Sectional Titles Act

To provide for the division of buildings into sections and common property and the acquisition of separate ownership in sections coupled with joint ownership in common property, the control of certain rights attaching to separate ownership in sections and joint ownership in common property, the transfer of ownership of sections and the registration of sectional mortgage bonds over, and real rights in, sections, the conferring and registration of rights in, and the disposal of, common property; the establishment of bodies corporate to control common property and for that purpose to apply rules; to establish the Sectional Titles Regulation Board; and to provide for incidental matters.

Ownership and Real Rights

Ownership and real rights in or over parts of buildings, and registration of title to ownership or other real rights in or over such parts

Despite anything to the contrary in any law or the common law –

(a)      (i)      a building or buildings comprised in a scheme and the land on which such building or buildings is or are erected may, subject to subparagraph (ii), be divided into sections and common property in accordance with this Act;

(ii)     where a scheme comprises more than one building, any such building may, subject to section 7(4), be divided into a single section and common property in accordance with this Act;

(b)     separate ownership in such sections or an undivided share therein may be acquired in accordance with this Act;

(c)     the owners of such sections own such common property in undivided shares in accordance with this Act;

(d)     a real right may be acquired in or over any such section or an undivided share therein or common property in accordance with this Act; and

(e)     the registrar may, in accordance with this Act, register a title deed whereby ownership in, or any lease of, or any other real right in or over, any such section or an undivided share therein or common property is acquired.


REGISTRATION AND COMMON PROPERTY

Ownership of common property

Owners of sections are jointly owners of the common property in undivided shares proportionate to the participation quotas of their respective sections as specified on the relevant sectional plan.

“PQ or participation quotas

the participation quota of a section is a percentage expressed to four decimal places, and arrived at by dividing the floor area, correct to the nearest square meter, of the section by the floor area, correct to the nearest square meter, of all the sections in the building or buildings comprised in the scheme.”

A sectional title deed in respect of a section must, in a separate paragraph, describe the undivided share in the common property of the owner of the section as an undivided share in the common property apportioned to the section in accordance with the participation quota of the section.

Typical sectional title building

A section and its undivided share in the common property are together deemed to be one unit, and –

  • no section may be disposed of or be otherwise dealt with separately from its appurtenant undivided share in the common property; and
  • subject to section 19, no undivided share in the common property may be disposed of or be otherwise dealt with separately from the section to which it is appurtenant.

Insurance of a section is deemed also to insure the undivided share in the common property of the owner of the section, even if no express reference to that undivided share is made in the policy of insurance.


EXCLUSIVE USE OF COMMON PROPERTY AND SERVITUDES

Rights of exclusive use of parts of common property

If a part or parts of common property is or are delineated on a sectional plan in terms of section 7(3)(f), the developer, when applying for the opening of a sectional title register and the registration of a sectional plan under section 11(1), may for a specific purpose impose a condition under section 11(2) in the schedule referred to in section 11(3)(b) by which the right to the exclusive use of such part or parts of the common property delineated for that purpose on the sectional plan is conferred on the owner or owners of one or more of the sections.


PARTICIPATION QUOTAS AND DEVELOPERS

Participation quotas

34.          (1)        Subject to section 51, the participation quota of a section is a percentage expressed to four decimal places, and arrived at by dividing the floor area, correct to the nearest square metre, of the section by the floor area, correct to the nearest square metre, of all the sections in the building or buildings comprised in the scheme.

(2)          In all cases where a developer alienates a unit in a scheme before the sectional title register is opened, the total of the participation quotas allocated to the respective sections and the participation quota of that unit must be disclosed in the deed of alienation.

(3)          A deed of alienation in which a disclosure contemplated in subsection (2) has not been made as required by that subsection, is voidable at the option of the purchaser, and thereupon section 26(23), (24), (25), and (26) applies with the necessary changes in respect of such an alienation.

