This post about why you should join your strata committee has been provided by Michael Ferrier, Eyeon Property Inspections.
Do Strata Committee members always make decisions that are in the best interests of the Owners Corporation?
You’d think that they do.
Unfortunately, this is not always the case. We have inspected thousands of properties around Sydney and have seen many cases where the Strata Committee members seem to put their own agenda ahead of the needs of the building. And in Strata Schemes, where the majority of Owners are not engaged in the day-to-day running of their community, it can be very easy to influence things.
This alone should be a good reason for you to want to join your Scheme’s Strata Committee.
So, what exactly is a Strata Committee?
The Strata Committee is comprised of the members or representatives of the Owners Corporation (all lot owners within the Scheme). The members are elected by the Owners Corporation at a General Meeting and are responsible for overseeing the running of the Scheme.
The Corporation also determines the number of people who can join the Committee: there can be a minimum of 1 and not more than 9 members. Large Schemes are required to have at least 3 active Committee members, and where a Scheme consists of only 2 lots the Strata Committee will be comprised of the owners of both those lots.
The Owners Corporation has the authority to dismiss members of the Strata Committee, as well as delegate some or all of the Committee’s responsibilities to a Strata Managing Agent or a Caretaker.
Who can be elected as a member of a Strata Committee?
According to NSW Fair Trading, the following people are eligible to be nominated:
- An Owner
- A Company Nominee of a Corporation that is an Owner
- A Person who is not an Owner but is nominated by an Owner who is not standing for election
- A Co-Owner of the lot nominated by another Owner who is not a Co-Owner of that lot or is not a candidate for the election
If you are nominated, you must disclose any connections you have with the developer or building manager, as well as any other conflict of interest.
Why have a Strata Committee at all?
In any larger Scheme, it becomes simply impractical to have every Owner involved in every issue that arises. Of course, there will be major items that will require everybody’s involvement, such as approving major works or legal proceedings. On the other hand, less significant issues like a broken mirror in the lift or a clogged garbage chute shouldn’t require everyone’s attention.
The Strata Committee has the authority to make decisions and deal with such issues on behalf of the Owners Corporation, unless specified otherwise by the legislation or Owners have placed restrictions on the Committee’s authority.
What do members of a Strata Committee do?
Once the Committee members are elected, they will decide who is to hold the office-bearer positions. These are the Chairperson, the Secretary and the Treasurer. Interestingly enough, one person can be nominated for all 3 positions. Each position is allocated certain duties and responsibilities in accordance with the NSW Strata Schemes Management Act 2015.
But remember, most of these duties will be delegated to a Strata Manager if you choose to appoint one.
- Presides at all meetings
- Determines quorums and procedural matters, such as declaring the result of voting and ruling a motion out of order
- Convenes all meetings
- Prepares and distributes minutes of meetings
- Puts a motion to confirm the previous minutes
- Gives notices for the Owners Corporation and the Strata Committee
- Maintains the Strata Roll
- Provides information for the Owners Corporation under Section 184
- Looks after correspondence addressed to the Owners Corporation
- Oversees all administrative and secretarial duties for the Owners Corporation and the Strata Committee
- Issues levy notices
- Issues receipts, does the banking and account for any money paid to the Owners Corporation
- Prepares any certificates under Section 184
- Keeps all accounting records and prepares the financial statements
So, why bother getting involved?
Joining your Scheme’s Strata Committee is not a decision to be made lightly. Becoming a member of the Strata Committee means a certain level of responsibility, as well as the possible risk of being part of unpleasant meetings if there is a dispute between the Owners. As a Committee member, you can also become a target for everything other owners don’t like. And in most cases, there is no pay involved for the hours you’ve spent on the job.
But the Strata Committee effectively controls the scheme’s long term future by giving a clear indication on where they want the Scheme to be positioned in the marketplace.
The Strata Committee directly influences the running of the Scheme and can ensure that no corners are being cut when it comes to maintenance, appearance and compliance matters. This, in turn, will help to preserve (and possibly even increase) the property market value, as property buyers would much rather live in a well-maintained building where the Owners Corporation cares about how things are going. Wouldn’t you?
We have prepared thousands of strata reports throughout the years and have seen some truly remarkable transformations where Strata Committees were able to literally raise their Schemes from the ashes.
So if you care about the Scheme you are part of, being on the Strata Committee will help you make a real difference.
If you have a question about your strata committee, some tips or something to add to the article, please leave a comment below.
- NSW: Think strata construction is bad? Strata records are worse!
- NSW: Do you have vacancies in your committee? Here’s what to do
This post appears in Strata News #268.
This article has been republished with permission from the author and first appeared on the Eyeon Property Inspections website.