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Item Number 9 on the recent 2024 AGM agenda states: “Overdue Levy Procedure. By ordinary resolution that should any Owner, Mortgagee in possession or former Owner of a lot not pay contributions by their due date in relation to a lot that: a)The Strata Manager may issue one (1) or two (2) reminder letters each requesting payment within fourteen (14) days of the reminder letter; b)If the Owner, Mortgagee in possession or former Owner has not made payment of any outstanding amount in accordance with any reminder letter sent by the Strata Manager, a law firm be engaged and instructed to… iii.Take legal action to recover unpaid contributions, interest on unpaid contributions or related expenses enforcing any judgment obtained including: 1.Obtaining any necessary writ(s) for the levy of property; and 2.Obtaining any necessary garnishee order(s)”
This item was defeated but the minutes show it was resolved. The Strata Manager states that:
“This motion cannot be defeated, these are our company terms which your scheme signs up for when taking on our management. The minutes remain correct.”
I then asked, “Why put it on the agenda?” and the SM stated, “There is a standard set of motions that must be put on the agenda each year, this is one of them.”
Who is working for whom? We do not want to remove the Strata Manager. We just want to know if the SM can change the outcome of the motion without the permission of the OC.
- This topic was modified 3 months, 3 weeks ago by .
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You’re probably bound by the contract.
You’re probably bound by the contract.
Yup, but procedurally the strata manager should have advised the chair not to allow the motion, so that reason was at least recorded for future reference. Next step, remove that clause from the contract at the next opportunity. But be aware that debt collection fees and sweetheart deals with favoured lawyers is the next scandal after insurance commissions.
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.
Sorry to echo the above two, but you are indeed bound by the contract. I hope for your sake it isn’t a Strata Community Association contract. They are very much in favour of the managing agent,
In one scheme I am involved in, the owners at a meeting a year ago, led by a useless but know all committee, decided to get a new strata manager and delegated nearly every function to him. That is ALL the owners decided to do that; all but me. I actually read the one sided contract and was horrified. That committee, of which I was not a member as well as other owners thought they were really smart and did not even bother to answer questions from owners about the delegations proposed at the general meeting.
Now, a year into the contract, a committee member wants to change some delegations. I too am on the new committee.
I asked he committee member why he wants to change the delegated functions given to the strata manager? After all he voted and promoted to others the “wisdom” of giving nearly all the functions to the SM! I asked him , “who in his right mind signs a contract without reading it”? It’s been 2 monthzs and I’m still waiting for a reply.
I told him about negotiating with the strata manager for any changes he wants. He is now considering just what functions of the strata manager he wants to change.
Anyway, I am not a lawyer but work in finance and the little I know of contract law was confirmed by Fair Trading. A contract e.g. strata management agreement, even if it’s very one sided, cannot be varied without the consent of both parties. “Consent” may mean the OC handing over cash to the strata manager in order to void a clause or two. A clause or two that was earlier agreed upon on by the OC.
The Manager cannot change the motion. The Minutes are a legal record of the meeting and the motions which passed.
If the contract has different terms, then that may create a conflict however the manager CANNOT knowingly change minutes to a set of events which did not happen. That is very illegal and you should be seeking legal advice on this.
The minutes under the various state acts must be an accurate representation of the meetings and the motions which passed. The manager or chair cannot retrospectively change those.
The manager can challenge the motion with the committee and the OC but cannot change and given the contract term gives the manager a financial benefit likely puts them in breach of their duty to act in the best interests of the OC as there is now a conflict of interest as well.
If any manager does this, the OC should be seriously looking at terminating the contract and looking elsewhere as this is a fundamental breach of trust, and of their duties as the manager on behalf of the OC.
They are clearly putting their own interests above the legislation and their legal responsibility to reflect the minutes.
The first thing the committee should do, is write their own minutes distributing them and disregard the managers minutes as not being an accurate reflection of the meeting.
Does your strata management contract have in it a provision amongst its “Schedule B Charges” along the lines…. Levy Arrears Collection – Issue letter of Demand / Refer lot owner debt for legal action Etc. $xxx Chargeable to Lot owner ? Most would.
I guess Office Bearers and Committee Members keen to do the right thing and ensure the efficient payment of levies might be gratified to think that the OC isn’t going to have to pay these collection charges, BUT on what basis can the owners corporation oblige an individual owner to personally pay the strata manager’s fees ?
Individual lot owners are NOT party to the SM agreement and s 86 of the Act only obliges recalcitrant owners to pay the “owners corporation’s reasonable expenses” if the debt is recovered by means of a Tribunal Order or a Court.
Where is the lot owner’s obligation to pay the strata manager for sending them a letter of demand etc ? I don’t see it…I see only another revenue stream for strata managers. It has gone on for years.
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