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ESTATE LIVING
1st Floor Lona House
212 Upper Buitengracht
Bo Kaap, Cape Town, 8001

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Jaime-Lee Gardner
jaime@estate-living.co.za
072 171 1979

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Louise Martin
louise@estate-living.co.za
073 335 4084

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Estate Rules: There for Good Reason

By Association of Residential Communities (ARC)

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Estate Rules: There for Good Reason

By Association of Residential Communities (ARC)

, |

A key characteristic of estate living is the existence of the Homeowners Association (HOA), of which all owners are required to become a member and pay levies towards. The HOA sets rules and regulations, essentially designed to protect the estate and its assets, and keep the peace among its residents.

The authority of the HOA stems from a legal contract between the board and its members, and its rules – as long as they are reasonable – should hold up well in a civil court in instances where they’ve been challenged.

Certain rules attract more debate than others, and sometimes it might seem that the HOA is acting outside its mandate by enforcing rules that form part of other pieces of legislation, such as the Road Traffic Act. An example is setting a 40 km/h speed limit within the estate, even though 60 km/h is the speed limit for a public road. In a recent court ruling over exactly this issue, the HOA was vindicated, when Justice Ian Topping of Durban High Court ruled that the complainant had ‘contractually bound himself to live within a controlled environment’, and the rule he objected to was reasonable and lawful.

‘They [the rules] are there to regulate conduct between neighbours and, as necessary, must be restrictive to take into account the cumulative rights of use and enjoyment of the estate by all its residents,’ Justice Topping said.

Essentially there are three categories of HOA rules.

Management rules: These rules relate to the governance of the company (owner of the estate), including HOA meetings, financial controls, voting, appointments of directors, management practices, and the Memorandum of Incorporation (MOI). These rules are important because they clearly outline the rights of all owners as members of the community.

Important documents include the MOI, the Architectural and Building Guidelines, the annual budget, and all resolutions passed relating to the governance of the company, which is bound by the Companies Act.

Conduct rules: These can be broken down to health and safety, use of roads and parks, the keeping of pets, noise and disturbances, the use of machinery and equipment, the use of facilities, and visitor access. These rules are designed to ensure good neighbourliness, and to serve the best interests of all in the community. Generally, these rules come with penalties should they be breached, and these penalties are set according to the potential impact of the breach.

Rules are not in place to punish owners and their guests, but rather to encourage compliance in the best interests of the community.

Building rules: These rules ensure that the presence of open stands – or worse, half-built homes – is minimised. Owners have specified time limits to start building, and specified time for completion. Failure to comply means increased costs to the HOA, such as added security, damage to roads and curbs, and noise and dust over extended periods, so there are building penalties if these rules are breached.

Owners living in an organised built community are also required to abide by local bylaws, including the keeping of livestock, the use and storage of hazardous substances, and the use of firearms.

CHARACTERISTICS OF GOOD RULES

The main consideration of rules is that they should be ‘good rules’, with fair penalties. So what makes a good rule? Transparency and relevance: Rules should require that members do what reasonable and decent people would do naturally anyway without the rules. So the people who break them, and who will incur penalties, are only the few who are not reasonable and decent.

Sufficiency: Good rules are the minimum necessary to provide for the comfort and safety of the residents, the equitable use and enjoyment of facilities, and the equitable burden of responsibility in a community.

Positivity: Residents must understand the need for the rule and comply with it voluntarily. Neither the board nor the manager is in a position to police the community.

Efficiency: Good rules accomplish exactly what the board intended them to accomplish. Unfortunately, some associations try to solve a problem by passing rules that are either too harsh or too broad, which makes it difficult for residents to comply. This might result in residents ignoring the rule and/or calling the board autocratic or dictatorial.

Enforceability: Make sure the board has the authority to enforce a rule before drafting it, then make the rule specific. Vague statements, such as ‘loud and boisterous activity should be avoided’ leave unanswered questions such as, how loud?, where?, when?

Flexible: Good rules allow flexibility and the use of reasonable judgement and mediation in their enforcement.

Communication: Rules need to be communicated effectively and often. HOA’s should redistribute copies of the rules periodically, put them up on the estate’s website, and also consider putting up signs on the roads and in pool and playground areas.

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