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As I’m travelling through rural NSW right now and am posting using fat fingers on my iPhone, I’ll need to keep this brief.
Previous posts have advised that irrespective of whether or not the Owners Corporation’s (O/C) insurer agrees to accept and process its claim for the repair of your lots ceiling, the O/C remains responsible for attending to the repair of that ceiling – that forms part of its common property.
You need to apply for the mediation of your dispute with the O/C under the provision of Sect 138 of the NSW Act, with the assistance of a NSW Communty Justice Centre or the NSW Dept. of Fair Trading.
Mediation is a compulsory precursor to the formal adjudication of your dispute if necessary in the Commercial Div. of the NSW Civil and Administrative Tribunal.
I can’t include the relevant links using my iPhone, so perhaps browse the relevant NSW Govt. websites for “strata disputes” (unless someone can post those links).
You’re correct about un-financial owners being unable to vote at a General Meeting, however attendance either in person or by proxy by just two (2) of the three (3) remaining financial owners of your Plan would be sufficient for any vote requiring a decision by a simple majority (show of hands) to be legally taken.
So the vote taken at the General Meeting to which you refer was legal, although….. as it was about the recovery of your unpaid contributions plus the prescribed rate of 10% pa interest (i.e. ≈0.8% per month on the amount then outstanding), together with the Owners Corporation’s costs of recovering its debt, no General Meeting was actually necessary as the Executive Committee or the Strata Manager if so delegated could have themselves made that decision.
What to do now?
Despite your post’s title of “bankruptcy” I’ll assume that you haven’t made that declaration, so the Owners Corporation’s legal action will likely result in a letter to you from its Lawyer or Debt Collection Agency, where your previous demonstrated efforts to pay-down your debt will no doubt work in your favour.
So when you receive that correspondence undertake to pay your next contributions installment on-time, and make an offer to repay whatever amount is then outstanding over whatever timeframe you can safely manage, and then see what happens.
I suspect that nothing will happen, because I doubt that your Owners Corporation or their Lawyer/Debt Collection Agency would bother to pursue you through the Courts for the earlier repayment of an amount of $3,700.00.
But in the event that something further is initiated, or if by some chance you have declared bankruptcy, then again speak with your solicitor or to the Australian Financial Security Authority about your overall situation.
Cosmo said: One proposal raised at the AGM was to connect water and electricity to a unit. We would have to reimburse the unit ‘connected’ for usage but the strata would save the fixed costs associated with having common property water and electricity.
Apart from the fact that the above proposal would be extremely messy and be reliant upon the on-going agreement of the current and subsequent Proprietors of the Lot “connected”, the usual practice is for Water Utilities to maximise their revenue by charging those so-called “fixed costs” to the individual Proprietors of serviced Lots, and for the Owners Corporation (O/C) to be charged for the property’s water usage only.
Under this usual scenario, the O/C would recover its costs of water usage from its individual members (i.e. Proprietors) as a component of their levy contributions and as calculated from their respective units of entitlement, so unless a significant number of Lots are unoccupied or some are non-residential that’s a fairly equitable arrangement.
Personally I don’t think that the saving of those “fixed costs” could be justified by the O/C’s costs of the works involved, and furthermore whilst it can certainly recover costs (as income) I don’t think that a payment (an expense) by way of a permanent / regular reimbursement to an individual Proprietor is permissible under the Act.
Can you advise as a matter of interest, does your Water Utility itself currently read each of those supply meters that have been retrofitted to individual Lots and invoice each Proprietor individually for the recorded usage?
Gillian – in order to cover our bases I contacted our building’s insurers a couple of years ago to advise that five (5) of the Lots in our self-managed Plan were then available for holiday / short-term occupancy.
The insurer’s representative told me that those details would be noted on our Policy, and that as the level of holiday / short-term occupancy was only around 20% of building’s total Lots, that no change to the extent or nature of our cover or to our premium would result.
I queried what percentage of that type of occupancy would affect our Plan’s cover and premium, and the insurer’s advice was that it varies from one geographic area to another. No other specifics were provided.
So my advice would be for owners corporations to fess-up, and to take into consideration that any increased premium that consequently arises can be recovered from the proprietors of Lots within N.S.W. whose activities gave rise to that increase.
77. Effect of use of lot on insurance premiums
If the use to which a lot is put causes an insurance premium for the strata scheme to be greater than it would be if it were not put to that use, so much of a contribution payable by the owner of the lot as is attributable to insurance premiums may, with the consent of the owner, be increased to reflect the extra amount of premium.
Note the sting-in-the-tail though, where those proprietors would currently need to agree – so just hope they’re unfamiliar or feel obliged to comply with Sect 77 the NSW Strata Schemes Management Act or perhaps wait until July 2016 when the new Act commences, where O/Cs may then seek Orders in the Tribunal against those proprietors who unreasonably refuse such an arrangement.
bim – all Owners should (actually must) be provided with the Minutes of the immediately preceding General Meeting, and any of those who submitted a Proxy Form prior to the commencement of that most recent AGM and like you had issues with those previously issued Minutes should have used the provision on the Form to direct their Appointed Proxy to vote as you did; that is against the Motion for acceptance.
Obviously for whatever reasons some absent Owners didn’t see any problem with the Minutes, and so the Motion to accept those as a true and accurate record was properly passed by a majority vote of those present and entitled to vote at the AGM, that is both personally and by proxy.
Graham – why would you contact Sydney Water when they’re only responsible for publicly owned water and sewerage assets??
It’s your Owners Corporation who’s responsible for arranging an inspection of and any repairs to the pumping station by somebody who knows what they’re doing, as opposed to a maintenance company who may only know enough to clean out the wet well and to trip the float so as to check that the pump turns ON and OFF.
Locate a Hydraulic Consultant who’s experienced with domestic wastewater pumping stations by contacting the Association of Hydraulic Services Consultants, but remember that the noise is likely there all the time, and it’s just that you can only hear it at night.
By the way, the lack of rain for days may be irrelevant if the rising main is long and the wet well capacity small, because depending upon how the float is set, a faulty non-return valve could permit sufficient wastewater to repeatedly drain back and to periodically activate the pump (i.e. recirculation) until natural evaporation determines otherwise.
Millie – in the first instance, unless your Strata Managing Agent is an Owner, or they were nominated for membership of the Executive Committee (E/C) by an Owner who was not themselves a candidate for membership, and in either circumstance then duly elected as a member of the E/C at the last Annual General Meeting, then whilst the Owners Corporation may have delegated the duties of Secretary to them in its current Strata Management Agency Agreement, they do not hold membership of the E/C and cannot vote unless in an “acting” capacity for an absent member.
All that said, the Strata Manager is correct to the extent that whilst the Act does require the production and distribution of “accurate minutes” of decisions taken at E/C meetings, there’s nothing specifically prescribed there in terms of what motions must be included in the agenda and be therefore minuted.
It seems to me that the Strata Manager has at least acceded to the owners’ request about the previous minutes being confirmed by placing a motion to that effect on the agenda for the next meeting, and that at least provides you and other owners with the opportunity to attend and, with permission, to have your say on that motion and to raise why you oppose it and what you’d like to see in future in terms of compliance with the Sch.3 of the Act.
I’d be interested to know what your E/C is “manipulating”, but as there’s no agenda with motions for owners to in advance oppose (as >30% can), you need to rely on General Meetings where the Owners Corporation has the ability to both change the membership of its E/C and to impose some limitations on what decisions it can (and cannot) autonomously make.
There is of course an opportunity to involve NSW Dept. of Fair Trading and the N.C.A.T. but given the hit-and-miss advice/decisions that arise in those, I’d resort to lobbying support from other owners to attend the next E/C and O/C Meetings respectively in an effort to turn things around.
Teena – as a Strata Manager appointed under S162 of the Act IS the Owners Corporation, I would suggest that an application to extend that appointment should be made by the appointee, and for extra “weight” endorsed by the Secretary of the Owners Corporation by way of an attachment with its Common Seal.
As for the timing, given the advice that you’ve received regarding the N.C.A.T’s backlog, the application should be lodged now.
Tracey – that’s good news, and to clarify my note to Mel’s post, it was intended to express my genuine concern about the often irrelevant comments that he and his two mates post to old topics, often without reading the preceding details, and with the prime objective of finding a way to include the name of their common franchise and its business operations. Other people who believe that their business operations could be of benefit to strata dwellers and to themselves work with Jimmy T to become become Official Sponsors of FlatChat.
You could both be correct, but my “understanding” (ref. post #2) of what will apply when the new Act commences was based on past experience with drafting the technical aspects of new Legislation in NSW where, save the influence of so-called “interested parties”, new provisions don’t usually require actions by affected parties such as Owners Corporations then formed to immediately re-shuffle their deck chairs and to change operational procedures in order to achieve compliance from day one.
That is why I interpreted “act as members……” as being a reference to Sch.3 of the current Act where at Cl.3 a person may with the consent of the E/C “act” as a member in place of another who cannot personally attend a Meeting.
So I assumed that upon commencement of the new Act the status-quo could apply to matters such as the composition of already elected / appointed E/Cs and to the form of current Strata Management Agency Agreements until the next planned General Meeting (AGM), unless of course individual Owners Corporations such as that for JC’s Plan wanted to then convene a General Meeting (EGM) in order to achieve earlier compliance.
Then again, I too could have misinterpreted and maybe none of us will know how the new Act will be applied until it is (Law), but let’s all hope that very little will be open to interpretation by the N.C.A.T.
