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Thanks Whale – that's why you are a StrataGuru. Now all we need is for ECs to be compelled to register the by-laws withing 30 days or face penalties for not doing so.
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Also, bear in mind that any building warranties that are in effect, only apply to the new work and not the original structure. Personally, I think you may be entering a world of pain … this building sounds like a triumph of style over substance. The “new car” smell will fade but there’s every chance the problems will keep coming. Caveat emptor.
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The “oops, I didn't get round to it because my cat's been sick and my mother visited from Dubbo and I don't get paid for this you know” scenario seems most likely. Pity help the person who buys into a building thinking it's pet friendly, for instance, only to discover it's not according to a by-law passed 18 months ago but never registered. Maybe there should be a statutory form on which you have to write new by-laws, record the date of the meeting and the result of the vote which goes straight in the post for registration as soon as the meeting's over.
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I have just realised (on having written the material below) that your property is in WA. I have answered based on NSW strata law which may be totally different (but will certainly have a lot of similarities).
Failing that, your best remedy is to claim a “fraud on the minority” which is where a majority of owners have used due process to award themselves common property for a nominal fee, thereby benefitting at the expense of other owners. I think that may be your strongest claim for which there is a legal precedent that went all the way to the High Court. Have a look here for the original judgement in the Supreme Court of NSW.
It sound very much like the three owners with ground floor apartments have decided to enhance their properties (and their property values) without compensating the other owners. They are not allowed to do this. Sadly strata law in WA is still in its infancy but this issue goes beyond that – talk to a specialist strata lawyer now.
Meanwhile, for NSW readers, if you are in a similar position, this is what you need to know:
There are three issues here:
1) Was approval given for the effective exclusive use of the fenced area by one lot owner. Or was this simply allowing one owner to change common property? Either way, that requires a special resolution.
2) was that special resolution properly notified and voted on?
3) has the owner, with the approval of some other owners, benefitted in terms of the increased value of their property to the detriment of all other owners?
Taking the first matter, for that owner to enjoy exclusive use of the area, which seems to be their intention, they have to have a special resolution by-law approved by 75 percent of the owners voting on the issue. The terms of that by-law would include their agreement to maintain the common property as if it was part of their lot.
However, the OC can authorise an owner to use common property in a specific way but this also requires a special resolution.
Finally, if this is presented simply as a motion to alter common property, then this applies:
For the purpose of improving or enhancing the common property, an owners corporation or an owner of a lot may take any of the following action, but only if a special resolution has first been passed at a general meeting of the owners corporation that specifically authorises the taking of the particular action proposed: (a) add to the common property, (b) alter the common property,(c) erect a new structure on the common property.
So all three possibilities require a special resolution and that has to be handled in a specific way. Any general meeting has to give written notice of the agenda seven days before the meeting. Also that agenda has to specify that there is a special resolution by-law on the agenda. This is what the Act says:
The notice must clearly indicate which motions require a special resolution for their passage and which motions require a unanimous resolution for their passage.
Also …
A motion must not be submitted at a general meeting unless notice of the motion has been given in accordance with this clause …
So, at the very least what you have here is a failure to follow the prescribed procedure under the Act. It sounds like there was no written notice of the motion and there was not indication that a special resolution was required, there fore the decision is invalid and you need to let all the owners know this as soon as possible.
Now a special resolution requires more than 75 percent vote in favour by all those voting at a general meeting and had proper procedure been followed, the vote, three out of three voting, would have passed. However, just one vote against out of four would have meant the motion would have been rejected – and, under the terms of the act relating to owners being denied a vote that would have made a difference to the outcome, the motion could be overturned then too. This is what the Act says:
An Adjudicator may order that a resolution passed at a general meeting of an owners corporation be treated as a nullity on and from the date of the order if satisfied that the resolution would not have been passed but for the fact that the applicant for the order: (a) was improperly denied a vote on the motion for the resolution, or(b) was not given due notice of the item of business in relation to which the resolution was passed.
(2) An application for an order under this section may not be made after 28 days after the date of the meeting at which the resolution was passed.
If that's the case, you had better get on to Fair Trading now (Tel 13 32 20) to begin proceedings.
Finally, even if the whole process was carried out according to the law, if this a land grab by one owner, which enhances the value of their property at the expense of the other owners (loss of common property) then this is considered a “fraud against the minority” and the owner has to pay compensation to the OC based on the increased value of their property. Why would the other two owners have supported this? Perhaps they have their own plans and this is a quid pro quo. See the link to the court case at the top of this posting.
You need to write to all owners and tell them that the decision to erect the fence was probably not legal and you need a General Meeting as soon as possible to either ratify or reject the motion. You also need, collectively, to get legal advice from an expert strata lawyer on exactly where you stand on this issue for future reference.
It's very important not to let this slide – before you know it, you'll have all your common property hived off to various owners and no commitment from them to pay for it or maintain and repair it (which should have been part of the special resolution by-law, as described above).
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Suggestion 1: Call 13 32 20 and initiate proceedings at Fair Trading to have a notice to comply sent to the culprits.
2. Send a letter explaining to the Strata manager that the Council’s hours of operation have nothing to do with the peaceful enjoyment of your lot – the strata by-law is on top of basic council by-laws.
3. Write to your EC to ask them what they are going to do about a) noise at antisocial hours and b) a strata manager who doesn’t even understand the basics
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Please clarify – is this one owner taking over the common garden area or the Owners Corp tidying up the garden with fencing?