(4)          Subject to subsection (5), the participation quota of a section determines –

(a)     the value of the vote of the owner of the section, in the case where the vote is to be reckoned in value;

(b)     the undivided share in the common property of the owner of the section; and

(c)     subject to section 39(1)(b), the proportion in which the owner of the section –

(i)      must make contributions for the purposes of section 39(1)(a); or

(ii)     may in terms of section 49(1) be held liable for the payment of a judgment debt of the body corporate of which that owner is a member.

(5)          Subject to section 39(1)(b) –

(a)     the developer, when submitting an application for the opening of a sectional title register; or

(b)     the members of the body corporate, by special resolution,

may make rules under section 37 by which a different value is attached to the vote of the owner of a section, or the liability of the owner of a section to make contributions for the purposes of section 39(1)(a) or 49(1) is adjusted, but –

(i)      where the owner of a section is adversely affected by a such a decision of the body corporate that owner’s written consent must be obtained;

(ii)     no such change may be made by a special resolution of the body corporate until such time as there are owners, other than the developer, of at least 30 per cent of the units in the scheme;

(iii)    in the case where the developer alienates a unit before submitting an application for the opening of the sectional title register, no exercise of power to make a change conferred on the developer by this subsection is valid unless the intended change is disclosed in the relevant deed of alienation.

(6)          The specification on or in the schedule to a sectional plan of –

(a)     the participation quota of each section; and

(b)     the total of the participation quotas of all the sections,

in the building or buildings comprised in a scheme is for all purposes deemed to be correct in the absence of proof to the contrary.


RULES AND BODIES CORPORATE

Rules

37.          (1)        A scheme is, as from the date of the establishment in terms of section 38(1) of the body corporate, controlled and managed, subject to this Act, by means of rules.

(2)          The Minister –

(a)     may make rules, on the recommendation of the sectional titles Regulation Board and subject to subsection (3); and

(b)     must publish the rules made in terms of paragraph (a) by notice in the Gazette.

(3)          The rules made in terms of subsection (2) must provide for the control, management, administration, use and enjoyment of the sections and the common property, and must comprise –

(a)     management rules; and

(b)     conduct rules.

(4)          The rules referred to in subsection (3) may be substituted, added to, amended or repealed in respect of a particular scheme –

(a)     in the case of management rules –

(i)      by the developer, when applying to the registrar for the opening of a sectional title register, to the extent prescribed;

(ii)     by the body corporate, from time to time by unanimous resolution of that body corporate as prescribed;

(b)     in the case of conduct rules –

(i)      by the developer, when applying to the registrar for the opening of a sectional title register;

(ii)     by the body corporate, from time to time by special resolution of the body corporate,

but a conduct rule substituted, added to or amended by the developer under subparagraph (i), or any substitution, addition to or amendment of the conduct rules by the body corporate under subparagraph (ii), may not be in conflict with any management rule made in terms of subsection (2).

(5)          A management rule or conduct rule made by a developer or a body corporate under subsection (4) must –

(a)     be reasonable; and

(b)     apply equally to all owners of units used for substantially the same purpose.

(6)          Subject to subsection (9), the rules made in terms of this section apply, as from the date of the establishment in terms of section 38(1) of the body corporate, in respect of the building or buildings and land in question and binds –

(a)     the body corporate;

(b)     the owners of the sections; and

(c)     any person occupying, or finding himself or herself in or on, a section for any purpose.

(7)          If the rules are substituted, added to, amended or repealed by a body corporate under subsection (4), the body corporate must furnish the registrar, in the prescribed form and manner, with particulars of that substitution, addition, amendment or repeal.

(8)     The registrar –

(a)     may not be involved in the enforcement or application of the rules made in terms of this section; and

(b)     is not required to examine or note or endorse any substitution, addition, amendment or repeal of the rules referred to in paragraph (a) against or on any certificate, deed or other document.

(9)          A substitution, addition, amendment or repeal contemplated in subsection (7) comes into operation on the date on which the registrar is furnished in terms of that subsection with particulars thereof.

