Anton Kelly

There is an inevitability about the cost of geyser maintenance and replacement: the owner concerned is liable for anything the body corporate’s insurer does not pay! It’s useful to understand the provisions that make for this “no place to hide” situation.

Most modern residential schemes have the geyser inside the section, so in terms of section 44(1)(c), it’s clear maintenance is the owner’s responsibility.
Another common arrangement is that the geysers are located in the roof space and supply one or a group of sections.

In very big buildings, particularly older ones, the hot water is often supplied to all sections from one or more boilers, usually located in a basement or boiler room. The maintenance of this system is clearly the body corporate’s responsibility and costs paid out of the administrative fund.

It is the situation where the geyser serves one or a small group of sections and is located on common property that is the most interesting.

paddocks_geysers

Because section 37(1)(j) makes maintenance of the common property the responsibility of the body corporate, on the face of it the geyser on the common property is also the body corporate’s responsibility, both operationally and financially. But no! Enter prescribed management rule 68(1)(vii).

PMR 68(1)(vii) makes a number of provisions in one quite long sentence. Here it is:
“(1) In addition to his obligations in terms of section 44 of the Act, an owner-
(vii) shall maintain the hot water installation which serves his section, or, where such installation serves more than one section, the owners concerned shall maintain such installation pro-rata, notwithstanding that such appliance is situated in part of the common property and is insured in terms of the policy taken out by the body corporate.”

Let’s break it down:

a. Owner to maintain the geyser that serves his or her section.

b. If the geyser serves more than one section, those owners maintain it pro-rata.

c. The owner or owners must maintain the geyser that supplies their sections even though it might be on common property.

d. The owner or owners must maintain the geyser that serves their sections even though it is included in the body corporate building insurance policy.
1. The first part is clear and applies to geysers on common property and to geysers inside sections – although that is a reiteration of a detail covered by section 44(1)(c).

2. This part is clear enough and incidentally applies to the boiler situation.

3. This is the main point of this provision and is necessary because of section 37(1)(j). The body corporate must maintain the common property but geysers on common property are the exception. Really, the provision exists to make that exception, which is fair since geysers inside sections must be maintained by the owners of those sections.

4. The last statement is an interesting inclusion. I guess it takes care of an objecting owner holding that since the geyser is insured by the body corporate, the body corporate must maintain it, no matter where it’s located.

Geysers are traditionally included in building insurance and the premium is paid by the body corporate but not the excess payments that result from a claim against the insurer. There are two ways that is ensured.

First, if the geyser is inside the section, PMR 29(4) applies. The rules says an owner is responsible for any excess payment for claims against the body corporate building insurance in respect of his or her section, unless the body corporate has made this a specific exception to the rule, and that can only be done by special resolution.

Secondly, PMR 68(1)(vii)’s shifting the maintenance responsibility for an installation on common property to the owner concerned also means that any excess applied to a claim for a geyser on common property must be paid by the owner or owners of the sections supplied by that geyser.

No matter which way one looks at it, owners have to call the plumber and pay for their geyser maintenance!


Image source: hometips.com

Article reference: Paddocks Press: Volume 10, Issue 9, Page 2.

Anton Kelly is an extremely knowledgeable specialist Sectional Title and HOA teacher and consultant. Having been the lead teacher on all the Paddocks courses for the last 5 years, Anton lives and breathes Sectional Title and HOA law, all day every day. There are not many issues he hasn’t come across before.

This article is published under the Creative Commons Attribution license.

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