In many small Owners Corporations (OCs), day-to-day management can feel relatively informal. Neighbours know each other, decisions are often made by consensus, and formal roles like chairperson or secretary might seem unnecessary. But even in close-knit communities, strata legislation sets out specific requirements that every OC must follow, particularly around governance and leadership roles.
One of the most frequently asked questions is whether every OC needs a chairperson. The answer isn’t just a matter of good practice. It’s also a matter of law.
What the Law Requires
The Owners Corporations Act 2006 outlines the obligations of an OC in Victoria. Section 98 of the Act (under Division 8, Office-holders) makes it clear:
“If an owners corporation does not have a committee, the lot owners must elect a member to be the chairperson of the owners corporation.”
This requirement applies regardless of the size of the OC. However, it’s particularly relevant for Tier Four OCs, which are defined as those with fewer than 10 occupiable lots. While Tier Four OCs may elect a committee, many choose not to due to their small size. In those cases, the Act is clear: if there’s no committee, there must be a chairperson.
Despite this, many OCs operate without formally electing anyone to the role. While this might work in the short term, it leaves the OC technically non-compliant—and vulnerable to administrative delays, legal issues, or disputes among owners.
Why a Chairperson Matters—Even in Small Communities
Electing a chairperson provides real benefits that improve the function and responsiveness of an OC, particularly when dealing with strata managers or making time-sensitive decisions.
Here’s why the role is so important:
- A central point of contact: The chairperson acts as the primary liaison between the OC and the strata manager. This helps avoid confusion and ensures that communications don’t get lost or delayed among multiple owners.
- Improved decision-making: Without a chair, strata managers must seek instructions from all owners. Often via email or written ballots. This can delay necessary repairs, service renewals, or responses to urgent issues. A chair can provide guidance more efficiently, with the backing of the OC.
- Legal compliance: Certain legal duties, such as the disclosure of benefits received by a manager (under Section 122(f) of the Act), must be made to the chairperson. Without someone in the role, the OC may be unable to properly fulfil these requirements.
- Reduced risk to the manager: As strata expert John Divita from MBCM Strata Specialists explains, “The importance of nominating a chair is to alleviate responsibility from the manager making decisions without the OC’s consent. If the manager has a chair, they can at least seek instructions from the chair.”
What If No One Volunteers?
This is a common challenge. In many small OCs, owners are hesitant to nominate themselves due to concerns about time, responsibility, or potential conflict. However, leaving the chairperson role vacant is not a sustainable solution.
If no chair is elected, the OC is technically in breach of its legislative obligations. This can have practical consequences too. Without a designated office-holder, the strata manager must communicate with all owners equally and obtain consensus for any action—no matter how minor.
This slows down processes, increases the workload on the manager, and can result in stalled decisions or disagreements. Even more seriously, it may expose the OC to governance risks if decisions are made without clear authority.
The good news is that being a chairperson doesn’t need to be burdensome. The role is primarily administrative and consultative, not operational. The chair doesn’t have to manage repairs, lead meetings, or make decisions alone. Their job is to represent the OC’s interests, provide a point of contact for the manager, and help ensure compliance.
Supporting Good Governance in Your OC
At ASM Strata Management, we often work with small OCs who are unsure of their obligations or operating informally without elected roles. In these situations, our team provides practical guidance to:
- Explain the requirements under the Owners Corporations Act
- Facilitate transparent elections at AGMs or special meetings
- Clarify what’s legally required versus what’s simply best practice
- Support new office-holders to understand their roles and responsibilities
- Streamline communications and improve responsiveness
Electing a chairperson may seem like a formality, but it’s a key step in ensuring your OC runs smoothly, remains compliant with legislation, and has the structures in place to deal with issues as they arise.
Practical Tips for OCs
If your OC hasn’t elected a chairperson—or you’re not sure if it needs to—here are some practical steps to consider:
- Review your current governance setup: Do you have a committee? If not, you need a chair.
- Raise the issue at your next meeting: Make sure all owners understand the legal requirement and the benefits of electing someone.
- Encourage participation: Let owners know the role doesn’t require a major time commitment.
- Seek support: Your strata manager can help facilitate the process and clarify responsibilities.
Need Guidance?
At ASM, we help Owners Corporations of all sizes manage their responsibilities with confidence. Whether you’re appointing a chairperson, updating your rules, or looking for more efficient ways to make decisions, our experienced team is here to help.
For more on this topic, you can read the original article featuring John Divita on LookUpStrata.
Or, reach out to your local ASM branch to discuss how we can support your OC with expert strata management services.