One of the most common misconceptions among trustees is that a body corporate can simply decide to fine an owner or resident for breaking the rules. Unfortunately, it doesn't work that way.

While fines are an important tool for encouraging compliance within a community scheme, they are only enforceable if your scheme has valid, properly approved conduct rules that specifically provide for them.

Failing to follow the correct process can result in fines being set aside by the Community Schemes Ombud Service (CSOS), leaving the body corporate unable to enforce its own rules.

Where does the authority to fine come from?

Neither the Sectional Titles Schemes Management Act nor its Regulations automatically gives a body corporate the power to impose fines. That authority must come from the scheme's conduct rules.

  • Noise
  • Parking
  • Pets
  • Refuse disposal
  • Behaviour of residents and visitors
  • Common property
  • Architectural guidelines
  • Short-term letting (where applicable)

If a scheme wishes to impose monetary penalties for breaches of these rules, the conduct rules themselves must expressly authorise fines.

Approved conduct rules are essential

For conduct rules to be enforceable, they should be properly approved by the body corporate, be reasonable and lawful, be lodged with and approved by CSOS, and apply equally to owners and occupiers.

If this process has not been followed, the scheme may have difficulty enforcing those rules, including any fines imposed under them.

The rules should clearly explain the fining process

Well-drafted conduct rules should deal with:

  • Which conduct may attract fines
  • The amount of each fine
  • Repeat offences
  • The procedure before a fine is imposed
  • The resident's right to make representations
  • The decision-making process
  • Any appeal or dispute process

Clear rules protect both the body corporate and residents by ensuring consistency and procedural fairness.

Due process still applies

Even where valid conduct rules exist, a body corporate cannot issue fines automatically. Procedural fairness requires written notice of the alleged breach, an opportunity to respond, fair consideration of representations, a reasoned decision and written communication of the outcome.

Ignoring these steps can render a fine unenforceable.

Why this matters

Invalid fines often lead to disputes, unpaid penalties and CSOS applications. Properly drafted and approved conduct rules give trustees confidence that they are acting within their legal authority.

Is it time to review your rules?

Many community schemes still rely on outdated conduct rules that may no longer reflect current legislation or modern sectional title living. A legal review can identify gaps, ensure compliance and strengthen enforcement.

Properly approved conduct rules are the legal foundation for effective governance, fair enforcement and harmonious community living.

Need assistance?

At VDM Attorneys, our Community Schemes Department regularly assists bodies corporate, homeowners' associations and managing agents with:

  • Drafting and updating conduct rules
  • CSOS rule approvals and amendments
  • Governance advice for trustees
  • Levy recovery and collections
  • Dispute resolution
  • Compliance with the Sectional Titles Schemes Management Act and CSOS legislation

Whether your scheme needs to modernise its rules or ensure that its fining procedures are legally enforceable, our team can help ensure your governance framework is compliant and effective.