(10)        The body corporate must, at the written request of –

(a)     an owner of a unit or any other person having a registered real right in or over a unit; or

(b)     any person authorised thereto in writing by the owner or other person referred to in paragraph (a),

make any rules then in force available for inspection to that owner, or other or authorized person.


Bodies corporate

38.          (1)        With effect from the date on which any person other than the developer becomes an owner of a unit in a scheme, there is deemed to be established for that scheme a body corporate of which the developer and that person are members, and every person who thereafter becomes an owner of a unit in that scheme is, as from the date on which that person becomes such an owner, a member of that body corporate.

(2)          The developer ceases to be a member of the body corporate referred to in subsection (1) when the developer ceases to have a share in the common property in terms of section 36(2), and any other member of the body corporate ceases to be a member thereof when that member ceases to be the owner of a unit in the scheme in question.

(3)          A body corporate must be designated as “the Body Corporate of the ………………………………………………………………… (name) Development Scheme, No …………...”, such name and number to be inserted being the name and the distinctive number referred to in sections 7(3)(b) and 12(1)(a), respectively.

(4)          The registrar must issue a certificate of establishment, in the prescribed form, to a body corporate established in terms of subsection (1).

(5)          Subject to this Act, a body corporate is responsible for –

(a)     the enforcement of the rules referred to in section 37; and

(b)     the control, administration and management of the common property for the benefit of all owners.

(6)          The Companies Act, 1973 (Act No. 61 of 1973), and the Close Corporations Act, 1988 (Act No. 26 of 1988), do not apply in relation to a body corporate.

(7)          A body corporate has perpetual succession and is capable of suing and of being sued in its corporate name in respect of –

(a)     any agreement entered into by it;

(b)     any damage to the common property;

(c)     any matter in connection with the land or building for which the body corporate is liable or for which the members of the body corporate are jointly liable;

(d)     any matter arising out of the exercise or non-exercise of any of its powers or the performance or non-performance of any of its duties in terms of this Act or any rule; and

(e)     any claim against the developer in respect of the scheme if so determined by special resolution.

(8)          When a body corporate is established in terms of subsection (1), the developer must inform the local authority concerned in writing –

(a)     of the corporate name and postal address of the body corporate, within 30 days after the establishment of the body corporate; and

(b)     of the full names, residential address and postal address of every person who purchases from the developer a unit in the scheme in question, within 30 days after the entering into of an agreement of sale.

(9)          The developer must convene a meeting of the members of the body corporate to take place not later than 60 days after the establishment in terms of subsection (1) of that body corporate, at which meeting the developer must furnish those members with –

(a)     a copy of the registered sectional plan;

(b)     a clearance certificate issued by the local authority concerned to the effect that all rates and other payments due by the developer to that local authority in respect of the property in question, up to and including the date of the establishment of the body corporate, have been duly paid; and

(c)     proof, in writing, of revenue and expenditure concerning the management of the scheme from the date of the first occupation of any unit in that scheme until the date of the establishment of the body corporate.

(10)        The agenda of the meeting convened in terms of subsection (9) is as prescribed in the management rules.

(11)        The developer must pay over to the body corporate, at the meeting convened in terms of subsection (9), any surplus funds as revealed by the proof of revenue and expenditure furnished in terms of paragraph (c) of that subsection.

(12)        A developer who fails to comply with a provision of subsection (8) or (9) or (11) commits an offence and is liable on conviction to a fine not exceeding N$8 000 or to imprisonment for a period not exceeding two years, or to both such fine and such imprisonment.

(13)        Despite anything to the contrary in this Act or any other law, a developer who fails to comply with a provision of subsection (8) is liable for the payment of the rates and taxes due to the local authority concerned in respect of the unit or units in question until such time as the developer complies with that subsection, irrespective of whether or not the developer is convicted of an offence under that subsection.

