Guidance for body corporates of a layered development that wants to add to or amend the default operational rules in the Regulations.
What is a layered development?
A layered development is where several bodies corporate are grouped together under an umbrella body corporate. A layered development consists of one “head” unit title development and one or more “parent” and/or “subsidiary” unit title developments.
There is a useful diagram in Schedule 1 of the Act (external link) that illustrates the relationship between parent and subsidiary unit title developments.
Considerations for layered developments
Operational rules help the body corporate govern the development and can help prevent disputes between unit owners and occupiers.
Deciding on rules that apply in mixed use developments can be difficult. Often, layered developments will also be mixed use – meaning the different bodies corporate can have different and sometimes competing agendas.
Making everyone in the development happy relies on having a good, comprehensive set of body corporate rules.
When you are deciding on what rules you need in your development, see the sections on residential developments and commercial developments. You will likely need a combination of the suggested topics in your rules. In addition, see the tips below.
Tips: what to think about when deciding on rules
When you are considering what kinds of operational rules you need in your development, you should think about:
- what kinds of matters people have had disputes about in the past, why these disputes arose and whether rules could help prevent disputes from arising in the future
- what kinds of facilities are there for everyone to use and whether rules are a way to protect or ensure access to those facilities
- what kind of behaviour is acceptable in the development and what kind of behaviour is not
- what kind of businesses are involved
- whether the units are used by the owner or whether there are leasing arrangements in place
- what kind of additional duties the body corporate is responsible for undertaking.
It will be important to think about where you sit in the layered structure – whether your development is part of another body corporate or whether other bodies corporate are part of yours.
This will affect how you make some of your rules – especially the ones about common property. If you are part of another body corporate you can use their common property, but they will set rules. Similarly, if another body corporate is part of your body corporate they can use your common property and this might impact on the rules you make.
Also important are the operational rules of the other bodies corporate in the layered development. Ideally, the rules for each body corporate in a layered development should align – or at least not be in conflict.
Under the Act, if there is a conflict between rules of:
- a subsidiary body corporate and it’s parent, the parent body corporate’s operational rules apply
- a subsidiary body corporate and the head body corporate, the head body corporate’s operational rules apply.
Bodies corporate in layered developments might also choose to add in some rules that make it clear how the governance structure works across the development as a whole. For example, bodies corporate could choose to make rules that clarify the notice periods for meetings (in cases where the notice periods need to be longer than the minimum timeframes provided in the Regulations) – this will depend on how many subsidiary bodies corporate there are in the development.