
We are seeing an increasing number of bodies corporate which are considering amalgamating with an adjacent body corporate which was part of the same development.
The setting up
The interest in amalgamations is derived from a wish to reduce:
In order to amalgamate the bodies corporate need to agree on a range of things, including:
The management rights agreements for each scheme (if any) continue as they were after any amalgamation. Usually we suggest that the consolidation of any management rights agreements occur after the amalgamation has taken place and after consideration by the new consolidated committee.
The bodies corporate each need to pass a resolution without dissent. Unfortunately, a layered scheme, which involves a principal body corporate cannot ever be entirely amalgamated. Only subsidiary bodies corporate can be amalgamated.
Sometimes one or two owners will have their own agendas and will vote against the amalgamation. In order to proceed with the amalgamation an application needs to be made to the District Court and it will permit the amalgamation to occur if the dissent was unreasonable.