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Curbing crazy EC members

It’s hard to know what to say about Harry Triguboff’s statement, mentioned in passing in a recent interview in the Sydney Morning Herald, that he had persuaded Bob Carr to change the laws to make it harder for apartment owners to launch legal actions.

I’m sure High-rise Harry had all apartment owners’ best interests at heart when he suggested to Bob the Builder that power-crazed executive committee members, hell-bent on wasting their levies on capricious and malicious legal adventures, be constrained by having to get the approval of the majority of owners in a building.

On the face of it, it seems right and good and fair.

It’s not Harry’s fault that some owners are too scared of the unlikely prospect of losing their homes to pursue legitimate claims for defect rectification. Likewise, he can’t be held responsible for investor owners – the majority in most apartment buildings – preferring not to let it be publicly known that their building isn’t up to standard before they sell.

But government heavy hitter John Della Bosca’s rejoinder to one critic who pointed out that it’s now harder for owners’ corporations to pursue legitimate claims against developers for defect rectification, does bear some scrutiny.

Big John said, without a hint of irony, that all parties had supported the change. Well, d’uh! Who are the biggest donors to party funds? Developers, of course. Even State politicians aren’t that naive.

For my money, the biggest problem in strata is that, like crazy, out-of-control ECs, consumer protection is largely a myth. Remember self-certification? Remember the scrapping of Builders Warranty Insurance for high-rises?

Small shady developers disappear into bankruptcy … only to pop up again under other names. Meanwhile the big companies load up executive committees with their mates and appoint their own building managers on 10-year contracts to make sure the shrinking six-year defects window passes without complaint, legitimate or otherwise.

Needless to say, we – the crazy, out-of-control, litigation-addicted apartment owners – are the ones who pay and pay and pay.

So take your hats off to Harry. You might not like what he says about trees but at least he’s honest.

NOT SO CRAZY

You are so right, this is how it works.

When you purchase with one specific company’s finance they take over your voting rights until you refinance.

They actually sell the front desk for millions and have written in their contracts that all lettings and resales are required through front desk. This is not binding.

They then stack the EC with their nominees, usually real estate agents who obtain their nomination from greedy landlords that don’t want levies raised or maintenance kept up. They also are the overcrowders as this keeps their returns high.

They then only let what is in the interest of the company pass through the EC.

The company puts in place bylaws giving exclusive use to any areas they want to utilise before they sell off units.

In our case visitor parking was used by company staff for 16 years until owners went to council and discovered the bylaw was illegal.

This company also uses Private Certifiers that issue Certificates which are fraudulent and then when the defects become known usually after the 6 years has run out and the EC is no longer stacked, the then owners are left with the defects to repair and special levies to the tune of $20,000 per apartment are required.

I have written to Sartor, Iemma and the other powers that be but they reply with nothing positive.

Buyers beware.

EC

This was originally posted as a reader’s comment (see below). The commenter “EC” referred to a specific company that allegedly does the things described above. Many large developers do not behave in this way and are excluded from these allegations. JimmyT

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