1. General issues about Bodies Corporate:
 1.1 What is a Body Corporate?
1.2 Are there different types of Bodies Corporate?
1.3 What is a Lot and what is a Unit?
1.4 What are my rights and responsibilities? 2. Money Matters
2.1 What is an Administrative Fund?
2.2 What is a Sinking Fund?
2.3 Do I pay a fair proportion?
2.4 Is my Body Corporate saving enough?
2.5 What to do with excess funds? 3. About Committees
3.1 What is a Committee?
3.2 Is a Committee necessary?
3.3 Election of a Committee
3.4 Becoming a Body Corporate Committee Member
3.5 Resigning from the Committee
3.6 How do Committees work? 4. Annual General Meetings (AGMs) and Extraordinary General Meetings (EGMs)
4.1 When is my AGM?
4.2 Who sets the meeting agenda?
4.3 How can I submit a Motion?
4.4 Do I have to attend an AGM/EGM? 5. Committee Meetings
5.1 How often are they held?
5.2 Who can attend Committee Meetings?
5.3 Where are the Minutes of these meetings? 6. About Body Corporate Managers
6.1 Is a Body Corporate Manager required?
6.2 What does a Body Corporate Manager do?
6.3 How do I select a good Body Corporate Manager?
6.4 Are Body Corporate Managers accountable?
6.5 Can a Body Corporate Manager agreement be terminated? 7. Appointing a Body Corporate Manager
7.1 How do we appoint a Body Corporate Manager? Notes about these FAQs
We pride ourselves on making the complicated issues involved with body corporate management easy. The following information provides simple answers to the most common questions we’re asked. Please note that the information on these pages should be viewed as 'general advice' only. The BCCM Act and Regulations is complex legislation and this information does not apply to all cases, in all schemes, under all circumstances. You should always check the Act regarding your specific situation. 1. General issues about Bodies Corporate: 1.1 What is a Body Corporate?^Top A Body Corporate is the legal entity automatically created when a Community Title Scheme (CTS) is registered with the Department of Natural Resources (formerly The Titles Office). A Community Title Scheme is a method of titling and subdividing land, or land and buildings, such that multiple Lots are created according to a Community Management Statement (CMS). The CMS describes the Scheme, the number of lots, entitlements for each lot, the By-Laws of the scheme, any exclusive use allocated to a lot, and other details. Every Community Title Scheme has a Body Corporate, comprises at least two lots, and has some Common Property. Every owner of a lot is automatically a member of the Body Corporate. 1.2 Are there different types of Bodies Corporate?^Top Yes. Most Bodies Corporate are Community Title Schemes which are simple and 'basic', however some CTS’s can be part of a 'layered' arrangement of other Schemes, headed by a Principal Body Corporate, and one or more Schemes under. These complicated arrangements are established due to 'mixed uses' in the building or community, which is the subject of the titling arrangement, eg. a building comprising a strata hotel and an additional residential apartment component. To make it more complicated, some also include retail outlets. 1.3 What is a Lot and what is a Unit?^Top Lots are created by the subdivision process and the creation of the Community Title Scheme - which must comprise at least two lots and common property. Lots have individual title under the Land Titles Act and have individual ownership - the Common Property is jointly owned by the owners. A 'unit' is just a more common name for a residential scheme lot, ie. in 'home unit', the term 'unit' is no longer used in the Body Corporate and Community Management legislation, and your Body Corporate manager will always refer to 'lots'. 1.4 What are my rights and responsibilities?^Top As an owner of one or more lots in a CTS, you are a member of the Body Corporate for that scheme. You are covered by the Body Corporate and Community Management Act (BCCMA). Emphasis is placed on this legislation to ensure owners' rights are effectively protected. It also ensures all matters of the Body Corporate are conducted in an open manner as possible – for example, the legislation allows any and all Owners to attend any Committee meeting - the Committee might not (unlikely) allow them to participate, but at least they can observe and listen in. In addition to protecting individual owners' rights, the legislation covers 'Community living’. As an owner and member of a community you are an Owner in a Community Title Scheme, and have a responsibility to comply with the By-laws of your Community Title Scheme. 2. Money Matters 2.1 What is an Administrative Fund?^Top The Administrative Fund is one of two funds resulting from the statutory requirement for a Body Corporate. It operates strictly in accordance with the legislative requirements under the Body Corporate and Community Management Act (BCCMA) and the particular Module of Regulations applicable to the Scheme. The second fund is a Sinking Fund – see 2.2. The Administrative Fund is used to pay the Body Corporate's non-capital expenses, such as Insurance, Resident Manager's salary, Body Corporate Manager fees, grounds, gardening and minor or recurring maintenance. Usually everything apart from expenditure on major improvements, and significant one-off plant and building maintenance are funded from the Administrative Fund. The Body Corporate has a statutory requirement to ensure that owners pay a levy sufficient to supply the Administrative Fund with the necessary resources to meet its obligations under the Act. 2.2 What is a Sinking Fund?