How to be an effective Trustee?
Guidelines for community scheme living in South Africa
30 July 2025 | Nicole Nel
Who makes the ideal Trustee?
We are often asked, “Who would make the best Trustees in a community scheme?”, and unfortunately as always there is no straight-forward answer.
People often believe that professional persons, like lawyers, accountants, engineers, etc., should be appointed, but these persons are far and few between in community schemes, and ninety percent of the schemes that I work with do not have these professional persons serving as Trustees, or even in the scheme at all.
What does the legislation say?
Because of the above, the Sectional Titles Schemes Management Act 8 of 2011 (“the STSMA”) and the Community Schemes Service Act 9 of 2011 (“the CSOSA”) have provided bodies corporate, and community schemes, with minimum standards of behaviour and conduct that must be followed by Trustees, or Scheme Executives, e.g. Directors, Management Committee Members, etc., in order for those entrusted with the decision-making powers of the community scheme to always act in the best interests of the community scheme and all of its members.
In this regard, section 8 of the STSMA very clearly provides that the Trustees of a body corporate serve the scheme in a fiduciary capacity. What this means is that a Trustee must:
a) Act honestly and in good faith with any and all matters pertaining to the body corporate, must only exercise their powers in terms of the STSMA in the interest and for the benefit of the body corporate, and must not act without or exceed those powers, and
b) Avoid any material conflict between their own interests and those of the body corporate, namely by not receiving any personal economic benefit, direct or indirect, from the body corporate or from any other person, and must notify every other Trustee of the nature and extent of any direct or indirect material interest which they may have in any contract of the body corporate, as soon as such they becomes aware of such interest.
In addition to the above, should a Trustee of a body corporate be guilty of breaching their fiduciary relationship to the body corporate, as outlined above, that Trustee can be held liable for any loss suffered by the body corporate as a consequence of this breach, or will be held liable for any economic benefit derived by the Trustee as a result of this breach.
At this point it must be highlighted that should a body corporate, or any stakeholder within the body corporate, be of the opinion that a Trustee breached their fiduciary relationship and it either resulted in a body corporate loss, or an economic benefit for the Trustee, they will have to pursue action against this Trustee in a traditional court of law, through a delictual application for damages, as the Community Schemes Ombud Service (“the CSOS”) does not have the jurisdiction to adjudicate on any claims for damages.
It is not only bodies corporate, through the STSMA, that have prescribed a fiduciary relationship between Trustees and the body corporate they are serving.
In this regard, Regulation 14 of the CSOSA, “Duties of Scheme Executives”, provides that all scheme executives, i.e. Trustees, Directors, Management Committee Members, etc., must:
a) Take reasonable steps to inform and educate themselves about the community scheme, its affairs and activities and the legislation and governance documentation in terms of which the community scheme operates;
b) Take reasonable steps to obtain sufficient information and advice about all matters to be decided by the scheme executives to enable him or her to make conscientious and informed decisions;
c) Unless excused by the chairperson of the scheme executives on reasonable grounds, attend all meetings of the scheme executives and attend the community scheme's annual general meeting, if it holds such a meeting;
d) Exercise an active and independent opinion with respect to all matters to be decided by the scheme executives, and
e) Exercise due diligence in relation to any business of, and necessary preparation for and attendance at meetings of, the scheme executives or any committee to which such scheme executive is appointed.
Fiduciary responsibilities in a homeowners association
In addition to the above, these obligations of a community scheme executive are in addition to and do not derogate from the fiduciary obligations of a scheme executive in terms of the common law or any applicable statute.
This means that, notwithstanding any additional duties placed on scheme executive in terms of the STSMA, a common law homeowners association’s Constitution, the Companies Act 71 of 2008 (“the Companies Act”), a Memorandum of Incorporation of a non-profit company homeowners association, etc., scheme executives must also comply with the regulations as set out in the CSOSA Regulations.
As stated above, sections 75, 76 and 77 of the Companies Act prescribe additional requirements for Directors of non-profit company homeowners associations, namely regulating matters like conflict of interest, the minimum standard of conduct expected from Directors, and how Directors can be held directly liable for breaching a fiduciary duty or any other prescribed duty in terms of the Companies Act.
Furthermore, a non-profit company homeowner association’s Memorandum of Incorporation can include additional requirements, fiduciary or otherwise, that Directors will need to comply with when serving in that role on behalf of the homeowners association.
Unlike bodies corporate and non-profit company homeowners associations, and besides for Regulation 14 in the CSOSA, common law homeowners associations do not have the STSMA, or the Companies Act, prescribing the fiduciary relationship between the scheme executives and the community scheme.
This is why it is therefore so essential for a Constitution of a common law homeowners association to contain clear clauses further outlining and detailing the required fiduciary relationship that the Trustees, Management Committee, etc., such that these persons are effectively able to serve the homeowners association to the best of their ability, and are aware of the consequences should they fail to do so.
Conclusion | No definitive answer
Although there is no clear answer to which kind of people make the “best” Trustees, this article certainly proves that it is not very difficult to be a good Trustee in your community scheme, and Regulation 14 of the CSOSA provides all community schemes with a great base layer of the minimum standards of conduct that we should expect from scheme executives when serving in these roles in community schemes.
About Nicole Nel
Nicole Nel is a Community Schemes Consultant at TVDM Consultants.
Nicole joined our team at the start of 2021 after finishing up her LLB at Stellenbosch University, where in the final year of her degree, Nicole worked as a research intern for the South African Research Chair in Property Law (“SARCPL”), where her research contributed towards various Property Law Juta publications. After graduating, she went on to complete an Advanced Diploma in Corporate and Securities Law through UNISA with distinction. Nicole recently completed the SA Legal Academy mediation course, and is an Accredited Mediator. Nicole is also a member of Golden Key, international honours society as a top academic achiever in her respective fields of study.
Click here to learn more about her.
