10 Mar Company schemes
In Victoria the most common form of communal title is an owners corporation, formerly called a body corporate.
Other forms of community titles include:
- Company share scheme
- Stratum estate
A company schemes are governed by the Corporation Act 2001 and not the Owners Corporation Act 2006.
A company of either type has a constitution which was previously known as the Memorandum and Articles of Association.
Company Share Scheme
- The building has not been subdivided
- There is no certificate of land title to a particular lot
- The land together with building improvements is owned by a company
- The shares in the company are issued in groups and the ownership of a group entitles the holder to exclusive occupancy of a particular flat
- The rights and obligations of the member and the company are usually be set out in the company constitution
- The building has been subdivided and a plan of subdivision (called a lodged plan) setting out lot boundaries is lodged with the Registrar of Titles
- A certificate of title issues for each lot
- Each owner of a lot holds a group of shares in the service company with the share undertaken in conjunction with the sale of a lot
- The rights and obligations of the company and member are set out in the service agreement which a member is required to enter into
A share certificate is a valuable document and should be stored in a safe place. If there is a loan secured by the share certificate, some lenders will take possession of the share certificate. A shareholder should always be aware of who has possession of a share certificate.
In most cases it is necessary to surrender the existing share certificate settlement of the sale transaction.
If a share certificate has been lost or destroyed application to me made to the company for a replacement. This requires the completion of a statutory declaration setting the circumstances of the loss or destruction and may require advertising of the intention to seek a replacement. This will usually take at least 28 days and may take more.
Conversion to Owners Corporation
- Company schemes may be converted to a plan of subdivision with an owners corporation to replace the existing scheme.
- Advice can be obtained from a legal practitioner experienced in this area.