Rising legal scrutiny of community schemes

ROUTINE decisions by community scheme trustees and directors, once viewed as “harmless administrative housekeeping”, are increasingly being found unlawful by South Africa’s courts.

- ZELDA VENTER

That's according to attorney Johlene Wasserman, Director of Community Schemes and Compliance at VDM Incorporated, who warns that this fast-developing legal trend is exposing schemes to significant financial risk and placing trustees and directors at real personal liability.

“Actions that were previously considered low risk are suddenly being tested against strict legal standards,” she says, adding that the consequences are immediate and far-reaching.

Wasserman, a governance specialist and former senior official at both the Community Schemes Ombud Service (CSOS) and the Property Practitioners Regulatory Authority (PPRA), says community schemes across the country have entered a period of heightened legal vulnerability, with disputes escalating in both frequency and severity.

“The sector is under unprecedented pressure as legal scrutiny intensifies, with directors and trustees increasingly being blindsided by risks they never realised were embedded in their everyday decision-making. Yet many of these conflicts can be avoided entirely with stronger governance oversight”.