An Examination of How Conflicts of Interest Detract from Developers Upholding Governance Responsibilities in the Transition Phase of Mult-Owned Developments: A Grounded Theory Approach

Abstract

The multi-owned development (MOD) is a unique property type consisting of at least two individually owned lots tied to communally owned common property with a separate registered entity (the body corporate) created to govern and manage the property. While the body corporate is the ultimate governing entity and the orchestra of operations for much of a MOD’s life, there is a period of time when a MOD’s developer makes governing decisions. It is during this phase, the transition phase, that the developer can bind the body corporate to a myriad of arrangements and relationships. Although state based Australian legislation provides a framework for body corporate governance, concerns have been raised over the extent of power and control exerted by developers when tasked with governing. There is a paucity of academic research concerned with the MOD transition phase. This study is therefore exploratory in nature, as it seeks to uncover the nature of governance decisions made by developers during the transition phase. This study is guided by the principles of the grounded theory method, which focuses on creating conceptual frameworks or theories through building inductive analysis from the data collected. Method triangulation was used in order to promote rigour in the research. A combination of semi-structured interviews, document (legislative) analysis and structured interviews was undertaken.