The common seal is a rubber stamp unique to each strata scheme, acting as the official signature of the Owners Corporation. While it may seem straightforward, misuse of the seal can expose members to personal liability, making it important to understand when and how it should be used.

What Is the Common Seal?

In strata schemes, the seal is used to execute binding documents and verify official agreements or contracts. It provides evidence of the agreed position of the Owners Corporation.

Legislation Governing the Seal

The use of the seal is outlined in Section 273 of the Strata Schemes Management Act 2015. The law specifies that:

• If there is only one or two owners in the scheme, the seal may only be affixed in their presence or in the presence of the strata managing agent.
• If there are more than two owners, the seal must be affixed in the presence of either:
  • Two lot owners or committee members authorised by the Owners Corporation, or
  • The secretary and another member of the strata committee.
• The strata managing agent may also affix the seal, but they must sign and attest the date and details of its use.

Importantly, misuse of the seal to fraudulently obtain a benefit is prohibited and subject to penalties.

When Should the Seal Be Used?

The common seal should only be used when a resolution has been passed by the Owners Corporation. Examples include:

• Approving contracts for services
• Making additional by-laws
• Appointing an Owners Corporation manager

However, the seal should not be used unnecessarily. For instance, placing the seal on a Development Application for Council can create confusion and is not required.

Best Practices for Owners Corporations

The seal should only be affixed when:

• All written information is clear and uncontested
• There is a resolution in place authorising its use

Many Owners Corporations entrust custody of the seal to their strata manager. In such cases, a formal resolution should be passed and minuted to grant this authority, ensuring compliance with legislation.

Conclusion

The common seal is a vital tool for validating Owners Corporation decisions, but its use must follow the legal requirements to avoid liability. If you have questions about when or how to use the common seal, contact your Strata Manager at Metro Strata.