How to change or update a by-law

Changing by-laws

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This article has been written by Mark Mellick, a partner at Brisbane law firm, LawSolve.

There are numerous events that might lead a committee and ultimately owners, to consider changing the by-laws applying to their scheme. For example, the ‘COVID years’ lead to more people working from home, resulting in a significant increase in schemes changing their bylaws.

Changes to legislation are also another trigger for by-laws to be considered. The recent changes to the Body Corporate and Community Management Act – which at the time of writing are yet to commence, have already seen schemes revisiting the smoking, parking, and pet by-laws. 

The purpose of this article is not to highlight trends in by-laws, but to explain the way in which by-laws are changed so any new by-law becomes binding on the owners.

While it is often the case that the committee will be the driving force behind these changes, it is important to note that agreeing to adopt a new by-law is a matter for the owners to vote at a general meeting.

The committee of course can have a view on what by-laws might or might not suit a scheme, and can provide a recommendation to the owners to vote to adopt a new by-law, or indeed to adopt a new suite of by-laws, but ultimately the decision to do so is one to be made by special resolution of the owners, either at the AGM or at an EGM.

Readers should note that if there are already existing exclusive use by-laws being changed or a new exclusive use grant being created, then the resolution required is a resolution without dissent. It may also be the case that the consent of the owner/s affected is required.

Adopting a new by-law

So, what happens in the event the owners resolve to adopt the new a new by-law?

Any new by-law will only become binding on the owners when a new Community Management Statement (CMS) containing the new or amended by-law in Schedule C, is recorded in the Land Titles Office.

Accordingly, it is good practice for the motion the owners vote on to adopt the proposed by-law, to also contain an authority for a new CMS to be prepared, executed by the body corporate, and recorded in Titles.

Lodging the new Community Management Statement

The new CMS must be lodged for recording within 3 months of the motion being passed.

There are some technical aspects to a new CMS, such that it will be examined by an Officer in Titles to ensure the document meets the Registrar’s requirements. The examiner will particularly look at any exclusive use plans accompanying the new CMS, even where the change to the by-law does not alter the existing exclusive use by-law/s.

Regrettably, it can be the case that a new CMS lodged for recording is not accepted by Titles because of a defect in the exclusive use plans. This means the body corporate is put to the expense of obtaining complying exclusive use plans from a surveyor.

Committees must understand that the passing of a resolution to adopt or change by-laws is not the end of the process. Failure to record a new CMS, putting the resolution into effect, will mean the body corporate remains governed by the existing by-law.

For information on adding or amending by-laws contact the team at LawSolve.

BCsystems will continue to bring you more, step-by-step guides on how to amend or change a by-law.

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