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Strata Committee voting and deciding without telling owners
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BondiLocal
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12/11/2018 - 6:39 pm
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HI Flat-Chat gurus, I’m in a 30-unit block where the Strata Committee claims they don’t have time for meetings, so they email each other to make decisions. However it means that owners do not know what is being proposed to go to a General Meeting until a General Meeting is held, which can be 11 months later. Also owners don’t hear about money being spent, and on what, until the AGM.

So, I’ve just received a 91-page agenda for our AGM next week. There are many issues to be discussed and voted on, one involving voting on spending a few million dollars. there are no details of amounts the SC has in mind, nor explanatory background to issues that are new to other owners.

What I really need to know is: Does the SC have the duty to make minutes and inform owners of their proposals and decisions,  whether they have physical meetings or not? Fair Trading website suggests yes:

“minutes must include details of all resolutions passed, including those considered without holding a meeting

but I can’t find it spelled out in the legislation that this means that votes of the SC must be minuted and distributed to all the owners. 

I intend to raise this issue at the AGM as the lack of communication and transparency, by both the Committee and the agent, have been causing shock and tears for 2 years to some owners, specially me. (I was on the Committee for years, got too tired, new Committee started, then I got terminal cancer so please don’t suggest I re-join!)

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Sir Humphrey
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12/11/2018 - 10:51 pm
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One week does not sound like sufficient notice for the AGM. In the ACT, where I am and I am more familiar with the legislation, at least 2 weeks notice is generally required. This does not mean that meeting papers can be put in the mail 14 days before the meeting date. The committee must also allow sufficient time for postage to be deemed to have arrived. From memory I think this 5 working days. In effect the papers need to be mailed out at least 3 weeks ahead. When I was a committee member, we generally did 4 weeks just to be safe. 

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Jimmy-T
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13/11/2018 - 4:03 pm
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Schedules 1 and 2 of the NSW Act specify that there must be 7 days notice given of a general meeting, with minutes issued withing 14 days.  Strata committee meetings require only 3 days notice with minutes issues within 7 days.

There is considerable debate over what “detailed” agendas and minutes actually mean. Some people think it means every tiny aspect and cough and sneeze in the discussion.  Others say, just bullet points, headlines and results.  But owners can instruct the secretary on how detailed they want agendas and minutes, through a vote at a general meeting.

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BondiLocal
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15/11/2018 - 10:17 pm
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Thanks, but my question was about decisions of the Committee not being notified to other owners, not about notice of the AGM.

Our Committee says it doesn’t have meetings, so they have no need to inform owners of their decisions.

eg the Committee hasn’t reported to the owners corporation about a botched project early this year, that cost $91,000 instead of $70,000, and was stopped when the money ran out, with only a quarter of the work completed. It was already running 4 times longer than estimated. I know because I had the drilling noise for 4 months, but non-resident owners have no idea and were told only that ‘we need more money’ to complete the job.

Now they recommend the same company undertake a huge package of external renovations, to cost approx. $3 million and take 2 years. With no engineer’s advice about what actually needs to be done.

We won’t have time at the AGM to discuss or ask for any of their plans in detail as there are so many items to be voted on. And we ‘don’t know what we don’t know’ to ask about.

At least half owners are investor non-residents who just vote Yes to everything.

If we had prior knowledge of their decisions, we would have time to think about it and even have a bit of extra info or feedback before it goes to a vote at the AGM. And we might find out what’s going on and why.

 They say they’re too busy to have meetings so they just email each other to make decisions. But they’ve managed to put a lot of time into getting quotes and deciding on our new balustrades etc. without telling us residents or owners anything.

So Please, I want to find out if I’m entitled to be notified of decisions of the Committee, within 7 days of the decision, in this situation where the Committee doesn’t hold meetings.

This advice is needed before we get to Other Business next Tuesday 20th Nov. – at about midnight!

Thanks!

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Lady Penelope
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16/11/2018 - 11:24 am
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BondiLocal – The following document may help you.

https://www.fairtrading.nsw.gov.au/housing-and-property/strata-and-community-living/strata-schemes/meetings-of-the-strata-committee

The Committee can make resolutions ‘in writing’ outside of holding a formal committee meeting however they must abide by the correct legal protocols under the Strata Schemes Management Act for this type of meeting which include:

  1. providing the owners with the correct Notice of the ‘in writing’ Meetings (i.e. at least 3 days),
  2. providing the owners with an Agenda including Motions that will decided at the Meeting, 
  3. and providing the owners with the Minutes of Meeting within 7 days of holding the ‘in writing’ Meeting, including all of the decisions made. 

‘In writing’ meetings, although permitted, are generally not preferred as a substitute to replace all Committee Meetings. ‘In writing’ Meetings  are generally used in ’emergencies’. This is because transparency of decision making is of paramount concern in the Legislation. 

You can also raise a Motion at the next General Meeting that requires there to be a minimum of 3 ‘formal’ Committee Meetings per year. You could define a ‘formal’ Committee Meeting as that which is not an ‘in writing’ Meetings. This allows owners to attend the ‘formal’ Committee Meetings – which they obviously cannot do if the Meeting is held ‘in writing’.

If the Owners Corporation votes to support your Motion then the Committee will not be permitted to hold all of their meetings ‘in writing’ and you should therefore achieve a better transparency at your scheme. 

However, you will probably have missed out on your opportunity to submit this Motion for the upcoming General Meeting. It appears that your General Meeting Agenda has already been sent to the owners and your General Meeting is next week. 

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BondiLocal
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16/11/2018 - 1:07 pm
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Thanks so much Lady Penelope for this advice.

I had already sent that link to our Committee. 

You see, they still say they don’t have meetings, because they don’t have formal motions or agendas or votes. They say their decision-making is just a series of emails with eventual agreement. 

