FAQs - Existing Owners
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An Owners Corporation is an entity which collectively manages a subdivided property, be it residential, commercial, mixed-use, industrial or retail. An Owners Corporation is established when a property is subdivided into 2 or more lots and the Owners Corporation formally comes into effect when the Plan of Subdivision for that property is registered.
The requirements of every Owners Corporations varies dependent upon the nature of the property. However, simply put, Owners Corporations are a legal requirement for all subdivided properties under the Owners Corporation Act 2006 because they help to ensure that where there is a shared responsibility, someone is appointed to be accountable for those common requirements and responsibilities (be it a voluntary owner or a professional manager).
If you own a property which is affected by an Owners Corporation then you are automatically a member of that Owners Corporation. Being a member of the Owners Corporation, you then also have a legal and financial responsibility to the OC and it is important that members familiarise themselves with those requirements in order to understand their role in the OC.
As a member of the committee, you will be one of the first points of contact that the manager can engage if necessary regarding an issue or query at the property. It is very rarely an onerous position but it is of great benefit to the manager of your property to have an active and engaged committee. The Owners Corporation Act permits the manager to delegate general resolutions (those not requiring a resolution of 75% of all members or more) to the Owners Corporation Committee and or Chairperson. So part of your role as a committee member will be liaising with your manager and sometimes other owners regarding necessary or proposed works required at your property and giving approval of those works.
All Owners Corporation Committee Members and Chairpersons are required to act honestly and in good faith, exercise due care and diligence in carrying out their function/powers and must not make improper use of their position to gain an advantage for themselves or any other lot owner.
Every property and its services costs vary based on the wishes of its member and also requirements under various state and national legislation. Typical expenses which your fees pay include services and expenses such as:
- Building and Public Liability Insurance
- Electricity, Water Costs & Gas (common only)
- General Maintenance and Repairs
- Gardening & Cleaning
- Lift Maintenance
- Fire Protection Services
- Essential Service Inspections
- Window Cleaning
- Gutter Cleaning
- Once off/unanticipated expenditure such as leaks, blockages, electrical faults and insurance claim excesses.
- Issuing of correspondence, invoices and minutes.
Generally, yes there is interest charged on overdue contributions and levies. It is important that this interest is charged in order to ensure that there is a deterrent in place to prevent any delays in member’s payment of fees. All interest collected is added to the Owners Corporation account and is of benefit to the Owners Corporation and the members who pay their fees on time as that money can then be put towards standard property expenses.
Unless otherwise stated in the minutes of your AGM, all Owners Corporations have building insurance in place, arranged by Ross Hunt via BJS Insurance Brokers. The level of cover is discussed each year at the AGM by the members of the Owners Corporation, where they may resolve to have the insured value increased by a nominal amount or have a valuation of the property carried out to determine the new insurable value. We recommend that Insurance Valuations be conducted every 3-5 years as a minimum, to ensure that the property is appropriately and adequately covered. The Strata Insurance also includes public liability cover of $10,000,000-$20,000,000 relating to the common property. It is important that members still endeavour to take out appropriate cover relating to content and landlords insurance (where desired or applicable) as these items are not covered under the strata insurance policy.
If you think there is a common issue at the property which requires attention then we encourage all our owners to contact their manager to discuss the matter. If the matter is urgent it is important that the owner reporting the issues, does so via phone, as we are not always at our computer and able to check our emails. If the matter is not urgent, an email to your manager or Ross-Hunt reception is perfectly appropriate (though you are welcome to report the issue vie phone if you prefer). If a matter is not urgent but does concern you, you are also welcome to attend the AGM to discuss any concerns or queries that you have in relation to the property.
The strata manager does not have authority to approve repairs or maintenance without the approval of the Owners Corporation and/or the Owners Corporation Committee, unless under emergency circumstances. The budgets which are set at the AGM ensure that sufficient funds are available to meet the needs of the Owners Corporation throughout the course of the year. Damage to the internal of your unit may be a claimable under insurance and should be reported to your manager for assessment.
The functions carried out by your manager will vary dependent upon the requirements of your property. However, all our Owners Corporation Managers are responsible for the following general responsibilities and tasks:
- Archiving all relevant documentation
- Circulation of Minutes and Special Correspondence
- Levying of Contributions
- Commencing debt recovery procedures against non-financial owners
- Organising repairs and maintenance to common property
- Maintaining and managing all common service agreements and contracts
- Commencing and managing the Owners Corporation Strata Insurance Policy (handled via our broker BJS Insurance Brokers)
- Managing and lodging all strata insurance claims.
- Holding and chairing the Owners Corporation Annual General Meeting
- Providing Owners Corporation Certificates as required (handled by an admin staff member who specialises in the preparation of OC Certificates)
- Ensure compliance with the Owners Corporation Act 2006
- Payment of all invoices and subsequent querying of any questionable or unclear invoices.
- Prepare financial summary statements which are to be provided to all members prior to the Annual General Meeting. This includes the preparation of the Owners Corporation budget.
- Maintain the Owners Corporation Register.