^Top The Sinking Fund is a statutory requirement and is used to pay the Body Corporate's capital expenses, eg. major improvements and significant one-off common property maintenance. It is also a requirement that the Body Corporate has a long-term (10 year) plan of expected maintenance and capital replacement costs expected to be incurred for the common property assets. The annual Sinking Fund budget allocates funding in accordance with this long-term plan. The Body Corporate has a statutory requirement to ensure that owners pay a levy sufficient to supply the Sinking Fund with the resources to meet its obligations under the Act. 2.3 Do I pay a fair proportion?^Top The proportion of the total budgets each owner pays is principally determined by the Contribution Lot Entitlement Schedule for the Scheme. (There are two Lot Entitlement Schedules, Contribution and Interest, and they have different functions. The cost of insurance is normally the only expense apportioned according to Interest Lot Entitlements – all other expenses are apportioned by Contribution Lot Entitlements.) The proportion of Body Corporate expenses you pay, relies on the Contribution Lot Entitlement Schedule drawn up for your Scheme. The Act has, as a fundamental basis, a requirement that the Contribution Lot Entitlements shall all be equal - unless there are very good reasons why they shouldn't be equal. If the Lot Entitlements for your Scheme are unfair, they can be changed, however the process is often a difficult one. Please contact us for further information on this process. 2.4 Is my Body Corporate saving enough?^Top As discussed in 2.3 above, a Body Corporate uses a Sinking Fund to provision for future expenditure of a capital nature. It is a statutory requirement that this provisioning be done properly. To assist with this process, it is also a statutory requirement for the Body Corporate to have a properly drawn up long-term (10 year) capital maintenance forecast, complete with expenses - usually referred to as a Sinking Fund Forecast Report. It is a requirement of the Act that this report be kept 'refreshed' and current so it will be representative of the state and status of the building and all Common Property. If the Sinking Fund report hasn't been updated for a number of years it will almost certainly not be representative of the funding needs of your complex, and so it is likely that the Body Corporate will be under-funding the Sinking Fund, ie. not saving enough. 2.5 What to do with excess funds?^Top The Act does not permit a Body Corporate to move surplus monies from the Sinking Fund to the Administrative Fund or vice versa. The Office of the Commissioner has indicated that they generally will not approve of any move to return surplus funds to owners. If a Body Corporate has surplus monies in either fund, the mechanism for correcting this is to simply reduce budgets in the subsequent year, or years, until the surplus is depleted. Generally, monies should not accumulate and build up in the Administrative Fund, but we do recommend budgeting for about a 10% surplus over expected requirements each year. The Sinking Fund is the correct fund where a Body Corporate accumulates money ready to meet the forecast capital expenses in the Sinking Fund Report, but it is not appropriate for a Body Corporate to accumulate substantially more money in the Sinking Fund than it plans to use. 3. About Committees 3.1 What is a Committee?^Top The Committee is the group of owners appointed (by election or nomination) at each Annual General Meeting, to run the affairs of the Body Corporate for the next 12 months. The Committee comprises an 'Executive' - the Chairman, Secretary, and Treasurer, a number of Ordinary members, and possibly non-voting members (in the case of a Body Corporate with a Resident Manager Caretaker and/or a Body Corporate Manager, representatives of these two entities are automatically non-voting members of the Committee). The Committee of a Body Corporate has extensive powers. Similar to a Board of Directors of a Corporation, each member is democratically appointed in accordance with the Act to run the Body Corporate. 3.2 Is a Committee necessary?^Top There is a statutory requirement for a Committee. We consider an active and properly functioning Committee to be a vital component for a Body Corporate. A dormant or dysfunctional Committee invariably leads to problems for a Body Corporate. 3.3 Election of a Committee^Top The Committee is decided each year at the AGM. Committees can have a minimum of 3 and a maximum of 7 members - 3 Executive members (Chairman, Secretary, Treasurer) and 4 Ordinary members. There may also be 2 non-voting members (Resident Manager & Body Corporate Manager). A person can occupy more than one of the Executive positions. Nominations are called for Committee positions prior to the financial year end. If only one nomination for a particular position is received, the person Nominated is duly elected to that position. Committee members and nominators must be current financial members of the Body Corporate, ie. they cannot be in debt to the Body Corporate. 3.4 Becoming a Body Corporate Committee Member^Top This can be done in four ways: a) you can nominate yourself to be appointed to one or more positions at the AGM when nominations are called. Nomination forms are sent out a number of weeks before the end of the financial year of your Body Corporate.
b) someone else can nominate you via this Nomination Form, but you must sign the form to indicate your consent to the nomination.
c) if not all positions are filled by way of nominations received before the AGM, then remaining positions will be filled by calling for nominations from those present at the meeting. If you're present at the meeting, you can nominate yourself, or arrange to have someone else present nominate you. You will need to be present or have provided the person nominating you with your written consent to the nomination.
