› Flat Chat Strata Forum › NCAT – the NSW Tribunal › Raising funds to defend NCAT action › Current Page
We may as well look at the laws that are coming in next week which basically say spending on legal fees must be approved at a general meeting unless they are less than $15,000 (see Section 103 (2) (b) of the 2015 Act, and section 26 (1) of the regulation, both below).
Fees should come from the Admin fund but it can borrow from the Sinking Fund provided it pays the money back (within a few months, I think). If the money isn’t in either fund a special levy can be raised.
Neither the decision to spend money on legal fees nor the raising of a special levy require a special resolution. A simple majority at a general meeting should do it.
I don’t think there has to be any specific decision required to spend OC money on strata management schedule B fees. They are part of the contract with the strata manager and a simple decision to request their involvement is all that’s required. They are management and not legal fees.
103 Legal services to be approved by general meeting
(1) An owners corporation or strata committee of an owners corporation must not obtain legal services for which any payment may be required unless a resolution approving the obtaining of those services is passed at a general meeting of the owners corporation.
(2) An owners corporation or strata committee may obtain legal services without obtaining approval under this section if:
(a) it is of the opinion that urgent action is necessary to protect the interests of the owners corporation, and
(b) the cost of the legal services does not exceed $10,000 or another amount prescribed by the regulations for the purposes of this subsection.
(3) Approval under this section is not required for the following:
(a) to obtain legal advice before commencing legal action,
(b) to take legal action to recover unpaid contributions, interest on unpaid contributions or related expenses,
(c) to take any other legal action prescribed by the regulations for the purposes of this section.(4) A failure by an owners corporation or the strata committee of an owners corporation to obtain an approval under this section does not affect the validity of any proceedings or other legal action taken by the owners corporation.
(5) In this Division: legal services includes obtaining legal advice and taking legal action.
Strata Schemes Management Regulation 2016 – Part 3 Financial management
26 Approval for legal services costs
(1) The amount of $15,000 is prescribed for the purposes of section 103 (2) (b) of the Act.
(2) For the purposes of section 103 of the Act, approval is not required under that section to the obtaining of legal services in relation to a matter that is not urgent if the cost of the legal services does not exceed $3,000.