Also the agent says it’s too expensive and time-consuming to let all owners know about Committee activities. It requires some emails but also some printed posted copies, Plus the noticeboard copy.

The agent won’t give the Committee the contact details of owners, so the Committee can’t send out emails, and the agent charges us for every email sent.

I’ll raise this issue in Other Business anyway on the basis of that Fair Trading link. But the practical difficulties of contacting owners will then be fired back at me and that’ll end that.

Is that Fair Trading link enough to force a complete change in their behaviour? Is each decision equivalent to an ‘in writing’ meeting? 

Your suggestion about requiring 3 meetings a year: where is that from? It could be very useful for the next General Meeting, thanks.

I don’t want to attend meetings myself as I get too stressed by now. (I did my time on the Committee and did everything, and got burnt out!) And just want to know what’s going on in the Committee’s heads. If I’d known earlier this year what was about to happen – a year of drilling noise and 5 months with no lift and I’m 140 stairs up – I would have moved out then. Plus $75000 in special levies in the past year being paid by each unit for future works they are probably planning but we have no detailed information.

But I love my view and position and want to stay for the months that are left to me! I actually engaged an expensive strata specialist lawyer who wrote to the Committee recently, but they just flicked it to the agent who wrote back without addressing any of my requests.

Thanks for listening and your help anyway

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Lady Penelope
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17/11/2018 - 11:33 am
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You are in a 30 Lot scheme. That would be categorized as a medium sized scheme. It is not unreasonable to expect that at least some committee meetings are held per year. Your scheme deserves to have a committee that functions in a transparent manner.

A 91 page AGM Agenda appears to indicate that your committee is not functioning correctly.

Your scheme appears to be undertaking some major projects at the moment. There are certain decisions that a Committee cannot make. There are decisions that can only be made by the owners corporation at a General Meeting. Has your committee overstepped their authority?

Any owner can raise a Motion for inclusion at an AGM. If there is sufficient support for the Motion and the Motion is ‘reasonable’ then the Motion will Pass. The committee must then abide by the directive outlined in the Motion.

The owners corporation can direct the committee to function in any way that the owner’s corporation chooses, so long as the directive is legal and reasonable. As an example, the owner’s corporation could direct the committee to hold a ‘reasonable’ number of meetings per year, and to hold the meetings in manner (except in emergencies) that permits owners to attend the meetings. The owner’s corporation can direct the committee to limit its spending to a certain amount, or to obtain a certain number of quotes for items of above a certain expenditure, or to submit a 300 – 500 word Explanation with any Motion that is proposed by the committee. 

Although the committee has certain ‘powers’, it is the owner’s corporation that has the ultimate ‘power’ in the strata scheme.

https://www.lookupstrata.com.au/nsw-strata-executive-committee-not-acting-appropriately/

You may need to take the matter further through the Office of Fair Trading and/or NCAT (see Options 6 and 7).  You have already taken the first step by seeking help from a strata lawyer. Perhaps the legal advice that you have already obtained can form the basis of your application. 

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scotlandx
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18/11/2018 - 2:54 pm
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In relation to this:

…they still say they don’t have meetings, because they don’t have formal motions or agendas or votes. They say their decision-making is just a series of emails with eventual agreement. 

The Committee can’t have it both ways – to make a valid decision, they need to have a meeting with an agenda including proposed motions, and vote on those motions – this would be particularly relevant for decisions regarding items that are significant, such as major projects. Notice of the meeting must be given to all owners, with the agenda and proposed resolutions. Bear in mind that giving notice of proposed resolutions is an essential measure as it is connected to two things:

– an owner’s right to attend Strata Committee meetings

– the right of owners holding one-third of unit entitlements to block a proposed resolution by lodging a notice of objection to that resolution.

(note you can have a paper meeting, or a decision made by written resolution, but certain requirements must be met which are dealt with in another response)

A series of emails with eventual agreement is not a resolution in accordance with the Act or general law. It follows that you can challenge those purported “decisions” as not being valid.

Also the agent says it’s too expensive and time-consuming to let all owners know about Committee activities. It requires some emails but also some printed posted copies, Plus the noticeboard copy.

The agent can say that, but the Act requires that notice of Strata Committee meetings and/or proposed resolutions must be given to all owners. It is not optional. The agent is disregarding the requirements of the Act.

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BondiLocal
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22/11/2018 - 10:17 pm
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Thanks so much, Lady Penelope and also scotlandx for your very valuable suggestions and advice.

So, my lawyer’s letter to the Committee was flicked from the Committee to the agent. The agent replied, ‘on behalf of The Committee’ just repeating the excuses I’ve already mentioned eg Committee agrees through emails and tells the agent what they want. I was advised to ring the agent with any questions or concerns.

At the AGM on Tues. night, the agent was chairing, but argued the Committee’s case in most items.  There were no actual votes at the AGM, not even a show of hands. Just like. ‘ok sounds like most of us agree to that’ at every turn.

The 91-page agenda wasn’t completed in the almost 4 hour meeting, so there was no Other Business. No adjournment or even officially ending the meeting. The agent just got up and left after being re-appointed for another 36 months. (I suggested re-appointment for 3 months but was just told ‘no way’ by the agent in the Chair. Then I suggested 12 months, but didn’t have enough supporters. The Committee trusts the agent, as do many owners)

At least one nasty item was knocked back ie the Committee asking to appoint a particular company to undertake all the major construction and waterproofing works, before they’ve even received quotations. Geez.

I think I’ll give up on the Committee and agent, stay for the good times all summer, then move out before that blue netting spoils my view. I’m too ill to spend my remaining months undertaking legal action, although I’d like to.

Thanks again, good people, it’s wonderful to get some detailed and reliable advice from Flat Chat gurus. 

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