Many times we are approached by people asking if they can manage the body corporate themselves, and if so, how do they do it?
The answer is yes: absolutely. Although a body corporate can engage a body corporate manager to perform its functions, it does not need to. At all times, it is the body corporate that is responsible to comply with its obligations, such as calling general meetings, setting budgets, and issuing levies. It is just usually more convenient to appoint a manager to handle all of these issues for the body corporate and its committee. A manager can simply be thought of as an agent: although it is the body corporate that must undertaken certain actions, it may be easier to get the manager as an agent to do it.
It is also possible to appoint a body corporate manager to perform only some tasks. Whereas some might provide full services, including performing the duties of the committee’s chairperson, secretary and treasurer, others might simply provide facilities to manage the body corporate’s budget and finances.
If a body corporate is self-managed, then it falls to the committee (and lot owners) to be mindful of their obligations under the body corporate legislation. Calling an AGM requires many procedures. For example, a budget needs to be set, including contributions to be levied, preparing appropriate statutory motions including auditing requirements, preparing and approving an agenda, compiling all the appropriate material into a notice, and then sending that notice out more than 21 days before the proposed date of the meeting. And that doesn’t include the procedures involved in actually holding the meeting.
It is not too difficult for a body corporate to manage itself, and the Commissioner’s Office provides fact sheets and an information service for people to assist. Care should be taken to follow the law as much as possible as, if a significant decision was not properly made, it may be invalid.
You should give some thought about whether self-management is appropriate for a body corporate. For example, if there are disputes about how the committee is running the body corporate, should lot owners allow that to continue? Said committee must necessarily have access to the body corporate’s bank accounts. In some circumstances, it might be better to have a body corporate manager look after the records and finances.
This article is intended as general information only and should not be relied upon as legal advice. For specific legal advice please contact us here.