Functions of bodies corporate

39.          (1)        A body corporate referred to in section 38(1) must perform the functions entrusted to it by or under this Act or the rules, and those functions include –

(a)     to establish for administrative expenses a fund sufficient in the opinion of the body corporate for –

(i)      the repair, upkeep, control, management and administration of the common property, including reasonable provision for future maintenance and repairs;

(ii)     subject to section 54, the payment of rates and taxes and other local authority charges in respect of the common property;

(iii)    the payment of local authority charges or other charges for –

(aa)    necessary maintenance with regard to the supply of electricity, gas, water and fuel; and

(bb)   the supply of sanitary and other services,

to the building or buildings and land;

(iv)    the payment of any premiums of insurance in respect of the scheme that may become due and payable; and

(v)     the discharge of any other duty or the fulfilment of any other obligation of the body corporate;

(b)     (i)      to require the owners of sections, when necessary, to make contributions to the fund established in terms of paragraph (a) for the purposes of satisfying any claims against the body corporate;

(ii)     despite subparagraph (i), to require the owner or owners of a section or sections entitled to the right to the exclusive use of a part or parts of the common property, whether or not that right is registered or conferred by rules made under the repealed Act, to make such additional contribution to the fund referred to in that subparagraph as is estimated necessary by the body corporate to defray the costs of rates and taxes, insurance and maintenance in respect of any such part or parts, including the provision of electricity and water, unless in terms of the rules the owners concerned are responsible for the payment of those costs;

(c)     to determine from time to time the amounts to be raised for the purposes of paragraphs (a) and (b);

(d)     to raise the amounts determined in terms of paragraph (c) by levying contributions on the owners in proportion to the participation quotas of their respective sections;

(e)     to open and operate an account or accounts with a banking institution or a building society as may be prescribed;

(f)      to insure the building or buildings, and keep the building or buildings insured, to the replacement value thereof against fire and such other risks as may be prescribed;

(g)     to insure, in addition to the insurance contemplated in paragraph (f), against such other risks as the owners may determine by special resolution;

(h)     subject to section 51 and to the rights of the holder of any sectional mortgage bond, to immediately apply any insurance money received by the body corporate in respect of damage to the building or buildings for the rebuilding and reinstatement of the building or buildings in so far as this may be effected;

(i)      to pay the premiums on any policy of insurance effected by the body corporate in terms of paragraph (f) or (g);

(j)      to comply with any notice or order by a competent authority requiring any repairs to, or work in respect of, the building or buildings or land in question;

(k)     to comply with any reasonable request for the furnishing of the names and addresses of the persons who are the trustees of the body corporate in terms of the rules referred to in section 37, or who are members of the body corporate;

(l)      to notify the registrar and the local authority concerned in writing of the domicilium citandi et executandi of the body corporate, being its address for service of any process;

(m)    to ensure compliance with any law relating to the common property or to any improvement on the land comprised in the common property;

(n)     to properly maintain the common property (including elevators) and to keep it in a good and serviceable state of repair;

(o)     to keep in a good and serviceable state of repair and properly maintain the plant, machinery, fixtures and fittings used in connection with the common property and sections;

(p)     subject to the rights of the local authority concerned, to maintain and repair (including renewal where reasonably necessary) pipes, wires, cables and ducts existing on the land and capable of being used in connection with the enjoyment of more than one section or of the common property or in favour of one section over the common property;

(q)     at the written request of an owner or registered mortgagee of a section, to produce to that owner or mortgagee, or a person authorised thereto in writing by that owner or mortgagee, the policy or policies of insurance effected by the body corporate in terms of paragraph (f) or (g) and the receipt or receipts for, or other written proof of, the most recent payment of the premium or premiums in respect of the policy or policies; and

(r)      in general, to control, manage and administer the common property for the benefit of all owners.

(2)          Any contributions levied in terms of subsection (1) –

(a)     are due and payable on the passing of a resolution to that effect by the trustees of the body corporate; and

(b)     may be recovered by the body corporate by action in any court (including a magistrate’s court) of competent jurisdiction from the persons who were the owners of sections at the time when the contributions became due and payable.

