With unfamiliar language, constant changes in legislation and different terminology used around Australia… living in a strata property can be confusing at times.
To help, we have compiled a list of explanations of the most common terms that you need to know living in a strata community and being a member of a body corporate.
The business of a meeting is ended with the intention of resuming it later.
An administrative fund is used to cover day to day expenses of a Strata Scheme such as electricity, cleaning, gardening, insurance premiums, routine maintenance and repairs to Common Property, management fees etc. It is controlled by the Body corporate.
A list of matters to be discussed at a meeting:
Annual General Meeting (AGM)
A meeting for all owners that must be convened once per year.
A body corporate is a legal entity which is created when land is subdivided and registered under the Land Title Act 1994 to establish a community titles scheme. All of the owners in a community titles scheme are automatically members of the body corporate when they buy their lot.
Body Corporate Manager
A Body Corporate Manager (also called strata manager) is a company appointed by the Owners (Body Corporate) of an apartment block to assist with the administration of the scheme on behalf of all individual Owners.
A Body Corporate Manager will work for the collective interest of all Owners and provide advice and guidance for matters like legal compliance and financial administration.
An estimate prepared by the Committee of the expenses likely to occur in the coming year for a scheme.
Building Format Plan
A building format plan is a form of subdivision which usually applies to multi-story unit complexes, and in some cases, other developments like townhouses. A building format plan defines land using the structural elements of a building, including floors, walls and ceilings.
A building manager is responsible for the management of Common Property on behalf of the Body Corporate. They may live on-site and also be responsible for letting services.
A set of ‘rules’ that the Proprietors and Occupants in a Strata Scheme must follow. These can be changed at a General Meeting of the Body Corporate. All by-laws are not the same so you should obtain a copy of the current by-laws for your Strata Scheme.
Capital Works Fund
Also called a Sinking Fund, the Capital Works Fund is a financial safety net for major capital expenditures for the building(s). Levies paid into this fund cover the costs of future capital expenses, such as painting the building, and replacing Common Property items like stairwell carpeting and roofing.
The chairperson is one of the three executive Committee members and is responsible for chairing Meetings of the Committee and Body Corporate.
Certificate of Title
Upon registration of the Strata Plan certificates of title are created for each Lot and the Common Property.
A collective term for the people who live in a strata-titled building or complex.
Community titles scheme
Community titles schemes allow you to privately own an area of land or part of a building, as well as share Common Property and facilities with other Owners and Occupiers.
Elected representatives of the Owners. The Strata Committee or Executive Committee of the Body Corporate represents owners or owners’ nominees and is responsible for the day-to-day running of the strata scheme. Members are elected at each Annual General Meeting (AGM).
Regular (often quarterly) Meeting where the elected members of the Committee meet in a formally convened Meeting.
All the areas of the land and buildings not included in any Lot. It is jointly owned by all Owners, and the Body Corporate is responsible for its management. The Lot and Common Property will be defined on your individual Strata Plan.
The Levies paid by the Owners to give the Body Corporate the funds to operate.
Contribution Lot Entitlement
The number assigned to the Lot in the Community Management Statement. It is properly calculated as an estimate of the relative amount of expenses either caused or benefiting that particular Lot. The Contribution Lot Entitlement schedule is used for determining each Owner’s Body Corporate Contributions.
Community Management Statement (CMS)
The Community Management Statement (CMS) is a crucial document that sets out the rules for living in that particular Scheme. A specific Community Management Statement drafted for the particular Body Corporate assists to minimise disputes if they arise.
Once the strata committee is elected, the members of the committee decide who is to hold the office-bearer positions. See: Chairperson, Secretary, Treasurer.
Financial Year End
The financial year for a Body Corporate is different to the taxation financial year. The financial year of a Body Corporate is the period ending on the last day of the month before the month in which the Scheme was originally established.
A Meeting that includes all Owners and other interested parties who have been advised by notice of a proposed Meeting to vote on specific matters listed in the agenda that pertain to the Scheme.
Strata levies are payments Owners must all make to cover the strata building’s running costs. Levies are set at each Annual General Meeting (AGM) when the Budgets are approved for the next 12 months and regular Capital works fund (or sinking fund) levies are usually payable quarterly.