d) you can advise the Committee that you are interested in serving on the Committee and if a vacancy arises throughout the year, you may be invited to join. 3.5 Resigning from the Committee^Top A member may resign at any time by sending written advice to the Secretary or Body Corporate Manager. 3.6 How do Committees work?^Top The Act doesn't require the Committee to have any regular meetings apart from an implied requirement to formally decide the new budgets and prepare the agenda for the AGM. Committees will decide how they will deal with the regular matters of the Body Corporate, and special issues, which will occasionally arise. Committees can choose regular, scheduled meetings - monthly, bimonthly, quarterly etc., or decide to meet only when necessary. Committees need to take care when holding informal meetings, especially if important matters are discussed, or any expenditure is vetted or approved. A formal Committee Meeting, where those decisions are expected to be made, must be properly called, held, and minuted in accordance with the Act. If it doesn’t follow this process, and makes decisions outside of a proper meeting, the members takes a real risk of not acting properly, or in the interests of other Owners. For urgent matters, Committee members can communicate via phone or e-mail, with decisions made under these circumstances to be properly ratified by a subsequent flying minute, or at the next formal Committee meeting if one is scheduled sometime in the very near future. The Committee can authorise expenditure, based on a spending limit per project or item. This limit is calculated at $125 x the number of Lots in your Scheme per item, or in some circumstances, an increased limit approved by a general meeting of owners. Occasionally an issue may arise that is within the Committee's power to approve or decide on, but it might choose to put it to a wider vote and raise it at the next AGM or EGM. 4. Annual General Meetings (AGMs) and Extraordinary General Meetings (EGMs) 4.1 When is my AGM?^Top The AGM must be held every year within three months of the end of the financial year of your Body Corporate. The date is usually determined by the Committee and is also subject to the schedule of the Body Corporate manager. 4.2 Who sets the meeting agenda?^Top The Body Corporate manager normally compiles the agenda in conjunction with the Committee. 4.3 How can I submit a Motion?^Top To be included on the AGM agenda, any Motion from an Owner must reach the Secretary prior to the end of the financial year of the Body Corporate. If it is received after year end, the Motion will be held over and must be placed on the Agenda of the next General Meeting of the Body Corporate following the AGM. 4.4 Do I have to attend an AGM/EGM?^Top It is not mandatory for owners to attend these meetings, however you are urged to complete the voting paper forwarded to you to enable you to have your say on the administration of your Body Corporate. 5. Committee Meetings 5.1 How often are they held?^Top See 3.6 above. 5.2 Who can attend Committee Meetings?^Top If you are an Owner and have given the Secretary 24 hours’ notice you may attend a Committee Meeting and observe the proceedings. Owners may actively participate in the meeting proceedings, ie. make comments, if and when the Committee allows or invites them. The Committee members may also invite other outside parties including advisers, etc. who may assist in an issue at hand. 5.3 Where are the Minutes of these meetings?^Top All Owners should receive a copy of the Minutes of a Committee meeting within a reasonable period following the Committee meeting. The Minutes of all Committee meetings, including all resolutions passed, are kept with the records of the Body Corporate and can be inspected by any Owner. 6. About Body Corporate Managers 6.1 Is a Body Corporate Manager required?^Top The decision to engage a Body Corporate Manager to look after their complex is made by the Owners at a General Meeting. There is no requirement under the Act for a manager to be appointed. 6.2 What does a Body Corporate Manager do?^Top The full list of functions and duties are set out in their Agreement with the Body Corporate. These include the full administration of the Scheme and will typically include such matters as: • managing Committee issues, including calling of Committee Meetings and issuing Minutes of those meetings;
• looking after insurance claims and renewals, and Owners’ queries;
• managing correspondence between all associated parties;
• managing the financial accounts of the Body Corporate;
• drawing up financial year budgets;
• calling the AGM, and sending out related Notices, Nominations, etc;
• holding the AGM, and issuing the Minutes following the meeting;
• attending to the calling of any EGM;
• setting up the new budgets adopted at the AGM, and the resulting Levies;
• issuing Disclosure Statements for Owners selling their Lot;
• advising any Owner on matters of Body Corporate law and procedure;
• managing disputes and resolutions that may arise;
• working with the Resident Manager as and when required. 6.3 How do I select a good Body Corporate Manager?^Top If you don’t already know of a good manager, ask other Owners for their recommendations. Do your research on managers and get references from them. Follow up references and choose the one that suits your specific needs. You must trust your manager to do their job well, so do your homework before signing up. 6.4 Are Body Corporate Managers accountable?^Top Yes, they are accountable. The Act includes a 'Code of Conduct' for Body Corporate managers. You can terminate a Body Corporate manager for a number of reasons including gross negligence, non-performance, or mismanagement. 6.5 Can a Body Corporate Manager agreement be terminated?^Top Yes, the Act includes clauses providing for termination in exceptional circumstances. The Agreement between the Body Corporate manager and the Body Corporate should always include clauses relating to termination. 7. Appointing a Body Corporate Manager 7.1 How do we appoint a Body Corporate Manager?^Top You can appoint a Body Corporate manager by having a Motion (Ordinary Resolution) passed at a General meeting of the Body Corporate – either the AGM or an EGM. A copy of the Agreement with the Body Corporate must be included in the meeting notice. | 
