What are the Differences Between Owners Corporation vs Strata Management?

Introduction

Managing a property in a strata scheme means understanding the distinct roles of the Owners Corporation, Strata Committee, and Strata Manager. Each of these groups plays a crucial part in the operation and upkeep of shared properties, with responsibilities that are closely connected yet clearly defined.

This article outlines the main differences between the Owners Corporation and the Strata Committee, helping property owners and residents gain a clearer understanding of how strata properties are managed and maintained.

Defining the Owners Corporation in a Strata Scheme

Who Makes Up the Owners Corporation

An Owners Corporation is a legal entity composed of all the lot owners within a strata scheme.

Specifically:

• You automatically become a member when purchasing a property in a strata development.
• Membership is mandatory and continues for the duration of your ownership.
• It ceases only upon selling your lot.

The term “Owners Corporation” is the current legal name in New South Wales, having replaced “body corporate” with the introduction of the Strata Schemes Management Act 1996 (NSW). This change reflects that the entity comprises the collective owners who share responsibility for the strata property.

Key Responsibilities of the Owners Corporation

The Owners Corporation is responsible for the overall management and administration of the strata scheme and makes major decisions to ensure the property is run effectively and in compliance with the law.

Its primary duties include:

• Managing Finances: Preparing budgets, issuing levy notices to owners for collection of funds, and overseeing the scheme’s financial accounts.
• Maintaining Common Property: Overseeing maintenance and repair of all common areas, infrastructure, and shared amenities such as gardens, lifts, pools, and hallways.
• Arranging Insurance: Organising and maintaining adequate insurance coverage for the common property and entire building.
• Keeping Records: Maintaining accurate records—including financial statements, meeting minutes, and the strata roll.
• Establishing and Enforcing By-Laws: Creating and enforcing rules that govern residents’ conduct and property use, a process that often requires expert legal advice on strata by-laws.
• Organising Meetings: Conducting regular meetings, including the Annual General Meeting (AGM), where key decisions are made and the strata committee is elected.
• Appointing Managers: Hiring professional strata or building managers to assist with day-to-day operations.
• Ensuring Legal Compliance: Ensuring the strata scheme adheres to all relevant laws concerning planning, building, safety, and workers.

Understanding the Strata Committee

How a Strata Committee is Formed & Who Can Join

To understand strata committees and how they work, it’s important to know they are elected by the owners corporation at each Annual General Meeting (AGM). The size of the committee is determined by the owners corporation and can range from one to nine members. For schemes with more than 100 lots, a minimum of three members is required.

When it comes to nominations, owners have several options. They can nominate:

• Themselves for a position on the committee.
• Another owner within the scheme.
• A non-owner for a position, provided certain eligibility criteria are met.

However, there are specific restrictions on who can be nominated unless they also own a lot within the strata scheme. These restrictions apply to:

• The building manager for the strata scheme.
• An agent responsible for leasing any property within the scheme.
• Anyone connected to the original developer or building manager, unless this connection is disclosed in writing before the election.
• Lot owners who have not paid all levies owed to the owners corporation at the time of the AGM.

The Role & Responsibilities of a Strata Committee

The strata committee is responsible for the day-to-day management of the strata scheme, acting on behalf of the owners corporation. While the owners corporation retains ultimate authority and can overrule committee decisions, it delegates many of its powers to the committee to allow for more efficient governance between general meetings. The committee often serves as the first point of contact for owners with strata-related matters.

The specific duties of a strata committee are extensive and typically involve making decisions on a variety of operational issues. Common responsibilities include:

• Financial Management: Approving routine spending for the daily operations of the scheme, such as paying invoices for repairs and maintenance.
• Property Maintenance: Overseeing the upkeep and repair of common property areas like gardens, driveways, lifts, and foyers.
• By-Law Enforcement: Issuing notices to residents who breach by-laws and addressing issues like noise complaints or parking violations.
• Approving Owner Requests: Reviewing and making decisions on applications from owners, such as requests regarding pets in NSW strata buildings or to undertake renovations.
• Meeting Administration: Adding agenda items for general meetings, preparing reports, and coordinating with the strata manager.

Members of a strata committee have legal duties they must uphold. They are required to act with honesty and fairness, exercise due care and diligence, and always act in the best interests of all owners in the strata scheme.

Owners Corporation vs Strata Committee: Key Differences for Your Strata

Membership & Participation

The fundamental difference between the two bodies lies in their composition and how members participate.

Membership in the Owners Corporation is automatic and mandatory for every person who owns a lot within the strata scheme. This membership begins upon purchasing a property and ceases upon its sale.

In contrast, participation in the Strata Committee is entirely voluntary. Members are not automatically appointed but are instead elected by the Owners Corporation at the Annual General Meeting (AGM).

This creates a key distinction in their nature:

• The Owners Corporation is comprised of all lot owners, with compulsory participation.
• The Strata Committee is a smaller, elected group of volunteers who choose to take on additional responsibilities.

