A lot owner from NSW is wondering ways to overrule Strata Committee decisions. Leanne Habib, Premium Strata provides the following response.
Jump directly to the QUESTION you are after:
- QUESTION: Can an EGM be called to reverse the decision of a majority at an AGM? The owners corporation by a majority vote accepted the proposed strata levies at our AGM. A group of dissatisfied owners have asked for an EGM with a motion to reverse the decision.
- QUESTION: When considering committee decisions, if a motion is defeated at an AGM (or EGM), how soon can the same or similar motion be proposed again?
- QUESTION: What is deemed as a justifiable reason for an owners corporation to call a vote to overrule its strata committee decisions? What proportion of the vote is required to overrule?
- QUESTION: Whose decision is it to appoint strata maintenance contractors?
Question: Can an EGM be called to reverse the decision of a majority at an AGM? The owners corporation by a majority vote accepted the proposed strata levies at our AGM. A group of dissatisfied owners have asked for an EGM with a motion to reverse the decision.
Can an EGM be called to reverse the decision of a majority at an AGM?
The owners corporation by a majority vote accepted the proposed strata levies at our AGM. Levies supported by appropriate budgets, explanations and Capital Works Funding Plan.
A group of dissatisfied owners (just enough to make the 25% required for an EGM) within a month have asked for an EGM with a motion to reverse the newly agreed levies to those of the previous year. They provide no further explanation or documentation.
It seems this is permissible but unsatisfactory. Can a series of AGM and EGMs be called each to reverse the decisions of a prior AGM, EGM?
Answer: Decisions may be reversed and any type of general meeting may revoke a decision of another type of general meeting.
Yes, decisions may be reversed and any type of general meeting may revoke a decision of another type of general meeting.
Under the strata legislation, a unanimous resolution or special resolution of an owners corporation about a matter cannot be amended or revoked other than by a subsequent resolution of the same kind.
The position may change if a decision has been implemented and is incapable of being reversed.
This post appears in Strata News #359.
Question: When considering committee decisions, if a motion is defeated at an AGM (or EGM), how soon can the same or similar motion be proposed again?
Are old Owners Corporation committee decisions “set in Concrete?”
At the conclusion of our recent AGM there was a discussion on the merits of undertaking a couple of capital works projects, and whether the Strata Committee should investigate their affordability and practicality of seeking a DA.
Long-time residents stated that someone had proposed the same idea some years before, and the committee decision, based on a vote, was to not pursue the initiative. Over the ensuing years, the newer unit owners would likely now have the numbers to approve this idea.
Therefore, our question is: If a motion is defeated at an AGM (or EGM), how soon can the same motion (or one ostensibly similar) be proposed for the second time?
Answer: Owners Corporations may change their minds over time, in the same way that their previous committee decisions may be rescinded.
We are not aware of any impediment to the Owners Corporation placing an old motion for reconsideration by it.
Owners Corporations may change their minds over time, in the same way that their previous committee decisions may be rescinded.
This post appears in Strata News #232.
Question: What is deemed as a justifiable reason for an owners corporation to call a vote to overrule its strata committee decisions? What proportion of the vote is required to overrule?
Our Strata has a couple of less than congenial lot owners who, after resigning from the Strata Committee, now repeatedly quote a single sentence from NSW Fair Trading’s website in all their correspondence, and speak it verbatim when in conversation with committee members.
They quote: “Any decision made by the strata committee is treated as a decision of the owner’s corporation. However, the owner’s corporation can vote to overrule its strata committee’s decisions or put limits on what they can make decisions about”. From the NSW Fair Trading FactSheet: Meetings of the strata committee.
This whilst both tedious and ungracious it is in fact quite true; in the event of a disagreement between the owners corporation and the executive committee, the decision of the owners corporation prevails.
Therefore my 5 questions are:
- What are deemed as justifiable reasons for an owners corporation to call a vote to overrule its strata committee decisions?
- What would be the process of calling for such a vote to take place?
- Would an extraordinary general meeting of the owners corporation be needed to put the overrule motion to the vote?
- What proportion of the vote is required to overrule strata committee decisions?
- Would strata committee members retain their vote in the owners corporation meeting?
- Finally, is there a definitive statement that could be used to effectively counter the NSW Fair Trading quote (and put these nay-sayers in their place)?
Answer: This could occurif the decision was not in the best interests of the Owners Corporation.
