[200William-EC] Fwd: Legal Compliance

[Diana Dennison]

---------- Forwarded message ----------
From: Stratasphere by STM <news at stratatitle.com.au>
Date: 24 May 2013 15:30
Subject: Legal Compliance
To: didee at zip.com.au


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Edition 7 - 2013
      Legal Compliance

    *Part 7 of 12: Effective Governance for Executive Bodies of Strata
Communities*

The Australian Standard on Compliance (AS3806:2006) defines compliance to
mean; Adhering to the requirements of laws, industry and organisational
standards and codes, principles of good governance and accepted community
and ethical standards.

In the context of a strata community, this means more than meeting the
statutory requirements of the legislation governing your strata community –
although that is part of strata compliance. The broad spectrum of legal
obligations with which a strata community must comply includes these:

•The general common law and statutory obligations of honesty, good faith
and duties of care and diligence;
•Special laws and rules about your strata community – the governing
legislation including regulations and rules or by laws of your strata
community; and
•The wider body of statutory laws applicable to all bodies in Australia
whether for profit or not for profit such as a strata community.

It is the last category above that is often forgotten or not understood in
strata communities.

These laws include:

•Tax compliance;
•Occupational/workplace health and safety – all common property is a
workplace because employees or contractors of the strata community
inevitably must enter upon the common
property to do work;
•Anti-discrimination laws; and
•Privacy laws.

This is a misconception among committee members of strata communities that
they are absolutely immune for personal liability for bad decisions which
harm the interest of the strata community. This is wrong on two fronts.

Firstly, they are liable for bad decisions which harm the organisation
because they didn’t exercise care and diligence in reaching a decision.

Secondly, even if immune personally as a committee member because they did
take care and diligence but still got it wrong, the strata community itself
has unlimited liability and as member of that body, they will be exposed to
their share of the damages (spread among owners according to
entitlements set out in the subdivision plan).

In the face of these realities, strata communities need to adopt a
compliance culture that goes beyond the specific strata laws applicable to
them. This involves starting a conversation about compliance at a broader
level. Some good habits in this regard include leaving compliance as a
standing item on agendas. Make a simple checklist of the main obligations.
Make someone on the committee as the owner or leader on compliance issues.
Make an annual calendar of compliance obligations.

*Next week: Financial Planning** and Control*


       Kind regards,

*Roderick Smith*
General Manager             *Stratasphere - Creating strong committees and
harmonious communities***       Strata Title Management offers
Stratasphere to clients to assist in educating them on their roles and
responsibilities. The content within this publication is of a generic
nature and may not be applicable to all owners corporations. Strata Title
Management attempts to provide the most up-to-date and accurate information
for our clients, however we strongly recommend that individuals and
Committees seek further advice before acting on any information in this
publication. We do not send out unsolicited e-mail, nor do we purchase or
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