The NSW Government’s new strata laws are full of good intentions but what happens if a strata committee just ignores them?

In short, it’s still up to individual owners to take up cudgels to fight the good fight.

Take the new strata regulation that says members with conflicts of interest shouldn’t be allowed to be present when the issues in question are being discussed.

Previously, the committee could decide whether or not it wanted the conflicted members present. Anyone who thinks that’s fair and reasonable hasn’t sat at a committee meeting and heard people being bullied and cajoled into voting against their own best interests.

That is exactly why the government brought in the new provisions which say that any member of a committee who has a pecuniary interest in the outcome of a decision can’t vote, they can’t speak and they can’t even be there when it’s discussed.

Have a look at the relevant section – it could not be more clear. But read to the bottom and you will find the committee’s get-out-of-jail-free card. Decisions will still stand even if this section of the Act is breached.

In short, there is no penalty and no comeback if the committee just goes ahead as if the law wasn’t there and invites any conflicted developer, builder, lawyer or estate agent members to stay, take part in the discussion and even vote.

However, there is another new condition on the statute book that could come into play. Section 37 defines the duties of strata committee members and says they must exercise their duties with honesty, fairness, due care and diligence. It also says they must comply “with this Act and the regulations.”

And there’s the ability to sack committee members with just a simple majority at a general meeting, rather than the 75 per cent super majority previously required.

Failing that, if a strata committee knowingly ignores the law and lets conflicted members – like developers or builders, for instance – take part in the meeting, could we see its office-bearers dragged to NCAT by an outvoted owner and removed from the committee for breaching their duties?

That will be the real test of whether the strata Act has real teeth or is just another wishy washy wish list?

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