Rules for Strata Council Membership
Following the publication earlier this year of a disciplinary order against a BC licensee for sitting on a strata council without having made the required disclosures, we’ve heard from licensees with questions about the requirement. This month’s You Asked Us column looks at why disclosure is required and how to ensure you’re complying with the rules for strata council membership.
Q: I’d like to put my name forward to be elected to sit on the strata council in the building where I own a unit. Do I need to disclose that I am a licensed real estate professional?
Yes, as a licensed real estate professional you have disclosure requirements in this situation.
Whether you are licensed for trading services, rental property management or strata management services, you will need to make a disclosure to the strata corporation before you begin sitting on the strata council, and you will need to provide a copy of the disclosure to your managing broker. RECBC has developed a form that you can use to make this disclosure, called the Disclosure of Management of Strata Corporation by Licensee Who Is an Owner. The form is available for download from the RECBC website and on WEBForms.
When you have made the disclosure, you may provide volunteer strata management services to the strata corporation (as a strata council member or otherwise), under the following conditions:
- You may provide strata management services to a maximum of two strata corporations in which you own a strata lot.
- You must not have sole signing authority for withdrawals of any funds of the strata corporation and may not otherwise have sole authority for expenditures of any funds of the strata corporation.
- You must not receive and not expect to receive any remuneration for the strata management services provided to the strata corporation.
- On receipt of any strata fees, contributions, levies or other amounts levied by or due to the strata corporation under the Strata Property Act, you must promptly deliver the money to the strata corporation.
Why disclosure is required
The Real Estate Services Act considers sitting on a strata council to be a strata management service. As a real estate professional, you can only provide real estate services through your brokerage, and you can only provide the real estate services for which you are licensed. (See section 2 of RESA, and the definition of Strata Management Services).
To allow real estate professionals to sit on strata councils or provide other volunteer services to strata corporations where they are owners, RECBC created a rule that provides an exemption from the Real Estate Services Act. Section 9-3 of the Rules permits a licensee who is a strata lot owner and therefore is a member of a strata corporation, who wishes to become a strata council member, or to otherwise provide strata management services to that strata corporation in a volunteer capacity, to do so without the Real Estate Services Act applying to them in relation to these services.
Re-election and disclosure
After your term on the strata council, if you wish to be re-elected, you should make a new disclosure and provide the copy of that disclosure to your managing broker. And of course, continue to observe all the requirements of section 9-3 of the Rules. If in doubt – disclose!
Consequences of failing to disclose
RECBC may take disciplinary action against a licensee who fails to promptly deliver strata corporation funds to the strata corporation, or who fails to make the required disclosures.