Introduction to body corporate
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Why does a body corporate exist?
What is a body corporate?
What is the role of the body corporate?
- Determine the contributions (levies) payable by owners required to fund the operation of the body corporate.
- Collect additional contributions for the future maintenance of the common property (sinking fund).
- Insure the common property, including public liability insurance.
- Establish by-laws (rules) that govern:
- Management and control of common property and body corporate assets;
- Use and enjoyment of lots, common property and assets.
- Keep records of the body corporate’s operations, including meeting minutes, roll of owners, financial accounts and various other registers.
Who is a member of the body corporate?
What are lot entitlements?
Lot entitlements are used to divide body corporate expenses and ownership of the common property amongst the lot owners, similar to the way a company is held by its shareholders. In many bodies corporate, these entitlements are equal, meaning each lot owner contributes the same amount in levies, and has an equal ownership share in the common property.
In other schemes, such as a high-rise on the Gold Coast for example, a four bedroom penthouse apartment may have more entitlements than a one bedroom apartment. The difference in entitlements means the owner of a penthouse contributes in greater proportion to the administrative and sinking funds, and also may own a larger share of the common property.
Each lot in the scheme has two schedules of lot entitlements – ‘contribution schedule’ and ‘interest schedule’. A table of the two schedules of entitlements for the entire scheme is contained in the CMS, see example below:
|Lot on plan||Contribution schedule||Interest schedule|
|Lot 1 on SP12345||1||22|
|Lot 2 on SP12345||1||22|
|Lot 3 on SP12345||3||33|
|Lot 4 on SP12345||4||37|
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