This topic contains 11 replies, has 4 voices, and was last updated by 1 week, 5 days ago.
07/10/2019 at 3:19 pm #43092
We have a committee [member?] who refuses to sign a declaration that none of the Strata Committee have been sued personally regarding being an office bearer now or in the past, and have no knowledge of any action in the future. This is impacting on our ability to get insurance. They have been told to sign as they are holding up our insurance which is due for renewal in about 2 weeks. What action can be taken against this member?
07/10/2019 at 3:29 pm #43096
- This topic was modified 1 week, 5 days ago by .
Immediately call an EGM with one item on the agenda: “Removal of non-compliant committee member.”
At the EGM, the votes of 75 per cent of those attending, in person or by proxy, can remove the member from the committee.
Under Section 35 (1)(e):
An elected member of a strata committee vacates office as a member … if the owners corporation, in accordance with a special resolution, determines that the person’s office as a member is vacated.
Immediately hold a committee meeting afterwards to bring in a new committee member who has already agreed to sign the document (this is by co-option by the committee, not full election).
I’m guessing the the prospect of being publicly kicked off the committee may nudge the recalcitrant member towards signing if he or she is able to do so.
By the way, I have never before heard of this being a condition for getting insurance but I can’t say it surprises me.07/10/2019 at 11:25 pm #43103
I don’t see how a committee member is under any obligation to sign that document. Seems a bit odd.
Was this a condition of the insurer as I have never of this either but it would be interesring to know.08/10/2019 at 8:59 am #43109
Thank you for your reply.
It is a Body Corporate Elite Declaration for Management Committee Liability.
We are not able to get terms and conditions until it is signed. There have been a few high water damages claims and most insurers are not interested. Apparently insurers can sometimes ask for these.08/10/2019 at 9:01 am #43114
“Body Corporate”? Are you in Queensland? There are different rules for removal of committee members there.08/10/2019 at 10:16 am #43115
I could only suggest that you get some advice from a specialist lawyer, not the strata manager. Thats your call.
I don’t think you can’t force somebody to sign something especially if they are unaware of the terms and conditions.08/10/2019 at 10:22 am #43118
No one is “forcing” anyone to do anything. It’s transactional. A car hire firm can’t force you to sign a document saying you will take responsibility for damage – they just refuse to rent you a car if you don’t.
It sounds like this block has been flagged as high risk due to previous claims so the insurance comany is saying if any committee members won’t sign, they won’t insure.
And if one committee member refuses to sign, the others are entitled to do whatever is required to get the insurance that the law requires them to hold.
Is the hold-out committee member trying to get insurance from another source? I would guess not.08/10/2019 at 11:24 am #43120
A car hire company has to provide the conditions of insurance prior to the signing of the contract. This is well regulated.
If im not mistaken what the op is saying is that they won’t provide any conditions prior to signing the disclaimer. I think that’s the sticking point.08/10/2019 at 11:30 am #43123
We are not able to get terms and conditions until it is signed.
It’s a sticking point but it’s not as if they are being asked to sign the contract sight unseen. I really don’t see the problem, here. Sure the insurance firm is being cautious, but that seems to be because of previous claims. Some strata schemes use their insurances as a renovation fund, others as their “no-cost” guarantors against litigation.
What is the potential down-side for the committee member … unless they have been sued in the past, which would be unfortunate if there had been no case to answer.
Get them to resign from the committee, sign up for the insurance, then bring them back on later, if it’s an issue.08/10/2019 at 1:32 pm #43124
Some strata schemes use their insurances as a renovation fund, others as their “no-cost” guarantors against litigation.
I couldn’t agree more.09/10/2019 at 9:00 am #43151
I’m guessing the op may be in SA or WA. In SA i dont think there is any legal protections under the ACT for the “management committee” members like there is in NSW, in which case the committee members need indemnity insurance which is basically office bearers insurance. Could be wrong.09/10/2019 at 12:42 pm #43173
As a business the insurance company can ask for whatever they want (within reason) to manage their risk. However asking for a signature before providing the T&Cs is highly questionable. Always read the fine print hefore signing.
As to whether they have “no knowledge of any action in the future” another reason to read the fine print. That is an incredibly vast statement basically capturing every comment even those made at the local pub. How many people here would sign such a document eyes closed?09/10/2019 at 5:37 pm #43179
Actually, this appears to be a fairly standard declaration for professional indemity insurance.
The declaration is required before the insurer can offer up insurance and quote a price which can only be done after they get the declaration as the op has stated.
The insurer will use this to cross check the information provided and calculate the risk and come up with a price for the policy or refuse or limit the insurance in some way.
It may also be also used as a waiver if false information is provided and they find out later.
It seems a bit unusual though for individual members to each have to provide a seperate declaration rather than the owners corporation as a whole making the application but this could be due to the different way that this works in other states as a management commitee perhaps?
In comarison, if you take out pi insurance as a business in NSW, normally the directors are listed in the declaration, they don’t fill in separate ones.
The reason the other member may not want to sign is probably because he has either had a claim, intending to clain or he doesn’t want to provide his private information which he is probably not obligated to do as it’s outside the scope odf what is expected and let’s not forget he ain’t getting paid.
The normal insurances required for the strata such as public liability and so on should not be effected by the pi insurance I wouldnt have thought.