Record Management of an Owners Corporation

Record management for an owners corporation is dictated by state strata legislation and federal legislation, such as taxation. There is variety of documents that need to be kept and each type of document needs to be kept for differing terms.

What Records Need to be Kept?

• full details of unit owners
• body corporate rules
• meeting minutes
• resolutions passed
• results of ballots
• proxies
• voting papers
• copies of  correspondence sent and received
• budgets and other accounting or financial statements
• tax returns (including any GST records)
• insurance policies
• maintenance plans/sinking funds (if applicable)
• legal documents, such as notices or orders
• signed contracts and agreements with suppliers
• leases and licences

How Long do Records Need to be Kept?

In Victoria, most records need to be kept for a minimum of seven years. Some records may only need to be kept for a year, such as proxies. Small schemes are exempt from record keeping.

Types of Records

Leases & Licenses:

Common property can be sub-divided for a unit owner’s personal use, such as an area for an additional car park or a private courtyard. A lease or license is prepared by the strata manager along with a diagram on the plan of subdivision of the proposed area. A special resolution (75% voting approval of all unit owners) is required to approve the lease/licence, which must then be signed by co-signed by a committee member and be stamped with the common seal by the strata manager. There is a difference between a lease and licence, primarily that a lease remains with the unit and a licence remains with a unit owner. If there is change of ownership with unit with a licence, a new licence must be issued and approved for the new owner.

Lease – short term agreement between an owners corporation and a unit owner for use of common property, such as storage of goods on common property or use of a common garden area for private gardening. A lease is transferable to new unit owners) If the lease is longer than three years, then it can be registered for a small lodgement fee. A lease is a contractual arrangement in writing and should include a diagram of the common property area being leased. It is shown as an encumbrance on title for common property.

License – a long term agreement for exclusive possession, such as a courtyard or car park. It is not transferable to new owners without specific clause. Income from leases and licenses as a once-off or annual payment requires tax registration and GST implications OCA2006 – S14 = “By special resolution, an owners corporation may lease or licence the whole or any part of the common property to a lot owner or other person” The owners corporation can also be a lessee or licensee. Leases and licences by an owners corporation must be authorised