Powers and duties vested in trustees
Category Newsletter: Article
The Body Corporate
In a sectional title scheme, the body corporate manages the property and makes key decisions in the way the scheme should be maintained. The body corporate is simply made up of members who own units in a common property such as an apartment complex.
These members appoint trustees who are responsible for the day-to-day running of the property, its financial management and can also act as routine decision-makers.
According to The Sectional Titles Act of 1986, the functions and powers of the body corporate are performed and exercised by trustees.
With certain powers given to trustees, it is important to identify exactly what provisions the Sectional Titles Act allows them and which functions are strictly reserved for the body corporate as a whole.
Decisions trustees are allowed to make
Trustees are the executive committee of the body corporate and are vital for the smooth running of a sectional title property. The Act states that trustees can make certain decisions, many of which are of high-priority and therefore it is imperative for the governing body to select trustees that are reliable and trustworthy.
Trustees have the power to:
• Appoint employees or agents on behalf of the body corporate who they see fit to control and manage the common property
• Exercise and perform certain or all of the duties of the body corporate
• Delegate specific duties and powers to a trustee/trustees (Can be revoked at any time)
• Raise a levy, both an annual or special levy
• Give certain consents like, consolidating and subdividing sections
• Make smaller consents such as, whether or not to keep pets
It is important to note that a decisions agreed upon must be unified and concluded at a meeting or as a written resolution. A written resolution can only be decided/voted on at a SGM or AGM.
Although working as a unified team is integral among trustees, the delegation of responsibilities to certain individuals for specific tasks is permitted.
Should certain responsibilities be part of a trustee portfolio, once a decision is made by said trustee (i.e quotes obtained for security etc), this is then presented to all trustees at a trustee meeting (TM) or via round robin to agree which quote to accept unless, the agreement is that the security trustee and chairman can make the decision without calling a TM bearing in mind the directions and restrictions as set out at an AGM.
Body Corporate: The final decision-maker
While trustees have a relative amount of leeway in decision-making, the body corporate is the final decision and policy maker in a sectional title, therefore many important decisions are left up to all the owners. Trustees cannot make decisions that needs to be taken by resolution at a general meeting and the Act allows these decisions to be made in meetings or by written resolutions.
Good-faith: The basis of trustee conduct
It is the duty of the trustees to act in good faith and contribute positively to the sectional title and all its owners. Acting in good faith means that they are required to avoid conflict of interests with themselves and the body corporate and are not permitted to take part in any decision if they have a personal interest in the matter that does not serve the “whole”.
A suitable candidate to fit the profile of a trustee needs to have a good working knowledge of the Sectional Titles Act and understand the scheme’s conduct and management rules.
Author: Coastal Property Group
