Obstructive Strata & conflict of interest

You just need an ordinary motion passed at the next AGM or at a EGM before that stating that the Strata wish to terminate the current SM with xx days notice (check what notice is required in their contract).

A simple majority of those voting is required (or if different lot entitlements a majority of entitlements).

It might pay to get a replacement SM lined up with another motion to employ company xx on termination date of current SM.

The only problem would be if the current SM has a long fixed term contract with penalties if early termination so check their contract

Rae – Whilst I wish that Strata Legislation was the same across all States & Territories, regrettably each seems to take whichever of those has the most recent Legislation, and then makes it their own by way of subtle changes that don’t always amount to improvements.

Consequently, some of the responses to date from people in other States/Territories are procedurally (and legally) incorrect in Victoria, particularly so with with the vote of your rusted-on Committee Chair, who as you’ve stated does have a casting vote at both Committee and General Meetings under your State’s Legislation.

Furthermore, there’s no point lobbying the other Committee Members about the removal of the Strata Manager, because as others have advised that can only be done by way of a simple majority vote at a General Meeting, and in order to have one specially convened for that purpose in circumstances where your Committee won’t, you need to to have a written nomination by ≥25% of your fellow Owners (determined by lot entitlement); a petition in lay terms.

Once you have been nominated, you can call upon the Committee Secretary or, if delegated, the Strata Manager (SM) to convene a Special General Meeting to consider and vote upon Motions to terminate the current SM’s Contract of Appointment, and to engage another.

As has been suggested in other posts, you and like-minded Owners will need to provide evidence in support of the Motion to terminate, have made substantial inquiries about a replacement SM sufficient to make a recommendation, and have thoroughly checked the specific termination procedures outlined in the current SM’s Contract of Appointment.

If the Motion to terminate is passed (simply majority), it’s then that the procedures referred to above come into play, and your Owners Corporation must follow those carefully in order to ensure a smooth hand-over of records etc from the current SM to the new one; not always an easy task when one of the parties is disenfranchised.

Should the Motion to terminate not receive majority support, then your only remaining avenue is to apply to the VCAT for “Orders of Termination”.

I would have thought your manager/chair may have fallen foul of section 122 of the Act where says they must not make use of their position to gai a personal advantage, directly or indirectly. Wouldn’t participation in a vote on whether or not to continue their contract contravene that rule?

This is what the Act says:

122. Duties of manager
(1) A manager—
(a) must act honestly and in good faith in the performance of the manager’s functions; and
(b) must exercise due care and diligence in the performance of the manager’s functions; and 
(c) must not make improper use of the manager’s position to gain, directly or  indirectly, an advantage personally or for any other person. 

Also, following up on Whale’s suggestion, Section 165 of the Act, which outlines the rulings that VCAT can make, includes the Tribunal’s power to revoke both the appointment of a chair and the appointment of a manager.

So I would be asking your chair to step out of the vote on whether or not her contract should be terminated and if she refuses to do so, and then uses her vote to consolidate her position, look at taking it straight to VCAT to have her removed from both roles.

In fact, just explaining to her that you have examined that option may persuade her to pull her head in.

@JimmyT said:

@kiwipaul said:
Their is no casting vote each vote carries the same entitlement in committee. If a committee decision is 3 votes all the motion is lost and it doesn’t matter how the Chair voted.

As Whale has pointed out below, this is not the case in Victoria where the Chair DOES have a casting vote.

Ditto in the ACT, the chair has a casting vote in both EC meetings and general meetings.