Author: Maryna Botha
Director – STBB Cape Town
11 November 2020
DEVELOPMENT LAW UPDATE | ISSUE 02 – 2020 (PART 3)
RECENT DRAFT AMENDMENTS TO THE SECTIONAL TITLES ACT: SOME FLEXIBILITY FOR DEVELOPERS
In September this year, suggested amendments to the Sectional Titles Act (‘STA’) were gazetted. Some of these affect developers directly and should provide more flexibility to amend sectional title plans at the time before the body corporate comes into existence.Those changes that affect developers directly and indirectly in the process of establishing a sectional title scheme, are briefly highlighted below.
1. Where an existing building, with residential tenants, is sectionalised
Currently the STA requires of the developer to, amongst other things, arrange for a meeting with all residential tenants of the building that will be sectionalised, advising them of the process, implications and their rights. A sensical amendment is introduced to section 4 of the STA, stating that at such meeting, the tenant may also appoint an agent to represent him/her. This is important, as the developer’s conveyancer is obliged, when application for the opening of the sectional title register is lodged in the deeds office, to provide confirmation that the tenants were invited to the meeting and that they attended (subject to certain exceptions).
2. Architect/land surveyor certificate in respect of compliance with town planning scheme
The certificate issued by the land surveyor or architect that must accompany the application to the Surveyor General to approve the draft sectional plan, requires confirmation that no operative town planning scheme is contravened with the opening of a sectional title register on the relevant property. Or, if it is contravened, that application to the municipality for condonation was successful.
The amendment now requires that the certificate must, in addition, state that the draft plans comply with section 26(2) of the Spatial Planning and Land Use Management Act (SPLUMA). These sections in SPLUMA require, in essence, certification that the plans are consistent with the applicable land use scheme or town planning scheme. It therefore allows for a more detailed and explicit certification on the side of the architect/land surveyor.
3. Submitting plans for – subdivision, consolidation, extension of sections or for extension of a scheme – before the body corporate is established
New clauses are proposed which would make it possible for a developer’s architect or land surveyor to submit a draft sectional plan of:
- subdivision of a section;
- consolidation of sections;
- extension of a section;
- extension of a scheme by the addition of sections and exclusive use areas; or
- extension of the scheme by adding common property
to the Surveyor General for approval, and registration thereof in the deeds office, before the body corporate has come into existence.
4. When the body corporate applies for a right to extend the scheme: who must consent
At present, where a body corporate applies for the extension of a scheme (where there is no reservation of rights in favour of a developer in terms of section 25(1), or it has lapsed), then all members of the body corporate must consent thereto, as well as the bondholders (that have bonds registered over sections and exclusive use areas). The amendment requires that the holders of any other real rights must also consent to such extension. It is specifically stipulated that none of the aforementioned parties may withhold consent without good cause in law.
5. Note the lapsing of a right to extend (sec 25) on transfer of a unit in the scheme (edited)
The proposed amendment of section 15B requires that, with the transfer of any unit in a scheme in respect of which a real right is registered which has lapsed, the registrar must note the lapsing of the right, on application by the developer or by the body corporate if the developer is no longer in existence.The changes are likely to become law without further amendments.
Contact our Development Law Unit at firstname.lastname@example.org, should you require assistance in this regard.
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