Many people buy the unit or property of their dreams, and only after they have settled on the property do they realise that they have certain obligations and have to pay Body Corporate fees. It is better to be aware of what is involved when you buy a unit in an Body Corporate.
Understand what an Body Corporate is
If you own a property within an Body Corporate then you automatically become a member of that Body Corporate and have responsibilities under the Body Corporate Act. Body Corporate are legal entities (this means they can sue and be sued). They also have legal responsibilities for a range of matters including financial management, insurance, record keeping, dealing with complaints and meeting procedures. Body Corporate manage and administer the building and common property and its insurance requirements, and in order to do be able to this they collect fees. If you are still not sure about what an Body Corporate is, then you should check with a professional - either your solicitor or conveyancer, or contact Australian Strata Management.
Read the Body Corporate (BC) Certificate
When you are in the process of purchasing the property, you should always ensure that the vendor’s statement (Section 32) is accompanied by an Body Corporate Certificate. The Certificate contains important information about insurance, the total fees, the allocation of lot liability and lot entitlement for the unit/apartment/ townhouse or any legal liabilities.
Check the BC Certificate for:
Ensuring compliance with Body Corporate Act 2006, the Body Corporate Regulations and rules.
The Owners Corporation sets annual fees to cover general administration maintenance, insurance and other ongoing costs. The Owners Corporation can decide the level of fees, how they are paid and times for payment (usually quarterly). An Owners Corporation can also levy special fees or charges on lot owners to cover extraordinary or unexpected expenditure (for example to pay for painting of the building). Owners must pay their share of the annual and special fees according to lot liability. If owners do not pay fees they lose the right to vote on all matters requiring an ordinary resolution. Although they can still attend meetings of the Owners Corporation, they can only vote on matters requiring a special resolution or unanimous resolution. The Owners Corporation can also charge penalty interest on any money owing and take action to recover any debts in a court or at the Victorian Civil and Administrative Tribunal (VCAT).
Tell the other person about your concern. Simply talking to your neighbour about the issue may lead to a solution. You could also make a written request for the matter to be discussed at the next meeting of the Owners Corporation or committee.
In general, it is wise to ensure that committee membership is on a rotating basis. This will ensure that the committee doesn’t become too one-sided, too entrenched on certain positions and also ensures that there is a continual flow of fresh ideas and input. If required, lot owners can remove a committee, or a committee member by ordinary resolution (majority vote) at a general meeting.
It is important that committee members know their obligations and responsibilities as well as rights of owners and residents. All committee members must not ignore or avoid complaints and issues, and should always be concerned with a fair hearing for all unit owners. It is important to remain impartial at all times, and not to be concerned with those issues or just affect you or that you agree with. It is also important to be able to deal sensibly and maturely with even frivolous issues.
Australian Strata Management 2019
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