The Queensland Government is currently examining the Queensland property legal framework, in particular the Property Law Act 1974 (PLA) and the Body Corporate and Community Management Act 1997 (BCCM).
The independent review is being conducted by the Commercial and Property Law Research Centre at the Queensland University of Technology as part of the staged review of the property legal framework. QUT’s findings and recommendations from the current review have been submitted to the Government in a final report on lot entitlements under the BCCM and various topics under the PLA.
The review is now in the community consultation stage as the public and industry stakeholders, including professional groups, lot owners and solicitors are being invited to make submissions in response to QUT’s findings and recommendations before the Government makes any decisions about possible changes to current laws.
Don Battams discusses the review in the following article.
BCCM lot entitlement changes
The Queensland Government is seeking feedback on the system of calculating and setting contribution lot entitlements in community title schemes.
Lot entitlements are allocated when a community titles scheme is first established and they set a lot owner’s share of body corporate costs and voting rights (contribution schedule lot entitlements) and their share of common property and government rates payable for each lot (interest schedule lot entitlements).
The issue of setting and adjusting contribution schedule entitlements has caused some debate in the community titles sector with regards to whether the current method accurately and fairly apportions body corporate costs among lot owners.
In its recommendation to the Queensland Government, QUT has proposed a new system that will aim to move away from the use of a single contribution schedule lot entitlement to allocate body corporate expenses, to a new system that will be phased in over a three year period for all new and existing schemes. The proposed system will allocate expenses into one of three categories, based on the degree to which the expense benefits the lots in the scheme. The proposed categories are:
- Category 1 – expenses that benefit all lots equally. These expenses will be divided equally among lot owners and typically relate to administration of the body corporate, i.e. to maintain body corporate assets and common property;
- Category 2 – expenses that benefit all lots, but not equally. These expenses will be divided by interest schedule entitlements to accommodate lots of different size or location where capital expenditure and expenses would vary because of these differences; and
- Category 3 – expenses that only benefit some, but not all lots. These expenses will be divided between the owners of those lots that receive the benefit either equally or based on interest schedule lot entitlements.
QUT’s recommendations include imposing a statutory obligation on developers to exercise reasonable skill, care and diligence in allocating body corporate expenses into the three proposed categories and setting interest schedule lot entitlements.
The Property Council of Australia has already expressed its concern that the proposed system introduces too much complexity and uncertainty in comparison to the old system. There are is also concern that the proposed changes retrospectively impact the rights of individual lot owners if the changes are introduced by the Queensland Government.
QUT’s final report and recommendations and the consultation guide to the report can be found here.
Submissions Close
The Government has requested written submissions for community and industry feedback on the proposed changes to the BCCM by 23 December 2016. Specifically, the Government is inviting feedback on whether the proposed changes provide a fair and practical way to apportioning body corporate costs among lot owners.
Submissions can be made by email or post to:
QUT Review ‐ BCCM
C/‐ Office of Regulatory Policy
Department of Justice and Attorney‐General
GPO Box 3111
Brisbane QLD 4001
Review of the PLA
The Attorney-General and the Queensland Government are seeking members of the public and stakeholders to provide feedback on the current property legal framework.
Since the introduction of the PLA in 1974, the laws surrounding how people deal with property and businesses have significantly evolved. There have been various discussions to suggest that certain provisions of the PLA are no longer up-to-date with modern day property transactions.
The review is being conducted in phases given the large extent of law covered by the PLA. The Queensland Government is currently inviting feedback on issues papers 3, 4 and 5. Some of the topics under review in these papers are:
- rights of way;
- co-ownership;
- mortgages;
- encroachment and mistake;
- corporations;
- unregistered land; and
- property in de facto relationship.
The various issues papers can be found here.
Submissions Close
Written submissions are encouraged to be submitted by all before the closing date on 13 January 2017. Submissions can be made by email or post to:
Property Law Review
C/- Strategic Policy
Department of Justice and Attorney-General
GPO Box 149
Brisbane QLD 4001
For further information or discussion, please contact HopgoodGanim Lawyers' Property team.