(3)          Despite anything to the contrary in any other law, a magistrate’s court has jurisdiction to hear any action instituted under subsection (2)(b) irrespective of the amount of the claim.

(4)          The body corporate must, on application by an owner or registered mortgagee of a section, or a person authorised thereto in writing by that owner or mortgagee, certify in writing –

(a)     the amount determined in terms of subsection (1) as the contribution payable by that owner;

(b)     the manner in which, and the time at which, a contribution referred to in paragraph (a) is payable;

(c)     particulars relating to the payments made by that owner in respect of the contribution referred to in paragraph (a), and the balance outstanding and payable; and

(d)     particulars relating to, and the amount of, any rates and taxes paid by the body corporate to the local authority concerned in terms of section 54(4) and not recovered by the body corporate from the owners concerned.

(5)          The body corporate is, for the purposes of effecting any insurance in terms of paragraph (f) of subsection (1), deemed to have an insurable interest for the replacement value of the building or buildings and is, for the purposes of effecting any other insurance in terms of that subsection, deemed to have an insurable interest in the subject matter of that insurance.

Powers of bodies corporate

40.          A body corporate referred to in section 38(1) may exercise the powers conferred on it by or under this Act or the rules, and those powers include the power –

(a)     to appoint, subject to the conditions determined by the body corporate, such agents and employees as the body corporate may consider appropriate;

(b)     when essential for the proper discharge of the duties of the body corporate and the proper conduct of its affairs –

(i)      to purchase or otherwise acquire, or take transfer of units in the scheme in question;

(ii)     to mortgage, sell, or give transfer of units acquired under subparagraph (i); or

(iii)    to hire units in the scheme or let units acquired under subparagraph (i);

(c)     to purchase, hire, lease or otherwise acquire movable property for the use of owners for their enjoyment or protection, or in connection with the enjoyment or protection of the common property;

(d)     to establish and maintain, where practicable and at its discretion, suitable lawns and gardens and recreation facilities on the common property;

(e)     to borrow money required by the body corporate in the performance of its functions or the exercise of its powers;

(f)      to secure the repayment of money borrowed by the body corporate, and the payment of interest thereon, by means of a negotiable instrument effected for that purpose or the hypothecation of unpaid contributions (whether levied or not), or by mortgaging any property vested in the body corporate;

(g)     to invest any money of the fund established in terms of section 39(1)(a);

(h)     to enter into an agreement with the local authority or any other person or body for procuring the supply to the building or buildings and land of electricity, gas, water, fuel, and sanitary and other services in so far as this may be necessary;

(i)      to enter into an agreement with any owner or occupier of a section for the provision of amenities or services by the body corporate to the section or to the owner or occupier thereof, including the right to let a part of the common property to any such owner or occupier by means of a lease other than a lease contemplated in section 19(1); and

(j)      to do all such other things as are reasonably necessary for the enforcement of this Act and the rules, and for the control, management and administration of the common property.

Functions and powers of bodies corporate to be performed or exercised by trustees

41.          (1)        The functions and powers of a body corporate must, subject to this Act, the rules and any restriction imposed or direction given at a general meeting of the owners of sections, be performed and exercised by the trustees of the body corporate holding office in terms of the rules, subject thereto that –

(a)     the majority of trustees must be owners of sections;

(b)     a trustee or an alternate trustee is elected annually at the annual general meeting in terms of the rules, but is not required to be the owner of a section, or the nominee of an owner which is a juristic person;

(c)     owners of sections may be represented by their spouses on the body corporate; and

(d)     the management agent or any of his or her employees, or any employee of the body corporate does not qualify for appointment as trustee.

(2)          For the purposes of an agreement in respect of the beacons and boundaries of the common property required in terms of the Land Survey Act, the trustees of the body corporate are deemed to be the owner of the land in question.


