QLD Strata: Understanding the New Laws on Execution of Documents

Under the recent legislative changes in Queensland, bodies corporate are no longer required to use a common seal when executing documents. The new law removes all references to the seal and the previous statutory requirements on how a body corporate can lawfully execute documents. Let’s explore what this means for apartment owners and body corporates.

What Has Changed?

Previously, the law mandated that body corporates use a common seal to execute documents, ensuring the authenticity and authority of such actions. However, the new regulation removes this requirement entirely. As a result, there is no longer a legislated method for executing documents, leaving body corporates with greater flexibility but also with the need for clear guidelines and resolutions.

What is “Executing documents?”

Executing documents refers to the process of signing and formally completing a legal document to make it effective and enforceable. This process often involves certain formalities to ensure that the document is legitimate and that the parties involved have properly agreed to its terms.

Practical Implications for Body Corporates

Given the removal of the seal requirement, body corporates must now adopt their own resolutions specifying how documents should be executed. This involves clearly outlining who has the authority to sign documents on behalf of the body corporate. It’s essential for both the signatories and the other parties involved in a transaction to verify that the proper authority is in place.

General Documents vs. Titles Office Lodgements

  1. General Documents: For everyday documents that do not require lodgement with the land titles office, it is crucial to have a clear resolution stating who can execute these documents. This resolution should be checked by all parties involved to ensure validity.
  2. Titles Office Documents: The land titles office has not yet updated its practice manual to reflect these changes. Until further guidance is provided, it is advisable to continue using the seal and having documents executed by two committee members, one being the chairperson or secretary, or to provide a copy of the resolution that authorises a different method of execution.

 

Specific Requirements for Certain Transactions

Despite the changes, certain transactions still require specific certificates to be lodged with the titles office. These include:

  • Disposal, leasing, and licensing of common property.

 

The amendments stipulate that these certificates must be signed by two committee members, one of whom must be the chairperson or secretary, following the previous default rule but without the seal. Alternatively, if a different method is used, a resolution authorising this must accompany the lodgement.

Recommendations for Body Corporates

Given the current lack of detailed guidance from the titles office, body corporates should:

  • Continue to use the common seal and execute documents with two committee members, one being the chairperson or secretary, until official updates are made.
  • Ensure that all resolutions clearly define the method of execution and the authority of signatories.
  • Keep thorough records of all resolutions and ensure they are accessible for verification by interested parties.

 

 

The removal of the requirement for a common seal in executing documents represents a significant change for body corporates in Queensland. While this offers greater flexibility, it also necessitates careful management and documentation of resolutions to ensure legal and procedural compliance. As we await further updates from the titles office, adherence to the previous execution methods and meticulous record-keeping will safeguard the integrity and legality of document execution.

By understanding and adapting to these changes, body corporates can continue to operate smoothly and confidently, ensuring that all actions are properly authorised and recognised. If you have any questions, please reach out to our team for expert guidance.

 

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