Published: 17 March 2007.

TOPPING UP? - DON’T FORGET THE BCCM FORM 20

Since December of 2003 rolling renewals have been possible under sections 79(2) and 80(2) of the Body Corporate Community Management (Accommodation) Regulation 1997 . Rolling renewals provide a popular way of topping up agreements, for example to comply with financier requirements at the time of purchase.

Under the Accommodation Module inserting a “right or option of extension or renewal� is a specific form of amendment which must comply with section 85 of the Module. Particularly the amendment requires an ordinary resolution of the body corporate, conducted by secret ballot and without the exercise of proxies. Most importantly however under section 85(2)(c)(ii) a notice in the prescribed form must be sent out to the members of the body corporate with the general meeting material.

The prescribed from is the BCCM Form 20, version 2 which was issued on 26 April 2004. To be properly completed the form requires the insertion of the following information:

1. For service contractors and letting agents:
(1) name;
(2) expiry date of the service contract or letting authorisation;
(3) the length of the proposed right or option of extension or renewal; and
(4) details of any areas of common property, the use of which is granted to the service contractor or letting agent by way of occupation authority;
2. For service contractors:
(1) the current annual remuneration;
(2) confirmation of whether:
(a) the service contractor carries out general caretaking and cleaning duties;
(b) the service contractor supervises employees or contractors; and
(c) the body corporate, the service contractor or both pay for:
(i) the equipment required to carry out the general caretaking and cleaning duties; and
(ii) the materials required to carry out the general caretaking and cleaning duties.
3. For letting agents:
(1) Any restrictions on the type of letting.

What are the consequences if the form is not properly completed or sent out with the general meeting material? The answers to these questions have been made quite clear in the adjudicators decisions of Somerset Park [2005] QBCCMCmr 490 (31 August 2005), The Goodwin [2005] QBCCMCmr 1 (5 January 2005) and Regency Place Nerang [2005] QBCCMCmr 36 (25 January 2005).

In all three disputes the BCCM Form 20 had not been sent out with the general meeting material. Each of the adjudicators firstly noted this fact and then went on to determine whether pursuant section 49 of the Acts Interpretation Act 1954, there had been “substantial compliance� with the relevant statutory provision, ie. Section 85(2)(c)(ii) of the Accommodation Module. In each decision it was noted that the explanatory note accompanying the motions to effect the amendment to insert the right or option of extension or renewal did not answer all, or even the majority, of the questions posed within the BCCM Form 20. On this basis, it could not be argued that there had been substantial compliance with the requirement to issue the BCCM Form 20; ie. by way of providing the same information in the explanatory note. There not having been substantial compliance, or the sending out of the BCCM Form 20 itself, in each of the three decisions the adjudicators determined that the motion approving the amendment was invalid.

The lesson to be drawn from these decisions and the clear words of the regulation module is that when topping up an engagement or authorisation don’t forget the BCCM Form 20!

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