TRUSTEE

Functions and powers of bodies corporate to be performed or exercised by trustees

41.          (1)        The functions and powers of a body corporate must, subject to this Act, the rules and any restriction imposed or direction given at a general meeting of the owners of sections, be performed and exercised by the trustees of the body corporate holding office in terms of the rules, subject thereto that –

(a)     the majority of trustees must be owners of sections;

(b)     a trustee or an alternate trustee is elected annually at the annual general meeting in terms of the rules, but is not required to be the owner of a section, or the nominee of an owner which is a juristic person;

(c)     owners of sections may be represented by their spouses on the body corporate; and

(d)     the management agent or any of his or her employees, or any employee of the body corporate does not qualify for appointment as trustee.

(2)          For the purposes of an agreement in respect of the beacons and boundaries of the common property required in terms of the Land Survey Act, the trustees of the body corporate are deemed to be the owner of the land in question.

Fiduciary position of trustees

42.          (1)        Each trustee of a body corporate stands in a fiduciary relationship to the body corporate.

(2)          Without prejudice to the generality of the expression “fiduciary relationship”, subsection (1) implies that a trustee –

(a)     must in relation to the body corporate act honestly and in good faith, and in particular –

(i)      must exercise such powers as he or she may have to manage or represent the body corporate in the interest and for the benefit of the body corporate and its members; and

(ii)     may not –

(aa)    act without having the powers; or

(bb)   exceed the powers,

contemplated in subparagraph (i); and

(b)     must avoid any material conflict between his or her own interests and the interests of the body corporate, and in particular –

(i)      may not derive any personal economic benefit to which if he or she is not entitled by reason of his or her office as trustee of the body corporate, from the body corporate or from any other person in circumstances in which that benefit is obtained in conflict with the interests of the body corporate; and

(ii)     must notify in writing every other trustee, at the earliest opportunity practicable in the circumstances, of the nature and extent of any direct or indirect material interest that he or she may have in any agreement entered into by the body corporate.

(3)          A trustee of a body corporate whose mala fide or negligent act or omission has breached any duty arising from his or her fiduciary relationship to the body corporate is liable to the body corporate for –

(a)     any loss suffered as a result thereof by the body corporate; or

(b)     any economic benefit derived by that trustee by reason thereof.

(4)          Any loss or economic benefit referred to in paragraph (a) or (b), respectively, of subsection (3) may be recovered by the body corporate by action in any court (including a magistrate’s court) of competent jurisdiction from the trustee who is liable to the body corporate in terms of that subsection.

(5)          Despite anything to the contrary in any other law contained, a magistrate’s court has jurisdiction to hear any action instituted under subsection (4) irrespective of the amount of the claim.

(6)          Where a trustee fails to comply with subsection (2)(b)(ii) and it becomes known to the body corporate that the trustee has an interest referred to in that subsection in an agreement entered into by the body corporate, that agreement is, at the option of the body corporate but subject to subsections (7) and (8), voidable.

(7)          The option contemplated in subsection (6) must, by written notice to that effect given to the other party or parties to the agreement, be exercised by the body corporate within 30 days after the body corporate became aware of the trustee’s interest in the agreement in question.

(8)          Where the body corporate under subsection (6) chooses not to be bound by the agreement in which a trustee has an interest, the Court may, on application by an interested person –

(a)     if the Court is of the opinion that in the circumstances it is fair to order that that agreement is nevertheless binding on the parties, make an order to that effect;

(b)     make any further order in respect of that agreement which the Court may consider appropriate, including an order as to costs.

(9)          A particular conduct of a trustee, except a conduct with regard to his or her duty referred to in subsection (2)(a)(i), does not constitute a breach of a duty arising from his or her fiduciary relationship to the body corporate, if such conduct was preceded or followed by the written approval of all the members of the body corporate where all those members were or are aware of all the material facts relating to that conduct.

for more information please visit the following link:

https://laws.parliament.na/annotated-laws-regulations/law-regulation.php?id=101

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