All strata schemes have a body corporate. The body corporate is made up of all owners of lots in the strata scheme. The body corporate has an important role in the strata scheme. The body corporate is the controlling body of a strata scheme and comes into existence automatically on registration of the strata plan by the Recorder of Titles. No expenditure is required to form the body corporate.
There are instances where a body corporate cannot manage, control and improve the common property, or is unable to maintain the common property or keep insurance as required by the Strata Titles Act 1998 (the Act).
In some cases, it is not possible to resolve these issues, and an administrator may be appointed by the Supreme Court pursuant to section 89 of the Act or the Recorder of Titles under section 127 of the Act.
Supreme Court Appointment
Section 89 of the Act states that:
(1) The Supreme Court may, on application by an interested person, appoint an administrator of the body corporate's affairs for a fixed period, or until further order by the Court.
(2) An appointment may be made on terms and conditions that the Court thinks fit.
(3) The administrator is to be remunerated on a basis determined by the Court and the remuneration and expenses of the administrator are payable from the body corporate's funds.
(4) The administrator has the powers and functions of the body corporate (or such of those powers and functions as the Court may determine) to the exclusion of the powers and functions of the body corporate.
(5) The administrator may delegate powers conferred under this section.
(6) The Court may, on the application of an interested person, remove or replace the administrator.
(7) If a person is appointed, removed or replaced as an administrator, the person must, within 7 days, give the Recorder written notice of the appointment, removal or replacement.
(8) In this section,
interested person means –
(a) the body corporate; or
(b) a creditor of the body corporate; or
(c) the owner or a registered mortgagee of a lot.
Recorder of Titles Appointment
In addition to the appointment of an administrator by the Supreme Court, section 127 of the Act allows the Recorder of Titles to appoint an administrator.
This section states that:
(1) If, on an application for relief under this Part, the Recorder is satisfied –
(a) that the body corporate has failed in the proper performance of a duty; and
(b) the applicant has a proper interest in the due performance of the relevant duty; and
(c) the circumstances are sufficiently serious to justify the appointment of an administrator under this section –
the Recorder may, by order, appoint an administrator.
(2) The appointment of an administrator –
(a) is not to be made unless the proposed appointee consents in writing to the appointment; and
(b) is to be made on such terms and conditions (which may include terms and conditions for the remuneration of the administrator out of the funds of the body corporate) as the Recorder specifies in the order.
(3) The administrator has, in accordance with the terms of the order, power –
(a) to administer the affairs of the body corporate generally; or
(b) to carry out the function or functions of the body corporate or its officers specified in the order.
(4) If an administrator has power to administer the affairs of the body corporate generally, the administrator's powers operate to the exclusion of the powers of the body corporate and its officers and if an administrator has power to carry out a specified function or functions the powers of the body corporate are excluded so far as they relate to those functions.
(5) An act or omission of an administrator done or made in the course of exercising powers under this section is to be regarded as an act or omission of the body corporate.
(6) The administrator must give the body corporate written notice of the exercise of powers under this section as soon as practicable after the powers are exercised.
The appointment of an administrator is a serious matter, and it is recommended that parties seek legal advice prior to applying to the Recorder of Titles for an appointment of an administrator.