On the 7th October 2016 the Community Scheme Ombud Service Act 2011 (Act 9 of 2011) came into force. The Community Schemes Ombud Service (CSOS) was established in terms of this act with the aim of providing an alternative, impartial and transparent service for the resolution of unresolved disputes in community schemes and to ensure their good governance.
So what is considered a community scheme you may ask? Well according to the act this includes the following: sectional title development schemes, a share block company, a home or property owner’s association, however constituted, established to administer a property development, a housing scheme for retired persons and a housing co-operative as contemplated in the South African Co-operatives Act, 2005 (Act No. 14 of 2005).
Any governing body, owner or occupant (this includes tenants) of such a community scheme who may have a dispute with another person/entity in that scheme will now have access to a low-cost dispute conciliation (mediation) and adjudication (arbitration) service provided by the Community Schemes Ombud Service. This means that you will no longer need to pay costly legal fees or spend months in litigation over issues in your scheme.
You are now able to refer such a dispute to the Ombud who will attempt to resolve the matter through a process of conciliation before making a ruling and his decision will carry the same weight as a court order. This can be done directly via their website www.csos.org.za
An application can be made to the CSOS in respect of the following issues in your scheme:
1 Financial issues; 2 Governance issues; 3 Meetings; 4 Management services; 5 Private areas and common areas and 6 General and other Issues
For more on this process please click on this link http://www.csos.org.za/documents/publications/introductiontothecsosservice.pdf
This service will be predominantly funded through a small levy calculated in relation to the overall levies of each community scheme and is paid by the Governing Body to the CSOS quarterly. The CSOS levy is calculated in proportion to each owner’s monthly levy payment to the scheme and is the lesser of R40 or 2% of the amount by which the monthly levy charged exceeds R500.00.
There is also a small application fee of R50.00 for cases submitted to the CSOS and an adjudication fee of R100.00 Applicants who earn less than R5 500.00 per month do not have to pay the application or adjudication fee if they wish to use the service.
Schemes must be registered with the CSOS within 30 days of the implementation of the act (7 November 2016) but by no later than the 6th December 2016. There is a prescribed form for this purpose, (copy of the form below) and set out in the Regulations to the Act. Failure to register is a criminal offence in terms of Section 34 of the Act and is punishable by fine and/or imprisonment not exceeding 5 years.
As such we encourage all schemes to register without delay!
Click here to download the REGISTRATION OF A COMMUNITY SCHEME FORM.