Thinking Inside the Box

A Paddocks Sectional Title Lifestyle Blog

Building on an Exclusive Use Area: Extension vs Improvement

improvement to exclusive use areaBy Carryn Melissa Durham

 

Paddocks received a question on its Facebook wall last week, which has inspired this blog post.

Caroll Meiring wrote:

exclusive use area

This question got me thinking…

 

What constitutes an extension of a section when an owner builds on his or her exclusive use area and what is simply an improvement to the exclusive use area?

Section 24(3) of the Sectional Titles Act 95 of 1986 (“the Act”) deals with extensions of sections:

“If an owner of a section proposes to extend the boundaries or floor area of his or her section, he or she shall with the approval of the body corporate, authorized by a special resolution of its members, cause the land surveyor or architect concerned to submit a draft sectional plan of the extension to the Surveyor-General for approval”.

Prescribed Management Rule 68(1)(vi) deals with improvements to exclusive use areas. It states that an owner:

“…shall not construct or place any structure or building improvement on his or her exclusive use area, without the prior written consent of the trustees, which shall not be unreasonably withheld and that the provisions of section 24 and section 25 or other relevant provisions of the Act or the rules, will not be contravened”.

 

But whether an alteration to an exclusive use area ‘extends the boundaries or floor area’ of a section, and is therefore an extension of it, or simply amounts to an improvement is not always clear.

When the exclusive use area is enclosed by a permanent structure and the space becomes water-tight, the nature and utility of the area is changed. The owner can then use the exclusive use area for a different purpose from which it was originally intended to be used. In such a case the boundaries and floor area of the section would have been extended.

However, when an outside exclusive use area such as a patio, veranda or balcony is covered or semi-enclosed by a non-permanent structure such as awning made of cloth, it does not become water tight and its utility may not have been changed. In this case, the alteration would likely constitute an improvement to the exclusive use area requiring prior written trustee consent, rather than an extension of the section, which requires a special resolution of the body corporate.

Using Caroll’s scenario where the owner wants to build a patio or wooden deck on their exclusive use area, and following the logic outlined above, the alteration would not constitute an extension of the owner’s section as the boundaries or floor area have arguably not been extended. A patio or wooden deck is not a watertight enclosure and the area’s utility has not been changed.

In Caroll’s case the patio or deck would be considered a structure or building improvement on the owner’s exclusive use area and therefore only the prior written consent of the trustees would need to be obtained to approve it.

Another common improvement to an exclusive use area is when an owner wants to create shade by placing a retractable awning against the wall abutting his section.

Extension of section in sectional title

What about the situation where an owner wants to waterproof the patio on his exclusive use area by adding walls and a roof made of metal or wooden shutters? The patio would become a permanently enclosed area and could then be considered an extension of the section. This is because the floor area of livable space would be increased. The patio would then become something more than a garden area. It would be a space that could be utilized as an inside braai room or extended lounge area.

extension of section sectional title law

If a body corporate wants to make some of the grey areas clear, it could make a rule which specifies exactly what alterations would constitute building improvements of exclusive use areas and what alterations to exclusive use areas would constitute extensions of the sections.

 

Have you come across this issue before? How does your scheme or management company approach it? Share with us by commenting below.

 

Image source:

http://www.pinterest.com/

 

Advertisements

40 comments on “Building on an Exclusive Use Area: Extension vs Improvement

  1. Francois
    December 8, 2016

    Our Body Corporate rules specifically prohibits the installation of air-conditioning units. What are the steps to follow to obtain approval for the installation of ‘state of the art’ units with silent motors that require installation on the patio, which is common property but regarded as an Exclusive Use Area. i.e. approval by trustees or approval by owners. If the latter, does it require an unanimous resolution or an ordinary resolution?

    • Paddocks
      December 9, 2016

      Hi Francois,

      Thank you for your comment. Please email us on consulting@paddocks.co.za with regards to your matter, and we can provide you with a no-obligation quote, so that we can assist you.

      Kind regards,
      Paddocks

  2. luke
    October 17, 2016

    Hi,
    Is it correct that an extension results in an increase in levies?
    This doesn’t seem right to me

    • Paddocks
      November 1, 2016

      Hi Luke,

      Thank you for your comment. Please email us on consulting@paddocks.co.za with regards to your matter, and we can provide you with a no-obligation quote, so that we can assist you.

      Kind regards,
      Paddocks

  3. Helena
    May 16, 2016

    Does a tiled roof attach to a raised boundary wall qualify as an extension?

