The Western Cape High Court delivered a significant judgment on 18 March 2025, determining that the Ashwood Centre Body Corporate's attempt to recover over R1.1 million in unpaid levies from Haldenby Estates (Pty) Ltd was unsuccessful.
This decision hinges on the court's finding that the plaintiff, Ashwood Centre, failed to lawfully raise the levies as required by the Sectional Title Schemes Management Act, the primary legislation governing sectional title schemes in South Africa.
In the ruling, Acting Judge SST Kholong laid out the case in which Ashwood Centre sought recovery of R1,104,323.11 for unpaid contributions dating back to December 2018. While Haldenby had originally contested the accuracy of these calculations, this point became moot during the case as both parties ultimately acknowledged the validity of the amount claimed. However, the core debate turned on whether the levies had been levied in accordance with the applicable law.
Central to the case was the evidence provided by Ashwood Centre's chairperson, identified in the judgment only as M Anvary. He asserted that levies were approved through resolutions passed at annual general meetings claiming that Haldenby was made aware of its responsibilities to contribute to the common expenses of the body corporate. Testimony pointed out that Haldenby had not contested the resolutions related to levies prior to this trial, suggesting tacit acceptance of its obligations.
Nevertheless, the defendant's counsel raised critical objections to how these levies were supposedly ratified. S Burnett from Haldenby, also a former trustee of Ashwood Centre, testified that he had never seen the official resolutions related to the levies during his tenure between 2017 and 2019. He further argued that the documentation presented by the plaintiff lacked the necessary dual signatures of trustees required under the law for such resolutions to be considered valid.
The court examined these assertions against the backdrop of the regulations stipulated in the Act. The judgment concluded that the plaintiff's failure to meet the requirements for valid resolutions meant that the levies could not be lawfully claimed. In a noteworthy statement, Judge Kholong stated, "None of these disputed documents were signed by two trustees or in the alternative a trustee and a managing agent as required."
The significant ruling not only dismissed the Ashwood Centre's claims but also underscored the importance of strict adherence to procedural requirements laid out in statutory frameworks governing sectional title schemes. The judgment concludes with the court ordering Ashwood Centre to cover the legal costs of both parties, emphasising the financial implications of not following proper protocol in levies and contributions disputes.
#Conviction
