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All our EC roles are delegated to the strata manager who we are now having problems with. What is the process to follow for the EC to convene an EGM if the manager delays or fails to do so after being instructed by the EC?
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Under Section 28 of the Act, an Owners Corp can delegate all its powers to a strata manager but can rescing those by an ordinary resolution at a general meeting
(ii) An owners corporation may, if authorised to do so by a resolution at a general meeting, revoke a delegation under this section.
If you also have an executive committee call for extraordinary general meeting (EGM).
If you don’t have an EC, get the signatures of 25 percent of owners (or owners who hold 25 percent of Unit Entitlements) and send them to the strata manager, calling for an EGM.
On the agenda, you want:
1. A decision to rescind the delegation of powers.
2. An election of an executive committee and office-bearers to take over the running of the strata scheme (if you don’t already have a committee in place).
If the strata manager refuses to comply with the request for the EGM, they are in breach of the Act and you can take them to Fair trading and NCAT to get an order against them.
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
ozzietars said…. What is the process to follow for the EC to convene an EGM if the manager delays or fails to do so after being instructed by the E/C?
Jimmy’s advice is as usual correct if your Executive Committee (E/C) wishes to rescind all the delegations granted to its Strata Manager in their Agency Agreement, but it’s important to consider that notwithstanding those delegations, the Owners Corporation (O/C) remains in the position of the Plan’s “principal manager” and under Sect 29(2) of the NSW Strata Schemes Management Act (SCMA) your E/C may itself still exercise any of its prescribed functions, including the convening an EGM; delegations or otherwise.
So if your E/C has voted to convene an EGM and its Strata Manager (S/M) delays or fails to act on an instruction to do that, then the Secretary should themselves prepare and distribute an Agenda, perhaps including an additional item to not only remove delegations from the S/M as Jimmy advised, but perhaps to remove them!
Sect 27(2) of the SCMA applies, but check the termination clause in your Agency Agreement and ensure that your E/C has a Proposal from an replacement S/M to put to the EGM so that there’s a continuity of service and a smooth hand-over of the O/C’s records etc.
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