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Someone correct me if I am wrong, but as I understand it, owners of lots cannot be restricted in their short term (AB&B) rentals by the OC.
In NSW, Section 137A of the Act allows owners corps to pass by-laws forbidding apartments from being let as short-term rentals when they are not the principal place of residence of the owner. Whether or not that allows the owners corporation to impose conditions on the lets that they do allow is another matter that will doubtless be thrashed out at the Tribunal at some future date.
In this case, bear in mind that we have only now learned that this is a block entirely given over to short-term lets.
… there is nothing compelling a Strata Committee (SC) from enforcing any by law.
Not so. The owners corporation has a duty to enforce its by-laws. This was confirmed to me by the former Fair Trading Minister Victor Dominello who quoted his Second Reading of the current Act, in which he said “Members of the strata committee will now have a statutory duty to act for the benefit of all owners and to exercise due care and diligence in their role.” He said that implied a duty of care to enforce their by-laws.
If the owners corp didn’t have a duty to enforce by-laws, why does section 232(2) (below) even exist?
Section 232 (2) Failure to exercise a function
For the purposes of this section, an owners corporation, strata committee or building management committee is taken not to have exercised a function if—
(a) it decides not to exercise the function, or
(b) application is made to it to exercise the function and it fails for 2 months after the making of the application to exercise the function in accordance with the application or to inform the applicant that it has decided not to exercise the function in accordance with the application.
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Ummm – very cynical.. OK so I should have mentioned that our block is actually holiday rentals only so owner occupiers can all get back in their cages and settle down…
OK, so you should have.
You can’t really criticise people for misinterpreting the issue and tell them to “settle down” when you leave out one of the most significant facts (not to mention all the other details you have now provided).
This is a very specific set of circumstances. However, the proposed by-law is, as you say, a “joke” … if you are in NSW.
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They know that it is illegal for the building manager to wheel lock a vehicle so this is their answer to the problem?
Actually, it’s illegal to wheel clamp a vehicle without the owner’s permission. This would have the owner’s permission
What guest in their right mind would agree to this and how can owners possibly comply with this by-law?
Okay, but short-term rental parasites (sorry, hosts) can set conditions on their rentals. And owners corps can set by-laws with reasonable conditions on allowing short-term rentals. And there are no strata-kops who will come running round to tell you your by-laws are not valid – someone has to take the scheme to the Tribunal to challenge by-laws that they think are unreasonable.
In the meantime, the short-term rental guests feel very unwelcome, find their keys have been cancelled and there is no access to the pool or gym as advertised in the online listing. Off the host goes to NCAT and quite possibly wins.
But wait, now there’s a new by-law that says your guests have to provide pictures of themselves drunk, so the security guys will recognise them when they rock up at 2am off their faces.
The point is, this sounds like a smart way of keeping short-term rentals out of a building without scaring the horses with a full-blooded ban.
My favourite “go away” tactic (as suggested by other Flatchatters) is to not allow access to the gym or pool to anyone who hasn’t done a facilities safety induction course, which occurs on Thursdays every second week and costs $80 a pop (free to permanent residents, including long-term tenants).
Disrupt the disruptors!
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There is a whole raft of orders you can seek at the tribunal under the NSW strata Act and most of them require mediation. That is where you can simply demand that the committee explains its thinking to all owners. Failing that, you can ask the Tribunal under a section 232 to overurn the decision of the committee.
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Before lodging an application for levy maintenance adjustments with NCAT, is it best to go thru the following:- the Owners Committee (they would be in agreement)
Tha’t your first step. You might want to take a cost estimate from a lawyer so everyone knows what they’r getting into.
- strata management (not sure of how they manage the process)
Your strata managers should be able to advice you on how to proceed
- Call for a general meeting to discuss
Yes, there will be objections – you can’t expect turkeys to vote for Christmas – but at the very least haing tried to get broad-based support can only help (even if noone else comes on board).
- Or just lodge an independent application for adjustments ruling?
Jumping straight to that step would make it more like a “them and us” dispute, rather than an effort to share costs equitably.
