate and high unemployment. But when owners stop paying for whatever reason, schemes start failing," Wasserman explained.
What can happen if you don't pay?
Wasserman noted that if a court judgment is granted against an owner who owes levies, the body corporate can apply for a Section 66 order under the Magistrates' Courts Act.
This legal process allows the sheriff to attach and sell movable assets such as vehicles, furniture, or electronics to cover the outstanding debt.
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"They may not, however, disconnect water, gas or electricity, restrict access to the complex, or publicly shame or defame owners in arrears," she cautioned.
"Taking the law into your own hands can backfire. Unlawful disconnections or access restrictions can lead to spoliation claims and serious legal consequences."
Courts are backing bodies corporate
Wasserman highlighted a recent South Gauteng High Court ruling as a turning point.
"The court upheld the Bondi Body Corporate’s right to sell a Roodepoort property over unpaid levies totalling R50,974.31," she said.
Despite the unit being worth R1.4 million and having a mortgage bond of over R632,000, the court confirmed that levy arrears can be enforced through the sale of a sectional title unit, provided all legal steps are followed.
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She also referenced another case, Cilaos Body Corporate v Tsengiwe, where the court ruled that bodies corporate may disconnect electricity for non-payment, as long as they comply with statutory limits.
"The owner in that case owed nearly R100,000 in levies and utilities, and the court affirmed that legal fees and enforcement costs were recoverable under Regulation 25(4) of the Sectional Titles Schemes Management Act," Wasserman said.
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