Con­ver­sion to sec­tional ti­tle – what it en­tails

Weekend Argus (Saturday Edition) - - PERSONALFINANCE -

Un­der the Share Blocks Con­trol Act, there is pro­vi­sion for the con­ver­sion of share block units to sec­tional ti­tle, and a large num­ber of share block prop­er­ties have been con­verted to sec­tional ti­tle.

The pro­ce­dure for con­ver­sion is gov­erned by a sched­ule to the Act. The com­pany direc­tors have to con­vene a gen­eral share­holder meet­ing if at least 30 per­cent of the share block mem­bers wish to ex­plore the open­ing of a sec­tional ti­tle reg­is­ter.

The direc­tors must also have de­tails of the pro­posed con­ver­sion such as sketches, build­ing plans and rules, at hand at the gen­eral meet­ing. The direc­tors must then give no­tice of a meet­ing for the con­sid­er­a­tion of a spe­cial res­o­lu­tion to open a sec­tional ti­tle reg­is­ter.

At this meet­ing, 50 per­cent of the share block mem­bers, with not less than 30 per­cent to­tal vot­ing rights must ap­prove the de­ci­sion.

The share block com­pany has to give no­tice to all con­cerned par­ties that the com­pany is ap­ply­ing to con­vert the prop­erty to a sec­tional ti­tle scheme.

The next step is to have a for­mal sec­tional plan drawn up by a land sur­veyor. Once the sec­tional plans are ap­proved by the Sur­veyor Gen­eral, a con­veyancer will sub­mit an ap­pli­ca­tion to the Reg­is­trar of Deeds for the open­ing of a sec­tional ti­tle reg­is­ter.

Be­fore a com­pany ap­plies to the Reg­is­trar of Deeds for the open­ing of a sec­tional ti­tle reg­is­ter, the com­pany must pro­vide proof to the Reg­is­trar of Com­pa­nies that ei­ther no valid ob­jec­tions were re­ceived or that any such ob­jec­tions have been ad­dressed.

When the sec­tional ti­tle reg­is­ter is opened, all the units are reg­is­tered in the name of the share block com­pany. A mem­ber of the com­pany is not com­pelled to take trans­fer of the unit he or she oc­cu­pies it. His or her rights and li­a­bil­i­ties against the com­pany re­main un­changed un­til the trans­fer of the unit. So, it is pos­si­ble to have both share block and sec­tional ti­tle apart­ments in the same build­ing.

The sec­tional ti­tle unit own­ers, to­gether with the share block com­pany, will make up a body cor­po­rate and will as­sume re­spon­si­bil­ity for ad­min­is­tra­tion and main­te­nance of the prop­erty.

The share block com­pany be­comes li­able to the body cor­po­rate to pay the levy con­tri­bu­tion on units that have not been trans­ferred from the com­pany to in­di­vid­ual own­ers.

Those mem­bers who have not taken trans­fer of the units they oc­cupy have to make a monthly con­tri­bu­tion or levy pay­ment to the com­pany, which pays the con­tri­bu­tion for those units to the body cor­po­rate.

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