In many community schemes homes or offices are owned by investors who lease the properties to tenants. It is not unusual for an investor owner who is receiving regular rental payments to pay his or her rates and bond instalments, but not to pay the association the contributions.
In these circumstances the association can make application for an order that obliges the tenant to pay the rental to the association, rather than to the landlord owner.
In terms of section 39 (1) (f) of the CSOS Act, an application may be for:
“an order requiring a specified tenant in a community scheme to pay to the association and not to his or her landlord, all or part of the rentals payable under a lease agreement, from a specified date and until a specified amount due by the landlord to the association has been paid: Provided that in terms of such an order-
(i) the tenant must make the payments specified and may not rely on any right of deduction, set-off or counterclaim that he or she has against the landlord to reduce the amount to be paid to the association;
(ii) payments made by the tenant to the association discharge the tenant’s liability to the landlord in terms of the lease; and
(iii) the association must credit amounts received from the tenant to the account of the landlord.”
Such an order may be given with or as part of an order that the contribution is payable by the owner to the association.
Only an association can make application for this order, the effect of which is to oblige a tenant to make specified rental payments to the association to settle a debts owed by the owner/landlord to the association.
An example of the type of order the CSOS could give is:
That James Gavin, the tenant of 208 Marshall Hills Flats in Berea in terms of a lease agreement dated 20 March 2015 must pay the Marshal Hills Share Block Company (“the company”) all rentals due the landlord, Graeme Potgieter from 1 June 2017 until a total of R54 080,00 has been paid to the company. This order takes effect immediately.
If you would like to see the whole of the Community Schemes Ombud Service Act, 9 of 2011, including the full text of chapter 3 that covers applications, you can access this from Paddocks’ resource library.
Do you have concerns about your matter, need assistance completing your application, or want a sectional title Consultant to review your application before submission? Have a look at the Paddocks’ Consulting page.
For general help on the CSOS, including the special meanings of the words and phrases “association”, “common area”, “dispute”, “executive committee”, “owner”, and “scheme governance documentation” see the CSOS Information page.
Needing other assistance? Have a look at our Paddocks assistance page, which includes the helpful application guide explanation, for more information.
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