What is a body corporate?

What is a body corporate

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When you own a lot in a community titles scheme (CTS), you automatically become a member of the body corporate. In this article we will answer the question – What is a body corporate? We will also discuss its primary role, the body corporate committee, how it is funded, how decisions are made, and when a body corporate manager is needed. 

What is a body corporate?

A body corporate is a legal entity that is created when land is subdivided and registered under the Land Titles Act 1994 to establish a community titles scheme. Community titles schemes allows you to privately own an area of land or a part of a building, while sharing common property and facilities with other owners and residents.  

Role of the body corporate

The primary role of the body corporate is to administer common property and assets on behalf of all owners. This includes functions required under legislation, such as organising insurance policies and managing financial accounts.  

The body corporate is also responsible for maintaining and managing common property, making and enforcing rules, and deciding on the amounts to be paid by owners to ensure the proper functioning of the scheme.  Decisions about body corporate matters are bade through the body corporate committee.  

The body corporate committee

A body corporate committee is a group of elected representatives of owners who are responsible for the day to day running of the scheme. They oversee the administration of the body corporate, make decisions on behalf of the body corporate, and put the lawful decisions of the body corporate into place.  

The committee is also responsible for organising repairs and maintenance, enforcing by-laws and managing the finances of the body corporate.  

How is the body corporate funded?

Every lot owner contributes to the body corporate through payments known as ‘levies’. These levies are pooled together in two funds to maintain the common areas and undertake other necessary functions of the body corporate.  

The owners vote on the size of the levy payments at the annual general meetings (AGM). 

For more information, see our complete guide to body corporate levies. 

How does the body corporate make decisions?

Some decisions are made by the body corporate committee, and others are made by owners at a general meeting.  

No individual acting alone can make a decision. Each lot owner has one vote at a general meeting, and decisions are made by a simple majority.  

Can I opt out of being part of the body corporate?

No, when you purchase a lot in a community titles scheme, you automatically become a member of the body corporate    

When is a body corporate manager needed?

A body corporate manager can be appointed by a body corporate to assist with the administration of the scheme on behalf of all owners.  

There is no legal obligation for a body corporate to have a body corporate manager, but they may choose to engage one to perform many of the administrative tasks, like tax returns and issuing levy notices. 

Duties of a body corporate manager

The body corporate manager is engaged to help the committee and can only do what the body corporate asks them to.  

The body corporate manager also keeps records, attends meetings, and provides advice to the committee. 

For more information on the role and responsibilities of the body corporate manager, you can check out our recent article to the topic.  

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