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22/10/2019 at 2:11 pm #43631RolandFlatchatter
We are a small strata block and have one lot owner $1,700 behind in levies (no explanation – they just won’t pay). The OC is indemnified under the law for recovery cost – is the real problem who funds the recovery cost initially – and then you may miss out because there are no assets to claim against?22/10/2019 at 2:22 pm #43647Jimmy-TKeymaster
There are specialist strata debt recovery agencies around who will not only get you your money back, but it will be at no cost to your strata scheme as they can claim all reasonable costs against the debtor.
Google “strata debt recovery” but make sure you contact a strata debt specialist rather than an ordinary debt collector working on commission.23/10/2019 at 4:26 pm #43748RolandFlatchatterChat-starter
I did contact one such debt collector who came up under the search suggested and they required payment of their fees from the OC even though they are enforceable costs against the debtor which they would endeavour to recover and reimburse the OC. This seems normal as the legal firm / debt collector won’t bear the risk of non collection. The risk is taken by the OC who fund the legal costs while the recover action takes place. If and when the action is successful the OC is reimbursed for its outlays.30/10/2019 at 8:56 am #44020Jimmy-TKeymaster
I don’t know if it’s normal but pre-payment of debt collection fees is not demanded by all firms. Colin Grace of Grace Lawyers – one of the biggest players in the field – wrote this:
Debt collection is not dissimilar to any other form of legal process. When we are engaged by an Owners Corporation for our debt recovery services, we will issue our invoices for the work that we undertake and expect to be paid for our work just like any other service provider (eg. plumbers, electricians). If we do our work well (which we do, always!), then we will recover the levies and the costs that the Owners Corporation has incurred as part of the process. The advantage for Owners Corporations is that the legislation allows for them to then legally recover the amounts of our invoices from the owner who failed to pay their levies (in part or whole).
As we have been working in the industry for many years we don’t normally ask for payment before we undertake the work, we undertake the work and then issue our invoices for payment within 30 days. As a favour to some of our clients who are dealing with plans in dire need of funds, we may agree to allow them extended time to pay our invoices (so as to allow for some recovery action to bring in some funds first).
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