    • Paddocks
      May 16, 2016

      Hi Helena,

      As pointed out in our response below, please contact our private consulting division on consulting@paddocks.co.za for further assistance.

      Regards,
      Paddocks

  4. Helena
    April 28, 2016

    My neighbour has a registered exclusive use area with a wall around it of which one side is a boundary wall. They want to raise the boundary wall by 2 metres and attach a tiled roof to it to form a patio. Will this be regarded an extension and increase their PQ?

    • Paddocks
      May 3, 2016

      Dear Helena,

      Thanks for your question. This is not something we can answer in one answer, I’d suggest contacting us on consulting@paddocks.co.za or calling 0216863950, for a quote to assist you.

      Thanks,
      Paddocks

  5. vivaga Thambiran
    April 5, 2016

    If an owner does an extention to his flat and the body corporate is demanding levies without it being registered in the deeds office because the owners are not giving their morgagees details. Can they demand you to pay levies to your extention.

    • Paddocks
      April 7, 2016

      Hi Vivaga,

      Thanks for your question. We suggest having a look at the special resolution that was passed authorising the owner to extend their section, as it may contain conditions relating to the payment of levies prior to registration, or enforce a timeframe for registration. Should there be no such conditions, the body corporate will need to take action to ensure registration and the collection of the levies.

      Regards,
      Paddocks

      • Marieta
        April 19, 2016

        We are still uncertain about the registration of the extention of a permanent waterthight living space at a unit. The building plans are approved for future extentions if needed. The owner have to appoint an munisipality inspector, land surveyor (registration) and finely get it registrated at the Deeds Office. (that is, to complete the full floorspace to the owner’s deed) However, there are still misunderstanding about to do the registration to the Deeds office, or not. (1) We will appreciate it, if someone will spell out the full procedures according to the Subtitle’s Act. (2) At what stage are the owner oblige to pay extra levy on his extention PQ? (3) And may the extra levy be back dated for time elapsed? (4) Will the extention PQ be coverd in the building assurance if not registerd? Please help, this is very important and urgent – as one trustee-owner get the benefit of his extention now for 8 years, with no registration at the deeds office, claiming he don’t have to register and therefore no extra lewy to be paid. Our Property Admininstrator does not help, they only do the administration and will not get involved in our in-house matters.(?)

  6. stirrer1
    February 25, 2016

    If an open deck is built on top of the verandah slab of the unit below who is responsible for maintaining said slab?

    • Paddocks
      February 26, 2016

      Hi there,

      Unfortunately there is not enough information to answer this question and it is more of a consulting matter, please contact us on consulting@paddocks.co.za and we can assist you.

      Kind regards,
      Paddocks

  7. Andre
    November 20, 2015

    I need to know the answer to Caroline Porter’s question posted 24 August as I did The same, but my PQ of 91 m2 includes the double garage therefor the DG was not registered as EUA, but as part of my unit

    • Paddocks
      November 24, 2015

      Dear Andre,

      Please see our response to Carina. Seeing that it is rather complex, please contact us on consulting@paddocks.co.za and we can see what we can do for you.

      Kind regards,
      Paddocks

  8. Carina Porter
    August 24, 2015

    We moved into a freestanding complex approximatley 10 years ago. Prior to purchase, and since we were buying with exclusive use to the double garage and double carport, we applied for consent from the trustees to change the double garage into a living area. We have proof of such being consented to by the Chairperson of the Body Corporate. We didn’t make any structural changes – we merely added in sliding doors, kept the roll-up double garage, and put in a ceiling. Plumbing with cold water only – which we use for our dishwasher – and electricity which feeds our ceiling lights and deep freeze and a fridge, was already there when we bought. Does this constitute extending the floor area? Or is it merely changing the use of an exclusive use area. Would we have needed to get plans for this change? Also, since we bought with having exclusive use to our carport and garage, can this be changed? The reason I am asking is because recently we received a letter from the managing agent stating that all residents must park in their garages. Does that mean our carport being exclusive use area had been taken away without us even knowing? Surely that type of resolution would have to be a unanimous one? Especially since 8 out of our 20 units have conversions of sorts and don’t all use garages as parking?

    • Paddocks
      November 24, 2015

      Dear Carina,

      This is rather a complex matter and strongly suggest contacting us on consulting@paddocks.co.za.

      Unfortunately, there is no quick answer to this, and to give a considered opinion, we would need to see relevant scheme documentation.

