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Engel & Völkers Licence Partner South Africa > Blog > Community Schemes Ombud Service Act 9 of 2011

Community Schemes Ombud Service Act 9 of 2011

The new sectional title scheme management act's which comes into play this year, will provide both the trustees and the residents within community schemes the platform to resolve disputes in an orderly and fair manner concerning topics of financial, behavioral,governance, community meetings, repairs, maintenance and general.

It is contemplated that the Ombudsman service will investigate and justify claims and complaints against managing agents or other employees of the community schemes, like sectional title body corporates, home owners associations, share block schemes etc. The act also implies that the Ombuds service will be able to rule on certain aspects,to overpower these bodies that have been put in place.

Upon receipt of a claim or complaint the Ombud will consider the content, relevancy and importance of the application and will be allowed to reject or request further action to investigate the application.  If an adjudicator decides that the application does warrant that making an order is appropriate, and then notice must be issued to the affected parties of such decision and the adjudication process, as provided for in the Act.

The Community Schemes Ombud Service Act, 9 of 2011 (OSA) and the Sectional Title Schemes Management Act, 8 of 2011,(SMA) will be put into operation during the course of this year. The new proposed regulations to the OSA will also provide for the following: An additional levy, over and above the normal levy to fund the operational infrastructure of the new Ombud service, payable on a sliding scale between R3.40to R68.00 per month to be added on to normal levies paid monthly. Corroborates will have to take out insurance against the risk of loss of money belonging to the community scheme, or for which it is responsible due to fraud or dishonesty. This will have to be funded by the sectional title owners. Corroborates must also have a reserve fund amounting to 25% of the administration costs with a five year maintenance plan.   


“Although this act will come at anextra financial cost to both body corporate and home owners, it encourages the managements of dispute in an orderly and fair fashion that would contribute to the safe investing of property in communal schemes, and in the long run willadd a great return on investment as well” added Craig Hutchison CEO of Engel& Völkers Southern Africa.

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