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    Topic
  • #77627
    Pompey43
    Flatchatter

      Is my Strata Committee able to commit significant body corporate funds not included in an annual budget and not approved by an AGM or EGM for a major project which, itself, hasn’t been put to a vote of the body corporate?

    Viewing 7 replies - 1 through 7 (of 7 total)
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    • #77712
      UberOwner
      Flatchatter

        What is the major project? If it’s remedial and urgent, then they’d have to be able to get it done. If it’s a nice-to-have then you’d hope to see some sort of planning, but I don’t know what the requirements are. I’m interested to hear what others say.

        #77721
        Pompey43
        Flatchatter
        Chat-starter

          Non urgent capital project. Nice to have. Project yet to be approved by OC. Preparatory expenditure on consultants to determine final cost of project not put to OC for approval. These costs now running to $150,000.

          #77730
          optusJo
          Flatchatter

            Are the Committee able to spend $150,000 without approval?
            Was it an Agenda item?

            #77737
            Jimmy-T
            Keymaster

              Good point. There may be something somewhere in the AGM minutes or budget that either allows the SC to spend up to a limit or, indeed, tells members there’s no limit on the spending they can approve.

              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.
              #77757
              Pompey43
              Flatchatter
              Chat-starter

                No line item in any annual budget for expenditure. No motion passed in any AGM approving expenditure. SC simply took it upon itself to spend or commit to expend OC funds to progress a ‘nice to have’ capital project.

                #77752
                chesswood
                Flatchatter

                  The question isn’t whether it’s a necessity or a nice-to-have. The committee cannot approve a change to the infrastructure. However, the committee can approve projects to maintain the common property unless limits have been placed on the committee’s powers.

                  #77820
                  The Hood
                  Flatchatter

                    Is my Strata Committee able to commit significant body corporate funds not included in an annual budget and not approved by an AGM or EGM for a major project which, itself, hasn’t been put to a vote of the body corporate?

                     

                    Section 73
                    Administration Fund (and there is an equivalent for the Capital Works fund (s 74)

                    (4) Amounts payable from fund
                    An owners corporation may pay money from its administrative fund only for the following purposes—

                    (a) payments of the kind for which estimates have been made under section 79 (1),

                    (b) payments made in accordance with this Division on a distribution of a surplus in the fund,

                    (c) payments to a member of the strata committee of the owners corporation in accordance with this Act,

                    (d) other payments in connection with exercising its functions under this Act or the by-laws, or the Strata Schemes Development Act 2015, except payments that are permitted to be made from the capital works fund,

                    (e) any monetary penalty payable by the owners corporation under this Act,

                    (f) the transfer of money to the capital works fund or to pay expenditure that should have been paid from the capital works fund.

                    To answer your question; most likely no.they can’t
                    The simplest way to look at spending is – No budget, no spend (but there are some exceptions to that general rule).

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