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09/05/2013 at 6:13 pm #8823
(Option 1: to get the developer to return to finish the defects rectification as order by OFT –FREE
Option 2: to repair the defects with outside builders – pay with special levy )
At the AGM, the Strata Manager and a few Exec CM discussed how to proceed with outside builders only as the Exec CM do not like the developer. All options were mentioned briefly but Option 1 was not discussed.
The AGM minutes read as follow:
Resolved: That the Owners Corporation discuss the status of the defects throughout the Strata Scheme.
Does the above statement constitute a VOTE among the OC for outside builders? The Strata Manager and Exec CM deemed that as a vote of YES for outside builders.
Any advice how to tackle such a situation?
Thanks
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10/05/2013 at 7:01 am #18426
Resolving to discuss something doesn’t sound a resolution to do anything at all!
What about resolving to immediately spend up to some amount to take legal advice on defect rectification? or engaging some representation in legal action to have the orders enforced?
If there are orders made etc. then someone has been trying to do something.
10/05/2013 at 9:15 am #18427As far as I can see no vote took place. Option 1 & 2 could have been considered a motion but the minutes don’t give a result for any vote FOR, AGAINST or ABSTAIN so nothing was decided. Just discussing an item does not constitute a vote, it has to be officially called and the result recorded in the minutes.
I would say getting the developer to do the repairs would not require another vote as it’s cost free, getting an outside builder to do the repairs would require another OC vote to approve the cost (assuming it’s above EC limit).
10/05/2013 at 9:33 am #18428That isn’t a resolution for a number of reasons.
– for a valid resolution at a GM, you first have to have the proposed resolution put on the agenda, requisite notice given etc.
– that resolution is then put to a vote at the GM.
– you can’t make changes to a resolution other than those that don’t materially alter the resolution. So someone can move an amendment to a resolution to alter it slightly or clarify it, but you can’t change the substance of it.
– here the proposed resolution gave two alternatives, have the developer rectify the defects or get other builders to rectify the defects. The only possible resolution therefore is one of those options.
– the minutes record that it was resolved that the OC discuss the status of defects. Note that the resolution refers to the OC, not the EC. On its face, the minute of that resolution is wrong, as what you would expect to see recorded is that neither Option 1 nor Option 2 were approved.
– you don’t need a resolution to “discuss” something anyway.
– it sounds like the resolution wasn’t put to a vote at the GM. Is that correct? If so the minutes should record that there was no vote on the resolution.
– even if the GM had voted and resolved to go with Option 2, you would then need a separate resolution to raise the special levy.
If it were me I would be going back and asking the strata manager:
– why the minutes are incorrect.
– how a minute that records that the defects be discussed can be construed as constituting approval for engaging builders and raising a special levy.
If you have an order from the OFT for the developer to rectify the defects, then the developer should rectify the defects. It is understandable that the EC may not like the developer but if you have an order, you should follow through.
10/05/2013 at 5:35 pm #18440Thanks for all the replies.
I was advised by LPI that Owners and Owners Corporation are different entities and OC funds are set up to maintain the building and the common property.
In your opinion, can the owners use the OC fund to finance a Defects Report($24,000) by a specialised company on the block for the developer to fix defects before the Home Owners Warranty expire?
Now a few owners (EC) want a special levy($466,000) to re-rectify the defects cos it was not rectified to their satisfaction though there is nothing wrong.
Help!! How can a few owners stop the few EC and the Strata Manager from proceeding with their plan? Is there any govt depts we can seek for help?
On one side you have the Strata Manager and 4 EC armed with the statement below to proceed. I know they are wrong but do not know how to proceed to deliver a strong message to stop their action.
11/05/2013 at 11:41 am #18449@chak said:
Thanks for all the replies.In your opinion, can the owners use the OC fund to finance a Defects Report($24,000) by a specialised company on the block for the developer to fix defects before the Home Owners Warranty expire?
Yes they can so long as a motion is passed at a property constituted GM.
The EC cannot approve this (unless it is within their budget limit).
To stop this happening you can start proceeding at CTTT if a properly constituted motion has not been passed. This action can be taken by an individual owner, the OC (once a motion has been passed) or the EC (again once motion has been passed).
12/05/2013 at 2:43 pm #18452Half a million dollars is a lot of money, if I were an EC member I would be very nervous about approving that kind of expenditure unless I were absolutely sure everything had been done properly.
