Australian Capital Territory Current Acts Australian Capital Territory Current ActsSchedule 2 Executive committees
Note The executive committee exercises the functions of the owners corporation (see s 35 (1)).
Who are the members of the executive committee and how many members there must be depends on whether the owners corporation has had its first annual general meeting and how many members of the owners corporation there are (see s 38 and s 39).
The executive committee must elect a chairperson, secretary and treasurer (see s 40). The functions of those office-holders are set out in ss 41 to 43.
The executive committee may—
• be helped in the exercise of its functions by a person employed or engaged under s 45; and
• delegate its functions to 1 or more executive members (see s 44 (1) or a manager (see s 58 (2)).
An executive committee member is protected from civil liability in relation to the exercise of the member's functions if the member acts honestly and without recklessness (see s 47).
Part 2.1 What the executive committee must, may and cannot do
2.1 Executive committee must keep minutes, and records and accounts
(1) The executive committee of an owners corporation must—
(a) keep minutes of its proceedings; and
(b) keep minutes of proceedings at general meetings of the corporation; and
(c) include in the minutes of proceedings kept under paragraphs (a) and (b) the following:
(i) the date, time and place of the meeting;
(ii) the names of members present at the meeting, including (if authorised) those members taking part using a method to hear or otherwise know what each other member taking part says without the members being in each other's presence;
(iii) details of proxy and absentee votes for the meeting;
(iv) details of resolutions passed including, for special, unopposed and unanimous resolutions, details of the kind of resolution; and
(d) keep a copy of any court order given to the owners corporation; and
(e) keep any authorisation by the territory planning authority given to the owners corporation; and
(f) keep proper records and books of account in relation to—
(i) the corporation's assets and liabilities (including all amounts owing to and by the corporation); and
(ii) all amounts received and paid by the corporation; and
(g) arrange for the financial records of the units plan to be audited before the annual general meeting if either—
(i) the number of units in the units plan is more than 100, or another number prescribed by regulation; or
(ii) the annual budget of the owners corporation is more than $250 000, or another amount prescribed by regulation; and
(h) if the rules of the owners corporation include alternative rules—maintain an up-to-date compilation of the alternative rules.
Note If minutes or other records kept by the executive committee contain personal information, the executive committee must comply with the Australian Privacy Principles under the Privacy Act 1988
(Cwlth) in relation to that information.
(2) The executive committee must give a copy of the minutes of proceedings required under subsection (1) to each member of the owners corporation within 14 days after the day the meeting was held.
(3) The executive committee must keep the documents, records and books of account for at least 7 years and make copies available for inspection on request by any member of the owners corporation.
(4) The executive committee may keep and distribute the minutes, records or books of account in an electronic form.
(5) If an owners corporation fails to comply with this section, each executive member of the corporation at the time of the failure commits an offence.
(6) It is a defence to a prosecution for an offence against this section if the defendant proves that—
(a) the defendant took reasonable steps to ensure that the section was complied with; or
(b) the failure to comply happened without the defendant's knowledge.
Maximum penalty: 20 penalty units.
2.1A Working out the annual budget for audit purposes
(1) For section 2.1 (1) (g) (ii), the annual budget of the owners corporation is the sum of—
(a) an estimate of each of the following for the financial year in which the annual general meeting is held:
(i) the total general fund contribution;
(ii) if there is a special resolution under section 78 (2) (b)—the general fund contribution payable by each unit owner, or unit owner in a particular class;
(iii) the total sinking fund contribution; and
(b) an estimate of any other amounts to be paid into the general fund in the financial year in which the annual general meeting is held; and
(c) any other amounts held by the owners corporation for the purposes of managing the units plan at the beginning of the financial year in which the annual general meeting is held.
Examples—other amounts held by owners corporation
• sinking fund
• special purpose fund
(2) In this section:
"general fund"—see section 72.
"total general fund contribution"—see section 75 (2) (a) (i).
"total sinking fund contribution"—see section 82 (3) (b).
2.2 Executive committee must present financial statements at annual general meeting
(1) At each annual general meeting of an owners corporation, the executive committee must present to the corporation—
(a) annual financial statements in relation to the matters mentioned in section 2.1 (1) (f); and
(b) the audit opinion (if any) in relation to the annual financial statements.
(2) Annual financial statements must cover the period from the end of the period for which the last statements were prepared (or, for the first annual general meeting, since the registration of the units plan), to a stated day (the stated day ) before the annual general meeting at which they are to be presented.
(3) The annual financial statements must be presented to the annual general meeting within 3 months from the stated day.
(4) If an owners corporation fails to comply with this section, each executive member of the corporation at the time of the failure commits an offence.
Maximum penalty: 20 penalty units.
(5) It is a defence to a prosecution for an offence against this section if the defendant proves that—
(a) the defendant took reasonable steps to ensure that the section was complied with; or
(b) the failure to comply happened without the defendant's knowledge.
