There’s an eye-catching example of lucrative self-congratulation revealed in the Forum this week.
It involves the secretary and chair of an Eastern suburbs apartment block convincing their neighbours to award them in excess of $90,000 each for wrangling the collective sale of their apartment block to developers.
On the face of it, the honoraria seem perfectly legal (if morally iffy). There’s an item on the scheme’s AGM agenda, praising the duo for having organised the collective sale of the block of one-bedroom, mostly tenanted flats for conversion to luxury apartments.
And it proposes rewarding them for their three years of hard work on behalf of the owners corporation.
To be fair, everybody benefits substantially from the sale (apart from the tenants, one of whom threw himself off the top floor of the building, allegedly after he learned he was about to be evicted).
But closer examination of the proposal raises a few questions.
Can you really have an AGM that is a paper vote only – with no opportunity for the other owners to question the amount of the reward, let alone discuss whether or not it should be given?
And, wait a minute, three years? As SCA President Robert Anderson points out in our Podcast, strata committee members can be rewarded but only retrospectively, and only for their efforts in the previous year.
Section 46 of the NSW Strata Schemes Management Act says: “An owners corporation may pay … an amount determined by the owners corporation at an annual general meeting in recognition of services performed by the person … in the period since the last annual general meeting.”
That’s ONE Year, not three, and some owners in the block are very annoyed that their committee members seem to be giving themselves nearly $100k in what effectively amounts to commission for the sale of the building.
And that’s why you don’t just have a paper AGM – people have to be able to say, ‘Hey, has anyone read item 17…’. People tend to assume everything in strata is the same old, same old – until someone points out it isn’t.
The vote will probably have taken place by the time you read this but you can still put your 10 cents – or $90k’s worth – HERE.
Elsewhere on the Forum
- Secretary won’t organise AGM approved repairs because they don’t want to pay. That’s HERE.
- Are these common property or lot property defects? That’s HERE.
- How do I get access to shared water heaters in former common property. That’s HERE.
- Small block seeks new strata managers. That’s HERE.
- Developer says repairs in a new apartment will be “one time only”. That’s HERE.
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