Real Estate Investor Magazine South Africa August 2013 | Page 35

RESIDENTIAL T he que st ion whet her a rbit r at ion is compulsory under management rule 71 was left open in Greenacres. The issue in that case was whether a dispute as to the liability of an owner to pay levies is excluded from the operation of the rule. This court held that it is not excluded and that it is arbitrable. In the case of Body Corporate Pinewood Park v Dellis 2013 (1) SA 296, the respondent was the registered owner of Sectional Title Unit 7 (the property) in the Sectional Title Development Scheme known as Pinewood Park No 202 (the scheme). The property was situated in Pinetown, KwaZulu-Natal. As owner of the property the respondent was obliged, in terms of s 44(1) (b) of the Act, to pay levies in respect of the property to the applicant, the body corporate, which managed the scheme. For convenience I shall refer to the applicant as ‘the body corporate’ and to the respondent as ‘the owner’. On 2 November 2006 the body corporate issued summons aga inst the ow ner for pay ment of a rrea r lev ies in the sum of R123 101.00, which the owner had allegedly failed to pay ‘despite same being due, owing and payable’ to the body corporate. The body corporate also sought orders for payment of interest on the amount claimed at a rate of two percent (2%) calculated from 1 August 2006 and for costs of suit on the scale as between attorney and client. The owner admitted in his defence that he was obliged to pay levies ‘imposed in accordance with the Act, as read with the rules governing the Scheme’, but denied he was obliged to pay the amount claimed. He pleaded further that any entitlement to claim the levies that had arisen more than three years prior to the institution of this action had prescribed and that the body corporate had from time to time appropriated payments received from him towards debits which were unauthorised and to which the body corporate was not entitled. He was entitled to be credited on his account with the payments, which were previously appropriated towards unauthorised debits. At the pre-trial hearing, the owner’s legal representative contended that the jurisdiction of the High court to determine the claim was ousted by the judgment in the Greenacres case, referred to above, which, in the owner’s view, compelled the resolution of the body corporate’s claim to be determined by arbitration. The court resolved that only if the disputing parties consented to arbitration at the time of the dispute, could a dispute be referred to arbitration and in addition, that the provisions of the Act and the regulations did not prescribe an arbitration procedure for inclusion in the rules; and the management rules were not an Act of Parliament that could exclude the operation of the Arbitration Act. It is not the object of this article to comment on the merits of the parties consenting to Arbitration in disputed matters or taking the disputes to court. It is suffice to state that it is the writer’s view, that given the time it takes to obtain a trial date today and the fact that there are arbitrators who specialise in Sectional Title disputes, it is generally far better to refer the disputes (particularly complicated disputes) to arbitration. RESOURCES Ivan Zartz Attorneys