How will this affect and improve Owners Corporation Compliance?
We have listed below important changes affecting stakeholders and members of the Owners Corporation. It is advisable that non-compliance with those changes, can lead to penalties and significant liability for owners if not adopted appropriately in accordance with the new amendments.
New requirements affecting the Owners Corporation records keeping and setup require thorough understanding of the new legislation and will need to be dealt with by the Manager carefully. The Manager will have to carry out additional work to follow those regulations, assist with the compliance process and ensure that there are no oversights exhibited by the Owners Corporation as of 1st December 2021.
Inversely the new amendments contain significant positive changes that streamlines processes, delegates more powers to apply rules and legislates the enforcements of levying extraordinary fees incurred by the Owners Corporation to the appropriate owners impartially.
The changes include:
1. Owners Corporation Tier Classification
The new Act has created a tier system to classify your property and the parts of the legislation which will apply to it.
2. Insurance Costs and Levies
The new Act has given greater flexibility in requiring owners who benefit disproportionately from insurance to pay a greater contribution with the creation of a new “lot entitlement” distribution process.
3. Committee Membership
New rules apply to whether your Owners Corporation is required to have a Committee and the number of people allowed and/or required to be on that Committee.
4. Common Seal
Your Owners Corporation can now decide on whether and/or when to use its common seal.
5. Maintenance Plan
The new legislation outlines requirements regarding the preparation and approval of a maintenance plan and fund for your OC.
6. Public Liability insurance
The new legislation outlines requirements regarding the level of Public Insurance your Owners Corporation is required to hold.
7. AGM Proceed Without Quorum – Managers can pass interim resolutions
The amended legislation will allow Managers to pass certain interim resolutions in certain circumstances.
8. Power to Commence Legal Proceedings
An Owners Corporation may now commence legal action by ordinary resolution for claims up to $100,000 which should assist larger Owners Corporation to pursue a legal matter when there are several owners who may be less interested in any action.
9. Audit of Financial Statements
The new legislation outlines requirements or the auditing its financial statements on a tier by tier basis.
10. Altering Common Property by Owner
The amended legislation clarifies the circumstances under which a lot owner may make adjustments to common property.
11. Authorised Entry to a lot
Where access to a lot is required to conduct work on common property, the rules have been amended to make this access easier.
12. Disposal of Goods Abandoned on Common Property
There have been significant changes to the rules relating to abandoned goods on common property in the new legislation.
13. Insurance for Multiple Single Dwellings
An Owners Corporation may vary the insurance requirements for a subdivision with multiple single dwellings.
14. Ballot Rules
New rules apply to the conduct of ballots for your Owners Corporation.
15. Interim Special Resolutions
New rules apply to special resolutions which should make it easier for Owners Corporations to make decisions where there are large number of owners who don’t attend the meetings.
16. Contract of Appointment
Contract of Appointment must not include terms that limits and allows the Manager to Automatically renew their contract.
17. Duties of Manager
Additional duties and responsibilities have been assigned to the Owners Corporation Manager.
18. Manager’s Report
Additional information is required from the Manager to include in the Manager’s report as part of the AGM Notice.
19. Making Rules
Owners Corporation may make rules in respect of building alteration, Payment Plans, Tobacco Smoke and Fire safety Procedures.
20. Occupiers and guests
Occupiers will be responsible for a guests’ behaviour.
21. Retirement Village
Separate provisions relating to fees, maintenance fees, obligations of initial owner, appointment of a Manager and Rules.
22. Availability of register
A lot owner must not authorise a representative to request a copy of the register.
23. Complaints
A Complaint cannot be made in respect of a lot owner’s liability.
24. VCAT Procedures
Changes made to the Act to empower VCAT.
25. Eligibility for Registration
It is and offence to act as Manager without being registered.
26. Proxy
Changes made to the Act to empower VCAT.
27. Creation of plans – Amendment to Subdivision Act 1988
Developers have obligations on how the structure of creating a plan is documented and implemented when the plan registers and the owners corporation is created.
