One of the reasons that the Community Scheme Ombud Service (CSOS) was established in 2016 is to regulate the behavior of residents in a community scheme based on the legally enforceable governance rules of the scheme. This is achieved by resolving disputes between parties where one party is seeking relief in terms of section 39 of the CSOS Act. The CSOS has a few months back circulated a draft practise directive on amendments to section 39(7)(b) of the CSOS Act. >>>>read more.
On 14 March 2023, the CSOS (Community Schemes Ombud Service) circulated a draft practise directive on section 39(7)(b) of the CSOS Act to industry role-players via email, asking for comment and input to be submitted to them. To date no final Practice Directive based on this draft and any amendments suggested has been published by the CSOS, but it is important for those involved in community scheme management and residing in such schemes to be aware of what the CSOS is planning and what would be the practical effect of such directive once published for role-players involved in community schemes.
 The key points of the Draft Practice Directive are as follows:
Currently when applying to the CSOS for dispute resolution, the complainant must choose one or more applicable orders from the 39 listed orders in Section 39 of the CSOSA. The CSOS wishes to expand their jurisdiction to include 12 additional orders, which will bring the total number of orders to 51. The current orders are categorised into 7 sections being Financial, Behavioural, Scheme Governance, Meetings, Management Services, Works pertaining to Private and Common Areas and General (Access to Information held by the scheme). The twelve new orders will be categorised by 5 additional sections being Contractual Issues, Adjudication Orders, Trustees, Administrator and Managing Agents.
Adjudication Orders is included to allow for an internal review process of CSOS matters andorders that may have been erroneously made by an adjudicator which currently can only be appealed by one of the parties in a High Court, and usually on a matter of law although the use of the PAJA as a means to appeal adjudication orders has become more prevalent. In this process, an application for review of an adjudicator’s orders will not be considered by an adjudicator assigned to the matter, but by the Chief Ombud.
3. Other New orders include:
(a)   Three proposed orders relating to contracts, including orders requiring an association to repay overpayments or refund deposits to someone who used to be a member of the scheme and declaring any of the following to be contrary to CSOS legislation or regulations: a contract’s term(s) and/or condition(s); and enforcement and/or recognition of a contract term and/or condition relating to community schemes.
(b)   Three proposed orders relating to body corporate trustees, including orders determining who a body corporate’s lawful trustees are and declaring that a trustee has breached their fiduciary duty and must therefore pay to the body corporate:
(i)   the financial loss suffered by that body corporate as a result; or
(ii)   the economic benefit the trustee received as a result.
(c)   Two orders relating to administrators are proposed. These are orders requiring court appointed administrators to cite CSOS as an interested party in their papers (i) extending their term of appointment or (ii) making changes to their appointment.
(d)   two proposed orders relating to Managing Agents: one to prohibit a managing agent from managing a scheme’s finances and the other requiring the Property Practitioners Regulatory authority to decide regarding a managing agent’s conduct.
If these draft proposals are implemented, it will mean that the CSOS’s jurisdiction in how community schemes are run and administered will increase, with hopefully an improvement to the administrational justice that should be a requirement in how schemes are run for the good of all parties concerned with the scheme.
Applicants seeking relief in matters concerning their scheme, will be able to apply for a wider range of orders, and in cases where CSOS Adjudicators’ hands would previously have been tied by the limitation of the current list of orders, the CSOS will have improved powers to consider matters that involve these types of orders and how a scheme is run. It should be remembered that these are only draft proposals, which would only be implemented once the required legislation is enacted.
Information about the CSOS, the CSOS Legislation, the various practise directives pertinent to community scheme living issued by the CSOS Ombud, their address and contact details, and the role the CSOS plays in the management of community schemes and dispute resolution between parties through mediation and adjudication, can be found on the CSOS Website www.csos.org.za , or can be obtained from Whitfields by emailing info@whitfields.co.za or by contacting your scheme’s customer service consultant.