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QLD: Q&A No One on the BC Committee? Here’s What You Do.

The LookUpStrata Team
contribute to the committee

Lot owners from QLD are concerned about the lack of committee involvement in their schemes. How can you encourage lot owners to contribute to the committee? What can you do if no one nominates for your body corporate committee?

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Question: Since 2016, I have been our chair, secretary and treasurer. No one else has ever attended an AGM. I’ve had enough. If I resign, what are our body corporate’s options?

Since our 8 unit block was completed in 2016, I have been the committee’s chair, secretary and treasurer. We have had many big issues, with an even bigger problem looming. All the pressure, time and responsibility is detrimental to my health. I have two ordinary committee members. One who has never had any input has decided not to put their name down again for our next AGM, and the other, as lovely as they are, always responds with, “I will go with whatever you think is best”. While it might be complimentary that they have confidence in me, I find the whole thing too demanding.

What happens if I do not nominate again or if I resign? Nobody but me has ever attended an AGM. In fairness, all the other owners work full-time and have no experience. If no one takes the reigns, would we employ someone, and how would that work? I’d still be the only one taking notice or reporting required maintenance. Will they get paid while not much changes for me? I would appreciate some advice.

Answer: Engage with your fellow owners to get them involved and remind them their participation on the committee is not only required under legislation, but it is in their financial interests to do so.

Firstly, I’m sorry to hear this happening. It is tough when you volunteer your time and it starts to wear you down. That is not how things should be.

To me, there is both an informal and a formal set of options for you here. The informal path – which, frankly, I think will be better for all concerned – is to engage with your fellow owners to get them involved and remind them their participation on the committee is not only required under legislation, it is in their financial interests to do so. The simplest way of doing that is to write to them (or chat with them, if that is possible and appropriate) and explain how it is vital they participate and form a committee. Ideally, you will have their details to do this. I’d emphasise there will be a significant cost if they don’t participate.

That ‘significant cost’ is where the formal options come in. If you have a strata manager engaged and your body corporate cannot form a committee at its next AGM, there is a process to undertake in which the strata manager executes what is sometimes called a Part 5 agreement. Under this arrangement, the strata manager takes on the functions of the committee. Not all strata managers will take on this role, and if they do, expect their charges to be considerably higher than normal, reflecting the work involved.

If you don’t have a strata manager, or you don’t have a committee at any time other than the AGM, then you or another owner may need to apply to the commissioner’s office to have an administrator appointed. This is roughly akin to having a receiver appointed in the corporate world. The administrator can be a strata manager, a lawyer, or someone with relevant expertise (I have been appointed and nominated for appointment as an administrator, for example). Again, expect the administrator’s proposed fees to be significant.

In either case above, the body corporate pays the fees. In other words, all owners will foot the bill. That, to me, is the single most compelling argument for your fellow owners to get involved.

You probably won’t be surprised to learn this situation comes up quite a bit. In all likelihood, there are probably thousands of bodies corporate in Queensland operating without a properly formed and compliant committee. That can continue indefinitely or until something happens – such as where you are at – to change the status quo. You will need to decide if and how much time and effort you are prepared to put in here. Is that fair on you, given what you have already contributed? No. Should we have a better system to manage these situations? Yes. I for one think it is entirely appropriate to allow bodies corporate to contract out their responsibilities to a suitable entity, although as it currently stands, you cannot do that, other than the methods described above.

This is general information only and not legal advice.

Chris Irons Strata Solve E: chris@stratasolve.com.au P: 0419 805 898

This post appears in Strata News #732.

Question: No one will nominate for the committee. If we have no committee, will every decision require a vote by all owners at an EGM? What options are available to us?

There are a number of highly relevant and valid reasons (including health) why none of our owners intend to nominate for the committee in the coming year. We have been told that if the minimum number of positions is not filled, every decision will require a vote by all owners at an EGM. Our Body Corporate Manager will charge $1,000 per meeting.

We recognise it would be best to form a committee, but there is every likelihood this won’t happen. Are there any alternative options available?