      We hope to hear from you,
      Paddocks

  9. John M
    July 14, 2015

    Thanks for a very informative discussion. I am however still not sure whether a louvre roof would be an extension or an improvement. The patio is calculated in the PQ. The roof will be put where there are currently pergolas. The roof will be able to open and close. The patio will not be closed off, i.e. still open on the sides, and therefore not water tight. What approval do I need? Any help will be greatly appreciated.

  10. Wyn
    November 19, 2014

    Hi, I have a question regarding this. I built a wooden deck outside our house. Garden has been registered as common property, thus I requested permission from the BC. BC granted permission without any rules or regulations stated or any stipulations. Now, a year later after massive storms, my neighbor had water damage to their wall. The BC held me responsible for the damage and said the wooden deck caused it. I had a hydrologist out at the house to write a report which concluded the deck had no influence on the damage and due to other factors, the damage occurred. The BC is still keeping me responsible for the removal of the deck to do the maintenance although the work has to be done on common property. Am I responsible for the costs or are the BC? They simply quote “Deeltitel wet of 86” is in force with no reference to which section so that I can refer to it. Any advice in this regard would be appreciated so that I can sort this out and make sure I understand the law a bit better. Thanks

    • paddocks
      November 20, 2014

      Hi Wyn, I suggest you contact Paddocks Private Consulting department on 021 686 3950. They will let you know the options for receiving our professional legal advice which is what you might want in this situation.
      Thanks.

  11. Pingback: 10 Questions Trustees Should Ask Before Approving Owner Changes to Common Property | UTH

  12. Pingback: 10 Questions Trustees Should Ask Before Approving Owner Changes to Common Property | Thinking Inside the Box

  13. mar
    May 8, 2014

    I assume that an open covered patio which is part of the section on the surveyor’s plan and which is enclosed and made water tight by owner does not alter the PQ.

    • Ian D. Samson
      May 9, 2014

      I would hazard a guess here that it would certainly alter the PQ. Enclosed and made water tight would alter the PQ because that space now becomes habitable and therefore chargeable for Levy. It would increase the habitable square meterage of the section by the area of the patio and therefore the total square meterage of the entire section.

  14. Andy
    May 7, 2014

    Anton Kelly wrote: Individual owners can only build on the common property if they formally extend their sections. Aside from the various approvals needed from the local municipality, a building extension such as an extra bedroom must be authorised by the body corporate. A special resolution is required and, if the extension alters the participation quota of the section by 10% or more. All financial institutions holding bonds over sections in the scheme must give their consent.

    Is this correct? Sounds strange. ALL owners own the common property.

  15. A.B.
    May 4, 2014

    Be careful if you build on what you THINK is your EUA.
    MARCH 2013 court case:
    SECTIONAL TITLE SCHEMES – SELLING MORE THAN YOU OWN

    McKersie v SDD Developments (Western Cape) (Pty) Ltd and Others (21283/12) [2013] ZAWCHC 46 (6 March 2013)
    This judgment highlights a very real danger in transactions involving the sale of a section together with exclusive use areas (such as parking bays). It happens in practice that a seller sells his unit and rights to a parking bay to a purchaser, the parties only later realising that transfer of the parking bay is not possible as it was never registered in the name of the seller. It is crucial for property practitioners to make sure whether a seller has title to such exclusive use areas before including it in the sale agreement.

    • Ian D. Samson
      May 5, 2014

      Fortunately our parking bays are registered EUAs on our Sectional Plan, as are our garden areas. We won’t have that problem.

      • A.B.
        May 7, 2014

        It is important to check whether your EUA’s were registered after a correct procedure was followed. The proprietary rights of affected owners must be recognized. The directly affected owners must give their written permission in addition to the SGM vote. The notice if the SGM should have been posted or sent by registered post. Emails are not necessarily enough.

  16. Bossie
    May 2, 2014

    If you have 20 units, pass 20 resolutions at one SGM.

  17. Jan
    April 30, 2014

    If you have 20 units, pass 20 resolutions at one SGM??

  18. kukri1946
    April 27, 2014

    Hi

    Our complex has had its first application for an extension. We thought it a good idea to get a special resolution from 75% of the owners to not only allow this person to extend but to allow all future owners to do this without them having to get a special resolution each time.
    They would still have to apply to the Trustees for permission, get plans etc etc

    Is this allowed?

    Butch

  19. Bossie
    April 25, 2014

    EXTENTIONS OR IMPROVEMENTS ON EUA:

    Sectional Titles Amendment Act, No. 11 of 2010 was published as Notice No. 1172 in Government Gazette No. 33849 of 7 December 2010.

