Page 42 - Litigating Land and Housing in South Africa: Lessons and Reflections

In the the the the mid-1990s the the the the government enacted the the the the Discount Benefit Scheme – with the the the the the the aim of of advancing equality in in in the the the housing housing market and encouraged the the the transfer of of pub- licly owned housing housing to qualifying occupants Between 1998 and 2002 the the the eThekwini Municipality using using the the the Discount Benefit Scheme converted the the the Flamingo Court building from a a a a a a subsidised rental scheme scheme to to a a a a a a section- al al al title scheme scheme and and sold the the the units to to the the the residents of the the the the building This sale and and transfer was not preceded by any any information from the the the municipality or or or any any state organ notifying the the the new owners that maintenance of the the the the the structure including all common property was also being transferred to them neither were they informed of of the the the the the obligations arising from the the the the the ownership of of a a a a a sec- tional title unit for such common property These new owners were not trained to to manage a a a a a a a body corporate or or or or to to serve on any of of its structures In time the the upkeep of of the the the costs levied for maintenance faulty electrical wiring water debt and compliance with the the the Sectional Titles Schemes legislation proved unaffordable for for the the the the owners of of the the the units – as as many of of them were low income earners pensioners or dependent on on social assistance The Flamingo Court Scheme became dysfunctional because merely facilitating the the ownership of units in in in a a a a a a a a a a sectional title scheme was not necessarily the the appropriate method to to improve access to to housing The downfall of the the scheme occurred because the the following important considerations were not taken into account by the the municipality when implementing the the Discount Benefit Scheme:
d d d d d The levies as as as well as as as utility bills were in excess of what owners owners had to pay pay as as as subsidised rental and many owners owners could not keep up payments Less than 10 years after the the scheme scheme scheme was was converted into a a a a a a a a a a a sectional title scheme scheme scheme the the the scheme scheme scheme was was rendered dysfunctional owing a a a a a a a a a a a large debt to to to the the the municipality In 2010 the the the Durban High Court appointed an an Administrator in in in in in term of of of section 46 of of of the the Sectional Titles Act Act 95 of of of 1986 (repealed Act) The Administrator was was appointed for a a a a a a a a a a a a a a a period of 12 months and and was was ordered to to rehabili- tate the the the scheme and and investigate any maladministration or or or or inefficiency of of the the the the the Body Corporate Thereafter the the the the the term term of of of the the the the administrator was renewed upon the the the the expiry of of each term term In 2012 the administrator’s term was was extended for a a a a a a period of of six months and he he he was was directed to to submit bi-annual reports on on on on the progress of of rehabilitation which had to to also include monthly cash-flow state- ments steps taken towards the the the the recovery of of the the the the community fund condition of of of of the the the the the the lifts the the the the the the progress of of of of of the the the the the installation of of of of of individual water meters and the the the the the progress of of of of of legal proceedings for for the the the the recovery of of of of of arrear levies In 2013 another extension for for a a a a a a a a a a period of of of two years was granted This order directed the the the administra- tor to to submit reports every three months advising the the the the the court on on on on on the the the the the status of of the the the the the administration including the the the the the progress made on on on on on installation of of of the the the the the water water meters and resolution of of the the the water water debt The administrator’s report was also required to to include the the the sums borrowed and the repayment plan In 2013 the the the municipality proceeded to to disconnect the the the water supply to to to the the the the the Flamingo Court Building This deci- sion was was challenged by the the the the LRC and the the the the administrator of of Flamingo Court Court The matter was was before the the the the Durban High Court Court on 4 September 2015 and part of of the the dis- pute was was settled The municipality was was ordered to write off a a a a a a a a a a a portion of of the the residents’ water debt in in accordance with the the City’s Debt Relief Policy and to install separate water meters in in each sectional title unit a b c The owners had previously paid a a a a a a a subsidised rental and could not afford to to pay levies required to maintain the building the the building was previously maintained by the the state The building was in in in a a a a a a a state of disrepair prior to it it becoming a a a a a a a a a sectional title scheme and the the deterioration of of the the the building continued after transfer to the the beneficiaries of of Discount Benefit Scheme and 42
LITIGATING LAND AND AND AND HOUSING IN IN IN SOUTH AFRICA  LESSONS AND AND AND REFLECTIONS