Please feel free to download a copy of the Strata Fix booklet to help you understand the Effective Governance of the executive committee.
Perhaps the single most important thing a committee can do is appoint the appointment of a body corporate management company.
A body corporate management company collects levies, pays bills, effects insurance, keeps the books and records and convenes, attends and minutes meetings. But what about the individual employed by the body corporate management company appointed to a particular building?
Their role is far more people focused than the process of body corporate management. A good Body Corporate Manager will be the glue that holds the strata community together.
Some of the qualities needed for this role are:
One of these qualities above all else needs to be understood well, both by Body Corporate Managers and by the Committees and communities they serve – empathy.
From the Body Corporate Manager’s perspective this means:
From the Committees’ perspective understanding empathy in body corporate management means:
Mutual feedback is also a matter that can benefit the relationship between the Body Corporate Manager and the Committee. The Body Corporate Manager might offer practical guidance on ways in which the Committee might help. The Committee might give encouragement for some tasks done well and constructive review and critique of organisational progress.
A clear statement of the role and responsibilities of any group can be the biggest step towards improving effectiveness and satisfaction.
While there are some legal differences between the role of a committee, council or executive of a strata community (as they are variously called), there are analogies between the practical functions of a committee and the board of a company. In this analogy, the Body Corporate Manager is the CEO of the company.
Drawing on the board analogy, the practical functions of the committee of a strata community are these:
A body corporate is a separate legal entity, comprised of all the lot owners within the complex. A body corporate is governed by specific legislation and by its own by-laws. There are a variety of structures and types of bodies corporate permitted under the Act. For your information, the Corporations Law does not apply to a body corporate.
The common property for a body corporate is owned by all the owners of lots included in the scheme as tenants in common. The share of ownership is proportionate to the interest lot entitlements. An owner’s interest in a lot is inseparable from the owner’s interest in the common property.
Common property includes: land within the scheme not forming part of a lot; utility infrastructure within the scheme; and body corporate assets.
The body corporate must administer the common property and body corporate assets for the benefit of the owners of the lots included in the scheme. The maintenance and upkeep of common property is usually contracted out to a caretaker or building manager.
This is a document which is specific for every body corporate in Queensland and is recorded in the Titles Office to the Department of Natural Resources and Mines.
Each Community Management Statement (CMS) is comprised of five schedules, each one holding relevant information about the body corporate.
Two lot entitlements schedules:
1. Contribution schedule determines the amount of levies; and the voting power of lot owners.
2. Interest schedule determines the amount of rates/taxes; insurance premiums and the share of ownership of common property by each lot owner.
If the body corporate is being constructed in stages, this schedule outlines the details of the progressive development until all areas are completed.
This schedule contains body corporate by-laws. The by-laws are the rules governing the body corporate which are binding on all members of the body corporate and occupiers of the lots. The by-laws specify such things as:- the permitted use of lots and facilities; the behaviour of owners and their visitors on common property; the keeping of animals; the appearance of lots; damage to common property; repairs and alterations to a lot and common property; and the recovery of monies, among other things.
Provides for any architectural or landscape codes to form a covenant on lots within the body corporate.
Lists details of any exclusive use provision granted to lot owners.
The sinking fund is a separate fund where money is put aside for future non-recurring maintenance
Body corporate levies are issued by the body corporate to pay for such items as:- the building manager’s salary; the body corporate manager; other service contractors, and the ongoing maintenance and upkeep of the common property, plus insurance and electricity.
The levies are divided into two (2) separate funds:
The administrative fund is for regular recurring expenditure and includes payments to service contractors, ongoing maintenance and repairs and the upkeep of common property.
The sinking fund is a separate fund where money is put aside for future non-recurring maintenance (eg: painting of exterior surfaces) and the purchase of new body corporate assets.
See also the FAQ “Why do I pay body corporate levies?”
A general meeting is a meeting of all members of the body corporate.
At a general meeting, resolutions are passed among other things:- to confirm the annual accounts; set budgets and levies; determine if an audit is required; and any other issue that requires a general meeting resolution. The last item of the agenda at every annual general meeting is the election of the committee.
The legislation prescribes the format of general meetings; the types of resolutions required; and who is eligible to vote.
Committee meetings are meetings of the committee members, and are held at regular intervals throughout the year.
The committee is comprised of the elected representatives of the owners and operates in a similar way to a board of directors to a company. The committee is made up of the following members: