Buying into or renting in a residential complex? Be sure to read the HOA’s rules

Are you looking to buy into a residential complex or rent a house in such a complex? We highly recommend that you read and familiarise yourself with the Home Owners Association (HOA) rules and regulations for that complex. A recent High Court decision has upheld the HOA’s right to enforce their rules and regulations.
This decision is in line with the general principles of freedom of contract. The Court said that, “… parties are free to contract as they please. The law permits perfect freedom of contract. Parties are left to make their own agreements, and whatever the agreements are, the law will enforce them provided they contain nothing illegal or immoral or against public policy.
HOA’s rules

On the HOA’s rules: The case

In this case, a homeowner (who was landlord for the property) breached the HOA’s rules regarding aesthetics. The owner was fined by the HOA, but failed to pay those fines. The HOA responded by restricting the tenant’s right to buy electricity and water vouchers he needed to top his pre-paid meters. The tenant then approached the High Court for assistance citing, among other things, his constitutional and statutory rights to basic services.
The critical fact in this case was that both the owner and the tenant had agreed to be bound by the HOA’s rules. In those rules, there was a provision that stated, “no electricity shall be provided or sold to any occupier or owner of any erf in respect of which levy payments are outstanding for a period of 60 days or longer, until such time as all outstanding levy payments are paid in full”. The court found that the tenant had freely agreed to be bound by the HOA’s rules, and because of that, the HOA had acted within its rights.

On the HOA’s rules: The moral

The moral of the story is this: When you buy or rent in a residential complex, be sure to read through and understand all the HOA’s rules and regulations of that complex. When you agree to them, you are bound by them!
If you need any assistance in this regard, please do not hesitate to contact us at [email protected].

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