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Ways to avoid a seller losing a sale or a buyer acquiring an unforeseen liability when transferring a lot in a community title scheme (strata units)  



For a contract of sale to be binding on a buyer, the seller must provide a current BCCM Section 206 Disclosure Statement to the buyer prior to the buyer signing the contract.

Such statement is generally automatically included as part of the contract and includes information about body corporate contact details, body corporate assets and current body corporate levies. Such information can be obtained directly from the body corporate manager or via your legal representative.

If such disclosure is not made, or the disclosure statement is not substantially complete, the buyer may terminate the contract at any time before settlement. This may be an attractive option for a buyer in a declining property market.

Compliance with by-laws

It is always most important that other residents of the scheme are not interfered with unnecessarily in the course of sale of a unit.

The bylaws may contain provisions which dictate when, where and how a seller may erect a ‘for sale’ sign and whether and how open homes can be conducted.  Body corporate permission may be required for such activities and a wise seller will consider the by-laws and advise their real estate agent of any issues prior to putting the property on the market.

Body corporate

The seller is not required to notify the body corporate they are selling, and the body corporate is not permitted to stop the sale of a strata unit.

If the seller receives an invoice for levies from the body corporate after settlement, such invoice is the responsibility of the buyer and it is a good idea for the seller to contact the body corporate to ensure it has been notified of the sale (see below).


Body Corporate Records Inspection Report

When the buyer signs a contract to purchase a strata unit it becomes entitled to inspect the private records of the body corporate. Such records include information on the Scheme’s finances, minutes of meetings (which may identify potential issues and conflicts and upcoming expenses) and an array of other documents relating to the scheme.

We strongly recommend buyers of strata units commission a Body Corporate Records Inspection Report to ensure they are well informed on the status of the scheme prior to settlement.

Buyers should ensure that if significant issues identified in such report, the contract is worded to enable them to seek compensation or terminate the contract due to such issues.

Review of the Community Management Statement (‘CMS’)

The bylaws for a scheme are the rules governing the conduct of inhabitants of that scheme.

It makes sense to review the by-laws prior to purchasing a strata unit to ensure such by-laws will not inhibit your lifestyle and you are aware of your rights and obligations. Issues such as pet ownership and noise are regular concerns for people in strata schemes.

The bylaws for a scheme are included in the CMS and a search for this document can be performed by your lawyer.

Body Corporate Information Certificate

When buying a strata unit, the buyer takes over the balance of the lot owners account, so if levies are owed to the body corporate by the lot owner, the new owner is responsible for such debts.

As part of the conveyancing process, your lawyer will order a Body Corporate Information certificate (Form 13) which outlines any money owed by the Seller. Such amounts should be adjusted for at settlement of the purchase of property.

Form 8

After settlement, your lawyer will provide a Form 8 to the Body Corporate to update the body corporate roll with the new lot owner's details.

This ensures the body corporate can provide the lot owner with notice of upcoming meetings and invoices for levies.

Once such form is provided to the body corporate, the buyer generally receives a welcome letter fairly quickly. If a welcome letter is not received, the buyer would be prudent to confirm with the body corporate manager that a Form 8 has been received.


The parties to a transfer of a strata unit have numerous responsibilities and there are various pitfalls for the inexperienced. Timely and accurate legal advice is paramount to ensure the risks of a seller losing a sale or a buyer purchasing a liability are minimised.

If you or someone you know wants more information or needs help or advice, please contact us on (07) 5443 4866 or email


If you need help, or have a question get in touch with us today.