By-Law Series - Part 2 - Limitations

This article is about the limitations of QLD By-Laws.

In part 1 of our by-law series, we discussed what by-laws are legislated to provide for.

Sections 180 and 181 of the Body Corporate and Community Management Act 1997 (Qld) (BCCMA) sets out 8 limitations for by-laws. In part 2 we begin with what by-laws cannot say by addressing, with examples, the first 4 limitations.

Limitation 1

“If a by-law for a community titles scheme is inconsistent with this Act (including a regulation module applying to the scheme) or another Act, the by-law is invalid to the extent of the inconsistency.”

In other words, a by-law must not say something that is contrary to any legislation. Although this is a relatively simple principle, it is one of the most common reasons that a by-law can be deemed unlawful.

A common example is when a by-law that seeks to authorise the committee’s ability to access a lot with 3 days’ notice.

The issue with this by-law is that:

1. the body corporate’s powers to access a lot is set out in the legislation;
2. a by-law cannot give the committee additional powers (at least that is the case under the BCCMA); and
3. the by-law is inconsistent with section 163 of the BCCMA which sets out a number of other requirements that need to be met before the committee can access a lot.

Limitation 2

“If a lot may lawfully be used for residential purposes, the by-laws can not restrict the type of residential use.”

This means that the body corporate cannot interfere with the residential use of a lot and is why by-laws:

1. cannot restrict Airbnb and short term letting (which is a lawful type of residential use); and
2. can restrict certain commercial uses (eg to protect caretaking service contractors from a competing business).

Limitation 3

“A by-law can not prevent or restrict a transmission, transfer, mortgage or other dealing with a lot.”

This limitation prevents by-laws from affecting an owner’s fundamental property rights and prevents any by-law which seeks to:

1. determine who can purchase a lot; or
2. let a lot out on a short term basis (including via Airbnb).

Limitation 4

“A by-law must not discriminate between types of occupiers.”

This prevents by-laws from making different rules for different occupiers.

For example, common property facilities cannot be reserved only for owner occupiers as opposed to tenants.

Conclusion

By-laws, particularly by-laws prepared prior to the commencement of the BCCMA, often do not comply with these limitations.

Unfortunately, this only comes to light when a committee tries to enforce the unlawful by-law. By then it is too late and little can be done to enforce the by-law until it is corrected.

Our next article will address the remaining 4 limitations.

In the meantime, please contact our dedicated body corporate team if you need any assistance with body corporate by-laws for a scheme you have an interest in.

This article has been republished with permission from the author and first appeared on the Mahoneys website.