Obligations of Owners Corporations
The main obligations of Owners Corporations are:
- Managing and administering the common property
- Repairing and maintaining the common property, fixtures and services
- Taking out and maintaining required insurance
- Raising fees from the lot owners to meet financial obligations
- Preparing financial statements and keeping financial records
- Providing owners corporation certificates when requested
- Keeping an Owners Corporation register
- Establishing procedures and adopting the model rules and implementing them
- Carrying out any functions and duties under the Owners Corporations Act 2006, the Owners Corporations regulations, rules and any other law and ensuring the compliance of same.
The Property Maintenance
All Owners Corporations are required to prepare and maintain the common property, any equipment and services that benefits some or all of the lots and common property and any of its own personal property. A maintenance plan covers planning and budgeting for future repairs and maintenance of the building. If an Owners Corporation has a maintenance plan then it is also required to have a maintenance fund to cover the cost of the works to implement the maintenance plan.
Owners Corporations are responsible for keeping track of their finances. Owners Corporations can raise fees from lot owners and lot owners have unlimited financial and legal liability to the Owners Corporation.
This means you may confront unexpected and adverse financial consequences because of poor financial management of the Owners Corporation. The Owners Corporation has a number of financial powers and responsibilities under the Owners Corporations Act 2006 including:
- Maintenance and insurance and setting fees to cover general administration
- Operating a bank account
- Paying remuneration to managers and employees
- Paying insurance premiums
- Keeping financial records
- Preparing annual financial statements
In addition, a prescribed Owners Corporations must audit financial statements after the end of the financial year and establish a maintenance fund to cover the cost of implementing the maintenance plan.
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