Question: A lot owner is a volunteer and looks after the gardens for free. If the body corporate pays this owner to paint the building, are there any insurance implications?
A lot owner in our building looks after the ground for free. To save costs, can we pay this person to paint the building? It would save the body corporate thousands of dollars. We are confident in their quality of workmanship.
Our treasurer is concerns about the insurance implications if we pay for work. Can work can be done voluntarily around the units? Are there different rules if we pay the lot owner for the work?
Answer: Is the body corporate covered in case of damage to the corporation property and injury to the lot owner providing the services?
This is a great question. Many lot owners perform work around the common property and do so voluntarily, or are reimbursed for expenses incurred.
A body corporate can authorise a person at a meeting to perform various maintenance tasks. If the lot owner is performing a task voluntarily on behalf of the body corporate, many insurance policies will provide cover in case of injury for voluntary workers. Some body corporates may purchase insurance cover for the lot owner to perform regular services for the body corporate. This will cover the lot owner as if they are a contractor providing services to the body corporate.
Other body corporates may just reimburse the lot owner upon providing a receipt for expenses. There are no set rules in how a body corporate handles this matter, however, there is an important factor to consider. Is the body corporate covered in case of damage to the corporation property and injury to the lot owner providing the services?
This post appears in Strata News #652.
Tyson D’Sylva Ace Body Corporate Management E: tyson.d@acebodycorp.com.au P: 08 8342 1544