Australia: E-Alert: New BCCM regulations – Changes to the Small Schemes Module (SS) and Specified Two-lot Scheme Module (TL)

Section 19 SS allows a lot owner to submit a motion for consideration at a committee meeting or be decided outside a committee meeting. The committee must make a decision as soon as reasonably practicable but within 6 weeks.

The committee is not required to decide on a motion if within the 12-month period before the lot owner submitted the motion, the lot owner previously submitted a motion about the same issue or has submitted 6 or more motions.
The motion cannot conflict with the BCCM Act, prescribed regulation module, by-laws or be on a restricted issue.

Section 20 SS states a voting committee member with a body corporate debt will not be able to vote at committee meetings or outside of a committee meeting, until the body corporate debt is paid.

Section 24 SS allows a body corporate to engage a body corporate manager or amend the engagement by special resolution.

Sections 77 SS and 21 TL prevent a committee member from receiving a benefit from a caretaking contractor or service contract, other than a "permitted benefit", unless authorised by the body corporate.

Section 36 SS allows a lot owner or the committee to submit a motion for the first annual general meeting.

Section 38 SS states that if 2 or more motions proposing different ways to deal with the same issue are submitted for a general meeting, the committee must list the original motions together on the agenda as a "group of same-issue motions". A voter may vote on one or more of the grouped motions.

Section 44 SS and 67 TL require a developer to provide additional documents including development approvals, building warranties, documents relating to any claim made against a policy of insurance taken out by the original owner, contracts or agreements for the supply of utility services, fire and evacuation plans and any proxy forms were the original owner is the proxy for an owner of a lot.

Section 47 SS allow a body corporate to pass a motion by special resolution to change how a quorum is calculated for a general meeting. A body corporate will be able to decide a minimum percentage of voters for a quorum at a general meeting that is:

1. not less than 10% of the number of voters; and
2. not more than 25% of the number of voters.

Under the old module, a quorum was present if 25% of voters cast a vote and (generally) two people are physically present at the meeting. Under the new module, bodies corporate can decide a person is personally present if that person casts a vote electronically. This should significantly reduce the number of adjourned meetings.

Section 49 SS states a representative or power of attorney may only represent one lot, unless:

1. the owner of each lot is the same person;
2. the representative or power of attorney is a family member of a lot owner; or
3. the power of attorney is given by a buyer under sections 211 or 219 of the Act.

The objective here is to prevent the activity of "power of attorney farming" which may result in inappropriate use of powers of attorney. The provisions prevent the concentration of voting power which might impact a scheme's decision making.

Section 46 SS states if a motion is ruled out of order, the reason for the ruling must be recorded in the minutes of meeting by the chairperson.

Sections 119 to 128 SS oblige a body corporate to include a defect assessment motion at the annual general meeting following the first annual general meeting.

Sections 31A to 31B TL oblige a body corporate on or before the second anniversary of the scheme's establishment to consider engaging an appropriately qualified person to prepare a defect assessment report for all property that the body corporate must insure for its full replacement value, but not for a body corporate asset.

These sections are designed to identify building defects early.