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Outstanding levies cannot always be attached to owners’ assets

Frustration caused a landlord to be evicted from her own home.

Sectional title owners cannot always have their assets repossessed to recoup disputed levies, according to Willem le Roux, director of sectional title finance company Propell. If repossession is denied, sequestration of the owner can then be investigated. But if the owner is paid up with all other major creditors, the insolvency law states that the sequestration process cannot be used unless it will benefit all creditors.

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This inability to recoup outstanding levies may necessitate a special levy on the other owners while the dispute continues in court – which is likely to be met with reluctance from the rest of the owners to assist in raising the special levy.

Le Roux believes that the best course of action is for the body corporate to have a reserve fund set aside to protect the scheme against financial distress and mismanagement.


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