An overhaul of the Unit Titles Act can’t come soon enough for a large Queens-town body corporate.
Steve Wilde – who chairs the body corporate, an owners’ management collective, at the 75-unit Greenstone Terrace on Frankton Road – believes the new law is more transparent.
“Some body corporates are run like dictatorships, with owners held to ransom, [membership] fees hiked and so on,” Wilde says.
Body corporate governance will shift from unanimous member approval to a 75 per cent majority – and Wilde applauds the change.
“We like the 75 per cent threshold – we might need urgent maintenance work on common property and one person could [presently] hold it up.”
Anderson Lloyd Lawyers partner Stephen Brent says the new law will hopefully come into force by year’s end.
The legal overhaul is partly because the old Unit Titles Act 1982 is a dog’s breakfast, Brent believes.
“It was a poorly-designed Act.”
Brent also says the new law requires greater transparency.
“The disclosure requirements on vendors are going to be more substantial – if you’re aware of it, you’ve got to disclose it.”
The typical unit-title development is a multi-storey complex, Brent says, with a mix of visitor- and owner-occupied apartments.
Colliers International’s John Scobie totals unit-titled apartments in Queenstown at 1000-plus and welcomes the law change.
“It’s going to be a positive thing because we’re too reactive at the moment rather than proactive.”
Maintenance is a good example of this positive change, Scobie and Brent agree. Unless 75 per cent of owners vote to opt out – unlikely in all but the smallest complexes, Brent predicts – then 10-year maintenance plans in the new legislation will replace so-called “sinking funds”.
“[A sinking fund is] just money they put aside for a rainy day to see what cropped up,” Brent says.
“But this is working out a [10-year] plan, trying to get some costings around it.”
Plans will cover painting, re-roofing, maintenance, wear-and-tear repair, structural issues, and sprinklers and lifts.
Long-term maintenance plans will see owners make regular contributions instead of being hit with large sums out of the blue, Brent predicts.
Specialist body-corporate secretary Susan Sawyer of Lakes Property Services also endorses the new 10-year plans.
Some of her 40 body corporates have such plans already.
“[The new law’s] just making it more formal,” she says.