How Does a Body Corporate Work?

In South Australia, each new Strata or Community titled property automatically creates its own legal entity called the Body Corporate. The primary function of the property’s Body Corporate is to manage and maintain the common property for all unit owners, oversee all other property of the corporation, and to enforce the outlined regulations of the Strata corporation. Unit owners automatically become members of the Body Corporate; however, tenants are not members. But how does a Body Corporate work? What are its functions?

Within this article, Strata Data are going to outline what a Body Corporate is, the functions of the body, and what your role is as a Strata property owner.

What is a Body Corporate?

A Body Corporate is a legal entity that represents a group of people who own property together. Body Corporates are also known as Strata corporations and Strata companies. They are set up to manage the common areas of a property, such as the grounds, pools, and parking areas.

How Does a Body Corporate Work?

Body Corporates are governed by their own set of rules, called articles or by-laws. These articles or by-laws cover things like what owners can and cannot do on the property. They are also governed by Acts and Regulations, in particular The Strata Titles Act and the Community Titles Act.

Body Corporates are responsible for maintaining the common areas of a property and ensuring that they are safe and well-maintained. They also collect levies from owners to pay for these costs. Levies can be used to cover things like repairs, insurance, and landscaping. Body Corporates can also use levies to set aside money for future repairs or improvements.

Owners of properties within a Body Corporate are members of that Body Corporate. As a member, you have certain rights and responsibilities. You have the right to vote at meetings on important decisions made by the Body Corporate that affect the other owners and tenants. You also have the vital responsibility of paying levies on time and ensuring you or your tenant follows the articles or by-laws.

If you have any questions or concerns about your rights and responsibilities as an owner of a unit in a property with a Body Corporate, you can refer these concerns to the Strata manager or the Body Corporate’s management committee.

Responsibilities of the Body Corporate

The Body Corporate is responsible for the management and maintenance of common property in a Strata scheme. This includes ensuring that common property is kept in a good condition and repairing any damage that may occur.

The Body Corporate is also responsible for the safety of common property and ensuring that it meets all relevant safety standards. In addition, the Body Corporate is responsible for the financial management of a Strata scheme, including levying Strata fees, and collecting payments from owners.

The Body Corporate Committee

The Body Corporate Committee is a group of people elected by the owners of units in a Strata scheme to manage the scheme. The committee is responsible for maintaining common property, enforcing the scheme’s by-laws and representing the interests of all owners.

It is not mandatory for a Body Corporate to elect a management committee, however for larger groups, it is often beneficial. Any committee must include the chairperson, treasurer, and secretary. Each of these roles entails different responsibilities.

Your body corporate manager can inform you about the decisions the committee is and is not able to make. Specifically, committees can only make decisions that require an ordinary resolution. They cannot make decisions requiring a special or unanimous resolution.

Funding the Body Corporate

The Body Corporate is responsible for funding itself. Under legislation, the Body Corporate must set aside money each year to cover its costs. This money is collected through the Strata levies.

Strata levies are paid by all owners of units in a Strata scheme. The amount of Strata levy that each owner must pay is decided by the Body Corporate. The Strata levies are paid quarterly.

If you have any questions about the Strata levies or how they are used to fund the Body Corporate, you should speak to your Strata manager or management committee.

Decision Making

The way decisions are made in a Body Corporate can vary depending on the size and structure of the organisation. However, there are some general principles that apply.

Decisions are made at either a meeting of all the owners known as a general meeting, or at a management committee meeting.

The meeting can be either physical or virtual (such as via conference call). A quorum is typically required for the meeting to be valid, which means that a minimum number of members must be present (or represented by proxy).

Once the votes are cast, the decision is typically made by a majority of the votes. However, there may be some decisions that require a special resolution or unanimous resolution.

Voting and the Body Corporate

Voting is an important part of any Body Corporate. It ensures that all members have a say in how the Body Corporate is run and helps to make sure that everyone is happy with the way things are going.

There are a few different types of votes that can be held by a Body Corporate. The most common type of vote is an ordinary resolution, which is used to decide on matters such as the budget,. Special resolutions can also be held on specific issues, such as changes to the articles or by-laws.

Voting is open to all members of the Body Corporate. However, only those who have paid their levies are eligible to vote. This ensures that only those who have a financial stake in the Body Corporate can have a say in its decisions.

The result of a vote is usually decided by a simple majority. This means that the side with the most votes wins. However, sometimes a different voting system may be used, depending on the reason for the vote.

Body Corporate Management Services

When it comes to managing your Strata property, you have a few different options. You can either manage the property yourself as a group of owners, or you can outsource the management to a professional Strata manager.

There are pros and cons to both approaches, so it’s important to weigh up your options before deciding.

If you’re not sure which way to go, here are a few things to consider:

Do you have the time and energy to dedicate to strata management? If not, then outsourcing might be the best option for you. A professional Strata manager will have the time and expertise to handle all the day-to-day tasks involved in running a property, freeing up your time so that you can focus on other things.

Do you have a good understanding of the Strata laws and regulations? A Strata manager will be up to date with all the latest changes in legislation, and they’ll be able to advise you on the best way to comply with the law.

Are you comfortable dealing with difficult situations? Strata managers are experienced in dealing with challenging situations, like as conflict resolution, problem-solving and recovering money from owners who haven’t paid their levies. They’ll be able to handle these situations calmly and efficiently, so that you don’t have to worry about them.

Final Thoughts

As South Australia’s leading Strata management company, Strata Data are the experts when it comes to understanding efficient and successful Body Corporate management. If you’re looking to reduce the hassle of your Strata management scheme and keep your property Strata compliant, get in contact with our team today via phone at (08) 8372 2777 or online.