Levies and special levies - my rights?

A Property24 reader asks:

I would like to know what my rights as an owner of a sectional title property in Paarl, Western Cape are regarding levies and special levies. 

A Property24 reader asks about her rights regarding levies and special levies and whether she can paint her own unit.

Our Body Corporate had a general annual meeting in January and our levies got backdated to November 2011, so we had to pay in the excess of that. We also were said to be painting the building which is great, but the levies have now more than doubled. I am already paying R987 for a flat and the extra levy is now a additional R1 600, apparently for painting. 

They cannot give us a time when this special levy will come into effect, all they say is that it is estimated to be by the end of the year, maybe beginning next year, being 2013. They also cannot say by how much my levy will be increased. I am aware that they had only one meeting and claimed to have had a second, but I have proof that there was no second meeting around this increased levy. 

So they falsified a second meeting to “prove” that more than half the owners were at this claimed second meeting 'cause not enough were present at the first. I was not even made aware of the second meeting, but I was made aware of the first - is this allowed? 

I cannot afford to pay a special levy for an unlimited amount, never mind for a small period of time. We were also told the rates and taxes were to be paid separately by the owners and that they will keep the money; our levies will remain unchanged, so they can save up for the painting. 

Now what I really don’t understand is that they kept the rates and taxes money and discounted me R60 per month, for rates and taxes at that stage of R368, which was how many years ago? Surely they should have enough money if they were running the property right from the start and saving where they should have been saving for these costs? 

I am aware that a special levy can be asked for, but the fact that we as owners have to pay, R1 600 x 12, presuming it's for 12 months as they backdated this to November, then for my flat it is R19 200, which has two walls to paint as I am bordered by others on either side, as well as a small single garage, that is also bordered by others, and sections for the passages and surrounding walls. How can this be possible?  

Can I have my flat painted at my own cost and then paint sections of the walls and passages as well, so it is fair towards others? I do not know who to turn to anymore as this flat is becoming a complete problem for me! I cannot afford to keep this flat running and nobody wants to buy it because the levies are too high. I have had it on the market for about 2 years and now with the levy nobody even looks at the property anymore. 

Please help or point me in the right direction... 

Phil Calothi, owner and Managing Director of the Cape Town based managing agent company,   Land and Sea Development Services (Pty) Ltd  , advises:

Before the commencement of a new financial year, the Trustees of a Body Corporate are obliged to estimate what the expenditure of the scheme will be for the ensuing year and to agree on the amount by a formal resolution at a meeting of the trustees. At the same meeting they are required to determine the levies, which will be payable by each member for the following financial year in order to recover the total budget they have approved. 

They must then, through their managing agent, timeously advise each member of the levy which will be payable for the following year. 

Within 4 months after the commencement of a new financial year, the trustees are required by law to convene a general meeting of the members. The agenda should  include an item wherein their budget for the year in progress must be presented for acceptance by the members who may decide by a majority vote to accept or amend the budget. 

It is highly unacceptable for a board of trustees to raise levies in arrears because they have not followed due process and, in my opinion, as the managing agent is paid to ensure that all the responsibilities of the trustees are correctly administered, your managing agent should be held responsible unless the trustees specifically prevented him from doing so. 

Special levies are raised when there are insufficient reserves to fund an extraordinary expense and, while the trustees are empowered to unilaterally impose them, they should follow acceptable procedures in implementing them. 

In the instance of the repainting of a building, they should follow the following procedure namely: 

1. They should obtain at least 3 tender prices from professional painting contractors with proven track records
2. Arising from the tender results, they should choose a preferred tenderer and, based on his price, determine an overall budget for the project.
3. They should then determine how much of that budget can be funded out of reserves and how much should be funded by members and determine the individual amount payable by each member
4. They should then determine whether they are going to collect the amount in a lump sum or over a period of time.
5. They should then advise each individual member of precisely what they intend to do and when, why they need a special levy, how much the levy will be and when they will have to pay. 

Again, if the above procedure has not been followed, your managing agent should be held responsible for not providing the management service he is being paid to provide. 

The body corporate is responsible for the painting of the common property( i.e. the exterior of the building). You are responsible for the interior maintenance of your flat and you may not repaint any areas of the common property without the prior approval of the trustees. 

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