South Africans are increasingly looking to move into security estates and other gated communities, but there is mounting tension around governance and accountability in these sectional title schemes, with many trustees not even undertanding the basic laws.
This is the feedback from Ebo Quagraine, Principal Property Practitioner at Propertyzz, who noted that South Africans are increasingly living in estates and sectional title homes.
However, alongside this growth in security estate living, there is rising tension around trustee governance.
These tensions range from levy disputes and reserve fund transparency to allegations of trustees acting beyond their powers and mandates—leading to courts increasingly being asked to intervene in body corporate decisions.
Quagraine noted that this has raised questions about whether these issues reflect isolated cases of mismanagement or a broader systemic governance problem in community living.
He believes the shift is less about worsening behaviour and more about growing awareness among homeowners.
“I think it’s more an issue of owners becoming aware of the assets that they’ve bought and what it’s supposed to do for them,” he said.
As owners become more informed, they begin to question whether they are receiving what they were promised.
He views this scrutiny as positive. Greater awareness naturally leads to more questions and, in turn, a system that is tested and corrected where necessary.
However, governance failures remain a concern. Referring to the Sectional Title Schemes Management Act, Quagraine noted that it was designed to address shortcomings in earlier legislation and clearly sets out the functions of a body corporate.
However, many trustees are not familiar with the Act. “Many people are not so well versed with the Act itself, and especially, trustees do not really read these documents.”
The result can include financial mismanagement, breach of fiduciary duty, governance failures, and lack of enforcement of rules or the abuse thereof.
“The majority of the people that are stepping up [do so] from a point of popularity context as opposed to being skilled personnel with a skilled mindset of how to appreciate the value of an asset,” he said.
Solutions for residents who have bad management
However, Quagraine noted that those with issues with management who are living in an estate or sectional title solution exist.
He said the Act provides for skills audits and, under Section 28, allows schemes to appoint executive managing agents who assume the fiduciary responsibilities of trustees.
“An executive managing agent absorbs the role of the trustees, actually holds the fiduciary responsibility,” Quagraine explained. If they fail in their duties, they can be held legally accountable.
While this comes at an added cost, Quagraine argued that the opportunity cost of poor governance is far greater.
“The cost of not having a good, knowledgeable trustee body outweighs expensing whatever amounts per unit for having a qualified practitioner that fulfils that role.”
For homeowners facing disputes, the law provides clear recourse. Owners are entitled to access scheme information and should first raise concerns with trustees in writing.
If that fails, they can approach the Community Schemes Ombud Service, which adjudicates disputes at no charge.
“You file your dispute, and you will get a proper adjudication process embarked upon and finalised,” he said, and added that the ombud’s ruling “is equal to a High Court ruling.”
Poor governance can have severe financial consequences. A neglected or poorly run scheme becomes undesirable and difficult to sell.
“Nobody wants to walk into a scheme and see paint peeling off, the roof coming down, and all of that, and then still want to put money there.”