    There are 10 non-financial management issues, some of which include a number of elements:

    A. Section 1(3A) has been amended to make it clear that the fact that a proposed unanimous resolution may affect an owner’s proprietary rights is not a bar to an application to the High Court by the body corporate to obtain the resolution.
    ——
    D. The next change is tied to the previous one. Section 24(6A) is inserted to provide that when a section is extended and there is a deviation of more than 10% the applicant must inform all bondholders, giving all relevant details including an assessment of the impact on the bondholder’s security. This must be sent by registered post to each bondholder and to the “headquarters” of any bondholder that is a financial institution.
    ————-
    I.Section 27(4)(b) has been amended to provide that when a registered exclusive use right in terms of section 27 vests in the body corporate in terms of section 36(2) – when the holder no longer owns any units – it vests free of any mortgage bond AND free from any other form of register real right.
    ————-
    J. The provisions of section 44(1)(g) are amended so that an owner’s obligation not to use an area for a purpose other than provided for on the sectional plan is extended to include both a section and an exclusive use area. –

    From Prof Graham Paddock article

    I do not understand Jennifer, if an owner adds 15% to his floor area! does he have to pay only for the additional 5%, or does it mean he has to pay higher levies for the increase of the total 15%, I.e. Is PQ is increased by 15%?

    • Janey
      April 30, 2014

      I read the answer:
      Murray Bennett replied on Fri, 25 Apr 2014 at 10:18
      The entire PQ for the complex has to be recalculated including the extension [total of all areas is 100% – each units PQ to then be recalculated to four decimal points] and the owner must pay the revised amount due.

      • Ian D. Samson
        April 30, 2014

        I do not agree with this at all. Why must the entire complex’s PQs be recalculated after one owner extends by a mere 10% or even the 15% stated above. What one owner does with his/her additional 10-15% extension has no bearing or influence on neighbouring units.

      • kukri1946
        May 1, 2014

        It is obvious that the owner with more sq mts must pay for them at the rate they are paying for the rest of their unit.
        Each of the other units levies will come DOWN slightly.

        How can you allow an extension and believe they dont have to have the new size registered? they would no be able to sell the unit until it is registered with the Deeds Office anyway

        Butch

    • Bossie
      May 2, 2014

      The ST Act is clear, if you add 20% by extension! the whole complex PQ must be recalculated. You have no choice. This is in ST act.

  20. J Bosman
    April 24, 2014

    I read:

    C. Section 24(6)(d) dealing with extensions of sections has been amended:
    – first to make it clear that the 10% deviation threshold applies to the section being extended,
    – second to provide that a land surveyor or architect rather than a conveyancer must certify the extent of the deviation where it is less than 10% and
    – third to provide that where the deviation is more than 10 percent the conveyancer must give a certificate confirming that all mortgagees have consented to the registration of the sectional plan of extension

    But it is still not clear what an extension is.

  21. Marieta Bodenstein
    April 24, 2014

    Yes, we also have a owner in our subtitle scheme who build himself what he called a patio. Including an expensive braai. The structure are an extension from his living room into the exclusive garden area, with extending his unit floor area with about 18 square meters. The braai chimney were fitted on the roof of the patio, not on top of the required roof of the head building. The trustees only gave permission to the structure with no braai and with certain conditions referring to the subtitle law. Now, three years later, we still struggle to get him to complete his commitment to section 24 – 25 of the subtitle law. We succeed that he finally remove his braai, but what is very bad for us trustees in this case, our Agent Manager are not very helpful to urge the owner to complete his commitment. According to the Surveyor-General who have to submit a new draft of the sectional plan, the owner are obliged to pay levy of the new extension.(There are no exemptions of 10% to the extension of living area to be considered by law.) The Trustees wrote letters upon letters to this owner, with no success. We need advice with this stubborn owner and who are responsible for cost if we decide to send him attorney letters?

  22. Ian D. Samson
    April 24, 2014

    However, since an owner may increase his/her living or liveable area by a maximum of 10% of the area of his/her unit without incurring an increase in levy, an extension of living space may be considered (in my case that would be a further 12.2 square meters).

    • Jan
      April 30, 2014

      forwarded: Murray Bennett replied on Fri, 25 Apr 2014
      The entire PQ for the complex has to be recalculated including the extension [total of all areas is 100% – each units PQ to then be recalculated to four decimal points] and the owner must pay the revised amount due.
      You have to take the full 22.5% extra. This is clear under ST Act.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow us on Twitter

Address:

+27 (0)21 686 3950
Mon - Fri
8am - 5pm

Enter your email address to follow this blog and receive notifications of new posts by email.

Join 421 other followers

%d bloggers like this: