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I wonder what would happen if the owners pursued the OC through Fair Trading and the Tribunal for failure to arrange alternative financial arrangements for owners who can’t afford to pay a special levy up front. I believe it is now possible for OCs to split finances between strata loans for people who can’t afford to pay up front and one-off payments from those who can but don’t want to pay interest charges.
With that in mind, the friend could apply for mediation – which is free of charge and doesn’t involve lawyers – leading to seeking orders from the Tribunal under Section 87 (1)(b) that refusal to engage in a payment plan was “unreasonable”. That section allows the Tribunal to order a “payment of contributions by a different manner”.
There is nothing in the Act that says all contributions have to be paid in the same way, and many examples of permission for the OC to find different ways of accepting levies payments. Application for meditation is free. Your friend could go to Fair Trading armed with information that the OC had the option to choose other methods and decided for reasons that it may not be able to justify not to do so. That would probably qualify as “unreasonable”.
Your friend should also try to find out if there are other owners who are facing the same issue, which will strengthen their hand. But this is certainly worth pursuing at mediation.
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.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 gang of three could just as easily say that they are keeping disruptive troublemakers away from the levers of power. In my experience at NCAT, I don’t think NCAT would buy such an argument, because it is subjective and cannot be proved.
That was intended as an example of a response to the excluded members saying – without evidence – that the committee members were being unreasonable. It’s the same argument, based on subjective opinions, not facts.
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The simple solution is to pass a motion at your strata committee that the strata manager should not pay any invoices unless they have been approved by the treasurer (or another registered office-bearer) of the strata committee. Anything that the strata manager pays without approval is on them.
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If you argue that the 3 are not benefiting the OC (that is failing what is required under s. 37), you then can also allege that all 3 need to be removed because they breached s. 238 (2)(b). Specifically, argue that their united behaviour demonstrates a wholesale failure of diligence inasmuch as the 3 exhibit an inattentiveness to the needs of 50% of the owners.
You’d have to prove that their holding on to power is harming the building in some real and material way. Telling the Tribunal that it’s anti-democratic won’t cut the mustard. However, if they are using their power to benefit their lots to the exclusion of others or prevent maintenance that would be a different issue. The gang of three could just as easily say that they are keeping disruptive troublemakers away from the levers of power.
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If you argue that the 3 are not benefiting the OC (that is failing what is required under s. 37), you then can also allege that all 3 need to be removed because they breached s. 238 (2)(b). Specifically, argue that their united behaviour demonstrates a wholesale failure of diligence inasmuch as the 3 exhibit an inattentiveness to the needs of 50% of the owners.
You’d have to prove that their holding on to power is harming the building in some real and material way. Telling the Tribunal that it’s anti-democratic won’t cut the mustard. However, if they are using their power to benefit their lots to the exclusion of others or prevent maintenance that would be a different issue. The gang of three could just as easily say that they are keeping disruptive troublemakers away from the levers of power.
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I think making a complaint against the agent via the Fair Trading website, under the Stock and Property Agent’s Act, might get a reaction
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If you take Netrsata in NSW as an example, they tell owners that standard practice (theirs) is for them to make all the decisions under delegated powers and just report back to the owners a few times a year. Naive owners go along with this, sign all the contracts put in front of them and think this is hunky-dory becasue they don’t know any different. Then someone with a bit of knowledge comes along and … boom! Questions are asked, excuses are made and “facts” become malleable. In the country of the blind, the one-eyed man is king … but the king always has a target on his back.
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In NSW the committee elects the chair and the chair does not have a deciding vote.
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Just to be clear, in case you think you are suffering deja vu, we covered this court ruling four weeks ago in this report on this website.
A week after that, I was at a conference and I asked a panel of lawyers and insurance experts if, for example, a cleaner servicing an Airbnb slipped on a puddle on common property and injured themselves, could the owners corp be fined under the workplace health and safety legislation?
The basic answer was “we don’t know” and “ask your insurer”. It all depends on whether an Airbnb is legally a commercial operation and, if so, do the cleaners and towel changers have appropriate insurance? I guess we won’t get an answer to that until the inevitable accident occurs.
But the one fact that was introduced was that the original strata manager, now long retired, is also being pursued by the WHS lawyers.
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I understood that a tied vote meant a motion was defeated?
An unresolved tied vote is a failed vote, so the status quo would prevail – i.e. no change.
Your best bet might be to apply to Fair Trading for mediation under section 232 (below) seeking orders that the scheme be required to overturn the decision of only half of the owners to exclude the other half.Or you could take a fine-tooth comb to Section 5 of Schedule 1.2 and see where the committee did not comply with requirements, then invoke Section 24 of the Act, and ask for the decision to be overturned on that basis. Again you would need mediation and a Tribunal hearing.
Or you could sit down with the other three and explain that if they don’t allow more members on to the committee you will,
- Seek orders at NCAT (as above)
- Call an EGM every month to review, discuss and, if necessary, overturn decisions of the committee. Under Section 19 (4), a qualified request for an EGM only requires 25 per cent (two owners in your case) to make the request.
- Make sure that the blocking of new members, and your objections to it, are recorded in the strata minutes and strata manager correspondence for potential future owners to see.
In other words, either they rethink their position and behave more reasonably, or they are entering a world of hassles and disputes that no one wants.
Offer a compromise. Maybe five instead of six, then work the election to your advantage by strictly following the rules.
Regarding suggestion 2, it is unlikely that all three committee members would be unanimous on every decision, so the threat of decisions being rescinded at an EGM would be very real to owners who had only prevailed by a majority of two to one.
232 Orders to settle disputes or rectify complaints(1) Orders relating to complaints and disputes
The Tribunal may, on application by an interested person, original owner or building manager, make an order to settle a complaint or dispute about any of the following—
(a) the operation, administration or management of a strata scheme under this Act,
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I hope that the attempt will be supported by the forum posting a link that I apparently can’t include in my post.
Send the link and I’ll have a look – JT
This is an issue dear to my heart, having been involved in a knock-down, drag-out fight with the famous Stephen Brell of Netstrata over his company’s failure to make the strata roll available to my strata scheme’s secretary.
One email in particular accused me of “gaslighting” the committee by telling them that Netstrata was required by law to make the roll available.
That has now been resolved – we have the strata roll – but it does give you an idea of how some (not all) strata managers operate to keep owners in the dark and committees on a tight rein.
By the way, I have to say that my friends in the Strata Commissioner’s office were absolutely zero help in this regard. But that was before Brell fronted up to the fateful revelations on ABC TV.
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Our Strata Committee did the following: Raised special levies for $33K for carpet and painting through two different contractors.
It’s unlikely that the committee passed the special levy as that has to be done at a general meeting, but they probably promoted the idea.
Regarding responsibility for the dust and its effects, if they were acting in good faith, then the committee members are not individually or collectively liable for any errors they may have made.
However, if they had been warned that there would or probably would be a contamination issue, or that they should reasonable have known this, and they did nothing to take that into account, that could be another matter which would most likely have to be resolved through a civil action, rather than at a strata tribunal.
Otherwise, the responsibility lies with the Owners Corporation – i.e. all owners – and your insurers.
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And why has NSW govt stopped updating and publishing this?
My guess?
- It was out of date before it got into people’s hands
- It was expensive to produce and distribute
- Nobody read it anyway
- Their websites and factsheets can be updated relatively easily
- Those websites can carry links to further information and forms
- People are still referencing editions that are well out of date as if they were the Bible.
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I suggested another meeting to ratify the previous decisions purely as a way of getting the message out that asking for everything to be strictly legal comes with consequences, preferably financial.
Following on from your other posts, I has taken me 20 years to realise that strata law isn’t law at all; it’s a set of guidelines based on the participants “best endeavours”.
Just look at the regs on who can and can’t vote at committee meetings. In fact, most procedural rules for strata meetings don’t bear close scrutiny.
What happens if someone doesn’t declare a conflict of interest and votes in favour of something that’s to their advantage? Nothing? Is the decision automatically invalid? Nope. Is the conflicted member penalised in any way? Nuh! Is the whole meeting declared a wash because it was conducted under false premises? Are you crazy?
I can’t help thinking of the tenants who were cleared by the Tribunal of breaching a Notice to Comply with a by-law because they said they were unaware of it, despite the fact that they had signed their lease saying they had read the by-laws and the Notice To Comply had the by-law reproduced on it, as the law demands.
The real problem is that the Tribunal is run by the Attorney-General’s Department and the laws are set by Fair Trading, and never the twain shall meet. Even today, if you ask the A-G’s department about a strata issue in relation to the Tribunal, they say “talk to Fair Trading”. Ask the same question of Fair Trading and they say talk to the A-G department.
The only positive thought in all this is that most strata owners and residents haven’t worked out that they can do pretty much what they want and no-one can do much about it.
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These people are impossible to reason with so in need something more than just “tell them this”.
No advice on what to say? That’s a hard ask. Do you want us to send some one round?
My temptation would be to send out an email telling all owners that because some [named??] owners claim not to have received due notice, you are going to have to call another meeting to ratify the decisions made at the meeting they claim, without evidence, to have not been compliant. If you can add potential expense to the re-called meeting, so much the better.
That said, there is a convention that you have to allow two or three working days (not including weekends) for notices to arrive by mail, if that’s how they were sent.
All said and done, I sense you may have more significant problems in your block than delivery times of notices.
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