A body corporate manages the shared parts and responsibilities of a community titles scheme. This article explains what a body corporate is and does, how it is funded and how owners can take part in decisions.
What is a body corporate in Queensland?
A body corporate is created when land is subdivided and registered to establish a community titles scheme. Community titles schemes can include duplexes, residential unit blocks, townhouse complexes, high-rise accommodation buildings, shopping complexes and business parks.
Owners privately own their lots while sharing common property and facilities with other owners and occupiers. Common property may include driveways, lifts and car parks. Every lot owner automatically becomes a member of the body corporate when they buy their lot.
Queensland’s Body Corporate and Community Management Act 1997 provides that the body corporate can sue and be sued in its corporate name.
What does a body corporate do?
The body corporate administers common property and body corporate assets for the benefit of all owners. Its responsibilities include:
- maintaining, managing and controlling common property
- deciding how much owners need to pay for the body corporate to operate
- making and enforcing by-laws
- arranging required insurance, including building and public risk insurance
- managing body corporate assets
- keeping records such as meeting minutes, owner details, financial accounts and registers.
The body corporate is responsible for common property and shared assets. Maintenance responsibilities for an individual lot may be different, so owners should check their scheme’s documents before arranging work.
You can read more about body corporate insurance and by-laws.
How are body corporate levies and funds used?
Lot owners contribute money to the body corporate through levies. These contributions pay for the body corporate’s operation, common property and shared assets. The amount each owner pays depends on the budgets set by the body corporate and the applicable lot entitlements.
Most schemes have two funds:
- Administration fund: pays for operational and recurrent expenses, including regular common property maintenance, insurance, body corporate management fees, electricity and administrative costs.
- Sinking fund: pays for future capital and non-recurrent expenses, such as painting, structural repairs and replacing major common property items.
Money cannot be transferred between the two funds. Budgets for both funds must be prepared each financial year. The sinking fund budget must also allow for likely capital spending for at least 9 years after the current financial year.
For more information, see our guide to understanding your body corporate levies.
How does a body corporate make decisions?
The body corporate makes decisions through general meetings and its committee. The committee may make decisions at a committee meeting or by voting outside a committee meeting, where permitted.
The decision-making process can vary between regulation modules. Some matters must be decided by the owners at a general meeting, while the committee can deal with others within its authority. An individual lot owner acting alone cannot make a decision for the body corporate.
What does the body corporate committee do?
The body corporate must elect a committee at each annual general meeting. The committee is made up of lot owners or people who act for them. Committee arrangements vary between regulation modules, and the Specified Two-lot Schemes Module does not have a committee.
The committee handles administrative and day-to-day matters, makes decisions on behalf of the body corporate and puts lawful body corporate decisions into place. Its authority is limited. For example, the committee cannot set or change a body corporate levy or decide matters that must be decided by a required type of owner resolution. It also has spending limits and must have money available in the budget before spending it.
How can lot owners get involved?
Lot owners can take part by reading meeting notices and motions, attending general meetings and putting forward practical suggestions for the scheme. You can also ask questions about proposed budgets, maintenance priorities and committee projects.
Active involvement can help owners understand how funds are allocated and contribute to planning projects. If you want to raise an issue, provide clear information and submit a motion where appropriate.
If you need help understanding your body corporate’s records, levies or meeting processes, contact StrataCare at reception@stratacare.com.au.
