Outvoted but not outsmarted

I think it was Winston Churchill who said democracy was the worst system of government … apart from all the others. In strata land, democracy has an anachronistic twist – reminiscent of the days when only landowners could vote – with those who own the most or largest apartments having the biggest say in the running of a building.

It’s a quirk of otherwise basically sound laws that means an extended family with a few compliant mates can run a strata block to suit themselves, and, as in this reader’s case, line their pockets.

Q: I live in an apartment block of 70-plus units in which one owner, a tradesperson, owns close to 10% of the entitlement of the whole block. This owner has family, girlfriend and a close friend on the Executive Committee. They, of course, all agree with his requests, including hiring his company to do substantial work on our building all without tenders or quotes since he has majority rule in the body corporate.

Now he also wants to charge us $90K (including GST) for his services. None of us are sure what these are as minutes are not taken at executive committee meetings. In the past he has bullied several of the owners and one of the threats lead to police intervention.

Is it legal to hire yourself for maintenance and upgrades to a building if there is an obvious conflict of interest? Please help us. What can we do?

Scared owner, Tamarama

If this bully-boy wants to charge for services, my take would be that he is claiming that he is acting as a building manager. Therefore, by law, he is not allowed to vote on any matter related to his fees. Check with the Office of fair Trading but if I’m right, there goes 10 percent of the vote in one fell swoop.

However, there is a more fundamental issue here. If what you say is true, your building’s Executive Committee is not functioning as it should under State law (and by not providing accurate minutes of EC meetings is actually breaching strata law).

You should contact the OFT immediately and ask for a Strata Manager to be appointed to run the building until all these matters can be sorted out. Your existing strata manager (if you have one) should be sacked for incompetence for allowing this to happen.

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