Roundup: Huge cost of small debt … and your questions

A friend received an email from his strata committee treasurer the other day.  He was $7 behind in his levies for his flat.

It was no big deal, just an oversight here and an interest payment there, a few cents short one quarter and a misplaced digit the next.

Well, I say it was no big deal, but a couple of days later he was about to take part in a vote on an issue that could have led to a special levy of $500,000.

Even more significantly, the issue was so divisive that his vote could have been crucial.  And if he hadn’t responded to the strata manager’s email, he wouldn’t have been allowed to vote at all.

Why not? Because in NSW (and many other places) strata law says that if you are unfinancial – you owe money on your levies – you can’t vote.

Seriously, this guy who pays something like $10,000 a year in levies, would have been disenfranchised over the cost of a coffee and a muffin.

And you can bet with a half-million-dollar special levy at stake, every vote would have been scrutinised to within an inch of its life.

This is not a freak incident – it goes on all the time. I have seen owners corporations deliberately delay telling people they were behind with their levies to so as to cancel their votes on crucial issues.

And I’ve seen committee members pay shortfalls out of their own pockets to make sure their mates could vote with them.

Come to think of it, I’ve also seen strata managers and owners almost come to blows when the former quite rightly refused to take a cheque from the latter at the meeting.  The money has to be in the bank or it doesn’t count.

There are two solutions to this problem.  Firstly, you need to make 100 per cent sure you are up to date with your levies before important strata votes.

But then the Government needs to loosen the rules a little. Put a $20 threshold on the debt – or one per cent of their quarterly levies.

But don’t take away owners’ right to vote over the price of a coffee and donut.

And on that slightly fattening note, here are the best of the worst – your questions on the Flat Chat Forum in the past week.

  • My levies have just gone up seven-fold to pay for repairs even though we have enough money in our funds to pay for them.  Is this right?  Is it even legal?  And do I have to pay? That’s HERE.
  • Are there any larger schemes (100 units or more) that are self-managed?  And where do I find out? That’s HERE.
  • My removalists damaged an already broken panel on the lift but fixed it.  Six months later the strata committee says I have to pay $500 for repairs. Do I? That’s HERE.
  • An owner built an extension, with permission, but he says we have to paint the part of the wall that’s now INSIDE the extension when we are painting the rest of the block.  Who’s right? That’s HERE.
  • Is it illegal for strata committees, building managers or strata managers to take pictures of residents and their guests when they are on their own private property? That’s HERE.

Hope you’re enjoying the new-look Flat Chat website but if you’re having any problems with it, please let us know on mail@flat-chat.com.au or by writing a comment below.

 

One Reply to “Roundup: Huge cost of small debt … and your questions”

  1. David says:

    I would recommend putting a $100 threshold on the debt level as most strata managers will not send out reminder notices if the debt is less than $100. Most debts less than this amount are just the extra strata manager fees imposed when a payment is received late.

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