A body corporate’s power to prevent the transfer of a unit if the seller owes money to the body corporate, is contained in section Section 15B(3)(a)(i)(aa) of the Sectional Titles Act, 95 of 1986 (the Act).
Levy clearance is an assurance from the trustees, or managing agent, that the owner does not owe any money. This covers “all monies” not just “contributions”. This means that the body corporate may withhold the certificate until all costs or potential costs have been paid or an arrangement for payment has been made that is acceptable to the body corporate.
Section 15B(3)(a)(ii) also refers to a clearance certificate but it applies to developers who hold rights to extend the scheme in terms of section 25. Section 37(1)(bA) says the body corporate must charge the developer for any expenses it has in respect of the area subject to the future development rights.