Understanding the Community Schemes Ombud Service (CSOS) in South Africa: A Comprehensive Guide

Living in a community scheme in South Africa can be rewarding, but it also comes with its share of challenges. Disputes between homeowners and community schemes can arise and when they do, it's important to have a mechanism in place to resolve them fairly and efficiently. That's where the Community Schemes Ombud Service (“CSOS”) comes in. In this blog post, we'll discuss everything you need to know about CSOS in South Africa, its purpose, functions, and benefits and how it can help resolve disputes between homeowners and community schemes.

What is CSOS?

CSOS stands for the Community Schemes Ombud and was established in terms of the Community Schemes Ombud Service Act 9 of 2011 (“CSOS Act”) to regulate the conduct of parties within community schemes.

CSOS’s aim is to promote harmonious community schemes by providing regulation, education and accessible dispute resolution services to all relevant stakeholders.

The Purpose of Community Schemes Ombud Service (CSOS)

The primary purpose of CSOS is to provide dispute resolution services to homeowners and community schemes in South Africa. CSOS aims to resolve disputes fairly, efficiently and cost-effectively and to promote harmonious living in community schemes. CSOS also has a broader mandate to protect the rights of homeowners and to promote good governance in community schemes.

Who Must Register with CSOS?

All community schemes must register with CSOS. Registration is mandatory.

What is a Community Scheme?

A community scheme is defined as any scheme or arrangement where there is shared use of and responsibility for parts of land and buildings, including but not limited to:

• Sectional titles development schemes;

• Share block companies;

• Home or property owners associations;

• Housing schemes for retired persons; or

• Housing co-operatives.

How to Register with CSOS

Community schemes are required to register with the CSOS within 30 days of either:

• the coming into effect of the CSOS Regulations which was on 07 October 2016; or

• the community scheme’s date of incorporation according to applicable laws.

Registration is filed by completing the prescribed Form CS 1 and there is no fee applicable to the registration of a community scheme. Once registered with CSOS, community schemes are, inter alia, required to:

• pay the CSOS levy on a quarterly basis, however, community schemes can make arrangements to make annual payments in advance. CSOS does make provision for applications to waive the CSOS levies and fees provided that the applicant does not have the financial capacity to pay for the prescribed fee and subject to compliance with certain requirements for exemption; and

• file annual returns with the CSOS within four (4) months after the end of the community scheme’s financial year, by filling in the prescribed Form CS 2.

Functions of Community Schemes Ombud Service (CSOS)

CSOS performs several essential functions, including:

1. Dispute Resolution: CSOS provides a range of dispute resolution services, including mediation, conciliation, and adjudication, to help resolve disputes between homeowners and community schemes.

2. Compliance Monitoring: CSOS monitors compliance with the Community Schemes Ombud Service Act, 2011, and other applicable laws, regulations, and codes of conduct.

3. Education and Training: CSOS provides education and training to homeowners, trustees, and managing agents on their rights and responsibilities under the law, as well as on good governance practices.

4. Research and Policy Development: CSOS conducts research and develops policies to promote good governance and harmonious living in community schemes.

Disputes Referred to CSOS

CSOS provides an Alternative Dispute Resolution service which makes provision for the referral of community scheme disputes to CSOS and the resolution of these disputes BY CSOS (outside of the courts).

Much like the procedure in the CCMA, a dispute must be referred to CSOS in the prescribed manner on the prescribed form and with payment of the prescribe fee, whereafter, the dispute referral is assessed and either referred to conciliation or arbitration.

Conciliations are chaired by a CSOS Conciliator who is there to assist the parties in finding a resolution. If the matter is not resolved, the conciliator will issue a Notice of Non-Resolution and will refer the matter to Adjudication. Matters that are referred for adjudication will be subject to a thorough investigation prior to presentation at the adjudication hearing. At the adjudication hearing, the Adjudicator will consider all the evidence presented and will hand down a determination that is binding on all parties to the dispute.

As a rule, parties are not entitled to legal representation. However, the Adjudicator has a discretion to allow legal representation. Persons aggrieved by any decision made by CSOS may lodge an appeal in the High Court on the question of law within 30 days after CSOS has made its order.

Adjudicator orders made by CSOS are enforceable in the Magistrate Court or High Court depending on the quantum or nature of the relief granted in the determination.

Failure to refer a Dispute to CSOS in the First Instance?

The South African Courts have found that an obligation exists to take disputes to the Community Schemes Ombud Service (CSOS) for resolution, rather than to the high court and that a party should only approach a high court if there is a compelling reason why the dispute cannot be not be dealt with by the CSOS.

A decision to refer a dispute to a court in the first instance, when it should have be referred to CSOS has been held to be an abuse of the legal process.

It is therefore imperative that before making the decision to rush off to the High Court, careful consideration should be given to whether or not CSOS is the appropriate forum for the dispute.

CSOS Levies

Each community scheme, which includes sectional title schemes, share block companies, home or property owners’ associations, housing schemes for retired persons and housing co-operatives are required to collect a prescribed monthly levy from every unit and pay it to CSOS on a quarterly basis. The purpose of the levy is to fund CSOS and the levy will be based on a sliding scale according to levies paid by the owners.

Conclusion

The Community Schemes Ombud Service (CSOS) plays a vital role in promoting good governance and resolving disputes in community schemes in South Africa. By providing cost-effective, fair and impartial dispute resolution services, CSOS can help homeowners and community schemes to resolve disputes quickly and efficiently. CSOS also provides education and training to promote good governance practices and prevent disputes from arising in the first place. If you need to access CSOS services, contact CSOS directly or submit a complaint to request dispute resolution services. Our Property Attorneys have extensive experience dealing with CSOS.

If you need assistance with a property dispute matter, contact our offices today to schedule a consultation with one of our specialist property law attorneys. Alternatively, you can schedule a consultation online by using the following link Book An Online Consultation.