You’ve just bought a unit – congratulations! You’re now an official lot owner in what’s known as a strata building – which is basically a multi-level apartment block or horizontal subdivision which includes shared areas. You no doubt have a lot to think about – and one of those things might be the role a body corporate will now play in your life.
You’ve probably heard about bodies corporate – and you may even have heard some horror stories about people who’ve had some unfortunate interactions with them. It’s definitely understandable if you’re wondering whether you have to participate in the body corporate – or whether you have the choice to opt out. Many first-time owners find themselves dealing with questions about the body corporate, and exactly what will be expected of them once they buy a unit or apartment.
But first, what exactly is a body corporate?
A body corporate is a legal entity that comes into existence when a parcel of property is divided between multiple owners. The property itself will contain both individual lots as well as common property which all owners share. The body corporate exists to manage and maintain the common property and uphold the best interests of all owners equally. It is usually run by a committee of nominees, who are usually members of the scheme, and who are tasked with making decisions on behalf of the other owners in the scheme. It will carry out tasks such as:
- Establishing by-laws which the complex will operate under
- Determining the amount of levies payable by owners, which go to fund the operation of the body corporate
- Keeping records of the operations of the body corporate, including financial records, meeting minutes, owner details etc.
- Dealing with by-law breaches and dispute resolution
- Insuring the common property
- Ensuring an adequate supply of funds is maintained for future maintenance of the common property
And that’s just for starters. The body corporate carries out a million and one functions that ensure everyone can live safely and harmoniously in the building.
Well, that’s great, but is it mandatory for your building to be part of a body corporate? And even if it is, do you have to individually be part of the body corporate? Let’s find out.
Is a body corporate necessary?
In almost all cases, a body corporate is mandatory when there is multiple ownership within a single structure or plan. So once you have more than one owner in a building, a body corporate scheme will automatically come into existence.
In very small schemes, however (think of a two-unit complex), the body corporate may exist legally but not in actuality. The body corporate always exists, but sometimes it is not operational – and no meetings are held, no levies are paid and no action is taken. But all bodies corporate are governed by the Body Corporate and Communtiy Management Act 1997, and the legislation relevant to bodies corporate will always apply, even when the body corporate is inactive.
Does every owner need to be part of the body corporate?
In a nutshell, yes. Opting out of body corporate membership is not an option. Once you buy a unit in a strata scheme, you buy into that scheme’s body corporate. All lot owners are automatically members of the body corporate once they have purchased a property, and as such, are bound by all the laws and regulations of the body corporate. It’s compulsory. All owners then have the right to participate in decision making for the scheme, as well as the responsibility to cooperate with other members of the scheme and to follow the strata by-laws.
No one can opt out because the body corporate carries out tasks that benefit all owners, not just some. All owners need the infrastructure for electricity to the building to be maintained; all owners need the building’s roof to remain fully functional; all owners will use the driveway; all owners will benefit when the building is painted, fumigated or repaired. All owners will need access to fire exits and safety facilities; all owners would prefer that their drains aren’t blocked and their gutters don’t leak, and all owners will be grateful for building insurance if something goes wrong.
The body corporate can be managed by a body corporate manager, who can make the running of the scheme more efficient. Contact the leaders in body corporate management in Queensland here to find out more: https://www.capitolbca.com.au/contact-us/