The Community Schemes Ombud Service (more commonly known as CSOS) celebrated its fourth anniversary in October 2020 and there is much to be said about the positive changes that have been made to the CSOS since its rocky beginnings. Notwithstanding the fact that the CSOS has improved remarkably in many aspects over the last four years, I have found it necessary to write this article to explain to readers why I may be losing faith in the reliability and effectiveness of the dispute resolution mechanism provided by the CSOS.
The CSOS was established to provide for, amongst other things, a dispute resolution mechanism because Parliament decided that the settlement of sectional title disputes via the courts had become too expensive and time-consuming. Furthermore, the traditional arbitration mechanism provided for in the old management rule 71, as prescribed under the previous Sectional Titles Act, had proved to be ineffective in practice.
Unfortunately, it appears that the alternative to dispute resolution established in terms of the CSOS Act is proving to be equally, if not more, time-consuming and ineffective and this article aims to shed some light on the three biggest concerns that I have had with the CSOS adjudication process over the last four years.
1) Lead time of applications
In my experience, which I must admit differs greatly depending on which CSOS provincial office is involved, a typical CSOS application takes approximately 9 to 16 months from the date of lodging the application for dispute resolution form, to the date of receiving the adjudication order.
Naturally, this prolonged time period is incredibly frustrating for the parties and attorneys involved in the dispute, especially in matters that involve a certain degree of urgency, and the general lack of professional and effective communication shown by the CSOS during the application process, only makes matters worse.
2) Administration of applications
Parties to the dispute resolution process normally list the CSOS’s poor administration of applications as their main source of frustration. The CSOS has published practice directives on dispute resolution, which aim to set clear guidelines according to which all applications are to be dealt with. However, in my experience, almost every application is handled very differently and often in a manner contradictory to that set out in these practice directives.
Although I appreciate that one of the guiding principles of the CSOS dispute resolution process is to act with as little formality and technicality as possible, I believe that a certain level of formality, transparency and consistency will go a long way to improving the administration of applications and the poor lead times mentioned above.
3) Quality of adjudication orders
Without a doubt, my biggest concern as an attorney is the shocking errors in law and poor judgments made by some CSOS adjudicators. While this statement is in no way intended to apply to all CSOS adjudicators, many of which are incredibly competent and experienced, the quality of CSOS adjudication orders that I have received over the last four years is of great concern.
For example, in a recent adjudication, I assisted a member of a home owners association with an application to the CSOS, in terms of section 39(3)(d) of the CSOS Act, for an order declaring that a provision of the association’s constitution, having regard to the interests of all owners and occupiers in the community scheme, is unreasonable, and requiring the association to approve and record a new provision. The adjudicator dismissed the application without considering the merits thereof, based on the argument that he does not have the authority to alter an agreement concluded between the parties.
In my opinion, the fact that a constitution is considered to be a contract concluded between an association and its members should not prevent an adjudicator from having the power to alter the terms thereof, if it is found that the provisions of the constitution have an unfair adverse effect on one or more of the parties to the contract. Is this not the very intention of the prayer for relief described in terms of section 39(3)(d) of the CSOS Act?
As an attorney specialising in community schemes law, my personal experience with the CSOS has left much to be desired. However, I don’t believe that it is all negative and my hope is that the CSOS evolves into the driving force for change in the community scheme industry that Graham Paddock and others envisaged back in 2004 when the idea of the CSOS was first presented to Parliament.
However, until then, I suggest that parties involved in serious community scheme disputes consider the option of appointing a community scheme specialist as an arbitrator to resolve their dispute via private arbitration, which in my opinion remains the most reliable and efficient dispute resolution option.
Article reference: Paddocks Press: Volume 15, Issue 10.
Specialist Community Scheme Attorney (LLB, LLM), Auren Freitas dos Santos, is the Director of The Advisory, a boutique law firm specialising exclusively in community schemes law. Contact him at www.theadvisory.co.za.
This article is published under the Creative Commons Attribution license.
7 Comments.
Ah you hit the nail on the head. This is a problem with just about every bit of legislation that this current government has introduced. It never listens to the comments received from knowledgeable public and associations. CSOS, Property Practitioners Bill, Rental Tribunals, STSMA – all are more difficult and complicated and red tape than previous situations. They are a total disaster and a waste of time and effort. The EAAB is the biggest disincentive to be an estate agent. Estate Agency is a business and NOT a profession! Transformation would be achieved immediately simply by doing away with the EAAB. 50% of estate agents are already black people, they simply don’t/cannot register with the Board. They don’t even protect the public by for example refuting a claim for stolen body corporate funds by a non-registered estate agent because “It was not reported to them within 3 month of being discovered” – yet they will not even look at a claim if you have not gone through the years of civil claim first. What is needed is a total review of all property legislations with a KISS principal behind it. Why should we currently be in a situation that tenants can steal electricity by not paying for it but the landlord/body corporate cannot disconnect them and that tenants that have not paid rental for more than 6 months cannot be evicted.
Want the economy to grow? Then get rid of the rocks in the road of property ownership and make everyone tenants, owners, landlords, body corporates responsible for what they should be doing.
Your very frank article is appreciated, though a little depressing. CSOS collect levies from Community Schemes but do not perform the very laudable, if not desirable, services as they should. Having said that, I am currently involved in community schemes related litigation abroad. There are no ombud services here – courts deal with such matters. It has now taken over 24 months and four court appearances without any judgement as yet. On the positive side here, lawyers charge a flat fee – per case. This fee is not overly excessive and is fixed, irrespective of the duration of the case.
Thank you for this interesting, but very worrying article. Our experience with the Cape Town Ombud has related to the approval of amended Conduct Rules, rather than with an adjudication. At our AGM three years ago, our Body Corporate Members duly approved a revision of our conduct rules, mainly to bring them into line with the STSMA’s new prescribed rules, plus a couple of additional rules. The approved rules were at that time submitted to our Western Cape Ombud, but despite a reminder, we have not had a response. I do not know whether this is a general experience with the approval of rules, or whether our submission of the only one to have fallen through the cracks. I would welcome any comments from you, or from other Sectional Titles schemes.
Meanwhile I have suggested to our Trustees that they re-submit, under cover of the laid-down form.
As a Administrator appointed by Court to sort out a Body Corporate in distress the CSOS is not the place to seek remedy.
They take too long and by such delay the rehabilitation of a Body Corporate has passed its sell by date for any success.
I have on judgments received taken 4 on appeal, again this is expensive as High Court is required and the damage to the Body Corporate already suffering a lack of support in levy payment just gets more into difficulty.
I no longer use CSOS.
We have had exactly the same experience with Rule Changes. Our village is in Somerset West. We have been waiting for two years for additional Management Rules to be approved. We now have our lawyer sending monthly queries but to no avail.
I am the manager at a retirement village, we have done the whole process, consilation , arbitration and our case was handled with professionalism, and within 2 months from date of submission, case was resolved. – western cape branch
All these so called regulating entities are a mere façade of job creation to make the governing party look good. But they are all as ineffective in their conduct as most other civil service departments, and cause more havoc, frustration, and anarchy than adding value to the industries they are suppose to represent and regulate. We have a situation where an already financially constrained body corporate is suffering a further R 10 000.00 loss due to an adjudicator who based his adjudication on fabricated half truths by an owner who is R 120 000.00 outstanding, and has NEVER paid one levy to the body corporate since registration of his unit in 2008. This BC can obviously not afford to appeal to the high court.