I assume there will be unit owners who would contest this as it is going to cost them more in levy’s, does it then become a tribunal hearing or is the ruling made just on evidence submitted showing the imbalance of contributions?There will probably be a hearing and I’m sure opponents to the move will be allowed to put their case. But don’t forget that this can be pursued by individual owners, so having the support of the committee and maybe even the majority of owners who attend your general meeting can only help.If you want to be alerted when anyone replies to your posts or responds to this topic, please register and login, then you will be able to subscribe to the topic. The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers. NB: Longer threads may spill over to additional pages - look for the numbers on the bottom right, under the last post.
The main barrier to splitting the costs is that strata law is absolutely rigid on the principle that charges to owners should be levied on the basis of unit entitlements. The trade-off is that those who pay most get more votes.
You could possibly (and I’m not sure about this) separate the water bills so that only high-rise owners pay for high-rise water. You’d do this by asking the Tribunal for orders under section 87 of the Act (below) to allow for payment in a different manner.
This would not fix the problem of additional wear and tear in the high-rise section of the scheme but then it would shift the voting balance either.
Otherwise, I would be seriously tempted to calculate the inequity in costs versus payments and then seek adjustment of the unit entitlements on that basis. The fact that townhouse owners are more active and united in their views may offset the shift in power balance towards the tower owners.
A cleaner break would be to apply to the Supreme Court to establish two strata schemes, plus a community scheme for shared resources, but that could be so expensive that you’d soon swallow up any financial benefits.
Either way, you need a reliable strata lawyer and I wholeheartedly recommend our sponsors Sachs Gerace.
87 Orders varying contributions or payment methods
(1) The Tribunal may, on application, make either or both of the following orders if the Tribunal considers that any amount levied or proposed to be levied by way of contributions is inadequate or excessive or that the manner of payment of contributions is unreasonable.
(a) an order for payment of contributions of a different amount,
(b) an order for payment of contributions in a different manner.
(2) An application for an order may be made by the lessor of a leasehold strata scheme, an owners corporation, an owner or a mortgagee in possession.
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I’m afraid I don’t think it’s as simple as that. Even if you were trying to do this under the laws that allow 75 per cent of owners to vote to renew the building, you would also need the approval of 75 per cent of all owners individually, as in one owner, one vote.
In any case, I suspect you need to refer to the Strata Schemes Development Act and, specifically, Section 9, Part 3, which refers to going to the Supreme Court to seek orders to change or dissolve the strata scheme.
Now, if you are going down that road you will need competent and experienced lawyers, and I am neither of those things.
But let’s look at the problem, rather than possible solutions. In your scheme, you feel the townhouse owners are paying too much and the apartment owners too little. You can change this more easily by having an overwhelming vote by owners in both parts of the scheme to ask the Tribunal (NCAT) to approve a redistribution of unit entitlements.
The maths are obvious – their block costs more to run yet you contribute more to the kitty. Something seriously wrong there.
Now, your apartment dwelling neighbours aren’t going to like this but, once you explain that if they refuse, the alternative is that you will go to the Supreme Court and ask it to split the strata, they may see the sense in playing along. Their refusal to play ball would be good evidence that you have tried to do the right thing and been baulked.
One word of caution, if you do get a redistribution of unit entitlements, you also get a dimished vote at general meetings. On the other hand, if you try to split the strata, that will cost money in legal and surveyor fees.
In short, be careful what you wish for.
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I guess the answer is, if the committee or chair or whoever believes the owners might want to contribute, the legal way to do so is to invite them to add to a special fund individually. Nothing wrong with using the offices of the owners corporation to contact owners for these purposes. At least that way people would have the choice not to support a movement with which they disagreed.
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Just a thought. Working on the basis that any payment that isn’t of direct benefit to the owners corp, albeit made in misguided good faith, what do you do? Ask the committee to ask for the money back or just ask those who voted in favour of the contribution to refund the money? Or just tell them to let it go and don’t do it again?
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Thanks! But what does ‘universal agreement’ mean, please? Is there any such thing in NSW? Would it mean a Special Resolution not more than 25% against? Or an Ordinary Resolution?
