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Body Corporate funds

By Johann du Toit on Thu, 11 Oct 2018 at 10:41

According to Part 3 9(c) (c)apply the body corporate's funds in accordance with budgets approved by members in general meeting;

At our AGM a value of R30 000. Was approved per project.

We now have an onwner that would lot of thing done at his unit. Which is correctly the responsibility of the BC. But now all these items that bneeds to be done comes almost to the value of R50 000. Is this seen as one project or is this handled as individually thus can be approved as such. The owners does not see it that way and I need some clarity.


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RE: Body Corporate funds

Frances Paton replied on Thu, 11 Oct 2018 at 19:05

The trustees have a duty to maintain the buildings of the scheme in good repair. I would question whether the body corporate has the right to place a limit on expenditure for necessary repairs and maintenance, especially when it is to the detriment of a single owner. However, has it been established that all the expenditure is for the account of the body corporate? If, for example, the work involves the repair or replacement of external doors and windows of that section, the STA requires the cost to be divided 50/50 between the body corporate and the owner.
What do others think?

RE: RE: Body Corporate funds

Johann du Toit replied on Fri, 12 Oct 2018 at 07:28

Thanks for the reply. Yes all that needs to be done is for BC expence. But my Question is, should this not be handled as one project, and be approved by the owners. This was not budgeted for thus other maintenance projects had to be set aside to complete this one. The owners give me as chairman now uphil as I have not delivered on the projects they would like to be done as asked in the AGM. Now my reply is that we had to fix this unit. They see this as a project which should have been discussed and budgeted for.

RE: RE: RE: Body Corporate funds

Frances Paton replied on Sat, 13 Oct 2018 at 11:15

Dividing the work on a single section into individual projects seems to be somewhat contrived, although it could perhaps make sense if very different and unrelated tasks are involved. You have not indicated what the nature is of the work to be done on the different sections, so it is difficult to comment. As a possible example, repairing the roof and then painting it would in my view be two components of a single project. However, it seems that you are already facing a difference of opinion with some of the owners.
The owners need to bear in mind that the body corporate has an obligation to maintain the premises so if the work that cannot be done due to lack of funds is necessary repairs or maintenance, and cannot reasonably wait until the next AGM, I suggest that the trustees consider imposing a special levy (see PMR 21(3)(a). However, if any part of the work to be done is an improvement (whether or not reasonably necessary) the trustees must comply with PMR 29(1) or (2), as the case may be. Agreement on certain projects at the AGM is not sufficient.

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