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Topic
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I’m new to the forum but read the column religiously.
At our last AGM, our EC chairman wanted some $60k of repair works approved which the very small quorum of owners (9/36) attending thought hadn’t been properly assessed so a motion was passed to restrict the EC’s spending to $15k max on one item while further assessments were made by the EC.
Yesterday, our Strata Manager inadvertently sent an email to ALL owners advising that the works were proceeding – but for only half of the affected units at a cost of $30k+. The contract for the work was signed on behalf of the OC by the Strata Manager.
I contacted the EC Chairman and advised that I believed the EC had acted illegally in approving the contract due to the spend restriction imposed. I also asked how the units had been assessed for the work – no reply. I also believe that the Strata Manager has acted inappropriately by signing the contract – should he not know there was a spend restriction?
The AGMs are usually held late afternoon in the carpark of the unit block. The EC Chairman has conveniently called an EGM for 10am on a Friday in the Strata Managers offices 15kms away.
My concern is that the building has insufficient funds to comfortably complete all works this year and should the owners of the units not included in this contract demand their unit work be included, a special levy will have to be struck which most of the owners could not afford given their socio economic position. Personally, I was for a special levy but am fortunate to be able to afford that.
Any advice on how I should proceed would be welcome.
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Replies
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Sherlock – I’ve had a couple of attempts to respond to your post today, but in addition to being side-tracked, I really can’t think of any innovative approach that you and like-minded owners could take to resolve the matter, other than to make sure that you all attend the extraordinary general meeting (EGM); ideally in person but at least by proxy to somebody who is attending with instructions about how you want your vote/s to be cast.
There’s no doubt that your executive committee (E/C) is in breach of the owner’s corporation’s (O/C) resolution regarding the limitation on spending for the matter now in question, that where a decision of an E/C is in conflict with one resolved by an O/C that the decision of the latter takes precedence [Ref:NSW Strata Schemes Management Act Sect 21(4)];, and that your strata manager should have known better than raise a work order for the repair works even if they were instructed to do so by the E/C.
It sounds to me like your E/C Chairman is one of those individuals who considers that he has an unalienable right to do as he chooses, so the best approach in my opinion would be to play the procedural card.
By that I mean to make it clear that the E/C should have met to make the decision about breaching the O/C’s resolution and that you’d like to see the minutes of that meeting that under the provisions of the Strata Schemes Management Act (SSMA) must be provided to all owners within 7 days of its conclusion.
Is there an agenda for the EGM, has it been distributed to every owner at least 7 days prior to the meeting, and is there a motion there setting out what is to be resolved (that I assume will be to retrospectively vary the O/C’s limitation on spending)?
Did the strata manager receive formal instructions to raise the work order, and if so from who?
A non compliance with any of the above would provide grounds to adjourn the EGM, but the best rationale would be on the basis that any motion to override a resolution of the O/C would, if carried, conflict with the SSMA and would be therefore unenforceable and may be ruled out-of-order.