- if the strata committee made a decision which was ultra vires or one that may only be made by the Owners Corporation
- if the decision of the strata committee was not in the best interests of the Owners Corporation
- a significant purchase is proposed to be made against the wishes of the individual lot owners
All of the above apply if the decision has NOT yet been implemented ie major purchase has already been made in which case the Owners Corporation would not be able to reverse the decision and would need to seek NCAT assistance.
- A general meeting would need to be called and by ordinary resolution, the Owners Corporation would vary, rescind or override the decision made.
- Yes or a motion on the AGM agenda.
Please note following the strata reforms which took effect in November 2016 there are now only types of general meetings, an Annual General Meeting and a General Meeting (formally referred to as an Extraordinary General Meeting)
- An ordinary resolution would be required as per point 2 above ie a majority
- Not really, because NSW Fair Trading position re-states the letter of the law (which is correct).
This post appears in Strata News #183.
Question: Whose decision is it to appoint strata maintenance contractors?
My issue is that our committee wants to appoint an expensive gardening company when we have cheaper quotes. A few other members and I are opposed to it, saying it is a waste of money. If gardening can be done for a reasonable amount, why spend big dollars?
Currently, these members and I are seen as troublemakers. The remainder of the owners have a majority and also have the Strata Manager on their side.
We believe the decision to accept the higher quote is not in the best interest of the body corporate. The gardening contractor has been recommended by the Strata Manager and frankly, we question the Strata Manager’s honesty and professionalism.
Are we able to disapprove any company recommended by the Strata Manager, as it is in conflict?
Can we ask the Strata Manager to butt out of Committee issues such as recommending strata maintenance contractors?
The Strata Manager is calling an executive meeting in which we have to decide (vote) to appoint a Gardener and he is saying majority vote will win? Can he do that?
There is no Secretary, Treasurer or any other official in our Committee. I have asked for this previously, but the Strata Manager told us we don’t need any Officials. I noticed that the Strata Manager is always getting his way regarding the appointment of strata maintenance contractors.
Answer: The appointment of a new gardener may be a matter that you and other owners feel is best taken to a general meeting
The Owners Corporation under the Act must appoint office bearers consisting of a Chairperson, Secretary and Treasurer. This is normally done at a committee meeting and traditionally, immediately at the first Committee meeting following the Annual General Meeting each year.
A decision regarding the appointment of a new gardener can be done at a committee meeting if owners have not previously restricted the decision making of the committee in relation to this subject. A majority vote at a committee meeting is the vote required to appoint a new gardener.
There is no conflict of interest if the Strata Manager proposes different strata maintenance contractors to assist with servicing the Owners Corporation, as this will fall normally within their delegated duties on behalf of the Owners Corporation, although the Strata Manager is required under the Act to disclose any direct connection or relationship with any nominated contractors, if relevant.
Further Pursuant to Clause 31 (3), Schedule 2 of the Strata Schemes Management Act 1996 (NSW), persons entitled to vote in respect of lots the total unit entitlement of which is at least one –quarter of the aggregate unit entitlement, can requisition the convening of a general meeting with the proposed motions that are submitted pursuant to Clause 36, Schedule 2 of the Act:
36 Requisition for motion to be included on agenda for general meeting
- Any person entitled to vote at a general meeting of an owners corporation on a motion that does not require a unanimous resolution may, by notice in writing served on the secretary of the executive committee, require inclusion in the agenda of the next general meeting of the owners corporation of a motion set out in the notice and the secretary must comply with the notice.
- The secretary must give effect to the requirement of the notice.
- Subclause (1) does not require the inclusion of a motion on the agenda of a general meeting for which notices have already been given in accordance with this Schedule but in that case the motion must be included in the agenda of the next general meeting after that.
- For the purposes of subclause (1), an owner of a lot who, but for the fact that the lot is subject to a mortgage or covenant charge, would be entitled to vote at a general meeting of the owners corporation is entitled to vote at that meeting.
Therefore, the appointment of a new gardener may be a matter that you and other owners feel is best taken to a general meeting so that all owners can consider the appointment of the new gardener, instead of leaving the decision for the committee, if the committee has different views on the subject.
If so, owners who have at least one-quarter of the aggregate unit entitlement can requisition a general meeting to consider the appointment of a new gardener.
Have a question or something to add to the article? Leave a comment below.
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This article is not intended to be personal advice and you should not rely on it as a substitute for any form of advice.
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