The Regulations to the Sectional Titles Schemes Management Act 8 of 2011 (“the STSMA”), and the Prescribed Management Rules (“PMR’s”), defines a managing agent as any person who provides scheme management services to a body corporate for reward, whether monetary or otherwise, including any person who is employed to render such services.

Appointment of an executive managing agent

An executive managing agent is appointed, in terms of a management agreement, to perform the functions, and to exercise the powers, that would, in the normal course of events, be performed and exercised by the trustees, duly nominated and elected by the members of the body corporate. PMR 28 deals with the appointment, duties, obligations, and termination of an executive managing agent.

It is important to note that the appointment of an executive managing agent does not replace the requirement for there to be trustees. However, due to the fact that the executive managing agent takes on the role and responsibilities of the trustees, it may not be necessary to have a trustee committee, or more than the minimum required number of trustees, namely two.

For the purposes of this article, we will focus on the administration and management of a scheme in the absence of trustees, in other words Scheme Management solely by an executive managing agent.

Duties of an executive managing agent

Once appointed, the executive managing agent is subject to all the duties and obligations of a trustee, and is obliged to manage the scheme with the required professional level of skill and care. Failing which, the executive managing agent will be liable for any loss suffered by the body corporate due to their failure to exercise the required skill and care, in its administration and management of the scheme.

As is the case with trustees, the executive managing agent has a fiduciary obligation to every member of the body corporate.

In addition to the duties of trustees, the executive managing agent must arrange for the inspection of the common property of the managed scheme at least every 6 months, and report at least every 4 months to every member of the body corporate relating to the administration of the scheme.

The executive managing agent must report on:

  • The proposed repairs to, and the maintenance of, the common property;
  • The matters it considers relevant to the condition of the common property;
  • The balance of each of the administrative and reserve funds of the body corporate, and provide a reconciliation statement for each fund;
  • The expenses of the body corporate, including the repair, maintenance and replacement costs; and
  • A brief description of the date and nature of all the decisions made by it.

The report is similar in nature to the report that must be prepared and submitted by a Court appointed Administrator of a scheme.

To summarise, the appointed executive managing agent, will hold office in the place of the trustees, and will be the administrative and executive arm of the body corporate, being involved in the day-to-day running of the body corporate, by exercising and performing the duties and powers of the body corporate, subject to any provision of the STSMA, the body corporate rules, or any directions and restrictions imposed by the members.

In our consulting department, we prepare management agreements, dependent on the requirements of the scheme, and the service offerings of the managing agent or executive managing agent. If you require such an agreement prepared, or your agreement reviewed, do not hesitate to contact me, Zerlinda van der Merwe, via email at consulting@paddocks.co.za or call the office on 021 686 3950 for a non-obligation quotation.


Article reference: Paddocks Press: Volume 13, Issue 4.

Zerlinda van der Merwe is an admitted Attorney of the High Court, specialist Sectional Title Attorney (BA, LLB, LLM), Zerlinda brings a wealth of experience and forms part of the Paddocks Private Consulting Division.

This article is published under the Creative Commons Attribution license.

Back to Paddocks Press – April 2018 Edition.

10 Comments.

  • craig.martin
    31/08/2018 14:51

    Hi, I have read your statement that “an executive managing agent does not replace the requirement for there to be trustees.” Surely, this needs to be clarified. You also say “due to the fact that the executive managing agent takes on the role and responsibilities of the trustees, it may not be necessary to have a trustee committee, or more than the minimum required number of trustees, namely two.” I don’t understand how this would apply in practice. I understand that the executive managing agent takes over all of the functions of the trustee and full accountability – in practice what point would there be to appoint another trustee other than to obfuscate the work of the executive managing agent?

    • Paddocks
      07/09/2018 08:58

      Hi Craig,

      At the start of the article, we mention that an executive managing agent is appointed in terms of a management agreement, which agreement may provide that the executive managing agent perform and exercise all, or only certain, of the functions and powers of the trustees. Should the members of the body corporate, in their resolution to appoint an executive managing agent, require there to be trustees, even the minimum number of two, this is possible.

      Thanks,
      Paddocks

  • Hi, I am not sure what the full difference is between a standard MA and an Executive MA. I was asked to define an Executive Managing agent for a body corp. Most duties are exactly the same ?

    • Paddocks
      22/03/2019 09:30

      Hi Brian,

      Thank you for your comment. We would love to help, however we do not give free advice. Here’s how we can help:

      – We offer consulting via telephone for R490 for 10 minutes. Please call us on 021 686 3950.
      – We have Paddocks Club, an exclusive online club, to help you get answers to your questions about community schemes.

      Kind regards,
      Paddocks

  • Can a Executive Managing Agent be an owner or a resident with a Managing Agent who does the admin work for the complex Are there set down fees for this person or is it subject to negotiation with the Members

    • Paddocks
      04/10/2019 09:38

      Hi Mike,

      Thank you for your comment.

      We would love to help, however we do not give free advice.We do offer private consulting. You’re welcome to send us an email at consulting@paddocks.co.za and we can provide you with a no-obligation quote.

      Kind regards,
      Paddocks

  • John Roberts
    07/09/2020 17:16

    There overwhelming problem with appointing an Executive Managing Agent is to find one that qualifies to do the job or expose themselves to fiduciary duties to all Owners.
    Are you aware of any practicing Executive Managing Agents in the Sandton area?

    • Paddocks
      11/09/2020 15:47

      Hi John,

      Thank you for your comment. We have sent you an email.

      Kind regards
      Paddocks Team

  • Can the Trustees appoint Managing Agents without reference to the Body Corporate?

    • Paddocks
      21/09/2020 09:52

      Hi Johan,

      Thank you for your comment. This would be something that our legal team would need to assist with. Please send an email to consulting@paddocks.co.za and the team will provide you with a no-obligation quotation for their assistance with your matter.

      Kind regards
      Paddocks