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This article is part 2 of our sectional title series explaining the Body Corporate and its responsibilities.
The Body Corporate is comprised of all the owners of a sectional title scheme. An investor buying into a sectional title scheme will automatically belong to the Body Corporate on registration of the unit (this is not optional).
The owners that make up the Body Corporate have a responsibility to make sure that the scheme or complex is run efficiently and according to the Sectional Titles Act 95 of 1986.
It stands to reason that all owners therefore collectively have that responsibility.
Now, the biggest question usually is what are the functions of a Body Corporate?
The Body Corporate functions are set out in the Sectional Titles Act 95
of 1986 and there are quite a few. Let have a quick look and understand
the basics.
- Budgeting – The Body Corporate must establish funds
for administrative expense for the sectional title scheme. That, of
course, includes everything from repairs to local authority charges,
electrical supply, fuel, sanitary and other services. Basically,
everything that is necessary to manage and administrate the complex.
- Set Levies – The Body Corporate must determine levies for owners so that they have enough money to manage and administrate the complex.
- Banking – Yes, the Body Corporate is also obligated to open and account with a financial institution.
- Insurance
– The Body Corporate also have the responsibility to take care of
insurance and also to make sure it is up to date, all insurances needed
of course. It was once found that sectional titles in a scheme did not
update their insurance. Each unit was insured at a value less than 30%
of the replacement cost. In this case, if the worst happens, for
example a fire broke out, the owners would have to pay out some 70% of
the total cost of rebuilding their properties. Keeping up with adequate
insurance is a very important role that the Body Corporate is obligated
to do.
- Maintain Common Property – The Body Corporate
must make sure that the common property is maintained, that includeds
elevators and generally keep the complex or building in good state of
service and repair.
- Comply with Authorities – If the authorities ask a body corporate to fix something under any regulations they are responsible to comply.
- Comply with Law
– Another interesting point is that body corporate must be in
compliance with any law that relates to common property or any
improvement of land comprised in the common property. This is an
interesting one as the members of the Body Corporate, in this function,
must by definition understand such laws. If they don’t then they should
hire someone that does, otherwise they can’t really comply with
something they don’t understand.
These are just some functions of the Body Corporate that give an idea
of the responsibility, which in general, is to manage and administer
the complex or sectional title scheme to the benefit of all owners in
it.
See Also FAQ Body Corporate and When a Body Corporate is Formed .
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