Part of the question here seems to be that the strata manager is giving the owners the correct advice and they are choosing to ignore it. Also, since the appointment was made with unanimous support, it doesn’t sound like any owner is likely to challenge the appointment at NCAT. As we say so often here, there are no Stratakops and the strata manager may not wish to upset the applecart any further.
I think the best thing they can do is to send a letter to the committee to get it on record that committee member can’t also be the building manager and what the possible downsides of allowing this to continue may be.
Given that the threshold for rescinding committee decisions when they were made inappropriately is almost impossible to achieve, it’s hard to see what the potential downsides might be if everybody is happy with the arrangement. However, if a new owner moved in and decided they wanted the scheme to be run according to strata law, that would be a different thing altogether.