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Topic
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Please can somebody advise us, what can be done in the following situation.
At the last AGM 3 OC members elected themselves through the poll voting to be the Executive Committee, despite that other owners wanted to participate as well.
2 of the newly elected EC members (3 in total) took the OC, before they were elected, to the NCAT regarding the upgrade of their balconies. They were not happy that this issue was decide at the EGM (conducted before the AGM) by special resolution and not by the simple one.
The first mediation day was set on the date of the AGM. The applicant’s asked the mediator to postpone the date.
Three weeks after the AGM a new date for the mediation was set.
The mediator wrote to the newly elected EC (2 members of the EC are the applicants and the Secretary is supporting them on the balconies issue) to call an ECM to appoint representative/s of the OC to represent the OC at the mediation.
The OC was only informed via the strata manager, who sent the mediator letters to the OC. The EC didn’t communicate on this issue with the OC.
Few days before the mediation, the OC received a letter from the mediator via our strata manager that the mediation will not take place. As the mediator reported, the Secretary called him and informed him “that the Owners corporation has decided not to participate in mediation…”
Despite that the mediator wrote twice, the EC needs to conduct an ECM to appoint the representatives, this was never done. The Secretary informed the mediator without conducting an official meeting and informed the mediator about the apparent “EC decision”. The entire current EC knew, the three opponents were willing to go to the mediation and mediate on the issue.
Unfortunately, when we contacted our strata manager in relation to this, he advised us that the EC could have made the decision without calling the ECM and consulting the OC.
The mediator was also very surprised that the decision of the EC was done, without an official ECM being called.Can you please advise us what can be done regarding this. Could the EC have made their decision, without an official ECM?
Should not the EC work in the interest of the entire OC and not only in their own one?Thank you
Alinka
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Replies
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Need more info
Who were the applicants (EC, OC individuals)
Who was the action taken against (EC, OC individuals)
If the EC weren’t the applicants or the respondents they cannot make the decision to not appear. Any decision of the OC overrides the decision of the EC.
The 2 EC members who are the applicants did they apply for mediation as individuals or did the EC apply.
If you can get 25% of the owners to request an EGM you can overturn any previous decision of the EC if you have a majority at the called EGM for any motions submitted.
Gosh this is messy, so just a few thoughts:
– in respect of the two EC members who made the NCAT application that is the subject of mediation, I suggest that they have a conflict of interest so therefore should be excluded from any considerations/decisions relating to the matter. That is – in their capacity as EC members. You are right, the EC members have to act in the interests of the OC as a whole.
– if that is the case, that leaves you with one EC member. That is not a quorum for the purposes of making an EC decision (technically you could argue that it might be but let’s leave that)
– going back to the Secretary advising that they didn’t want to go to mediation – a single member of the EC can’t make a decision on behalf of the EC, they have to meet and make a decision. It seems that didn’t happen. So the Secretary didn’t have the authority to do that.
– the strata manager is wrong, you have to have an EC meeting to make a decision. The requisite 72 hours notice needs to be given, with the proposed resolutions notified to all owners in accordance with the Act.
– the other owners can object to a proposed resolution of an EC, where notice is given of that proposed resolution, by owners who own at least one third of the entitlements giving notice to the EC that they object to the decision. Any purported decision then has no effect.
Of course, here no notice was given, but if it had been, then if you had the numbers then notice of objection could have been given.
In summary – there was no valid decision, I doubt whether two of the EC members could have participated in any “decision”, and given the nature of the matter and the complexities, it should have gone to the OC (all of the owners) for a decision.
To that extent – on one analysis you could say that the advice given by the Secretary has no force, but that may be a moot point – has the time passed for the mediation?
Alinka – I am not sure what taking them to NCAT on that issue would achieve.
I think you would be better off determining the status of the mediation and whether or not the time for that has passed. If it hasn’t – get the owners to determine whether or not they want to do mediation and appoint the representatives.
Otherwise – the issue is that the mediator was informed without authority that the OC would not mediate. Perhaps you then need to ask NCAT for a mediation session to be reset.
The initial problem you had was owners trying to get the upgrade of the balcony passed as an ordinary resolution when it requires a special resolution (SR) but the Strata Manager (SM) now agrees it requires a SR and so in effect you have won.
The 54% of owners who support this upgrade cannot proceed without a SR and they don’t have the numbers for it.
As to the conciliation as they have 54% of the vote they can vote down any motion to go to conciliation I’m afraid.
You need to supply the SM with a letter signed by 25% of the owners stating that any upgrade to the rails he authorizes will be illegal and he (or whoever authorizes it) will be liable for any expenditure unless so approved by a SR.
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