The recent appointment of a Community Schemes Ombudsman is good news for the increasing number of homeowners in sectional title complexes and other community housing developments, as it means they should soon have access to a “user friendly” dispute resolution service.
An ombudsman has been appointed in terms of the Community Schemes Ombudsman Service (CSOS) Act passed in 2011. The main intention of the Act is to establish the CSOS, that would, among other functions, provide all parties in all sectional title schemes with a way to resolve disputes in a cost-effective and timely manner, instead of having to resort to the courts.“The new ombudsman, Mr Themba Mthethwa, has been appointed in terms of the Community Schemes Ombudsman Service Act passed in 2011,” says Andrew Schaefer, MD of national property management company Trafalgar, “and we are delighted at the news as it indicates that full implementation of this legislation is on the way at last.”
The main intention of the Act, he says, was to establish the Community Schemes Ombudsman Service (CSOS) that would, among other functions, provide the owners, tenants, trustees, directors and managing agents of all sectional title schemes, homeowners’ associations (HOAs), retirement villages and share block companies with a way to resolve disputes in a cost-effective and timely manner, instead of having to resort to the courts.
Schaefer says this alone would represent a significant improvement on the current situation, in which the Sectional Titles Act does provide for the arbitration of disputes in sectional title schemes, but does not cover any other kind of housing scheme with shared facilities such as estates and retirement villages.
However, Schaefer says, this is not the only reason why the implementation of the new legislation has been so keenly anticipated. “Importantly, the Act also provides for the CSOS to become the custodian and quality controller of the governance documentation relating to all community housing schemes, to monitor compliance and to provide public access to that documentation.”
At the moment, the governance documents for different types of community schemes are kept and filed by various bodies, including the Companies and Intellectual Property Commission, the Deeds Office, and some local authorities. However, they are generally never examined or controlled, and in many cases have been amended or even removed without authorisation, he says.
In short, he says, the situation is chaotic, and many community schemes are currently being run without any regard for the requirements of their governance documents, so the sooner the CSOS can establish a central, properly-controlled registry for these documents, the better.
It will then be able to fulfil another of its mandates, which is to oversee and approve any proposed changes to governance documents and management rules, while also monitoring compliance, and that promises to bring about a major improvement in the overall operation of community schemes, says Schaefer.
The new CSOS website outlines several other services that it will provide, while at the same time making it clear that these will be funded by means of an annual CSOS levy payable by every community housing scheme.
“However we don’t foresee that this levy will be onerous,” says Schaefer. “In fact we think it will be a small price for owners of property in community schemes to pay to have the CSOS in place to protect their interests.”
With the establishment of the CSOS board a few months ago, and now the appointment of Mr Mthethwa as chief ombudsman of the service, he says the CSOS Act is expected to come into force by the end of the current financial year, and to be fully operational by the end of 2015.
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