By-laws are contained with the body corporate’s community management statement (CMS). It is the CMS, registered with the Titles Office, that gives a body corporate life. By-laws are in Schedule C of the CMS. Because they are incorporated into the CMS, it is not possible to simply ‘amend’ by-laws. A by-law is only effective if it is in the registered CMS.
This means that, if the body corporate wants to change its by-laws, it must register a new CMS. Anything else will be unenforceable. Section 54(1) of the BCCM Act says a CMS cannot be amended and that the only way to record a new CMS is to register an entirely new one.
Usually, a new CMS would require a resolution of the body corporate without dissent. If there is a proposed change to an exclusive use area, such as giving a part of common property to a lot owner for parking, then it would still need to be a resolution without dissent.
However, if it is only a change to the by-laws that does not affect any exclusive use, then the body corporate can resolve by special resolution to agree to register a new CMS with the new by-laws. This requires at least two-thirds of the body corporate to vote ‘YES’, and that no more than 25% of lot owners and total contribution schedule lot entitlements vote ‘NO’.
Once the new by-laws are agreed to by special resolution, a new CMS can be prepared with the new by-laws (or the new CMS can be prepared beforehand) for execution by the body corporate under its seal. This is then lodged with a general request with the Titles Office, along with the registration fee. If everything is in order, the new CMS will be registered and the new by-laws will apply from the date of registration.
This article is intended as general information only and should not be relied upon as legal advice. For specific legal advice please contact us here.
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