General body corporate FAQ
Some general things to know about a body corporate.
Q.1 How is a body corporate set up and governed?
The Body Corporate and Community Management Act 1997 and the associated Regulation Modules (Accommodation, Standard, Small Schemes and Commercial) is Government legislation that determines how a body corporate is to function. To get the Act free online go to our useful links page.
Q.2 What are by-laws?
By-laws are a set of rules that are set down to ensure that all occupants can sensibly and peacefully enjoy the common facilities together. The by-laws and their enforcement are essential to preserve property values in the community. A by-law cannot impose a monetary liability on an owner or occupier of a lot; cannot discriminate between different types of occupiers (owners/tenants); and, cannot restrict the type of residential use of a lot as long as that lot may lawfully be used for residential purpose
Q.3 How much can the body corporate committee spend?
The Act makes it that committee spending is set at a default amount of $200 per lot. This limit can be increased at a general meeting by ordinary resolution to an amount (excluding GST) which is not capped or defined. If the spending to be approved by the committee is above the default spending limits , than it must obtain two quotes and attach these to the agenda for the committee meeting. This is generally done by the body corporate manager.
Q.4 Should I read and keep the information the body corporate provides?
It is important for owners to at least peruse the information sent to you by your body corporate. The information is relevant to your property and may affect your levy contributions. The annual General Meeting notice is probably the most important for Owners to read and understand. The package includes all relevant levy information for the next year, what insurance cover is in place, and who the body corporate committee members are. Should an owner want to sell their property, all the necessary information is provided in the annual General Meeting package sent out each year. You should carefully read all information provided to you by the body corporate.
Get involved with your body corporate
Ways in which you can participate with your body corporate.
Q.1 Why do I receive a Notice of the annual General Meeting?
The Body Corporate and Community Management Act 1997 provides that all owners are to receive a copy of the notice of the annual General Meeting. You should consider whether you will attend. Matters and issues directly concerning your investment in your property are discussed and decided upon in the meeting. This is a chance to have your say – but keep it constructive and relevant.
Q.2 What if I want to be on the committee?
The opportunity to elect new committee members occurs at each annual General Meeting of your body corporate. The secretary must serve notice on each owner, inviting nominations for the election of chairperson, secretary, treasurer or ordinary member of the committee. Remember, unless the body corporate resolves otherwise, this election must be by secret ballot.
Q.3 Can I propose a motion for the next annual General Meeting?
Yes. A property owner is entitled to propose a motion at any time of the year to be voted on at the next General Meeting. Additionally, when nominations are called for (at least 3 weeks but no more than 6 weeks prior to the financial year end), owners may submit a motion they wish to be included on the agenda for the annual General Meeting. Motions need to be in a format you can vote either yes or no to, and not just for general discussion. It is best to talk to your body corporate manager about how to best word and put forward a motion – they will not do it for you but will make sure it complies with all requirements to be a valid motion.
Q.4 Who can vote at a General Meeting?
Every owner is entitled to vote at a General Meeting. If you cannot attend a meeting, you can either appoint a proxy to vote on your behalf or fill out the voting paper and return it (some body corporates will allow this to be done electronically). There has to be a minimum number of people attending a General Meeting for it to be valid – this is called a quorum. Anyone who has not paid thier levy on time is not entitled to vote a meeting.
Being part of a body corporate means that you have to pay money to it, and that the body corporate makes payments for a number of things.
Q.1 Why do I have to pay levies?
It costs money to keep common property of the body corporate running and in good repair. So every property owner has to, by law, contribute to the fund of the body corporate. Normally there is an administration fund for the regular costs (maintenance, mowing, insurance premiums, body corporate management, etc) and a sinking fund for non-recurrent or major works (painting building, major repairs, fences, common area carpets, etc). The body corporate maintains these funds in a bank account for each one.
Q.2 What if I disagree with the amount of levies required?
All levies (both administration and sinking funds) are determined at the general General Meeting each year by way of ordinary resolution, which means that more than 50% of votes counted must be in favour. If you have an issue, ideally the matter should be raised before the annual General Meeting, so your reasons can be considered. Remember that the body corporate cannot run without money and payments of levies to the body corporate are effectively an investment in your property.
Q.3 Sinking funds seem a waste of money?
It would be a very unusual property that does not require some upkeep. At times, the upkeep can become significant (imagine what it costs to paint a 10 storey building). So a sinking fund is created to try to cover all major anticipated costs over the next nine years. Actually, a sinking fund is a very fair way to do this. What it means is that people can buy and sell their properties without being unfairly charged for major items of work.
How to select a new Body Corporate Manager
Information you need to provide to the person you ask to provide a quote
- Body Corporate full name including CTS number
- Number of units
- Date of Financial Year
- How frequently are levies collected – 3 monthly / 4 monthly / 6 monthly / 12 monthly
And if possible it is also useful to know
- Building Format Plan / Standard Format Plan – which one?
- BUP number / GTP number
Questions that are relevant for you to ask / consider
- Is the Body Corporate Manager that is looking after you an employee or principal?
- Do you need meetings outside 9 to 5 hours?
- Do you want fully integrated electric services (so that your Body Corporate information is available via online log-in)
- Where is the Body Corporate office – is it local? Does this matter?
- Do you expect your BCM to get quotes and organise maintenance? If so, is this included in the standard fee or additional fee?
- Do you want disbursements at a flat fee / or fee for service?
- What is included / excluded in the Standard fee?
- If the disbursements are charged at fee for service (fee for each paper, phone call, email) – what controls are in place to avoid this fee becoming out of control?
- Is the business as well as the BCM registered with Strata Communities Australia (Queensland) (SCA)?
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