When you purchase a unit, you automatically become a member of the body corporate. All unit owners in a unit title development make up the body corporate.
The body corporate is responsible for a range of management, financial and administrative matters relating to the common property and the unit title development as a whole.
The body corporate is an entity made up of all the unit owners in a unit title development - if you are a unit owner, then you are also a member of the body corporate. Every unit title development has a body corporate, whether or not the body corporate is functional. If you don’t have a functional body corporate, you can find some tips on getting things up and running below.
Powers and duties
The body corporate is responsible for a range of management, financial and administrative matters relating to the common property and the unit title development as a whole. These functions mainly relate to the things all unit owners have a shared interest in – land, money, other property – which is why all unit owners are members of the body corporate.
The body corporate has a number of powers and duties, which are outlined in section 84 of the Act. Some of these include:
- managing, maintaining and repairing the common property, including common building elements and infrastructure that might not be common property
- establishing and maintaining a long-term maintenance plan
- keeping and maintaining a register of all unit owners
- calling general meetings of the body corporate
- keeping accurate financial statements
- taking out insurance that covers the development
- levying contributions on owners to fund the operation of the body corporate
- providing documents to unit owners, such as financial statements, meeting minutes and insurance details
- making and enforcing the body corporate operational rules.
Body corporate manager
Often a body corporate manager is contracted to perform some of the services of the body corporate on behalf of the unit owners.
Companies that provide professional body corporate services typically offer the following services:
- arranging maintenance of common property
- organising facilities for meetings
- administering the body corporate’s financial activities.
Appointing a body corporate manager does not in any way affect either the individual or collective property rights held by a unit owner.
Creating a body corporate
A body corporate is automatically created when a unit title development is created (specifically, when the unit plan for the development is deposited with Land Information New Zealand). This is usually done by the developer – a body corporate does not need to do anything else to register its existence. The name of a body corporate is made up of the words ‘Body Corporate Number’ and the registered number of the unit plan (for example Body Corporate Number 123456).
Body corporate not functioning as it should
If you are in an established development but the body corporate is not operational or performing the functions required by the Act you could:
- talk to the other unit owners and ask how they think the body corporate should be run
- talk to other people you know who are members of a body corporate in another development
- establish an annual social event to discuss any body corporate matters; such as property maintenance, insurance or finances
- think about engaging a professional body corporate manager, even if it is only to get things up and running.
First annual general meeting for new developments
If you are involved in a new development, there are some things you need to know to get the body corporate up and running:
- the body corporate must have its first annual general meeting as soon as possible and not more than 6 months after the date the unit plan was deposited or the first unit was sold
- at the first annual general meeting the body corporate needs to elect a chairperson
- at the first annual general meeting the body corporate should also decide whether they need a body corporate committee
- when the developer has sold enough units that they no longer have control over the development, they must give the body corporate notice of that fact and call a meeting. At that meeting, the developer must provide the body corporate with a turn-over disclosure statement and disclose any interest they have in contracts made by the body corporate.
Statutory management of a body corporate
The body corporate, or anyone with a financial or ownership interest in the body corporate or a registered interest in a unit can apply to the High Court for an administrator to be appointed if they believe that the body corporate is not managing, or cannot manage, its affairs effectively.
If an administrator is appointed, they take full control of the affairs of the body corporate from unit owners and the body corporate committee.