I’m pretty sure Chesswood meant a motion that requires a unanimous vote
Schedule 1(13.8) of the NSW Act says:
Voting rights cannot be exercised if contributions not paid
A vote at a general meeting (other than a vote on a motion requiring a unanimous resolution) by an owner of a lot or a person with a priority vote in respect of the lot does not count if the owner of the lot was an unfinancial owner at the date notice of the meeting was given and did not pay the amounts owing before the meeting.
Section 5 of the Act says “a resolution of an owners corporation is a unanimous resolution if it is passed at a properly convened general meeting and no vote is cast against the resolution.”
That definintion is important becasue it doesn’t require every owner to vote in favour. Some could abstain, so in that regard Chesswood isn’t 100 per cent correct in using the term “universal agreement”.
But that’s splitting hairs. There are very few circumstances remaining that would require a unanimous vote although the return of excess strata funds to owners would be one of them.
Unfinancial owners can’t vote on either ordinary or special resolutions.
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I wonder if it’s just a case of exposing the process and the disinformation to all the other owners.
How about, every time he does it, sending out emails that, without calling the person concerned a liar, just states the facts, supposedly in the interest of keeping everyone informed.
Something like “Mr Gaslight, the resident of unit 666, has alleged that such and such occurred. In fact, this is what actually happened. Mr Gaslight has been informed of his error.”
Then just keep doing it and doing it until his credibility in the block is totally eroded. You will have to be persistent, and at least be able to corroborate the things that he says, but if he complains, you can say that you are allowing owners to hear his opinions and judge for themselves.
There are few things worse that a neighbour with an irrational grievance and time on their hands.
And if you don’t want to take it head on, maybe you could take your lead from Joe Biden who won’t even utter his predecessor’s name while Trump fulminates from his golf course to a gradually diminishing audience.
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Also, you can’t stand for election under section 32:
32 Persons who are not eligible to be appointed or elected to strata committee:(2) An owner of a lot in a strata scheme who was an unfinancial owner at the date notice was given of the meeting at which the election of a strata committee is to be held and who did not pay the amounts owing by the owner before the meeting is not eligible for appointment or election to the strata committee.
However, unfinancial owners can nominate someone else to be elected to the committee under Schedule 1 (5.6) :
5 Nomination of candidates for election prior to meeting(6) An owner or a person may make a nomination even if the owner or person cannot vote because the owner is an unfinancial owner.
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The way this is dealt with is strata law is complicated but the principles of transparency are quite straight forward.
Section 57 of the Act says strata managers may not receive gifts or commissions for services provided unless that is in their contract or approved by the owners corporation (in most cases, the strata committee).
Section 60 of the Act says Strata Managers must declare any commissions they receive at the schemes’s AGM and imediately inform the strata committee of any commissions that differ from what was declared at the last AGM, as well as any changes that are likely to occur – i.e. offers that have been made to them that they are likely to accept.
Failure to do so can lead to fines of up to $2200 and the Tribunal can order the SM to pay the commission received to the owners corp. Receipt of commissions for organising compulsory strata insurances are commonplace but frequently resented by the owners corps.
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Note this was lifted chapter and verse from Fair Trading’s website, see https://www.fairtrading.nsw.gov.au/housing-and-property/strata-and-community-living/strata-schemes/by-laws-in-your-strata-scheme in their reference to “nuisance”.
I stand corrected, withdraw and apologise. That’s the first time I’ve ever seen that definition of nuisance meaning anything other than something that can cause actual harm. Having said that, Fair Trading’s web pages are notoriously unreliable and we’ve had occasion in the past to tell people just to ignore specific advice until the corrected it. The Act certainly doesn’t refer to noise as a nuisance (but it does refer to smoke).
There is another issue here: at what point does an owners corp start invoking chapter and verse of the law? Sometimes it’s more effective just to say stop doing that bad thing, although on othr occasions you might need to remind people that there are laws by which they are expected to abide. I suppose it depends on the issue and the people involved.
The problem with invoking the laws that you have suggested is that there is nothing in the specific wording that clearly tells the miscreant exactly where they have gone wrong. That could lead to endless discussion and debate whereas a simple “Move your stuff or lose it” note, citing the Unrecovered Goods Act, spells out exactly what can be done with the stuff.
Finally, please do me a favour and stop referring to yourself in the third person in replies. We can see who’s responding at the top of each post.
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