Sectional Title Amendment Bill 2003: briefing

Meeting report

LAND AND ENVIRONMENTAL AFFAIRS SELECT COMMITTEE
10 September 2003
SECTIONAL TITLE AMENDMENT BILL 2003: BRIEFING

Chairperson: Reverend P Moatshe (ANC)

Documents handed out:
Sectional Title Amendment Bill - Department Powerpoint Presentation
Sectional Titles Amendment Bill [B43-2003]

SUMMARY
The Department of Land Affairs briefed the Committee on the Sectional Title Amendment Bill. The main concern was that exclusive use areas could be rented to people outside a secured complex, thus jeopardising the safety of those who had invested in the complex. It was also noted that the Regulations Board did not have any representatives from body corporates as members.

MINUTES
SECTIONAL TITLE AMENDMENT BILL - DEPARTMENT PRESENTATION
Ms N Makgalemele (Department Deputy Director) explained that the Bill contained amendments to the Act of 1986 as recommended by the Regulations Board. The Bill is also being amended in Afrikaans to ensure the same interpretation.

Mr H Geldenhuys ( Registrar Deeds Office) said that the objectives of the Bill were to streamline its application and clarify areas of uncertainty. He proceeded to lead the Committee through the Bill.

Please refer to attached document.

Clause 1(a) removes the words "notarial bonds" from the definition of "owner". (b) clarifies the body corporate's right to approach the court for relief. There is therefore no need to rely on Rule 71 regarding arbitration.

Clause 2 assists in making the Act more user-friendly by repealing subsection (5A).

Clause 3(a) and 3(b) repeals superfluous paragraphs.

Clause 4 substitutes the heading "Dealings with common property" with "Alienation and letting of common property".

Clause 5(a) provides for the substitution of "limits" with "boundaries or floor area". (b) repeals paragraph (b) of subsection 24(6), which is redundant because of the repeal of subsections (1) and (2).

Clause 6(a) amends the heading to read "Extension of schemes by addition of sections and exclusive use areas". (b) inserts paragraph (dA) to clarify registration procedures. (c) amends paragraph (c) of Section 25 (10) to make the paragraph more gender sensitive. (d) omits reference to the repealed section and substitutes a Latin phrase with its English counterpart to make it more gender sensitive.

Clause 7 incorporates new conditions into the Section 11(3)(b) schedule for lodgment of prescribed documents.

Clause 8(a) makes linking exclusive use areas optional to benefit prospective buyers and resolve the marketing problem for developers. (b) amends Section 27(1)(b) of the Act consequential to the amendment of Section 27(1)(a) about optional linking of exclusive use areas. (c) inserts paragraphs (c), (d), and (e) in Section 27(1) to provide for the vesting of remaining exclusive use areas in the name of the body corporate and procedures to be followed. (d) inserts paragraphs (b), (c) and (d) in Section 27(4) of the Act to provide for the vesting of exclusive use areas in the name of the body corporate and procedures to be followed where a member of the body corporate is no longer the owner of a section while exclusive use areas are still registered in his or her name. (e) inserts subsection (7) to provide for obtaining separate titles.

Clause 9 amends section 37(2) and replaces "when such contribution became due" with "such resolution was passed". The liability is linked with the time of the resolution.

Clause 10 relates to the short title of the Act.

Discussion
Dr E Conroy (NNP) asked if these were the final amendments for making the Act user-friendly. Referring to the issue of the High Court, ordinary people did not want to engage in costly litigation. He asked why the Magistrate's Court could not be taken into consideration. With regard to detaching exclusive use areas from a unit, Dr Conroy pointed out that letting units to people outside of the property would cause conflict. An ombudsperson should be appointed to deal with sectional title deeds.

Mr M Sulliman (ANC) referred to section (8) subsection 7(a), saying that separate title deeds were expensive. He asked for clarification on the matter.

Reverend M Chabaku sought an explanation of the word "alienation" in the context of the Act.

Ms Makgalemele said that these were not the final amendments to the Act as more issues relating to sectional titles always arose. The process of an ombudsperson to deal with sectional titles was being accelerated so that conflict could be resolved. The plan now was to revise and review the whole Land Registration System for one holistic system.

Mr Geldenhuys referred to the definition of court in the Act, explaining that both High Court and Magistrate Court were covered by it. Regarding exclusive use areas, detachment was optional because some could not be detached in some cases. Concerning separate titles, this was included because financial institutions sometimes insisted on keeping the title.

Mr S Ogunronbi (Department) explained that the word "alienation" was inanimate in the legal context, and simply referred to the act of separating one thing from another.

Dr Conroy said that separate exclusive use areas were a problem in practice. For instance, if parking space was rented to people outside of a complex of apartments, people who did not reside there would come onto the grounds. The Sectional Title Registration Board comprised of architects, bankers and lawyers, without any representatives from body corporates. This was a big flaw.

Mr Sulliman said that, as public representatives, they should discourage people from investing in title deeds that would be problematic in the long run.

Reverend Chabaku said that money was the main concern in these matters.

The Chairperson pointed out that Dr Conroy, as a former property owner, had a great deal of experience in these matters. He still needed clarification on a few issues referred to in the Act.

Mr Geldenhuys explained that the Sectional Title Act dealt with the division of building. Common property could have exclusive use areas.

Dr Conroy explained that exclusive use areas could only be rented, not sold, to people outside of the secured area, constituting a breach of security. People who had bought the units under certain conditions were now jeopardised in terms of their security.

Mr Ogunronbi said that it seemed feasible to the Registration Board to continue selling units without attaching flats.

Dr Conroy insisted that this provision did not make the Act user-friendly. The Deeds Office did not take into consideration the human side of sectional titles.

The meeting was adjourned.