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Hi, I have a tricky situation.
approx. 20 months ago, I feel in arrears on my levies,partially due to the fact I was out of work, and could not pay it all.
I received a letter of demand to pay the ‘full amount within 7 days, or legal action will commence’–the full amount was approx. 3000, and I made a partial payment of $1400, only a few days after that due date.
In the levy statement, I was now charged approx $850 as part of the legal costs-(negating nearly half of my partial payment), for the legal action that commenced against me.
I complained to the strata manager, rejecting liability for this ‘debt recovery cost’ given I had just made a partial payment. I was also annoyed that members of the OC knew I was unemployed and going through a hard time.
I did not get a response.
A few weeks later( it seems), I was served with a statement of claim as I was threatened with. From negligence on my part, I did not notice this at all- I could argue, that I wasn’t served directly, and it was placed in my letter box simply as ‘documents from the strata management company, where it got placed in a pile of other mail.
(This statement of claim had slight errors and made no mention of the partial payment, but this is minor)
A few months passed, and it seems I received a default judgement for the amount, with another quarterly levy charge and including their claim for legal costs of (approx. $950– the maximum claimable amount )for a total of approx 6850
I only realised all this happened, when i was (this time properly) served a ‘Bankruptcy notice’ against me. this time the amount was for a total of $7750, including additional file fees, and costs etc. I also had now received a default against my credit rating too.
my (costly) legal advice to this situation suggested I was better to pay up rather than to fight the default judgement, explain how i missed the statement of claim, etc. It could be more costly to me if I lost, so it was suggested to pay the full amount, and accept the mistake I made, but i really wanted ‘a motion to set aside the default judgement’ so as to not affect my credit rating.
I finally scrounged up the $7750 (redrawing on my mortgage etc.) and paid it off by the due date. I received an email from their solicitor saying ‘ no further action would be taken’ (this was in February 2012)
I do accept the responsibility for being negligent and the extra costs incurred– which have been around (at this stage) at least $2500 of money down the drain.
this is not where the story ends though!
a month or so later, I then received a new charge on my levy notice for approx $2000 FOR the strata management’s ADDITIONAL legal cost on this matter.
At NO time was it disclosed there were any additional costs to be incurred– what included in the statement of claim, and what was on the bankruptcy notice, was what I understood was required to pay in regards to this matter–penalties et. al.
(and had I of known, my course of action would have been different)
I requested a line item breakdown of those costs– that was in April 2012- I received a response in AUGUST 2012– 4 months later!
Furthermore, I also noticed that in July 2012, I was also charged another $975 in ‘debt collection commission fees’ to the same matter.
So now, I have incurred approx.$2800 of ‘undisclosed’ costs, post settlement. I found this very unfair and told the strata manager i would dispute these charges: and wanted a separate statement on my levies– any monies paid WOULD be directly to quarterly levies– not these claimed costs, or for them to ‘roll up’ these costs into my levies (and charge interest). (I can not be ‘financial’ as I cannot/will not pay everything to be up-to-date,to bring this up at a strata meeting)
The strata manager never responded to my claim disputing liability, or the request to separate the charges into another statement. This was in October 2012.
Now, I’ve fallen on hard times again, being unemployed for the first 4 months of the year, and so i fell in arrears, but made partial payments– pro actively paying an amount that I could afford to avoid what happened a year earlier.
So, just this week, 6 months after I raised my objections, and without warning I’ve received a new letter of demand to pay $5700 within 7 days or face legal action (again)— without any breakdown of what this comprises that amount–
of which I can argue, there’s the $2800, plus a new round of debt collection/legal costs.
I have contacted the lawyer explaining my situation– no response (yet)
I have contacted the strata manager– no response (yet)
I am clearly not happy about any of this. It seems that a strata manager-debt collection-laywer relationship can just pass any arbitrary cost they feel like at any time under the guise of section 80, and I am effectively powerless.
“costs involved in recovery of strata levies” means that they can just tack on whatever they want beyond what they were awarded by the court.
I did not contest anything and just ‘sucked it up’, but now I am paying 80-90% of my original debt as additional ‘legal costs’. Surely this can’t be fair or just? are they any limits to my liability– i don’t seem to have any protection. This just seems like an exploitation of the law in order to fuel an industry– so what are my real legal options? A counter-claim? A cost-assessment?
In any other area, costs awarded are limited when it comes to small claims for entirely this reason,and there are laws regarding passing on ‘third party costs’ without disclosure or agreement (from what i’ve read)- so how can section 80 simply override any other legislation unchallenged?
On top of that, The “Owners of Strata Plan 36131 v Dimitriou [2009] NSW CA27 (25 Feb 2009)” case argument rarely wins (it seems) but likely my only real argument, and there’s this too
Help please…
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