Strata Schemes – Part 1 of 3 'Introduction'
What is Strata?
Strata refers to a system of ownership whereby a building is divided into portions known as ‘lots’. The building can be an apartment block, a complex of townhouses or villas, commercial offices and so on. In addition to each individual lot, each owner also shares ownership of the common property which usually encompasses foyers, gardens, stairwells, driveways and external walls. Each individual lot owner is responsible for maintaining their own property however, the common property needs to be maintained collectively by all the lot owners through levy payment systems. Enter, the Owners Corporation.
The Owners Corporation comprises of each lot owner in the Strata Scheme and they are responsible for administering, controlling, and maintaining all areas of the strata scheme. However, given that some strata schemes can comprise of upwards of 20 lots, it would be impractical to involve each and every lot owner for the purposes of working out ‘who will trim the roses this week’. Enter, the Executive Committee.
The Executive Committee consists of individual lot owners who have been elected at each Annual General Meeting (AGM). The Committee is predominantly responsible for running and overseeing the day-to-day administration type issues for the Strata Scheme. Within the Executive Committee there are three positions/office bearers who must be elected, these are:
- Chairperson – who must preside at all meetings of the Executive Committee. It’s important to note however that the Chairperson doesn’t have a casting vote under any circumstances
- Secretary –who is responsible for preparing meetings, providing notices, answering correspondence addressed to the Owners Corporation and generally doing all administrative and secretarial duties for the Owners Corporation and Executive Commit
- Treasurer – who is responsible for giving notice of any levies, keeping all accounting records, preparing financial statements and section 109 certificates and taking care of all of the general banking and account management for the money paid to the Owners Corporation.
And there we have the introduction to Strata Schemes and a general overview of its composition.
My next blog will delve deeper into the responsibilities of the Owners Corporation and the Executive Committee, the introduction of levies and special levies, and ongoing maintenance and repairs.