Improvements to Common Property
Different resolutions would be required for improvements to the common property.
The first question to is - Who will be doing the improvement? Will it be done by an owner or by the Body Corporate? If an owner wishes to make the improvement and it is viewed to be a major improvement, then that owner will require permission from all the other owners and the improvement will become part of the common property – to be maintained by the Body Corporate going forward. It is also important to first determine if the improvement does not constitute the extension of a section.
If the improvement is not the extension of a section, it is recommended that exclusive use rights be created over the area where the improvement would be done. If it is an exclusive use area where the improvement will be done, then the owner would require an ordinary resolution to be passed by the Body Corporate (this can only be done at a general meeting of owners)
There are also instances where the owner can do improvements to common property and only require Trustee approval. One can refer to PCR 4 in this instance and this is only possible for minor alterations to the common property.
PMR 4 (1) from the STSM Act states the following in this regard:
The owner or occupier of a section must not, without the trustees’ written consent, mark, paint, drive nails, screws or other objects into, or otherwise damage or deface a structure that forms part of the common property.
If the Body Corporate want to attend to works on the common property, it must be determined if it is maintenance or an improvement. If it is maintenance the Body Corporate may proceed with the work (in line with the budget), but if it is not maintenance, it must be an improvement.
Improvements are classified as either reasonably necessary (previously called non-luxurious) improvements or not necessary (previously called luxurious) improvements.
To do an improvement to common property that is not necessary (luxurious) the Body Corporate will require a unanimous resolution to be passed.
PMR 29 (1) from the STSM Act states the following in this regard:
The body corporate may on the authority of a unanimous resolution make alterations or improvements to the common property that is not reasonably necessary.
To do an improvement to common property that is reasonably necessary (non-luxurious) the Body Corporate will be required to follow the procedure set out in PMR 29(2):
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The Trustees need to give written notice to the owners of what they intend to do. The notice must include the following:
(a) The fact that the Trustees intend to do the improvements 30 days after the notice was sent.
(b) Details of the improvements such as costs, how it will be funded and a motivation for the proposal including drawings showing their effect and a motivation for the need.
- Should any owner – during the 30-day period request (in writing) a meeting to be held to discuss the improvement, the Trustees must call a Special General Meeting for a special resolution to be passed regarding the improvements.
- The Trustees may not start with the improvements until they had the meeting and the special resolution passed.
- If the Trustees think that some owners will definitely request a meeting, they can pre-empt it and call the SGM at the same time that they are sending out the notice with their proposals.
PMR 29 (2) from the STSM Act states the following in this regard:
The body corporate may propose to make alterations or improvements to the common property that are reasonably necessary; provided that no such proposal may be implemented until all members are given at least 30 days written notice with details of-
(a) The estimated costs associated with the proposed alterations or improvements;
(b) Details of how the body corporate intends to meet the costs, including details of any special contributions or loans by the body corporate that will be required for this purpose; and
(c) A motivation for the proposal including drawings of the proposed alterations or improvements showing their effect and a motivation of the need for them;
And if during this notice period any member in writing to the body corporate requests a general meeting to discuss the proposal, the proposal must not be implemented unless it is approved, with or without amendment, by a special resolution adopted at a general meeting.
Some owners incorrectly think that a “non-luxurious” improvement is a special resolution straight off – it is not – you have to follow the procedure as outlined in PMR 29 (1).