A strata Scheme is a building or collection of buildings that has been divided into ‘lots’. Lots can be individual units/apartments, townhouses or houses. When a person buys a lot, they own the individual lot and also share the ownership of Common Property with other lot owners.
Minutes, also known as minutes of Meeting, are the instant written record of a Meeting. They typically describe the events of the Meeting and may include a list of attendees, a statement of the issues considered by the participants, and related responses or decisions for the issues. A Strata Committee must keep full and accurate minutes of all Meetings.
An occupier is anyone who is a resident, lives in the Scheme or occupies a Lot for business purposes.
An ordinary resolution is passed if no poll is requested and the votes counted for the motion are more than the votes counted against the Resolution.
The original owner is the owner of all of the Scheme land. The original owner is commonly the developer of the scheme.
An owner is a person(s) or company that purchases a strata Lot and is registered on the Certificate of Title.
A Property Manager manages an individual property on behalf of a lot owner. They find suitable tenants for lots, arrange leases, inspect the condition of the property, receive rent, manage repairs and arrange for maintenance for the inside of the property.
Another name for a strata owner.
An Owner can delegate their voting rights to another person, who becomes their proxy. An Owner can make any person their proxy, including their tenant. Proxies must be given to the Secretary before or at the Meeting. For large Schemes, the proxy must be given to the Secretary at least 24 hours before the scheduled Meeting.
The least number that must be present in a Meeting to make its decisions valid. This is at least 25% of the Owners entitled to vote at a General Meeting, at least 50% of the voting members of the Committee for a Committee Meeting. There must be a quorum at a General Meeting before any motion, including electing a strata committee, can be voted on.
A decision is made at a general meeting if a motion is included on the agenda, and owners vote to pass the motion. This is called a resolution. There are 3 types of resolutions including an ordinary or general resolution, special resolution and unanimous resolution.
The Secretary is one of the three Executive Members and is responsible for sending out notices of Meetings, calling for and receiving nominations and receiving completed voting papers and Proxy forms. Generally, your Body Corporate Manager will carry out these functions on the Secretary’s behalf.
Levies paid into this fund cover the costs of future capital expenses, such as painting the building, and replacing Common Property items like stairwell carpeting and roofing.
Standard Format Plan
A standard format plan defines land horizontally with references to marks on the ground or a structural element (for example, survey pegs in the ground or the corner of a dwelling).
Another name for Body Corporate Manager
A strata scheme is a parcel of land with a building(s), where individuals each own a portion referred to as a Lot. A strata scheme can have a minimum of 2 Lots and can be used for residential or commercial purposes or a mixture of both.
Strata managing agents
Another term for strata managers.
Each parcel of Real Property land, i.e. land used for the purpose of residential or commercial property, on which a Strata Scheme building is built must be subdivided into a Strata Plan. In other words, all Strata Schemes are represented by means of a Strata Plan.
See: Strata Scheme
A Special Levy is raised when there are not sufficient funds in either the Administrative Fund or the Sinking Fund to pay for an expense/project that has not been budgeted for.
Examples of capital expenditure that a building may need to raise a Special Levy for include: painting of the Common Property, fire safety compliance, upgrading the balustrades of the building etc. A Special Levy can only be raised at a General Meeting by an Ordinary Resolution.
A special resolution has to be passed with a 75% majority of members of the Body Corporate (based on Unit Entitlement). If you would like to add a new By-law, this would require a special resolution to pass.
The records containing the record of each Lot Owner and their Lot details in the Scheme.
The Treasurer is one of the three Executive Members and can be responsible for preparing Budgets and managing funds, although the legislation does not require them to. Generally, your Body Corporate Manager will carry out these functions on the Body Corporate’s behalf.
Each Lot is given a unit entitlement which is shown on the CMS. Reference to a Lot’s Contribution Entitlement.
Utility infrastructure is the cables, wires, pipes, drains, ducts, meters, plant and equipment by which the Lots and the Common Property within the Scheme are supplied with Utility Service.
A utility service for a Community Titles Scheme includes water, gas, electricity, air conditioning, telephone, data, television, sewer, drainage, a waste removal system.