By Kay Keam - 17 May 2013
Care needs to be taken when looking at body corporate
rules. The first step is working out what the rules are.
Just because a notice of change of rules for a body corporate
has been registered against the title to a unit doesn't mean that
those rules are still current. Don't be fooled as old rules
may now be redundant.
Generally if a change of rules was registered under the old Unit
Titles Act 1972 and replacement rules under the new Unit Titles Act
2010 have not been passed and registered, those old rules will now
be replaced by the default rules set out in the Regulations.
There will not be anything noted on the title to draw this to your
attention and it would be quite easy to incorrectly assume that the
old rules are still in effect.
The second step is working out what can be changed from the new
Act
The new Act draws a distinction between the parts of the old
rules for voting and meeting procedure which are now in the Act and
the operational rules which are in the Regulations. Only the
operational rules can be changed.
When it comes to changing the default operational rules, we need
to ensure that any changes are permitted by the Act. A
purported change to the default rules must not exceed the
discretion given in the Act and if this discretion is exceeded then
the new rule will not be valid. The rules will also be
invalid if they are contrary to the Act.
The default operational rules in the Regulations are very
basic. There are only two rules compared to the extensive
rules that should be used for complex developments. Rules for
commercial developments will also be quite different from rules for
mixed use or residential developments. Examples of the types
of changes you should consider would include control and
administration of common facilities such as visitor parking, gym
facilities or a swimming pool. To ensure that your
development is going to work for everyone, you should check that
the operational rules are drafted specifically for your
development.
Given that there are now more restrictions on what can be
contained in body corporate rules, other options such as a land
covenant should also be considered.
If you would like us to review your rules please call Elise Markwick
or one of our property
team.
Contact
Elise
Markwick