Strata Tip #78: Sinking fund – Use a project manager for big projects

Large projects within multiple areas of common property and / or lots can involve complicated legal and construction issues.  As a general rule of thumb once you have more than two consultants working on a project (plus the body corporate on behalf of the ownership group) then you need a project manager.  While there will […]

Article: Committee Members Legal Costs

Committee Members Legal Costs – can you reimburse them? There are a number of very strict requirements that have to be adhered to for a Body Corporate to lawfully pay the legal costs of one or more of its committee members. To find out more read the Article – Committee Members Legal Costs

Strata tip #73: Records – Interested person access

When you receive a request for documents or to inspect the body corporate records, typically that request will be made by a committee member or an (allegedly) “interested person”. Committee members have reasonable access to the body corporate records without charge. On the other hand, “interested persons” must apply to the body corporate and they […]

Strata tip #72: Defects – Give the builder a chance to remedy

Once you have the cost to rectify the defects, you should provide the defects inspection report and the scope of works to the developer and/or the builder.  Give them a real opportunity to rectify.  That’s so that the Body Corporate makes a genuine attempt to minimise its’ losses.  If the builder/developer doesn’t rectify, then the […]

Strata tip #71: Meetings – Amending motions

At a general meeting a motion can be amended, provided that the substance of the motion does not change.  For example, a motion to approve spending might be reworded to approve the spending after a particular date (i.e. if cash flow for the body corporate is a problem).  The amendment is voted on by the […]

Strata tip #70: By-laws – Less enforcement means more breaches

It is one of the fundamental roles of a body corporate to enforce the community title scheme’s by-laws.  If the committee, or majority of owners, don’t want to enforce a particular by-law then the correct thing to do is to amend the by-law.  Unless or until the by-laws are changed, with very few exceptions, bodies […]

Strata Tip #69: Insurance – Duty of disclosure

Under the Commonwealth legislation, Bodies Corporate have a duty to disclose “every matter that is known to the insured” which the Body Corporate knows to be relevant, or would reasonably expect to be relevant, to an insurer when deciding whether to issue a policy. The duty of disclosure arises again at renewal time when an […]

Strata tip #68: Sinking Fund – Better to have and not need, than to not have and want

While you can’t refund excess sinking fund monies, you can reduce sinking fund levies in future years if you have excess funds.  Conversely, excess sinking fund monies can be used to undertake capital upgrades, either in advance of time or as whole new projects.  A well-managed sinking fund will have a contingency which hopefully you’ll […]

Strata tip 67: Spending – For major spending, consider two motions

If you’ve just voted to accept a quotation and enter into a contract with the successful tenderer at a given price, what happens if there’s a contract variation?  In the worst case you’ll have to go back to the owners in general meeting to approve the variation.  One way to avoid this is to pass […]

Strata tip 66: Utilities – Rain water harvesting

Sending rain water down the drain these days is almost criminal.  Storage is cheap and there are many options to choose from.  With a little planning, rain water can be redirected through toilets and washing machines in new buildings.  In older buildings rain water can easily be used for common area cleaning, topping up the […]

Strata Tip 65: Spending – Body Corporate Managers – They’re not judges

Often a malfunctioning committee or body corporate will, in effect, refer issues to their body corporate manager to determine; most commonly disputes about by-laws.  Some body corporate managers make excellent mediators; bringing parties together to exchange information in an effort to reach an agreement.  Don’t ask your body corporate manager to act as a judge […]

Strata Tip 64: Buying – Most due diligence issues are fixable

Aside from a business that’s not making enough money, most issues that arise during due diligence are fixable.  It might take goodwill and perseverance, but even void management rights agreements can be fixed (which can happen if the seller forgot to exercise an option!).  A good lawyer will give you a list of things to […]