Our recent article on developers demanding proxy votes in strata unit sales contracts has stirred things up, with one reader writing to tell us they had backed out of a purchase on principle. You can hardly blame them after the developer insisted on them signing away not only their own rights but also the vote of whoever might buy the apartment off them in the future.
Meanwhile, even if you have already signed away your proxy, don’t worry – you can tell the developer where to stick it. For a start strata proxies have to be on the right forms and if they’re not – and many aren’t – the votes shouldn’t be counted.
As far as your own vote is concerned, all you have to do to rescind a proxy is turn up at a meeting and vote in person. No one can stop you and the proxy is automatically defunct. If you don’t want to go or can’t get to the meeting, you can sign another proxy form which supercedes whatever you signed in the sales contract – for instance, in favour of other owners who have realised they are being ripped off and want to take action. Proxies are like wills – only the most recent counts.
And remember that proxies only last for a year from when they were signed so they may be out of date anyway. Having said all that, countless numbers of purchasers of new apartments are duped or bullied into signing away their rights. By the time they wake up to it, the developers have tied up all the essential contracts for their building for at least 10 years, often including appointing themselves managers on lucrative contracts that are clearly not in the owners’ best interests.Next week I intend to ask Fair Trading Minister Linda Burney what her office plans to do, firstly about alerting people to this rort and then about closing these loopholes. Watch this space for a response that hopefully goes some way to reflecting her department’s title.Meanwhile If you’re not sure about your rights, you can download a free copy of Fair Trading’s “Buying into a Strata Scheme” at www.fairtrading.nsw.gov.au/pdfs/corporate/publications/ft176.pdf.