How does the body corporate committee work? [Feb 2008]

APARTMENT SMART QUESTIONS & ANSWERS

Q          "We are looking at buying an apartment, and selling our family home.  But we are concerned that we will have unexpected costs which we will have no control over. How does the body corporate committee work, in terms of deciding what needs to be done around the property.  When if ever do problems arise? Is there a chairman of the committee and do they ever abuse their power?"

A          Living in an apartment is very different from living in a family home in the suburbs.  This point has been recognised by the Auckland Regional Council in a study carried out by the Auckland Regional Growth Forum in 2003.  Apartment living is a relatively new concept in New Zealand as a consequence of a more intensive housing initiative in our major cities.  Many people move from the family home to an apartment after the children have left the family home.

The question really gets to the core of the differences between an ordinary family home on its own section and an apartment which will, in most cases (though not all), be an apartment as part of a unit title building.

The form of most titles in apartment buildings is a unit title created under the Unit Titles Act 1972 (currently under review by the Government).  All unit title buildings are required to have a Body Corporate and a Body Corporate Committee.  All owners form the Body Corporate and the committee is elected by the owners at each Annual General Meeting.  The Body Corporate is responsible for common areas in the building – such as carparks, driveways, lifts, stairwells, escalators and such common features, even in some cases the exterior cladding of the building.  The role of the committee is to manage the Body Corporate and its various responsibilities and in that regard it must raise levies from owners to meet the annual maintenance and upkeep budget.  The committee sets the annual budget and this is reviewed and approved by all owners at the Annual General Meeting.  Often a manager is employed by the Body Corporate to manage the day to day affairs of the Body Corporate and look after the common property maintenance and upkeep.

Therefore, in buying an apartment within a unit title building it is important to ask a host of questions which you may not normally ask if you are buying an ordinary family home.  Most lawyers have a list of questions that help identify these particular issues.  In addition, the ARC publishes a very useful booklet called The Mysteries of Body Corporate:  A Guide to Rights and Responsibilities of Apartment Ownership, which can be obtained through the ARC which explains many of these issues.

For more information contact Tim Jones at .(JavaScript must be enabled to view this email address)

The contents of this newsletter are of a general nature only. While the information is believed to be correct no responsibility is accepted for its accuracy. Readers are advised to establish the applicability of information in relation to specific circumstances and not to rely solely on the text of this newsletter.

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