How will sectional titles scheme rules be interpreted when the Sectional Titles Schemes Management Act comes into effect?
By Prof. Graham Paddock and Dr Carryn Melissa Durham
Prof Graham Paddock is considered by many to be the authority on Sectional Title scheme management law and practice in South Africa, Prof. Paddock has specialised in sectional title, homeowners’ associations and other forms of community scheme law for over 40 years.
Dr Carryn Melissa Durham is one of the most highly qualified Sectional Title lawyers in the country (BA, LLB, LLM and LLD), Carryn forms part of the Paddocks Private Consulting Division.
Historically there has been some confusion as to the legal nature of sectional title scheme rules. The academic thought leaders, in the law of sectional titles in South Africa (Professors CG van der Merwe and GJ Pienaar) agree that rules made by bodies corporate are “the product of the legislative power of an autonomous statutory association.”
Draft Regulation 6(1), made under the Sectional Titles Schemes Management Act 8 of 2011 (“the Act”) states:
“Rules, as prescribed and as amended by a body corporate in accordance with section 10 of the Act, must be considered to be and interpreted as laws made by and for the body corporate of that scheme.”
At the public information sessions, held after the publication of the Draft Regulations for public comment, the question was raised: What does Regulation 6(1) mean?
Under section 10(6) of the Act, a body corporate is obliged to have the scheme’s rules available for inspection at trustee and owner meetings, and to deliver copies of the rules to all owners and occupiers of sections. The sectional title scheme management stakeholders, including the chairpersons and trustees (who will have to make rulings on the application of rules in the course of meetings), owners, occupiers, managing agents and legal advisers, will all have to be familiar with the content of the scheme rules and know how to interpret them. This article contains our view on how rules made by bodies corporate, will have to be interpreted under the Act.
When interpreting the rules, a good start is to test the rules against the provisions of the Constitution of South Africa – this being the supreme law of the Republic. Clearly no law or rule of a body corporate can be contrary to any provision of the Constitution.
In addition, the specific requirements of the Act, in regard to the making of rules by a developer or a body corporate must be taken into account. One of the first considerations is that the Act creates a hierarchy:
- In terms of section 10(1) of the Act, the management and conduct rules are both subject to the Act.
- In terms of section 10(2)(b) of the Act the conduct rules may not be irreconcilable with any prescribed management rule.
Section 10(2) of the Act states that the rules must provide for the “regulation, management, administration, use and enjoyment of sections and common property”. This is the full possible scope of the rules, and they cannot validly provide for any other matter. Thus, for example, any provision in the rules that purport to control the behaviour of owners anywhere other than in and upon the land and buildings that form part of the scheme, would be invalid. Section 10(3) of the Act establishes the requirement that the management or conduct rules must be “reasonable and apply equally to all owners of units”. Any provision that is unreasonable will not constitute a valid rule. It is important to note the requirement that the rule be reasonable, should be based on the particular circumstances of the scheme and members of the body corporate. There needs to be a rational basis for the interpretation – the decision should be founded on what is appropriate and fair in the circumstances. This argument is strengthened by the fact that, in terms of section 10(5)(b) of the Act, the chief ombud must not approve any rule for filing unless, he or she is satisfied that it is reasonable and appropriate to the scheme. Section 10(4) of the Act provides that scheme rules bind the body corporate as well as the owners and occupiers of sections. Accordingly rules cannot validly regulate the behaviour of any other persons. The Act also contains various procedural requirements as to the types of body corporate resolutions and/or consents required for making rules. Under section 10(5) of the Act, new and amended rules come into operation on the date that the chief ombud issues a certificate approving the rules or on the opening of the sectional title register for the scheme, whichever date is the latest. After the rules have been tested against the requirements in the Act, the golden rule is applicable, (i.e. that the text read, as a whole and taken in context, must be given its ordinary, literal and grammatical meaning, otherwise known as its plain meaning). In this regard, authoritative dictionaries may be referred to. In the enquiry, one seeks to establish the intentions of the legislator. This begins with looking at the text of the law – in the hopes that the intention will be clear from a reading of that text. If the intention is clear, that is the end of the enquiry.
The Interpretation Act 33 of 1957 may be useful in interpreting the detailed provisions of any rule. It deals with practical matters such as the calculation of time, the reckoning of a number of days, measurement of distances, expressions relating to writing, gender and expression as well as the meaning of various words commonly found in legislation.
Other techniques used in interpreting the text of the law are to read the long title, any preamble and the text in context. As far as possible, words must be given the same meaning throughout the rules and the Act. However, where the intention is still not clear from the text, then it is necessary to use additional rules, guidelines, principles or presumptions of interpretation. There is no established hierarchy of these presumptions. The courts are flexible in their approach, and often exercise a discretion.
General language used must be construed to include all instances within its scope. For example, if a rule requires that two trustees must sign any document on behalf of the body corporate, then the word “document” should be interpreted so as to include all written, printed, or electronic matter that provides information or evidence or that serves as an official record and that binds the body corporate.
If in any rule something or a number of things are expressly included, then this means that anything else is automatically excluded. An example is that a conduct rule that forbids the keeping of dogs, cats and birds should not be interpreted so as to forbid the keeping of hamsters.
Rules, being a form of legislation, must be considered to be designed to achieve a particular purpose. Another principle of interpretation that must be used is the mischief rule. This interpretative tool looks at what mischief the law or rule is meant to remedy and prefers a meaning that achieves that objective. There are also a number of additional presumptions in regard to the intention that underlies a rule. It is presumed, for example, that the rule is intended to advance the community’s best interests. There are also presumptions against:
- absurd results;
- harsh, onerous, unjust, inequitable or discriminatory treatment; and
- retrospectivity (regulating an action taken before the rule became effective).
Another important consideration is contextuality. Words can have different meanings in different contexts. In this regard, the historical setting of text is important. This may include examinations of documents providing background information of the origin of the legislation or rule. However it is important to note that in the interpretation of statutes, statements or documents by Parliament, are generally excluded.
Finally, the principle of stare decisis can also apply in the case of judicial interpretation of a rule. A lower court is bound by an interpretation of a higher court, and a court must consistently follow its previous interpretations.
If you have issues or queries relating to your scheme’s rules please contact us at [email protected]
Article reference: Paddocks Press: Volume 11, Issue 06, Page 01.