The biggest problem facing many Body Corporates (BC's) is the amount that they have outstanding in unpaid levies. Many have arrears summing up in the tens and hundreds of thousands. The question on most trustees' lips is, "What can we do with these hangers-on that won't pay but use all our facilities and continue to be protected by our security service?"
Many trustees resort to actions such as putting names up on a notice board, or stopping the culprits from using the swimming pool." Putting defaulters' names on a notice board is risky. If an owner's name is published in error, it could result in a claim for damages against the BC. Tempting though it may be, preventing defaulters from using body corporate facilities would be wrong and is unnecessary. And how would you do it?
The Sectional Titles Act and Rules prescribe legal and effective ways of recovering debts, ways that BC's should implement and pursue. Although many bodies corporate throughout South Africa are facing frighteningly high totals of unpaid levies and special levies, it is obvious that most of them do not have a clearly defined and published policy for handling unpaid levies. Others are often accused of not following the guidelines, or even worse, applying them selectively.
Section 37 of the Act requires the BC's to establish a levy fund to which every owner must make contributions, calculated according the Participation Quota (PQ) of the owner's section. The BC's is entitled to institute legal action against non-payers and to charge interest on arrears and to recover legal costs from the defaulter. In spite of this, there are many cases of owners who have not paid their levies for many months and against whom no action has been taken. There is no excuse whatsoever for such inactivity on the part of the body corporate and trustees. Defaulters must be made aware that the money that they owe is not owed to the managing agent or the trustees, but to every other owner in the scheme.
Members who do not pay their levies while continuing to enjoy all the facilities are living at the expense of their neighbours. It is a thread that runs through the spirit and meaning of the Act that all members of the body corporate must be treated equally. There can be no special dispensations for the favoured or punishment for the others. It is absolutely essential that debt recovery procedures must be followed fairly, consistently and swiftly. Many bodies corporate implement a debt recovery programme similar to the one that follows:
On the 15th day of the first month, the defaulter receives a friendly, written reminder, for which he or she is charged an administrative fee of R50, in addition to which interest calculated at 2,5% per month is added.
On the 15th day of the second month, defaulters receive a คอนโด กรุงเทพ less friendly, final reminder for which he or she is charged another R50. Included in this letter is a warning that if the money is not paid, the matter will be handed over to the body corporate's attorney and that all recovery costs will be claimed from the defaulter.
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