Warning for people living in complexes and sectional titles in South Africa

A new High Court ruling has confirmed that body corporates have the legal right to disconnect the electricity supply of owners in sectional title schemes who are in arrears—as long as the proper legal process is followed.

According to legal experts at Wright Rose-Innes, the powers of a body corporate to disconnect the electricity of owners in arrears with their levies and utilities has long been a contentious issue.

This has often sparked conflict between financial obligations and individual rights, the group said.

However, in the a new case between the body corporate of a sectional title scheme and one such owner, the High Court has struck a balance between a body corporate’s duty to maintain financial stability and the rights of an owner in arrears.

The respondent in the case had fallen behind on levy and utility payments—including electricity consumption—for over two years since becoming an owner.

In response, the body corporate sought a monetary judgment for the outstanding amount and an order authorising it to appoint an electrician to disconnect the owner’s electricity supply until the arrears, along with interest, had been paid in full.

The court noted the conflict between two competing rights, namely, the body corporate’s rights to be reimbursed for the payments made on behalf of unit owners who are in arrears, and an owner’s right to be supplied with electricity.

According to the legal firm, the court held that a fiduciary relationship exists between the trustees and the body corporate, which requires the trustees to manage the body corporate’s affairs in a manner that benefits all its members.

“This duty includes recovery of monthly levies and other charges to ensure sufficient funds for administering the affairs of the sectional title scheme, as well as maintaining the common property within the scheme,” it said.

A body corporate is a non-profit association and is not allowed to generate income from sources outside the Sectional Titles Schemes Management Act, 8 of 2011.

Thus, its financial sustainability and continued existence depend almost entirely on the levies and utility charges paid by its members.

The body corporate had also been covering the owner’s electricity charges for over two years, as it is required to pay electricity charges to Eskom monthly on behalf of all members.

The court noted that if the body corporate were unable to recover these payments from individual owners, it risked depleting its funds, which could ultimately lead to the disconnection of electricity for the entire scheme.

The court further held that an order authorising the disconnection of the owner’s electricity was crucial in this regard, as the continued enjoyment of electricity without payment was detrimental to the financial stability of the body corporate and other paying owners.

However, the legal firm noted that it is important to emphasise that a body corporate cannot arbitrarily take the law into its own hands by disconnecting certain utilities, as this may amount to spoliation.

The appropriate court authorisation must be obtained, it said.

“The judgment therefore reinforces the principle that while unit owners have the right to basic services such as electricity, they also have a duty to contribute toward the financial sustainability of the sectional title scheme.”

“By confirming that a body corporate may disconnect electricity, provided the correct legal procedures are followed, the court has established a preventive measure for the body corporate to safeguard the interests of paying owners.”

“This ensures that all members contribute fairly towards the financial affairs of the body corporate while empowering the body corporate to act against non-paying owners.”