Answer: All bodies corporate must have a valid Committee. If there is no committee the body corporate can engage a body corporate manager under a part 5 Agreement, to carry out the functions of a committee.

Living in Strata Communities brings with it many joys, but also it brings with it a number of obligations. Compliance with the Body Corporate and Community Management Act, and the associated Regulations Module you are registered under, can be problematic.

With regard to a Committee, all bodies corporate must have a valid Committee. If there is no committee the body corporate can engage a body corporate manager under a part 5 Agreement, to carry out the functions of a committee.

The rules for forming a Committee vary, depending on the Regulation Module you are registered under. For example if you are registered under a Small Schemes Module, you only need a Secretary and Treasurer. This can be two eligible individuals or one person may hold both positions.

I will answer your question as if you are register under the Standard Module.

In which case, the composition of a committee must be at least three (3) voting members and not more than seven (7). You must have a Chairperson, Secretary and Treasurer. There must be a committee even if you have a body corporate manager engaged under section 119 of the Act.

If you cannot form a committee at your Annual General Meeting, you will need to call an Extraordinary General Meeting (EGM) to again call for nominations to try and form a Committee.

If you are not able to form a committee at this EGM you will need to have a body corporate manager appointed under a Part 5 Agreement, section 122.

So what is the difference between having a body corporate manager engaged under section 119 of the Act or under a Part 5 Agreement, section 122.

  1. Under section 119, the Committee still make the decisions of the body corporate provides instruction to the body corporate manager. There is an Administration Agreement that would usually have a schedule of set fees for a list of agreement services.

  2. Under a part 5 agreement, you basically hand over all the decision making to the body corporate manager. Under this agreement they will charge you an hourly rate for all work undertaken for your body corporate, and this rate could be $500 per hour or higher.

In my humble opinion, a part 5 agreement should be the last resort. Why would you want to hand over the decision making to someone who was not an owner in the scheme.

As you only need a minimum of three (3) voting members to form an eligible committee, I would recommend you try every avenue of having owners nominate.

If an owner has their health to consider and does not want to, or cannot be, on the Committee they are able to nominate a family member. Or a person acting under the authority of a power of attorney given by an owner can be nominated to the Committee.

It is not unusual for owners to feel that they do not want to hold a position on the Committee due to the fear of the perceived work load.

However, when you have a body corporate manager engaged under section 119, they do this work for you but under your instruction. So they basically take the work load off the elected members.

If you cannot form a committee, you will need to appoint a body corporate manager under Part 5 Agreement, at a General Meeting, to carry out the function that would, if there were a committee for the body corporate, be carried out by the committee and each executive member.

This is going to add considerable cost to your owners. So you need to ask owners, why would they want to put themselves to this additional expense.

While there can at times be substantial matters that a Committee need to deal with, if all owners take turns at being on the Committee it helps to share the load.

So my recommendation is to talk to your owners, and see if you can get at least three owners to “give it a go” and join the Committee.

Karen Thompson Vision Strata E: contact@visionstrata.com.au P: 07 5630 6546

This post appears in Strata News #626.

Question: The same Investment Owners have been on the Strata Committee since 2010 due to a lack of interest from other owners. How can we encourage lot owners to contribute to the committee?

I own 1 of 16 units in a QLD complex built-in 2010. The complex was 100% Rentals for over 8 years with two new owner-occupiers in recent years.

I am very surprised others are not interested in maintaining their investment property. There has been a consistency of the same 2-3 Investment Owners having to re-standing for Strata Committee since 2010. Even with the AGM Motion papers and Voting Papers, we seldom get others to participate, thus the Strata Management following up with existing Committee Members to re-stand and talk one of us to take up the Chairperson position.

Please note the Committee Members (as well as several other Investment Owners) all live outside QLD and mostly rely on Strata Management, Trades, Property Agents to provide feedback on Complex issues.

We even approached Strata to assist and conduct 3 monthly site inspections. This has helped enormously by allowing us to identify action points such as Visitors Car Parking used by Tenants, Gardens maintenance, Bins overflowing, Graffiti etc.

