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Destruction or damage

25 October 2012

There are three instances when a building (or buildings) is deemed to be destroyed, i.e. as provided for in section 48 of the Sectionals Titles Act 95 of 1986 (the Act):

  1. Upon the physical destruction of the building
  2. When the owners by unanimous resolution so determine, and
  3. When the court makes an order to that effect.

From the above it can be assumed that in the first instance the building is physically destroyed, i.e. the building is no longer intact.  It is therefore not actually 'deemed' to be destroyed, but physically destroyed.  In the other two instances the building is still intact and not really destroyed in the true sense of the word. 

Section 48(3) of the Act provides for the authorisation of a scheme for the rebuilding and reinstatement in whole or in part of the building.  One may argue that a building can only be rebuilt when it is physically destroyed.  Why would the owner or the court authorise the rebuilding of a building which is not physically destroyed?  On the other hand, why make a decision to have the building deemed to be destroyed (when it is not physically destroyed) and therefore decide to 'rebuild' it?  One cannot rebuild a building that is not physically destroyed.  If the intention is just to reinstate a building that was deemed to be destroyed, at what stage can it be decided upon?  For example, a building is 'deemed to be destroyed' in 2009, which building consists of units 11 and 12 in the scheme.  A notification is lodged as provided for in regulation 31 infra and registered in the deeds office.  The effect will be that the said units will be cancelled, although the building will still be intact (now common property).  Can the body corporate, now in 2012, authorise a scheme to rebuild that building, i.e. eventually reinstating units 11 and 12?  The Act does not provide for a mechanism or a prescribed form to do this at a later stage.  This will also result in the extension of the scheme by (again) adding units 11 and 12, which were previously cancelled.  Therefore, the decision to have a building declared to be deemed to be destroyed and the decision to rebuild, or not, must be taken simultaneously.  This confirms the statement that it appears to be ridiculous to do that, and that section 48(3)(a)(i) of the Act may only be applied when a building is physically destroyed, as contemplated in section 48(1)(a) of the Act. 

Section 48(3)(a) of the Act provides for the authorisation of a scheme - 

  1. for the rebuild and reinstatement in whole or in part of the building or buildings;
  2. for the transfer of the interests of owners of sections which have been wholly or partially destroyed, to the other owners.

The above mentioned subsection omits to state whether it is (i) and (ii) or, (i) or (ii), i.e must the buildings be rebuilt and where only part of the buildings are rebuilt, the interests of the owners be transferred, or, must the buildings be rebuilt or the interest of owners be transferred (the one or the other).  It is submitted that both subsections should be applied as set out in the following example, i.e. when part of the building is rebuilt [subsection (i)] and the other part not to be rebuilt consists of units, it will result in the cancellation of the affected units and the transfer of the interests of those owners [subsection (ii)] to the other owners.  It is also possible that only subsection (ii) be applied on its own, e.g. when the buildings are deemed to be destroyed as contemplated in section 48(i)(b) and (c).  It is not necessary to rebuild, as the building is still intact ('deemed' to be destroyed).  The owners or the court will therefore  authorise a scheme as contemplated in section 48(3)(a)(ii) only, i.e. for the transfer of the interests of the owners whose units are affected, to the other owners.  It is submitted that the Act be amended to include the wording "and/or" with regard to sub-sections (i) and (ii). 

With regard to the above explanation, one must refer to the provisions provided for in regulation 3(1):

"Whenever a building or buildings are damaged or deemed to be destroyed as contemplated in section 48 and a scheme has been authorised for in section 48(3)(a) of the Act, the body corporate shall notify the registrar."

Regulation 31(1) includes both subsections (i) and (ii) of section 48(3) of the Act.  This means that when a building is not physically destroyed, and is therefore still intact, it will not be capable of being rebuilt and subsection (i) is not applicable.  The question is whether in such a case a notification, as provided for in this regulation, will have to be lodged.  It is submitted that it should be lodged, as the interest of owners of the affected units (deemed to be destroyed) must be transferred to the owners of the other units.  As it is stated in section 48(3) of the Act it appears that both criteria as referred to in subsections (i) and (ii) can be applied.  It is therefore evident that section 48 needs to be amended in order to clarify the above.  It is further submitted that subsection (i) and (ii) should specifically be made applicable in respect of section 48 (1)(a), i.e. physical destruction, and sub-section (ii) only specifically be made applicable in respect of section 48(1)(b) and (c), i.e. deemed to be destroyed.

Section 48(3)(a)(i) of the Act also provides for the rebuilding of the whole of the building which is deemed to be destroyed.  What will the purpose be of applying regulation 31(1) if the whole of the building is rebuilt? If the building had been physically destroyed it must in any case be rebuilt according to the existing sectional plans that are registered.  If all of it is rebuilt, no one will ever know that it had been destroyed.  This fact will not have the effect of changing the records in the deeds office.  One can also argue that regulation 31(2) cannot be applied in this case, as there will not be a change in the PQ schedule.  It will therefore not be possible to lodge the PQ schedule which will exclude reference to any section which has been destroyed as contemplated in regulation 31(2):

"The notification to the registrar pursuant to subregulation (1) shall be accompanied by a schedule in terms of section 5(3)(g) of the Act which shall exclude reference to any section which has been destroyed ...." (my underlining).

If no sections are destroyed, then this regulation cannot be applied.  It is therefore submitted that the Act should once again be amended to omit the fact that the building may be rebuilt and reinstated in whole and that a notification in this regard must be lodged with the registrar of deeds. 

Another matter that merits a discussion is the instance when part of a section is destroyed or deemed to be destroyed.  The point of departure in the deeds offices was that the section must be subdivided. The subdivision would reflect the one area as being the boundary of the destroyed portion of the unit and the other area which is still intact, being the portion after the destroyed portion has been removed.  The intact portion and the destroyed portion will be described as two different sections once the subdivision is effected.  The destroyed section will then be able to be 'removed'  as provided for in section 48 and regulation 31.  However, according to section 7(2) read with section 5, regulation 5 and specifically regulation 6(b), there must be a building which must be divided into sections, and the boundaries of a building must be represented by physical features.  When a building is physically destroyed it does not exist anymore and draft sectional plans will not be able to be prepared, nor be approved by the surveyor general, as it will not comply with the requirements of the Act. 

An alternative which may be considered will be to apply section 48(3) and regulation 31, but to adapt regulation 31(2) in order to be applicable to a part of a section that is destroyed.  It is submitted that regulation 32(2) be amended to read as follows:

"The notification to the registrar pursuant to subregulation (1) shall be accompanied by a schedule in terms of section 5(3)(g) of the Act which shall exclude reference to any section or part of a section which has been destroyed ...." 

This amendment will solve the problem in dealing with a part of a section which is deemed to be destroyed.  However, it will also be required to lodge an amended floor plan of the affected sections, and, if applicable, the block plan. 

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