Decision-Making Authority & Scope

The Owners Corporation holds the ultimate authority and is responsible for the most significant decisions affecting the entire strata scheme. Its scope includes:

• Managing finances
• Arranging insurance
• Maintaining common property
• Ensuring legal compliance

The Strata Committee, on the other hand, operates with delegated authority to handle the day-to-day management of the strata property. The Owners Corporation determines the extent of the committee’s powers and can overrule its decisions.

Typically, the committee’s responsibilities involve:

• Overseeing routine operational matters
• Reviewing owner requests for renovations
• Addressing by-law breaches

Eligibility Requirements & Member Removal

Eligibility for the Owners Corporation is directly tied to property ownership, meaning there are no other restrictions on joining.

Membership is automatically terminated when an owner sells their lot, making the process of leaving equally straightforward.

By contrast, the Strata Committee enforces specific eligibility criteria, excluding certain individuals:

• Building managers
• Leasing agents for properties within the scheme
• Owners who owe levies at the time of the AGM

The process for removing a committee member is also distinct and can be achieved through:

• An ordinary resolution passed by a majority vote at a general meeting
• An order from the NSW Civil and Administrative Tribunal (NCAT) for misconduct or failure to comply with strata laws

The Role of a Professional Strata Manager

What a Strata Manager Does

A professional strata manager, also known as a strata managing agent, is appointed by the owners corporation to assist with the administration and management of the strata scheme. While hiring one isn’t legally required, most schemes engage a manager because committee members are volunteers and need professional expertise to coordinate the affairs of lot owners.

The owners corporation decides which tasks to delegate, typically covering both administrative and financial duties. These responsibilities often include:

• Coordinating Meetings: Organising and conducting strata committee and general meetings, including preparing and distributing agendas and minutes.
• Managing Finances: Collecting and banking levies, preparing budgets, paying invoices, and maintaining the scheme’s financial records—with a critical focus on strata levy recovery.
• Arranging Insurance: Obtaining and renewing the necessary insurance policies for the strata property on behalf of the owners corporation.
• Advising on Asset Management: Providing guidance on the proper management and maintenance of the scheme’s assets.
• Record Keeping: Maintaining the strata roll and other official records as required, especially maintaining the strata roll.

Distinguishing Between a Strata Manager & a Building Manager

It is common to confuse the roles of a strata manager and a building manager, since both ensure the property runs effectively. However, their duties are distinct aspects of management.

A strata manager is primarily responsible for the administrative and financial duties of the scheme. They are the main point of contact for owners and have authority to enforce by-laws and manage the owners corporation’s funds.

Their work also focuses on ensuring the scheme meets all its legal and financial obligations.

In contrast, a building manager handles the day-to-day, hands-on maintenance of common property. Their responsibilities are physical and operational, including:

• Overseeing the upkeep of common areas like lawns and gardens.
• Performing minor repairs or organising tradespeople for larger jobs.
• Managing general safety and access to the property for contractors.

Key Legal Updates & Accountability in NSW Strata

Extended Time to Claim for Strata Repair Failures

Numerous legislative changes in the past years have strengthened the rights of property owners within a strata scheme.
The Strata Schemes Legislation Amendment Act 2025 (NSW) has extended the time limit for owners to seek damages if an Owners Corporation fails to repair and maintain common property.

Owners now have six years to bring a claim, starting from when they first become aware of the loss.

The Duty to Repair is Not a Duty to Upgrade

A key legal precedent clarifies the extent of an Owners Corporation’s maintenance duties.

In Evans v The Owners – Strata Plan No. 40841 [2025] NSWCATAP 113, the NCAT Appeal Panel affirmed that the duty is to keep common property in a functional state of repair. This means the corporation is not obligated to upgrade functional equipment—such as an old but working exhaust fan—simply because an owner prefers a newer model.

Consequences of Unauthorised Works & Owner Conduct

Court rulings have provided important clarifications regarding owner responsibilities and their impact on damage claims.

Notable decisions include:

• In Colman v The Owners – Strata Plan 61131 [2025] NSWSC 63, owners who perform work on common property without approval cannot later claim reimbursement, a key lesson when considering retrospective approval for unauthorised strata works
• In The Owners Strata Plan 2661 v Simone Selkirk [2024] NSWSC 760, the court held that unreasonable behaviour, such as denying access and delaying repairs, can reduce or eliminate an owner’s claim for resulting losses.

Conclusion

Understanding the distinct roles of the Owners Corporation and the Strata Committee is fundamental for effective strata scheme management. While the Owners Corporation includes all lot owners and holds ultimate responsibility for the scheme’s overall governance, the Strata Committee handles the day-to-day operational decisions and management tasks.

Navigating the responsibilities and legal requirements within a strata scheme can be complex. If you require clarification on these roles or need assistance with any strata-related legal matters, contact PBL Law Group’s strata lawyers for owners corporations for tailored advice and support from specialist strata lawyers.

Frequently Asked Questions (FAQ)