By Auren Freitas dos Santos
Part Three: Clarifying the CSOS’s Authority Over Home Owners Associations
As we continue our series called “A Call for Change: Addressing the Shortcomings of CSOS”, we turn our attention to a persistent issue: the widespread misunderstanding of the CSOS’s authority over Home Owners Associations (HOAs) and what the CSOS can and cannot regulate when it comes to HOA governance documents.
The Misconception
A common misconception among CSOS staff, HOA members and managing agents is that the CSOS must approve any amendments made to the constitutions, memorandums of incorporation, and rules of HOAs. This misunderstanding has led to unnecessary complications and frustrations within many HOAs. The misunderstanding is so entrenched that the CSOS even has an official Form which HOAs are expected to submit to the CSOS to notify them of any amendments to HOA governance documents. This form is available on the CSOS website.
The Reality of CSOS’s Jurisdiction
Section 4(1)(c) of the CSOS Act specifies that the CSOS is tasked with regulating, monitoring, and controlling the quality of governance documentation for sectional title schemes. This jurisdiction does not automatically extend to HOAs or other community schemes unless the Minister of Human Settlements explicitly extends it via a notice in the Gazette, which has not happened to date.
As a result, HOAs are not legally required to submit their governance documents to the CSOS for approval and CSOS does not have the power to direct HOAs to make changes to their governance documents, a point that many still do not realise. This misunderstanding can lead to unnecessary administrative efforts and frustration when dealing with the CSOS.
CSOS’s Limited Powers Regarding HOAs
Despite this, we must clarify that the CSOS does hold some authority over HOAs governance documents. According to Section 39(3) of the CSOS Act, adjudicators can issue a number of orders related to the governance documents of HOAs. However, this power is limited to adjudicators acting in accordance with section 38 of the CSOS Act and does not extend to the Chief Ombud and other staff members of the CSOS.
The Need for Clarity
The confusion largely stems from a lack of clear communication and understanding about the CSOS’s role. While the CSOS does not oversee the initial or amended documentation of HOAs, it can intervene in specific disputes to ensure fairness and legal compliance. This distinction is critical but often misunderstood, leading to misinterpretations and misapplications of the CSOS’s powers.
Implications for Home Owners Associations
For HOAs, recognising the limits of the CSOS’s authority is essential. Misunderstanding the CSOS’s role can lead to unnecessary legal challenges and administrative burdens. Clarity on this issue can help HOAs manage their governance more effectively and avoid unwarranted rejections and delays.
Call to Action
By raising public awareness and advocating for transparency and accountability from the CSOS, we aim to create a more efficient and equitable system for all community schemes. Together, we can ensure that the CSOS operates within its legally defined powers when overseeing community schemes.
We encourage our readers to challenge any overreach by the CSOS, particularly when asked to submit HOA governance documents for review. It is crucial to remind the CSOS that it must adhere strictly to its jurisdiction and does not have the authority to regulate amendments to these documents. Your active participation is essential in holding the CSOS accountable and safeguarding the proper governance of community schemes.
For HOA members and administrators seeking guidance on their governance documents or needing legal assistance in disputes, you can contact Auren Freitas dos Santos, a Director of The Advisory, a boutique consultancy specialising exclusively in community schemes law, at info@theadvisory.co.za.
Specialist Community Scheme Attorney (LLB, LLM), Auren Freitas dos Santos, is a Director of The Advisory, a boutique consultancy specialising exclusively in community schemes law. Reach out to him at info@theadvisory.co.za for assistance with any disputes in your community scheme.
