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Lecture 6: ADMINISTRATOR & GENERAL MEETING
Test: 5 qs, answer 3 – 1.5 hours. Exam: 4 qs, answer 2.
ADMINISTRATOR STSMA s 16
- If everything is in disarray, as a last resort can appoint and
administrator (have a trustee and managing agent usually)
o Inefficiency, infighting and maladministration which causes
chaos in the finances and the administration
o Last resort = appointment of administrator
- preliminary steps:
o can have a spec. general meeting or annual gen. meeting to try
to solve problem
o can appoint new trustees;
o appoint a new managing agent: Williams v Nathan [2006] JOL
18414 (W)
the had appointed a managing agent
then went to mag court to appoint an administrator
(wanted to appoint the magaing afent as the admin)
mag court refused application
they said they have the managing agent, he must solve
the problems, you cannot appoint the same person as an
administrator
Man. agent appointed can ask court appoint man.agent as
administrator; court dismissed application to appoint
administrator
Appointment of administrator
- STSMA s 16(1):
o must make an application to Mag Court (not ombud)
o can be done by the BC, local municipality, judgement creditor,
owner, holder of real right etc
- S 16(1): must be a suitably qualified and independent person (not
man. Agent cos chances are hes messed up already)
- S 16(2)(a) When: when there is:
o 1. serious financ. and administrative mismanagement
o 2. there is a reasonable probability that he will be able to meet
obligations & manage the scheme properly must add some
value in trying to solve the problems
- Dempa Investments CC v Body Corporate of Los Angeles [2008]
JOL 21735 (W); 2010 (2) SA 69 (W) Study Guide page 83
o Managing agent: Inexperience+stubbornness; finan.crisis:
maladmin., dishonesty
o There were exceptional circumstances: serious financial
difficulties, flagrant maladministration, inefficiency, dishonesty,
managerial deadlock (2 camps interdicting each other) they
would never be able to solve it themsleves
o Dempa had a debt of R1.6million debt and a very inefficient
repayment method
, 2
o would never have been able to pay of their debt in this way
Duration, terms, remuneration
- S 16(2)(a) How long: always a fixed period
- S 16(2)(a) Such terms and conditions as Court deems fit
- S 16(2)(b) Remuneration & expenses are administrative expenses
which means it is paid by BC
Powers and duties
- S 16(3): Powers & duties as Mag Court directs to exclusion of the body
corporate
o Eg. can say all the powers of BC, or just limit
- S 16(3): address management problems as soon as reasonably
possible
- S 16(4) Obligations:
o (a) convene & preside over meetings;
o (b) lodge with ombud
(i) copies of the notices and minutes of meetings
(ii) written reports on administration every 3
months/shorter intervals
- If all the powers have been handed over to the administrator, he can
still have meetings just to report what he is doing
- But then, there can be no general or special resolutions
- very NB to see the terms and conditions imposed by the Mag court
to see how much power he has
Removal, replacement etc
- S 16(5) Mag Court application:
o By the administrator and all the applicants ito s 16(1):
o To remove him; replace him; extend his term; renew terms of
appointment; cost order
GENERAL MEETINGS
- BC is a juristic person
- Has 2 bodies that can help them to do what they need:
o Trustees executive committee
o The general meeting makes all the policy decisions
Notice of, attendance at general meetings Ann.1 rule 15
- (1) must give 14 days’ notice of the place, date, hour to all
o members,
o all bondholders,
o people with development rights,
o managing agent
- (2) can waiver your right to be notified or revoke waiver
o Must give written notice of this to the b.c
- (3) the notice must be accompanied accompanied by
o agenda;
Lecture 6: ADMINISTRATOR & GENERAL MEETING
Test: 5 qs, answer 3 – 1.5 hours. Exam: 4 qs, answer 2.
ADMINISTRATOR STSMA s 16
- If everything is in disarray, as a last resort can appoint and
administrator (have a trustee and managing agent usually)
o Inefficiency, infighting and maladministration which causes
chaos in the finances and the administration
o Last resort = appointment of administrator
- preliminary steps:
o can have a spec. general meeting or annual gen. meeting to try
to solve problem
o can appoint new trustees;
o appoint a new managing agent: Williams v Nathan [2006] JOL
18414 (W)
the had appointed a managing agent
then went to mag court to appoint an administrator
(wanted to appoint the magaing afent as the admin)
mag court refused application
they said they have the managing agent, he must solve
the problems, you cannot appoint the same person as an
administrator
Man. agent appointed can ask court appoint man.agent as
administrator; court dismissed application to appoint
administrator
Appointment of administrator
- STSMA s 16(1):
o must make an application to Mag Court (not ombud)
o can be done by the BC, local municipality, judgement creditor,
owner, holder of real right etc
- S 16(1): must be a suitably qualified and independent person (not
man. Agent cos chances are hes messed up already)
- S 16(2)(a) When: when there is:
o 1. serious financ. and administrative mismanagement
o 2. there is a reasonable probability that he will be able to meet
obligations & manage the scheme properly must add some
value in trying to solve the problems
- Dempa Investments CC v Body Corporate of Los Angeles [2008]
JOL 21735 (W); 2010 (2) SA 69 (W) Study Guide page 83
o Managing agent: Inexperience+stubbornness; finan.crisis:
maladmin., dishonesty
o There were exceptional circumstances: serious financial
difficulties, flagrant maladministration, inefficiency, dishonesty,
managerial deadlock (2 camps interdicting each other) they
would never be able to solve it themsleves
o Dempa had a debt of R1.6million debt and a very inefficient
repayment method
, 2
o would never have been able to pay of their debt in this way
Duration, terms, remuneration
- S 16(2)(a) How long: always a fixed period
- S 16(2)(a) Such terms and conditions as Court deems fit
- S 16(2)(b) Remuneration & expenses are administrative expenses
which means it is paid by BC
Powers and duties
- S 16(3): Powers & duties as Mag Court directs to exclusion of the body
corporate
o Eg. can say all the powers of BC, or just limit
- S 16(3): address management problems as soon as reasonably
possible
- S 16(4) Obligations:
o (a) convene & preside over meetings;
o (b) lodge with ombud
(i) copies of the notices and minutes of meetings
(ii) written reports on administration every 3
months/shorter intervals
- If all the powers have been handed over to the administrator, he can
still have meetings just to report what he is doing
- But then, there can be no general or special resolutions
- very NB to see the terms and conditions imposed by the Mag court
to see how much power he has
Removal, replacement etc
- S 16(5) Mag Court application:
o By the administrator and all the applicants ito s 16(1):
o To remove him; replace him; extend his term; renew terms of
appointment; cost order
GENERAL MEETINGS
- BC is a juristic person
- Has 2 bodies that can help them to do what they need:
o Trustees executive committee
o The general meeting makes all the policy decisions
Notice of, attendance at general meetings Ann.1 rule 15
- (1) must give 14 days’ notice of the place, date, hour to all
o members,
o all bondholders,
o people with development rights,
o managing agent
- (2) can waiver your right to be notified or revoke waiver
o Must give written notice of this to the b.c
- (3) the notice must be accompanied accompanied by
o agenda;
