The owners corporation

What is the owners corporation? The owners corporation (commonly abbreviated to o.c.) is the legal ‘entity’ or body that is the actual owner of the building. The owners corporation is governed by the Act as well as a range of other legal rules and regulations as to what it can and cannot do. If you own a strata apartment you have rights and responsibilities including voting as an ‘owner’ of the owners corporation.

The owners corporation must hold certain meetings, an executive committee must be appointed, and the owners corporation has the power to make resolutions and by-laws. The owners corporation must abide by the Act and at the same time an owners corporation cannot break the law. The Act states that an owners corporation has functions “conferred or imposed” on it – in other words there are certain things that an owners corporation is allowed to do and certain things that it must do.

The primary duty of the owners corporation is to manage and “look after” the building which is the main physical asset of the strata scheme. The owners corporation has formal legal status but it is not a person. No one person can say that they are the owners corporation (but many people try). The owners corporation can nominate a person to speak (or write letters etc) on behalf of the owners corporation but the owners corporation cannot delegate all decision making powers to a person.

It is common for many owners corporations to only hold one formal ‘general’ meeting each year called the “Annual General Meeting”. Other extraordinary general meetings can be called if and when required but many buildings never hold other meetings. It is also (unfortunately) common for buildings to never hold executive committee meetings. It is the opinion of Strata Renovations that this is a mistake. Even though the Act does not demand it, all buildings should regularly hold executive committee meetings.

Remember always that all decisions made are not made by an individual, rather they are decisions made by the owners corporation.

An owners corporation is not a company in fact the law specifically states that the owners corporation is excluded from the provisions of the Corporations Act that apply to most companies in Australia. However many of the concepts when it comes to running an owners corporation are very similar to how companies are run and “good strata management practices” are often identical (or similar) to “good corporate management practices”. Numerous court decisions refer.

At a practical level, the owners corporation is represented for most purposes by the members of the executive committee depending on the degree of delegation.