Managing a building management committee correctly and within the law, requires a high level of knowledge, a good deal of experience and the patience and commitment to read, understand and apply complex strata management statements. |
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In 2001 the NSW Strata Schemes legislation was amended to better deal with complex developments where there are several different parts, such as a single building that has residential apartments, a hotel and a retail centre. This kind of development is called a part strata development. Two things are needed to manage a part strata development in NSW, a strata management statement (SMS) and a building management committee (BMC) to administer the strata management statement. The strata management statement is a set of rules that dictates how the building management committee must be run and how the building management committee must manage and operate shared facilities. |
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The Building Management Committee is established to manage and operate shared facilities on behalf of the members (each of which could be an owners corporation in its own right). Each member must appoint a natural person to be its representative at meetings of the building management committee. |
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It is absolutely essential that your strata manager has read and understood this usually lengthy and often complex document before working with a building management committee. It is not something that can be just put to one side, with a ‘she’ll be right mate’ or ‘we’ll work it out as we go’. The statutory requirements for an SMS are separated into matters that must be included and matters that may be included. Once registered, a strata management statement may generally only be amended by a unanimous resolution of the building management committee and by special resolution of each owners corporation governed by the SMS. |
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Furthermore, the amendments must be registered on each Certificate of Title for each stratum lot in the deposited plan (this includes the Certificate of Title for common property of each strata scheme) at NSW government’s Land and Property Information. |
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| A building management committee is not a legal entity. Constraints include the fact that it cannot engage employees and any insurances taken out by the BMC must be in the name of all members. A BMC cannot own equipment, facilities or land, which must be owned either by individual strata schemes or lot owners. Each member must contribute to the expenditure of the BMC in the proportions specified in the SMS and at the end of each financial year, any shortfall in expenditure must be paid immediately by the members any surplus must be distributed to the members. |
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Dynamic is an undisputed leader in this field. Contact our experts for a confidential discussion on (02) 9263 9925. |