This article discusses body corporate funding social events and why levies cannot be used for parties.
Question: Can our Body Corporate pay for quarterly drinks and a Christmas party?
Answer: No. Body Corporate funds are raised in order to administer the common property and assets of the body corporate, enforce the scheme’s by-laws and to accommodate for items included in the annual budgets.
No. Body Corporate funds are raised in order to administer the common property and assets of the body corporate, enforce the scheme’s by-laws and to accommodate for items included in the annual budgets.
It has been consistently held that the Body Corporate is not permitted to use Body Corporate funds outside of these purposes, for example, social events. An adjudicator has relevantly stated:
“…a body corporate cannot use its funds for a social event such as a Christmas party even though the event may be a popular idea, proffer many benefits for owners and occupiers, foster improved relations between owners, assist to heighten community harmony and may deter a potential dispute.[4]”
While the Body Corporate cannot fund social events of this nature, this does not prevent the events occurring where the money is raised by the owners or occupiers who have chosen to attend.
This post appears in Strata News #530.
Peter Hunt Mathews Hunt Legal E: peter.hunt@mathewshuntlegal.com.au