This is what I think you should do:
1. Get the owners who support you, and write a letter to the strata manager as a matter of urgency. In the letter say this:
– the EC does not have any authority to enter into a contract on behalf of the Owners Corporation for rectification works, other than those ordered by the CTTT.
– if the EC enters into any other contract in relation to rectification works, you will hold the EC members personally liable in respect of that contract.
2. contact the CTTT in relation to your options, this may include obtaining an order such as an interim order preventing the EC from entering into a contract on behalf of the Owners Corporation, without the approval of the Owners Corporation.
14/05/2013 at 1:56 pm #18464Thanks for the replies. It has been very useful. Accordingly I have written to the Strata Management who insisted it was a resolution for engaging outside builders although the Developer is willing to attend to defects as order by FairTrading. He further insisted it was a direction from EC. Anyway I will be taking the next step to CTTT. It was only 3 members of the EC who do not want the Developer to rectify their defects but opt for outside builder and Strata Manager appears to be working alongside with them.What a mess!!! Thanks all the same.
14/05/2013 at 2:52 pm #18468Gosh they sound like very interesting strata managers, I wonder whether they were asleep when they did their training.
It would be worthwhile to also write the EC and strata manager a letter, while you are getting your act together with the CTTT.
15/05/2013 at 7:42 am #18472scotlandx, it was effective because the SM went on annual leave immediately the following day and emailed before to state that the issue was not resolved. Thanks.
If a few of us owners with enough unit entitlements to call for an Extraordinary GM, how can we go about contacting all owners as some units are rented out?
If it is the strata roll, where can I get hold of it because I know positively our EC do not have one? Can we ask the Strata Management for it?
15/05/2013 at 10:44 am #18473Yes – as an owner you have a right to a copy of the strata roll. All you need to do is contact the strata manager and ask for it. They may charge you a small fee for it. They must provide it to you within 10 days of you making the request.
15/05/2013 at 11:09 am #18475Thanks. I am organising to do the usual thing under such situation, how can OC get rid of the Strata Management? Do we have to wait till their contract expire or can we give them notice to terminate? What are the correct procedures to follow under the Act?
The same with dissolving the EC, can we, at the Extraordinary GM motion to dissolve the EC? Voting for EC members, can it be done by show of hands either Yes or No?
Sorry, I am entering into new ground and want to do it correctly under the Act.
15/05/2013 at 11:35 am #18477“Thanks. I am organising to do the usual thing under such situation, how can OC get rid of the Strata Management? Do we have to wait till their contract expire or can we give them notice to terminate? What are the correct procedures to follow under the Act? “
Hi Chak, others might know better than me but for the Strata Manager we almost hired the contract stpulated a 3 year term where we had to compensate them if terminated. Then according to the contract we were asked to sign, the contract was ongoing and we needed to give 3 months notice to terminate.
I think it all depends upon the contract you signed when you first engaged the Strata Manager. As to the second part of your question, I will leave it to others.
15/05/2013 at 11:43 am #18478You need to look at the contract you have with the Strata Manager to see what the terms for dismissal are. They often require you to give them three months notice that you intend to either terminate or not renew their contract (under normal circumstance where they have fulfilled all their contractual duties).
You can, by special resolution, declare any or all the seats on the EC vacant at a General Meeting provided you a) have a motion to do so on the agenda and b) not more than 25 percent of owners voting at the meeting (in terms of their unit entitlements) vote against it.
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.
15/05/2013 at 2:06 pm #18480Bear in mind Chak that the SM is more accurately referred to as a Strata Administrator because they can make no independent decisions and they take instructions from the EC and OC.
If you can get 25% (by entitlement) to sign a letter demanding an EGM then the SM has to organize one.
Make sure you submit motions that:
1) removed the power of the EC to authorize any spending above $xxx
2) No more spending by the SM or EC except what was approved by the budget at the AGM
3) to pursue any individual who has authorized Strata funds to be spent without a property authorized vote having occurred, and to pursue the said individual to recover from them said expenditure.
If you have the numbers calling an EGM is the quickest way to stop the spending as CTTT can take months to get any action, and the result of the EGM vote would strengthen your application at CTTT (it might also put the fear of god into these spenders if they think they might be personally liable for the spending)
15/05/2013 at 3:55 pm #18481Can we call an EGM if we have enough unit entitlements between us and not go through the SM?
Can an owners request for the Strata Roll on his own or can we as a group with enough unit entitlements (more than a quarter of the total unit entitlements) request for the Strata Roll?
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