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MCS Courier - July 2014

24 July 2014

In the first article Life right contradictions in sectional title schemes Tertius Maree investigates the and provides a suggestion as to the implications of the non applicability of the provisions of Regulations 7 to 14 of the Retirement Schemes Act when the retirement scheme is a sectional title scheme. These regulations are the ones in terms of which the developer is required to establish an association of which holders of rights of occupation (life-right holders) are to be the members.

The problem however is that it seems that the understanding of the legislature had presumably been that the establishment of such an association would be unnecessary in the case of a sectional title scheme because provision is already made in terms of the Sectional Titles Act for the membership of owners to a body corporate. However, if this assumption is correct, sight may have been lost of the fact that even if the retirement scheme is registered in the form of a sectional title scheme, it may be the developer’s intention to retain ownership of the units and to grant only so-called life-rights in respect of sections to residents. In fact this unusual and probably unanticipated type of development does occur from time to time, leaving the question whether a developer should then establish a life-right association irrespective of the provisions of Regulation 2, or is the intention that such life-right holders should become members of the body corporate?

In Learning to count: Part 3  Tertius takes a closer look at the manner in which a quorum should be determined at general meetings in terms of Prescribed Management Rule 57(2) and expresses the view that votes should be counted on the basis of one unit one vote. 

In Amending the rules for levies dispensation he discusses the applicability of Standard Management Rule 32(4) to Standard Management Rule 31(1) regarding the alteration of the levies formula. A point worth highlighting is that all rules relating to levies which may be adopted by the body corporate belong in the Management Rules and not in the Conduct Rules. The tendency to sometimes utilise the ‘easier’ Conduct Rules to adopt new rules related to levies cannot be condoned.

MCS Courier 47 July 2014

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