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I wouldn’t wait for it to happen again. The “peaceful enjoyment’ by-law covers everything from wooden floors to karaoke machines and powers tools as well. It might be worth contacting your EC to have it minuted that the use of power tools at evening and weekends is in contravention of this rule. If need be, suggest that they draft a new by-law for your next AGM that governs the hours when noisy work can be done. It tends to happen that all buildings reach an age when renovations are required – and once one person starts it spreads like a virus.
By the way, your council’s restrictions are laughable – you must be living in a builder’s paradise. But by-laws for your complex supersede local council by-laws in issues like this – it’s not “instead of” it’s “as well as”.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.
It's hard but not impossible – and this is one of the few areas where your costs in taking action can be awarded against the developer by the CTTT.
The CTTT can also award repayment of excess levies back to the individual owners who have been ripped off (in what sounds like a very cynical con job).
Have a look at the relevant section of the Act (below), count up how much you think you have overpaid and if it runs to the thousands rather than hundreds of dollars, your next call should be to a specialist strata lawyer who will guide you through what you need to do to put things right.
Your biggest problem may be getting a valuation – the people who are underpaying aren't going to invite a valuer in just so they can pay more – but there are ways round that which a lawyer will explain.
Anyway, here's what the Act says:
183 Order for reallocation of unit entitlements
(1) Tribunal may make order allocating unit entitlements
The Tribunal may make an order allocating unit entitlements among the lots that are subject to a strata scheme in the manner specified in the order.(2) Circumstances in which order may be made
An order may be made only if the Tribunal considers that the allocation of unit entitlements among the lots:(a) was unreasonable when the strata plan was registered or when a strata plan of subdivision was registered, or
(a1) was unreasonable when a revised schedule of unit entitlements was lodged at the conclusion of a development scheme, or
(b) became unreasonable because of a change in the permitted land use, being a change (for example, because of a rezoning) in the ways in which the whole or any part of the parcel could lawfully be used, whether with or without development consent.
(3) Matters to be taken into consideration
In making a determination under this section, the Tribunal is to have regard to the respective values of the lots and (if a strata development contract is in force in relation to the strata scheme) to such other matters as the Tribunal considers relevant.(4) Application to be accompanied by valuation
An application for an order must be accompanied by a certificate specifying the valuation, at the relevant time of registration or immediately after the change in the permitted land use, of each of the lots to which the application relates.(5) Qualifications of person making valuation
The certificate must have been given by a registered valuer under the Valuers Act 2003 authorised under that Act to make such a valuation (a qualified valuer).(6) Ancillary orders that may be made if original valuation unsatisfactory
The Tribunal may, if it makes an order allocating unit entitlements that were not allocated in accordance with a valuation of a qualified valuer and, in the opinion of the Tribunal, were allocated unreasonably by a developer, also order:(a) the payment by the developer to the applicant for the order of the costs incurred by the applicant, including fees and expenses reasonably incurred in obtaining the valuation and the giving of evidence by a qualified valuer, and
(b) the payment by the developer to any or all of the following people of such amounts as may be assessed by the Tribunal to represent any overpayments (due to the unreasonable allocation) for which liability arose not earlier than 6 years before the date of the order:
the lessor of a leasehold strata scheme
the owners corporation
the owners of lots.
(7) Recovery of amounts awarded
An amount ordered to be paid under this section may be recovered as a debt.(8) Who may make application?
An application for an order under this section may be made only by:(a) an owner of a lot (whether or not a development lot) within the parcel, or
(b) the owners corporation, or
(c) the lessor of a leasehold strata scheme, or
(d) the local council, or by any other public authority or statutory body representing the Crown, being an authority or body that is empowered to impose a rate, tax or other charge by reference to a valuation of land.
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The Strata Community Australia website https://nsw.stratacommunity.org.au/ would be a good starting point – but let’s throw this open.
Does anyone have any thoughts on what the Key Performance Indicators for strata managers should be?
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get the required signatures to hold an EGM (25 percent) or take them to Fair Trading and the CTTT and ask an adjudicator to order the election to take place
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Strata law is quite clear on this – an EC member vacates their seat when they cease to be an owner. The Executive Committee is then required to replace the member with someone who occupies their place until the next election.
Your strata manager really should know this – it’s pretty basic stuff. This is what the law says:
4 Vacation of office of member of executive committee(1) A person elected as a member of an executive committee vacates office as a member:
(a) if the person was an owner at the time of election and the person ceases to be an owner
(2) When a vacancy occurs in the office of a member of an executive committee … the owners corporation must appoint a person eligible for election as a member to fill the vacancy. Any person so appointed holds office, subject to this clause, for the balance of his or her predecessor’s term of office.
In my experience, the Executive Committee, acting as the representatives of the OC, are required to elect a new member and, if there was no other candidate and you are eligible, you should be invited to fill the vacancy
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I’d be risking ending up in court myself if I said too much. The options you suggest were not available for a number of reasons. That’s all I can say. I have written and rewritten this many times over but the people involved suffered two years of extreme stress – even though they did nothing wrong – and I really can’t say any more, as much as I’d love to tell their story. That’s the real weakness in defamation law in this country – being right is not enough. You have to be right and rich. Forget not being able to afford to lose, sometimes you can’t afford to win. And that’s why I was cautioning people to be careful of what they write about other owners.
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