On 24 August 2023, Queensland Attorney General, the Hon Yvette D’Ath MP (the Attorney General) introduced the Body Corporate and Community Management and Other Legislation Amendment Bill 2023 (the Bill) into Parliament.

The Bill implements recommendations from the Government’s 2022 Housing Summit (read more here). It was considered by the Legal Affairs and Safety Committee (the LAS Committee), which recommended it be passed.[1] On the 26 October 2023, the Bill was tabled for its second reading in the Senate. The Bill amends Body Corporate and Community Management Act 1997 (Qld) (the Act) in 2 key areas:

1. Scheme termination – where a community titles scheme is financially inviable to facilitate renewal and redevelopment of the land; and
2. By-Laws and Governance – covering key administrative and practical issues affecting bodies corporate, including towing of vehicles, smoking (including vaping) and the keeping of animals.

The Bill also amends other aspects of the Act, including updates to consumer protections when purchasing ‘off the plan’ (covering sunset clauses and changes to sections relating to layered schemes and the various Codes of Conduct found in Schedules 1A, 2 and 3 of the Act).

The LAS Committee made a number of other recommendations on the passing of the Bill. However, and most importantly, the Bill did not pass, and has been held over for a further debate between during 14 to 16 November 2023.

What does this mean for your Scheme or portfolio? The Act as it currently stands has not been amended and the Bill is not yet legislation. We will keep you updated with further developments following Parliament’s further sitting days in mid-November. Please read on if you would like further information on positions taken in the Parliament.

Scheme Termination

The Bill proposes that a scheme may be terminated with 75% support of owners at a scheme.

The majority of the LAS Committee felt that the correct balance was struck in affording equitable rights to owners who wish to terminate and sell an unviable scheme, and those who do not – including the need for evidence in advance of termination and a dispute resolution process in the event that the termination is opposed. This was the first major point of contention amongst stakeholders in the public hearings for the Bill.

Some stakeholders felt that the relaxation of the termination process will accelerate new opportunities for property development. Others felt that these amendments do not provide proper protections to dissenting owners if a majority group of owners attempt to terminate the scheme. The primary concern, in the context of the ongoing cost of living crisis and lack of housing in Queensland, is that some owners may vote to terminate a scheme which will, in practice, force people to sell and leave their homes who may not have been in favour of termination.[2]

The Government feels there is a strong process to safeguard against forcing people out of their homes in the event that the vote to terminate a scheme is not unanimous.

The Committee suggested the Government should develop education programs and offerings for owners, occupiers and various other stakeholders to provide information about the process of termination, and the dispute resolution process available to owners.

The Government has taken that recommendation on notice and assured Parliament that the Commissioner for Body Corporate and Community Management will update resources and educational programs in the industry to encourage engagement with the amendments as a matter of priority.

By-Laws and Governance

1. Towing: The Committee recommended that the Government should, in collaboration with the Community Titles Working Group, consider providing additional resources to bodies corporate about their rights and responsibilities with respect to towing unlawfully parked vehicles. The Government has accepted that recommendation.
2. Nuisance/Hazard – Smoking: The Committee was of the view that the proposed amendments of section 167 of the Act (which requires the owner or occupier of a Lot refrain from using a Lot or Common Property in a manner which will cause a nuisance and/or hazard) should include statutory examples or an explanatory note with respect to ‘regular’ exposure to smoke or smoking products.

The Government took the position that such a definition, or inclusion of examples, may be overly prescriptive and that the word should be interpreted with its ordinary meaning. The amendment seeks to address regular and frequent exposure to smoke, preventing lot owners from creating a nuisance and/or hazard.

Other Matters to Note

The Committee also recommended (among other things), the following matters:

1. Review of the prescribed fees for digital records;[3]
2. Within 24-months of the passing of the Bill, the Government review the amendments surrounding sunset clauses, and consider if the intended consequences and protections to consumers have eventuated, as well as if there are unintended consequences inconsistent with the policy intent of those particular changes.[4]

The Government has accepted these recommendations.

The Committee also recommended further matters, including a review of the interaction between the Act and the Minimum Housing Standards Reforms recently introduced in Queensland.

The Government rejected these recommendations on the basis that the Minimum Housing Standards do not consider the overlap between the maintenance obligations of the Body Corporate for areas of Common Property, but has agreed to continue to observe the operation of the reforms and their implementation within community titles schemes.

If you have questions about this article, please contact our office on (07) 3102 4120.

 

[1] Hon Peter Russo, Record of Proceedings, First Session of the Fifth-Seventh Parliament (26 October 2023) 77 – 78.

[2] See, for example, Hon Laura Gerber, Record of Proceedings, First Session of the Fifth-Seventh Parliament (26 October 2023) 79.

[3] Ibid.

[4] Ibid.