Cosmetic Remedial Levy | Levies and Unit Entitlements | Flat Chat Forum: Your Questions Answered




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Cosmetic Remedial Levy
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swoo
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15/04/2017 - 8:48 pm
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I live in NSW in a 12 Unit complex. Recently we had a remedial report by engineers stating that there were no current structural defects but did advise we start to undertake some remedial work in order to avert future problems such as finding the source of water ingress in the garden beds causing seepage into the garage underneath. Sounds reasonable. However our Strata Committee wants to spend $65,000 on a a small wall which extends around the complex as there are some areas where rust is visible and some render in places is lifting.... They suggest the whole wall needs to have all of the rods replaced and render all- 275sqm. The total cost of remediation is $180,000 (inc $65,000 to render). A Levy will have to be raised. The engineers ranked the render as last on their list.

I asked if the render could be left until next year or a later date as this really hikes up the total cost and is cosmetic. The chairperson is pushing to get the lot done and I am worried that the levy amount will increase especially once the work on the garden beds begin.Some residents including me will be pushed financially and may not be able to meet an increase in a special levy.

What can I do (along with 2 other residents) beside pleading we leave the render work for the time being until items listed higher on the priority list are dealt with first.

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JimmyT
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16/04/2017 - 1:52 pm
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I am happy to advise theat two of our sponsors may be able to help you with this.  Magnatex might come up with an alternative solution (since rusting rods are their stock in trade) and Lannock may provide the finance to avoid a special levy.

Click on their ads and talk to them.  If you can come up with better alternatives then the committee surely must at least listen.

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Sir Humphrey
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16/04/2017 - 2:21 pm
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Another option, if the wall is easily accessible, would be to see if enough owners would be prepared to do the rendering of the wall DIY. It might not be such a highly skilled job as the other tasks and a series of working bees might do it at much lower cost. Those who can't or won't do the work might provide the labourers with cool drinks periodically and a communal meal at the end. It might help build a sense of community. 

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swoo
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25/04/2017 - 10:36 pm
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thanks for the response.

Our Strata Manager informed us all at a general revision of the various remedial specialists that the sponsor i assume you refer to has gone "belly up" I contacted Lannock and have received an immediate response however our Strata Manager will have his own lender in mind and the Strata Committee will accept whomever he suggests. I have emailed all owners info on Magnatex but it was totally ignored Over 95% of owners are over 80 so doing the job themselves is out of the question even though they are all retired.

Can I apply to NCAT for orders to delay the rendering alone as this poses undue financial stress for purely cosmetic works  . My concern is that the cost will blow out and $65,000 is an obscene amount of money for a small wallwhich could be repaired over the next 5 years.

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JimmyT
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25/04/2017 - 10:57 pm
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None of our sponsors have gone "belly up" so I would be informing all your committee of this and asking the strata manager why they are providing false information on this? What's in it for them? 

You can certainly apply to NCAT to have orders put in place to halt the work, provided you can show that the decision was made in a way that didn't comply with the Act or Regulations (see below).

The key question is, has the Act been breached or ignored and you could argue that the owners have been given false information and, had they not been misled, might have made an entirely different decision.

Meanwhile I would ask the strata manager to declare all commissions and payments that would be made to them if this work went ahead as they have outlined as they are required to do under sections 60 and 61 of tha Act (also below). 

 

24 Order invalidating resolution of owners corporation
(1) The Tribunal may ... make an order invalidating any resolution of ... the persons present at a meeting of the owners corporation if the Tribunal considers that the provisions of this Act or the regulations have not been complied with in relation to the meeting. 

60 Disclosure of commissions and training services
(1) A strata managing agent for a strata scheme must report the following at the annual general meeting of the owners corporation for the scheme:
(a) whether any commissions or training services have been provided to or paid for the agent (other than by the owners corporation) in connection with the exercise by the agent of functions for the scheme during the preceding 12 months and particulars of any such commissions or training services, 
(b) any such commissions or training services and the estimated amount or value of any such commissions or training services that the agent believes are likely to be provided to or paid for the agent in the following 12 months.
Maximum penalty: 20 penalty units.
Note. It will be an offence for an agent to receive commissions or training services that are not of a kind permitted by the agent’s terms of appointment or approved by the owners corporation (see section 57).
(2) A strata managing agent must, as soon as practicable after becoming aware that commissions or training services provided to or paid for the agent (other than by the owners corporation) differ from the commissions or training services or any estimate of them disclosed at the annual general meeting, disclose to the strata committee the variation and give an explanation for the variation.
Maximum penalty: 20 penalty units.
(3) The Tribunal may, on application by an owners corporation, order a strata managing agent to pay to the owners corporation:
(a) the whole or part of the amount or value of any commissions or training services provided to or paid for the agent and not disclosed in accordance with this section, or
(b) the whole or part of the amount or value of any commissions or training services provided to or paid for the agent that are not of a kind or an amount disclosed by the agent under this section, if the Tribunal is satisfied that the disclosure of those things at the previous annual general meeting was not made in good faith.
(4) In this section: training service means a training course or service (including attendance at industry events such as conferences).

61 Procedure for requiring information from strata managing agent
(1) An owners corporation is to require information from a strata managing agent under this Division by written notice given to the strata managing agent.
(2) The notice must specify a member of the strata committee to whom the information is to be delivered.

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