 | New Body Corporate Laws |
The new Owners Corporation Act 2006, which covers the management and operation of bodies corporate, came into effect on 31 December 2007.
The Act incorporates relevant sections of the Subdivision (Body Corporate) Regulations 2001 and Subdivision Act 1988 and builds on and enhances these provisions to give owners corporations the powers that are necessary to carry out their functions, and requires them to exercise them responsibly.
The Act clarifies the responsibilities and powers of owners corporations and committees in meeting procedures, dispute resolution and record-keeping. It also recognises a common sense distinction in the financial and management responsibilities between, for example, a two-lot building and a modern 100-lot high rise.
Large or prescribed owners corporations - those that have more than 100 lots, or collect more than $200,000 in annual fees per financial year - in addition to the standard requirements for all owners corporations defined in the Act, are also required to:
- prepare financial statements in accordance with prescribed standards
- have financial statements audited
- have a maintenance plan
- get five-year valuations of common property for insurance purposes.
One of the most significant areas of change in the new Act is in the appointment and supervision of managers. Paid managers must be registered with the Business Licensing Authority (BLA) and are prevented from registering if they are insolvent or do not have professional indemnity insurance. The register will be made available to the public and include details of any orders made against the manager.
The new Act also clarifies the manager's powers where there is and is not a committee and enables the committee to remove a manager, rather than limiting this capacity to a general meeting or ballot of lot owners.
Consumer Affairs Victoria has produced a free Guide to help people understand their responsibilities under the new Owners Corporation Act 2006.
Information on registration is available from the BLA on 1300 13 54 52 or via the BLA website.
On 7 February 2008, the Parliament of Victoria passed amendments to the Owners Corporations Act 2006.
The key changes:
- allow members to elect a manager to act as chair of a general meeting
- allow owners corporation committees to appoint a manager to act as secretary
- allow owners corporations to charge up to the prescribed fee ($150) for an owners corporation certificate.