Can we request for Committee members with over 5 years continued service to have a 25% reduction on their Strata Fees? If nothing else I’m almost certain we would get lots of replies during the AGM and receive more voting papers. Hopefully, then these Investment Owners will start to participate or reject such commissions to long-standing Committee Members.

Is there a better way to get others to contribute to the committee?

Answer: You can email the other owners to encourage them to be more involved, with a focus on the impacts on their bottom line. I know that other schemes do things like a portal, blog or other online presence for their building and that can be useful.

First up I want to commend you for making the effort to be involved in the face of apathy. As you point out, that happens a lot in the strata sector unfortunately and frankly, it puzzles me too. If a person is going to spend $500k and more on their lot, why on earth wouldn’t they take the time to participate in decision-making that has a direct impact on that investment?

And yet we know it’s a struggle to get people to nominate for committee. I saw and heard it all the time as Commissioner. I suspect that a lot of people think they won’t have time for it – even though the time commitment can be pretty manageable – but probably the bigger issue is that body corporate ‘stuff’ can seem very complex and challenging and there might be a fear of the unknown or a fear of having to get informed about a lot of things.

While your suggestion about discounts is a novel and left-field idea I’m afraid it won’t fly. For starters, the Standard Regulation (s143) provides for how discounts on levies can (or can’t) be made and your suggestion doesn’t fit in with that. Moreover, I think it’s just about impossible to work in practice. Does that mean for example that after 5 years, the discount kicks in and kicks in indefinitely? Or is it only while they’re on the committee? What if someone is up to 4 years and then has a health or family crisis which means they can’t participate, even if they want to? There are many other questions this poses.

So, then, how to encourage? Great question! I’m a firm believer in appealing to the hip pocket. If you have a copy of the roll then you should also have copies of owners’ email addresses. You can email them to encourage them to be more involved, with a focus on the impacts on their bottom line. I know that other schemes do things like a portal, blog or other online presence for their building and that can be useful.

I might also suggest the great – and free! – committee online training (link ‘online training’ – https://www.qld.gov.au/law/housing-and-neighbours/body-corporate/legislation-and-bccm/services/training) provided by my former Office. That might alleviate concerns about having to get across too much content.

Good luck!

Chris Irons Hynes Legal E: chris.ironsn@hyneslegal.com.au P: 07 3193 0500

This post appears in Strata News #396.

Question: I’m very dissatisfied with the level of garden maintenance and the apparent apathy of our committee. Can I claim compensation from the other lot owners?

I am a Lot owner who is very dissatisfied with the level of garden maintenance and the apparent apathy of our committee as they have contributed to the problem by voting to turn off our common area irrigation system roughly 2 years or more ago. I have complained, I have communicated with the office for body corporate services, all dead ends.

Once the common area garden at the front of my lot was almost completely dead, I took over the care of it as it was unsightly and I believe killing property value. I have for the last at least 2 years used my time, money and cost of water to maintain this garden myself. I have insisted that the onsite managers no longer touch it and was informed I had to apply to the committee to be able to look after it.. basically let it die again as they are getting sick of my noise.

I have been reading about the farmstock case, I realise this was an onsite manager but on the basis of the ruling – It is a general rule applicable to every contract that each party agrees, by implication, to do all such things as are necessary on his part to enable the other party to have the benefit of the contract.

Do I have the avenue for recourse? Not only are the committee & onsite manager not doing all things necessary to enable at least this party (me) to have the full benefit of the contract, neither are the other lot owners whether they care or not. I’ve also paid additional funds from my own pocket, time and manual labour to a task that technically I am already paying for.

I would think I am due compensation at least???

Answer: Before we start suing people for compensation, consider these questions.

I think before we start suing people for compensation I think the starting point would be to understand:-

The reality is though that the costs of proceedings for something of this nature would more than likely well and truly outweigh the benefit any compensation actually sought. How can I get other lot owners to take an interest and contribute to the committee?

Frank Higginson Hynes Legal E: frank.higginson@hyneslegal.com.au P: 07 3193 0500

This post appears in Strata News #197.

Have a question about encouraging others to contribute to the committee in your scheme or something to add to the article? Leave a comment below.

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