This article discusses NSW strata garage lot voting rights and how utility lots affect voting and committee nominations.
Question: The garages in our unit block have unit entitlements. Is this counted for voting and nomination of a committee member? If an owner is unfinancial for their garage lot, can they vote?
Our block has 4 units. Lots 1 – 4 have a unit entitlement of 20. Lots 1 and 3 also own garages that form lots 5 and 6, each with a unit entitlement of 2.
Lot 3 was unfinancial at the time of the AGM for the garage lot (5) but financial for lot 3. Are lots 5 and 6 included for the purpose of voting and nomination of a committee member? In this example, is lot 3 financial or not?
Answer: Lots 5 and 6, whilst being utility lots, are still lots for voting and nomination of a committee member.
In this scenario, lots 5 and 6 are defined under section 4 of the Strata Schemes Management Act 2015 (NSW) (‘the Act’) as a “utility lot”.
These are separate lots on the title, and the law does not prevent those lots from having voting rights.
To clarify, Schedule 1, clause 14(1) of the Act states:
Simple majority vote to generally apply.
A motion put to a meeting, or an election of officers of the owners corporation or members of the strata committee is to be decided according to a majority in the number of the votes cast for and against the motion with each person having one vote for each lot in respect of which the person is entitled to vote.
In other words, there is no exclusion of utility lots from counting as lots entitled to vote.
If all lot owners were financial, the owner of those lots with apartment and utility lots actually have two votes (or the ability to nominate one person, per lot) – one for each lot.
A motion’s outcome is only based on unit entitlement:
- A special resolution is required (see section 5(2) of the Act); or
- A poll vote is demanded (see Schedule 1, clause 14(2) of the Act).
If the motion were to be decided by special resolution or poll, the combined unit entitlement for those lots matters (i.e. those with apartment and utility lots have 22 unit entitlements worth of voting power, whilst those with apartment lots only have 20 unit entitlements worth of voting power).
In summary, lots 5 and 6, whilst being utility lots, are still lots for the purpose of voting and nomination of a committee member.
This post appears in the March 2023 edition of The NSW Strata Magazine.
Tim Sara Sara Strata E: tim@sarastrata.com.au P: 04 8500 7960