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[devinnie]

I am concerned that strata managers at Strata Community Australia have written Part / Clause 6 of the Strata Management Agency Agreement to abrogate their responsibilities towards Owners’ Corporations. Is this agreement even legally binding given that it is written by strata managers for strata managers, who are obviously minimising any culpability on their part?

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[chesswood]

Of course it is but the agreement is subject to relevant law. It’s apparently intended to minimise the agent’s liability but recognises that liability may still exist. Look at 6.5 which says the other clauses apply to the extent permitted by law. What happens in a particular case depends on the facts of that case. No two cases will be exactly the same.

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[Jimmy-T]

Despite their normally cordial relationships, it seems the Owners Corporation Network (OCN), the number one advocacy for strata owners in NSW and Victoria, has issues with Strata Community Australia over aspects of the standard agreement (which SCA is apparently revising, in any case.)

This is how OCN suggests you alter the standard agreement with respect to Section 6.

Agent liability
In the standard agreement, the agent is excluded from all liability for any claim, liability or loss arising
directly or indirectly out of the services or additional services or arising from any cause of action
whatsoever except to the extent that the claim, liability or loss is caused or contributed to by the agent’s
breach of this agreement, breach of statutory duty, negligence, dishonesty or fraud and requires the
owners corporation to indemnify the agent against and loss.
If you think this is unreasonable then revise existing 6.2 to read (noting strike outs)

6.2 The agent is excluded from all liability for any claim, liability or loss arising directly or indirectly
out of the services or additional services or arising from any cause of action whatsoever except to the
extent that the claim, liability or loss is caused or contributed to by the agent’s wilful breach of this
agreement, breach of statutory duty, gross negligence, dishonesty or fraud. The owners corporation
agrees that it will at all times indemnify the agent against all actions, suits, proceedings, costs, claims,
expenses or demands which may arise in the course of or as a result of the agent’s management of
the scheme, including all legal expenses incurred by the agent in defence of or initiation of any legal
proceedings as well as any excess payable under the agent’s professional indemnity insurance;
(a) by third parties against the agent;
(b) by the owners corporation against the agent arising before, during or after this agreement.

If you are considering this substantial adjustment to the strata management agreement, have a chat with OCN first about how this might play.  But bear in mind, if your Owners Corp isn’t happy with any contract, they don’t have to sign it.

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[kaindub]

Remember thst any contract is a mutual agreement between two parties.

in the extreme a court can annul a contract if one party Is disadvantaged .

I have heard of strata managers saying thst they can’t change the SCA contract so take it. Owners could then just refuse to sign such a contract and find a strata manager who is more amenable.

Despite their bad reputation, there are some very good strata managers who will align with the owners.

And there is more than the SCA contract out there. We recently resigned with our strata manager and they had their own management contract which was very fair.

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