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Understanding How and Why a Body Corporate is Formed

April 14, 2025

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When a property is developed and subdivided into lots and common property, such as an apartment block, townhouse, or commercial unit complex, a body corporate is automatically created.

This is not just a legal structure, it’s a vital framework that allows a shared living environment to manage common property, finances, and community rules.

This article touches on why and how a body corporate is formed, and why it matters to property owners and residents.

What is a body corporate?

A body corporate is a legal entity made up of all the lot owners in a community titles scheme. It’s responsible for managing and maintaining the common property and ensuring that the scheme runs smoothly. In essence, it’s the collective group of owners who make decisions about shared spaces, building maintenance, and community rules.

Read more here on what is a body corporate.

How is a body corporate formed?

A body corporate is established automatically when a developer registers a community titles scheme with Titles Queensland. This occurs within the constraints of the Body Corporate and Community Management Act 1997, and includes:

A Community Management Statement (CMS): This document sets out the rules of the scheme (by-laws), lot entitlements, and other details that govern how the body corporate operates.
A Survey Plan: This plan defines the boundaries of the lots and common property.
The First AGM: Once the first lot is sold, a first annual general meeting is held, where the first body corporate committee may be elected.

The body corporate exists from the moment the plan is registered and continues to operate for as long as the scheme exists.

Why is a body corporate formed?

The primary reason for forming a body corporate is to manage the responsibilities that come with shared ownership. In developments with multiple owners, there are common areas like lobbies, gardens, pools, gyms, fencing and driveways, that no single owner is solely responsible for. A body corporate ensures:

Fair management of shared spaces: Regular maintenance, cleaning, and repairs are organised and funded collectively.
Financial management: The body corporate sets budgets, levies owners for costs, and maintains sinking and administrative funds.
Decision-making and governance: Owners vote on key issues, from renovations and maintenance projects to changing by-laws or appointing service providers.
Legal compliance: The body corporate must follow legislative requirements, keep records, lodge tax returns, and ensure insurance obligations are met.

The role of lot owners

All lot owners are members of the body corporate. This is not optional. They have voting rights and can participate in the body corporate’s decision-making through voting. This right is protected and governed by body corporate legislation, designed to ensure all property owners have an equal opportunity to influence how their community is managed and maintained.

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Committee advice

The Code of Conduct for a Body Corporate Committee

To ensure these standards are met, committee positions are governed by a legally binding set of rules, which define the expected behaviour and responsibilities of members. These rules are outlined in the Body Corporate and Community Management Act 1997 (BCCM Act), and all voting committee members must adhere to them.

21 Apr 25

Basics