Are Your Body Corporate By-Laws Enforceable? Common Problems Worth Reviewing

When a problem arises in a community titles scheme, the committee may turn to its by-laws for a solution. A provision might require payment of cleaning costs, give the caretaker authority to refuse an application, or allow access devices to be deactivated following a breach. Before relying on that provision, however, the committee needs to establish whether it is legally enforceable.

By-laws can contain provisions that exceed the body corporate’s powers, even where they have been in place for years. Identifying those problems before a dispute arises can save considerable time, expense and frustration.

This article concerns Queensland schemes governed by the Body Corporate and Community Management Act 1997 (BCCM Act). Different rules may apply to schemes governed by other legislation.

Key takeaways

• Recording a community management statement does not make its by-laws valid or enforceable (s 115L(2) Land Title Act 1994), so developer-drafted wording also needs scrutiny.
• A by-law (other than an exclusive use by-law) cannot impose a monetary liability on an owner or occupier, however the charge is described.
• Caretakers can support operations, but approvals and contravention notices must go through the proper statutory process.
• By-laws cannot override statutory entry safeguards or authorise eviction, lockouts or cancelled access as a penalty.
• Owners and occupiers cannot be compelled or deemed to join bulk utility or service arrangements.
• By-laws must not be oppressive, unreasonable or discriminatory, and must comply with other legislation, including assistance animal rights.
• Regular reviews help identify problem provisions early. Amendments generally require a special resolution and a new CMS.

Registration does not guarantee validity

A community management statement (CMS) can look authoritative. It is formally recorded, applies to the scheme and may have been prepared by solicitors when the development was established.

However, s 115L(2) of the Land Title Act 1994 expressly provides that recording a CMS does not establish that its by-laws are valid or enforceable.

Developer-prepared provisions and wording copied from other schemes require the same scrutiny as later amendments. Some provisions may have been problematic from the outset; others may need updating following legislative changes or decisions clarifying the law.

Automatic charges and compensation

By-laws sometimes require an owner to pay cleaning expenses, reimburse repair costs or indemnify the body corporate against losses associated with a breach.

Under s 180(6) of the BCCM Act, a by-law, other than an exclusive use by-law, must not impose a monetary liability on an owner or occupier. Describing a payment as reimbursement or compensation does not overcome that restriction.

This does not mean the body corporate must absorb every expense. It may have an independent right to recover money under legislation, an enforceable agreement or another legal cause of action. However, the body corporate cannot create a right to recover those costs simply by stating in a by-law that an owner or occupier must pay them.

Giving the caretaker decision-making powers

An on-site caretaker can have an important operational role, but that role should not be confused with the body corporate’s decision-making authority.

A by-law purporting to let the caretaker grant or refuse approvals at their discretion deserves scrutiny. Decisions requiring body corporate approval must be made through the appropriate statutory process, including by the committee where it has authority.

For example, a caretaker may report suspected breaches or assist with administrative steps, depending on their engagement. They cannot themselves decide to issue a contravention notice. Clear drafting helps residents understand who can make decisions and where applications or complaints should go.

Entry to lots and enforcement shortcuts

Provisions allowing entry to a lot whenever the committee considers it desirable, eviction of disruptive occupants, or cancellation of access rights for breaching the by-laws raise serious concerns.

The BCCM Act provides specific entry powers for authorised inspections and works. Entry under s 163 generally requires at least seven days’ written notice and must occur at a reasonable time, with different arrangements for emergencies. A by-law cannot override those statutory safeguards.

Similarly, a by-law cannot give the body corporate a general eviction power or authorise locking residents out as punishment. Breaches must be addressed through the applicable enforcement procedures. Any separate right to enter or take urgent action needs its own lawful basis.

Compulsory utility and service arrangements

Bulk arrangements for electricity or other services may offer practical benefits. However, the body corporate’s agreement with a supplier does not automatically establish an agreement with every owner or occupier.

Participation in a supply arrangement must be based on the owner’s or occupier’s agreement. A by-law cannot compel that agreement or deem it to exist.

Provisions requiring participation, compelling signatures or automatically joining incoming owners to supply agreements therefore warrant review. Contractual obligations must arise under an enforceable agreement or applicable law. Removing defective wording does not extinguish rights under a valid supply agreement.

Unreasonable restrictions and unequal treatment

By-laws must not be oppressive or unreasonable, or discriminate between types of occupiers. A rule reserving the common property pool for owners while excluding tenants is a straightforward example of problematic discrimination.

Blanket prohibitions also deserve attention. Depending on the subject and applicable legislation, reasonable conditions or an approval process may address the concern without prohibiting the activity altogether. For example, concerns about noise from a common property recreational area may be addressed through reasonable hours of use, rather than a blanket prohibition on its use.

Consistency with other legislation

By-laws must also comply with other applicable legislation. A provision that conflicts with the BCCM Act or another Act is invalid to the extent of that inconsistency.

For example, an animal by-law must respect the rights of people with disability who rely on guide, hearing or assistance dogs. Ordinary pet approval requirements cannot override those statutory rights. The wording should make this clear so that residents and committees understand when approval is required.

A review can identify provisions that overlook these protections and help prevent disputes arising from their application.

Why regular reviews matter

As discussed in our article When Did You Last Review Your Scheme’s Bylaws?, committees should periodically consider whether their by-laws remain suitable. A review is particularly worthwhile where the original developer’s wording remains largely unchanged, legislative changes affect the scheme, or proposed enforcement exposes uncertainty.

Addressing those issues early helps the committee understand its lawful options and reduces the risk of relying on provisions that may be successfully challenged. It also provides an opportunity to make approval requirements clearer and adapt the by-laws to the scheme’s current needs.

Amendments generally require approval by special resolution at a general meeting and recording of a new CMS. Exclusive use by-laws have additional requirements. The committee should obtain advice on both the proposed wording and the process for adopting it.

For assistance reviewing and updating your scheme’s by-laws, contact our experienced Body Corporate Lawyers on (07) 5532 3199 or submit an enquiry online.