2.3 Executive committee must present insurance details at annual general meeting
(1) At each annual general meeting of an owners corporation, the executive committee must give to the corporation the following details about each insurance policy held by the corporation under this Act that is current at the time of the meeting:
(a) the name of the insurer;
(b) the amount of cover under the policy;
(c) for a building insurance policy—details of any recent valuation of the insured buildings;
(d) a summary of the type of cover under the policy;
Examples
public liability insurance, building insurance, personal property insurance
(e) the amount of the premium;
(f) the amount of any excess payable on the happening of an event for which the insurance gives cover;
(g) the date the cover expires;
(h) the amount and type of any financial or other benefit given, or to be given, by the insurer, for the insurance being taken out, to any person.
Example—financial or other benefit
commissions, discounts
(2) If an owners corporation fails to comply with this section, each executive member of the corporation at the time of the failure commits an offence.
Maximum penalty: 20 penalty units.
(3) It is a defence to a prosecution for an offence against this section if the defendant proves that—
(a) the defendant took reasonable steps to ensure that the section was complied with; or
(b) the failure to comply happened without the defendant's knowledge.
2.4 Approving use of common property
The executive committee of an owners corporation may approve an application by a member of the corporation to use the common property if—
(a) the use applied for is minor; and
(b) the use will not unreasonably interfere with the reasonable use and enjoyment of the common property by other members of the corporation.
Example—minor use
installation of airconditioner or awning on unit that extends over common property
2.5 Decisions about taking legal action
(1) This section applies if the executive committee proposes to take legal action.
(2) The executive committee of an owners corporation must not take legal action on behalf of the owners corporation unless—
(a) the legal action relates to the payment of a contribution under the Act by a member of the corporation to the corporation; or
(b) the costs of taking the legal action are reasonably estimated by the corporation's legal representative to be not more than the amount prescribed by regulation; or
(c) the corporation approves taking the legal action by ordinary resolution.
Note Section 2.6 allows urgent legal action to be taken.
(3) For this section, the executive committee of an owners corporation "takes legal action" if the committee—
(a) begins a proceeding; or
(b) begins to defend a proceeding; or
(c) continues, or continues to defend, a proceeding.
(4) In this section:
"costs", of taking legal action, means the legal costs and disbursements incurred by the owners corporation for its legal representation for the legal action.
2.6 Taking urgent legal action
(1) This section applies if—
(a) the executive committee of an owners corporation is satisfied on reasonable grounds that it is necessary to take legal action urgently on behalf of the corporation; and
(b) the executive committee cannot reasonably get the corporation's approval before taking the legal action.
(2) The executive committee may take the legal action.
(3) However, the executive committee must—
(a) seek the approval of the owners corporation as soon as practicable after beginning the legal action; and
(b) if the owners corporation does not approve taking the legal action, the executive committee must discontinue the proceeding or withdraw the defence.
(4) For this section, the executive committee of an owners corporation "takes legal action" if the committee—
(a) begins a proceeding; or
(b) begins to defend a proceeding.
2.7 Decisions about staged development
(1) This section applies to a meeting of an executive committee of an owners corporation for a staged development if the development has not been completed.
(2)
The executive committee must not decide a matter about the
uncompleted stages of the development.
Part 2.2 Executive committee—meetings and procedures
2.8 Meetings of executive committee
(1) An executive committee may meet for the conduct of business when it decides, and may adjourn and otherwise regulate its meetings as it considers appropriate.
(2) An executive member may call a meeting of the committee by giving to each other executive member not less than 7 days written notice stating the business that the member proposes to bring before the meeting and the time and place of the meeting.
(3) The executive committee may authorise a meeting to be held using a method of communication, or a combination of methods of communication, that allows a member taking part to hear or otherwise know what each other member taking part says without the members being in each other's presence.
Examples
a phone link, a satellite link, an internet or intranet link
(4) A member who takes part in a meeting conducted under subsection (3) is taken, for all purposes, to be present at the meeting.
2.9 Quorum of executive committee
(1) Business may be transacted at a meeting of an executive committee only if a quorum is present at the relevant time.
(2) A quorum is worked out as follows:
(a) if the total number of executive members is an odd number—
(b) if the total number of executive members is an even number—
2.10 Voting of executive committee
(1) At meetings of an executive committee, all matters must be decided by a majority of the votes of the executive members present and voting.
(2) If an executive committee has only 2 members, all matters must be decided by unanimous vote.
(1) At a meeting of the executive committee, the chairperson may leave the chair during the meeting for any reason.
(2) If the chairperson leaves the chair during a meeting, the executive members present must elect another executive member present to chair the meeting.
(3) At a meeting of the executive committee, the chairperson—
(a) may vote as an executive member; and
(b) if the votes on a matter are equal—may exercise a 2nd (casting) vote, unless there are only 2 executive members.
Note If there are only 2 executive members, all matters must be decided by unanimous vote (see s 2.10 (2)).