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Withhold levy payments

By Barbara Murphy on Thu, 22 Mar 2012 at 13:22

Is it legally permissible for owners to pay levy funds into a seperate trust account, perhaps held by an attorney, for release once issues of Trustees mismanagement are addressed ? At present Trustees have personal access into the account where these monies go at the moment in both our HOA and our Body Corporate (we are sectional title but part of larger gated community). There are too many issues to outline here but some serious cause for concern - enough that we wish to cease Trustee access to our funds right now.


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RE: Withhold levy payments

John Yates replied on Thu, 22 Mar 2012 at 14:54


RE: Withhold levy payments

Carel Basson replied on Fri, 23 Mar 2012 at 11:55


RE: Withhold levy payments

Myburgh Brink replied on Fri, 23 Mar 2012 at 12:50

If the problems are serious as you believe they are why not replace the trustees (PMR's 13 (e) and 53) with more competent and reliable people? You should also make yourself available for election - you may even nominate yourself. Alternatively declare a dispute i.t.o. PMR 71.

By withholding contributions, if all owners decided to follow the same route, the BC's finances would be compromised. This would have a chain reaction: no funds for maintenance/repairs (urgent or routine), no funds to pay electricity/water, no funds to pay wages, i.e. no money to meet the schemes obligations. This would mean that a creditor or any owner could apply to have the scheme placed under Administration (§46) and §47 could also be applied, where ALL owners are held liable for the BC's debts as per their PQ values. A further spin-off of withholding contributions is that anybody in arrears may not vote on any ordinary resolutions at general meetings (PMR 64 (1). By paying it into another account means the BC has not received it in its own account therefore it is outstanding and both interest and collection costs are also recoverable from the defaulting owners (PMR31 (5) and (6)).
2012/03/23 12:47...Show More

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