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Topic
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On the topic of special levies – can the executive committee decide to raise a special levy for maintenance or improvement work on a building or does the proposal of a special levy have to be taken to a general meeting. In either case i.e. decision by the executive committee or decision by a general meeting, can the decision to raise a special levy be passed by a vote of 75% or more in favour.
If the decision to raise a special levy is passed by either method above, can unit holders refuse to be bound by the decision – especially in an understandable case of hardship. What action could then be taken against the unit holder who refuses to pay the special levy?
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Replies
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Only a general meeting can agree on levies, special or otherwise although an EC can take a recommendation to the meeting (as they should).
The decision to have a special levy requires only a simple majority vote at a general meeting, although that can include proxies and, if necessary, a poll vote based on unit entitlements.
Unit owners can't refuse to be bound by any legitimate agreements reached at properly constituted general meetings. There is a basic principle in strata that your responsibilities to the Owners Corporation of which you are part are “without limit”.
You can apply to the CTTT to be excused from paying a levy but unless there is some highly unusual circumstances (and hardship isn't one of them) you are unlikely to be successful. Also, if you default on your levies you lose your voting rights at a general meeting.
If you refuse to pay levies, special or otherwise, you can be pursued for the debt and may find you are then also responsible for the cost of the debt collection. However, a reasonable EC will take your circumstances into account and
allow you a little leeway before they unleash the debt collectors on
you.
Your best options are to oppose the special levy through raising support at a general meeting or, failing that, get your bank to extend your mortgage (which many lenders will do if they see the special levy being used to improve or protect the value of the property). Trying to fight this in the face of a majority of owners in favour will be a waste of time, emotional energy and money.
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Special Levies are split according to unit entitlements, just as normal levies are. We have had a couple of these in the past few years in our block.