A combination of grammatical errors, an IP address and e-mail provider from Mumbai India, and a USA linked website all has me confused, so huh! Offending post now removed, Whale’s response left “pour encouragez les autres” – JT
JC – apart from the new term of “strata committee”, the only significant change to membership that’s relevant to your post is that building managers and property managers cannot be appointed unless they’re also owners.
So in the circumstances you describe where such a person is a member of the executive committee as a non-owner on the date that the new Act commences, then as I understand it that person could remain a member until the next Annual General Meeting unless, as is currently the case, a special resolution vote by the Owners Corporation at an earlier General Meeting removes them and declares their position vacant.
Cameron said….. I’m just wondering what happens if a large number of owners decide to just hide out in their unit instead of coming down for a vote and things go a certain way. Surely there has to be some regulation to prevent that from happening right? Like minimum attendance or something?
There is, and there’s a whole section on General Meetings procedures starting on page 19 of THIS document as also linked in my last post.
As we now have a trio of self-storage operators as contributors to this Forum, may I ask if you’re all strata dwellers or if there’s any collective motive in addition to the occasional oblique reference your business operations and the link to your respective websites, or all of those?
Just to satisfy my curiosity.
sofgrain – presumably your Executive Committee (E/C) commissioned the Report on behalf of the Owners Corporation (O/C) because it suspected that something may be defective with the building’s 90 yo wiring, and now that the Report’s been received and even summarily read, Members would be expected to have “reasonable knowledge” of what remedial works are recommended.
In those circumstances the Office Bearers’ Liability Cover that’s included in almost every Building Insurance Policy of the Owners Corporation in order to limit the costs of claims against E/C Members may be void, and even if the costs of defending any such claim was covered the amount of any settlement, or punitive actions by a Court would almost certainly not be.
It’s been around 3 months since Members received the Report, and even though the holiday season occurred in the midst of that period, you’re justified in being concerned about the E/C’s lack of action.
I’m guessing that your concern about inaction stems from your membership of the E/C (right?), in which case you need to obtain the support of other Member/s who together with you comprise at least 30% of the E/C membership, at which time you can require the Secretary to convene a Meeting within whatever timeframe you collectively specify in writing.
Failing that, you should seek the support of like-minded Owners who together with you hold ≥25% of the aggregate units of entitlement for your Scheme, at which time you can collectively petition the Secretary in writing to convene an Extraordinary General Meeting of the O/C to consider a Motion to address the Report’s recommendations.
The actions that I’ve suggested would in themselves limit your personal liability and to some degree that of the O/C itself should some incident arise that could have been mitigated had the Report’s recommendations been more promptly addressed.
The area below the lawn where you wish to excavate would be common property, and as you’re in NSW (or your IP address is) and your proposal would comprise a change to that common property by the construction of a new structure below it, you’ll need to obtain the prior written consent of your Owners Corporation (O/C) by submitting a Motion supported by detailed plans, trades license, and liability insurance details to a General Meeting, seeking consent to your proposal via a vote in favour by a minimum 75% of those present both in person and by proxy (i.e. a special resolution) calculated on the basis of their lot units of entitlement (UOE).
Your Local Council would require the O/C to make a notation on your DA or BA to the effect that its consent to the above has been granted.
In the meantime have a chat with your Strata Manager, but more importantly your fellow owners and particularly those on your Executive Committee re the above, and if indications are that you can jump the above hurdle, then you’ll need to concurrently work on seeking that same minimum degree of consent (i.e. ≥75%) for an Exclusive Use By-Law and its subsequent Registration, that as the name implies would need to be legally drafted at your expense to grant you and subsequent Owners of your Lot the exclusive use of the area of common property occupied by your proposed garage extension, and document that you as opposed to the O/C will be responsible for all on-going maintenance and repairs for that area.
Then finally, as the additional parking space would add “value” to your Lot, you’ll need to have that Exclusive Use By-Law set a mechanism by which you make a payment, perhaps annually indexed, that’s equivalent to the levy contribution that you would otherwise pay if your Lot originally had a tandem / 2 vehicle carspace, or perhaps an amount representing the difference between your current contributions and those that other owners with that set-up currently pay.
As for the costs, they would involve those for a Strata Lawyer to draft the Exclusive Use By-Law (EXBL), the costs to convene a General Meeting of the O/C unless of course you submit your Motion to an already scheduled AGM, and the costs to have the EXBL Registered on your Plan’s Strata Title; I’d estimate $2-3K all-up if it goes to an AGM but have a talk with one of FlatChat’s sponsors HERE.
It all sounds complex, but not so for a suitably experienced Strata Lawyer with whom you should also discuss any requirement for a Strata Sub-Division and the resultant costs to, in addition to all the above, add the physical details of your proposed works to the existing Strata Title Plan.