Duties and Obligations of Committee Members

Contributed by Col Myers, Partner, SMALL MYERS & HUGHES – 21 August 2018

Duties and Obligations of Committee Members

Committee members are all volunteers and the vast majority are unpaid.

The strata legislation (and by laws) in each state provides the framework for governance of strata title buildings. Bodies Corporate (or, as they are called in New South Wales, “Owners Corporations”) delegate much of their day-to-day decision-making authority to committees.

Who is eligible to be appointed?

· New South Wales
Any lot owner is eligible as well as a nominee or an individual who is not a lot owner but who is nominated for election by an owner of a lot who is not a committee member or is not seeking appointment to the committee. Note however that a building manager, a letting agent or an associate of the developer are not eligible for election unless they own a lot in the scheme and they disclose their position prior to voting. Unfinancial members are also not eligible for election.

· Queensland
Any lot owner is eligible, or a person who is a family member, power of attorney or company nominee of an owner, as well as a representative of a subsidiary scheme. However, a Body Corporate manager, service contractor or letting agent (or an associate of any of those persons) are not eligible to be voting members of the Committee.

Functions and powers of committees

· New South Wales
An Owners Corporation may have a committee and strata manager assist it in carrying out its management functions. However, committees cannot make any decision which is required by way of a unanimous or special resolution at a general meeting.

· Queensland
A decision of the committee is taken to be a decision of the Body Corporate unless it is a “restricted” issue under the relevant regulation module. Restricted issues include fixing or changing monetary contributions, changing the rights, privileges or obligations of owners, or issues reserved specifically for the Body Corporate at a general meeting.

Statutory duties

· New South Wales
The legislation specifically provides that committee members must act in the benefit of the Owners Corporation and exercise due care and diligence and disclose all pecuniary interests.

· Queensland
The legislation provides that committee members must act honestly and fairly and in the best interests of the Body Corporate and must disclose any conflict of interest in any matter before the committee.

Positive obligations on committees

New South Wales
The committee must act with care and diligence and in the best interest and benefit of the Owners Corporation.
Queensland – The committee must act reasonably in making decisions and in the best interests and the benefit of the Body Corporate.

Conflicts of interest

· New South Wales
A committee member must disclose any pecuniary interest he or she has in a matter before the committee. Particulars of the disclosure must be recorded by the committee and kept in a book and then it is up to the discretion of the committee whether a member is present during discussions and exercises a vote.

· Queensland
A committee member must disclose any conflict of interest and is not entitled to vote if there is a conflict.

Statutory protections

· New South Wales
A matter or thing done or omitted to be done in good faith by a committee member does not, for the purpose of executing a function of the Owners Corporation, subject that person to any action, liability, claim or demand.

· Queensland
A committee member is not civilly liable for any act or omission made in good faith and without negligence in performing their committee role. However, this protection does not include defamation.

Insurance

Most Bodies Corporate ensure that committee members are at all times covered by office bearers’ liability insurance.