In a sectional title scheme, trustees play a critical governance role. They are responsible for managing the affairs of the body corporate, making operational and maintenance related decisions, ensuring legal compliance, and protecting the financial sustainability of the scheme.

Trustees are the legally authorised representatives of the body corporate, while the managing agent is not a trustee. Instead, the managing agent is a professional or company appointed to administer day-to-day operations under the direction of the trustees. The trustees are entitled to appoint professionals and delegate work but remain legally liable and responsible for all decisions made unless the scheme is placed under administration or an executive managing agent is appointed. Trustees may refer a matter to members in general meeting for a decision and cannot be held liable once members have voted on a matter.

But what happens when a scheme ends up with no trustees — whether due to resignations, failure to appoint trustees at an AGM, or lack of willing owners?

The consequences can be serious and far-reaching, affecting owners, finances, compliance, and even property values.

1. The Scheme Cannot Function Legally
Under the Sectional Titles Schemes Management Act 8 of 2011 (STSMA 7(1) to (3)), the body corporate must act through its trustees. Trustees are the legally authorised representatives of the scheme.

Without trustees:
a)     no lawful decisions can be taken;
b)     no governance authority exists; and
c)      the body corporate becomes administratively paralysed.

Even routine matters may become legally questionable.

2. Financial Management Breaks Down
Trustees are responsible for overseeing the financial affairs of the scheme, including:
a)     approving payments;
b)     enforcing levy collections;
c)      managing budgets; and
d)     authorising contracts.

Without trustees:
a)     Service providers may not be paid
b)     Levy arrears increase
c)      Banking mandates may become invalid
d)     Insurance premiums may lapse
 
  
3. Maintenance and Repairs May Stop
Trustees must ensure the common property is properly maintained.
If no trustees are in office:
a)     Maintenance decisions cannot be approved
b)     Emergency repairs may be delayed
c)      Contractors may refuse to act without authority
d)     Property deterioration accelerates

Delayed maintenance often leads to significantly higher future costs.

4. Legal Non-Compliance Risks
The body corporate appoints trustees who have a statutory duty to do all things necessary to administer the common property, including:
a)     Holding AGMs
b)     Maintaining insurance
c)      Keeping accounting records
d)     Enforcing conduct and management rules

Failure to meet these obligations may expose the scheme to disputes and regulatory intervention under the Community Schemes Ombud Service (CSOS).

Owners themselves may ultimately bear the consequences of non-compliance.

5. Contracts and Service Agreements Become Problematic
Many service providers require trustee approval or authorised signatures for:
a)     Security contracts
b)     Managing agent agreements
c)      Maintenance services
d)     Utility arrangements

Without trustees:
a)     Contracts may lapse or become unenforceable
b)     Suppliers may suspend services
c)      The scheme’s operational stability is threatened
  
6. Insurance and Liability Exposure
Trustees must ensure that adequate insurance is maintained.
If trustees are absent:
a)     Insurance renewals may be missed;
b)     Claims may be rejected due to lack of authorised representatives; and
c)      Owners could face personal financial exposure following damage or liability claims

This is one of the most serious risks facing a scheme without governance.

7. Owners May Need to Approach CSOS or Court
Where no trustees exist, owners or interested parties may apply to CSOS for intervention.
Possible outcomes include:
a)     Appointment of an executive managing agent which may lead to increased management fees, thus impacting levy payments.
b)     Compulsory governance measures as ordered by CSOS.
c)      Administrative orders directing the scheme’s management

In extreme cases, the High Court may become involved — a costly and time-consuming process.

8. Property Values Can Decline
Poor governance directly affects market value.
Buyers and banks often investigate:
a)     Financial stability
b)     Governance structures
c)      Maintenance standards

A scheme without trustees signals risk, which can result in:
a)     Reduced buyer and rental confidence
b)     Lower property values
c)      Difficulty obtaining mortgage or additional finance
  

9. Owners Ultimately Carry the Burden
A common misconception is that “nothing happens” if no trustees are appointed. In reality:
a)     The body corporate still exists.
b)      Legal obligations remain.
c)     Owners collectively remain responsible.

The absence of trustees does not remove liability  it merely removes proper management.
 
How Can This Situation Be Fixed?
If a scheme finds itself without trustees, the following steps should be taken urgently:

Call a Special General Meeting (SGM) to appoint trustees.

• Encourage owner participation and education to foster awareness of responsibilities and governance requirements.
• Consider appointing an executive managing agent or external professional trustees if owners are unwilling or unable to serve.
• Seek guidance from a professional managing agent or CSOS.
• Early intervention prevents escalation.

In Closing
Trustees are not merely administrative volunteers they are the governance backbone of a sectional title scheme. Without them, the scheme risks financial instability, legal exposure, and declining property standards.

Owners must be proactive in the appointment of trustees, tolerant of communal living and understand and accept the responsibilities that come with the appointment of a trustee. To ensure efficient handling of these responsibilities it is vital to educate yourself in the fiduciary and legislative requirements and ensure proper advice is being obtained. 
 

Active participation by owners is essential to maintaining a healthy, compliant, and financially sustainable community.
 

A functioning body corporate depends on willing leadership  and every owner has a stake in ensuring that leadership exists.