This article discusses when a BCCM Form 20 requirement applies to management rights decisions, clarifying why it is required for variations but not for entering into a new management rights agreement.
What is the process for the proposal of a new management rights agreement? Does a form 20 need to accompany the motion?
Our Community Title Scheme is under the Accommodation Module. The original Caretaking and Letting Agreement is in place from the developer and there have been several changes in Caretakers since, as well as some minor variations to the agreement with some of these being time extensions.
The Caretaker has put forward a motion requesting a full 25 years renewal and for the current agreement to be contemporaneously replaced by this new proposed agreement.
Does a form 20 need to accompany the motion? If so, would this invalidate the motion as it doesn’t meet the legal requirements for all lot owners to be aware of the information that would be contained in form 20.
A BCCM20 is only required when a management rights agreement is being varied – not a new one entered into.
Surprisingly enough, a BCCM20 is only required when a management rights agreement is being varied – not a new one entered into.
You could quite easily argue that the entry into a new management rights agreement is a more significant decision for a body corporate than varying an existing one, but the counter argument to that is that when a new agreement is entered into, copies of the new agreements should go with the agenda so owners are very clearly informed about what is being put to the meeting. Copies of the existing agreements don’t need to be sent when a variation is proposed which is why the BCCM20 summarises the key terms of the existing arrangements for owners to save them the work of finding out what is already in place.
This post appears in the May 2021 edition of The QLD Strata Magazine.
Frank Higginson Redchip Strata Law E: FrankH@redchip.com.au P: 07 3193 0500