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Home » Levies » Levies NSW » NSW: Strata levy debt recovery process: Steps to take when an owner refuses to pay

NSW: Strata levy debt recovery process: Steps to take when an owner refuses to pay

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Question: One lot owner is refusing to pay levies. What is the correct/recommended procedure to pursue debt recovery and in what order should those steps be taken?

I am the “Honorary Administrator” of a self-managing strata scheme of four townhouses.

We may need to take levy recovery action against one owner who is refusing to pay the 4 equal quarterly levy contributions discussed and agreed to as an agenda item at our AGM.

I have sent several friendly reminders and a formal letter of demand to pay by 4 equal quarterly instalments as required under the NSW Strata Schemes Management Act and the Owners Corporation, but he is refusing.

The lot owner has requested to pay by setting up a periodic payment arrangement with his bank to pay in small fortnightly instalments.

After sending out reminder notices and a formal letter of demand, what is the correct/recommended procedure to pursue debt recovery and in what order should those steps be taken?

Answer: The process is as follows

Generally speaking, the process is as follows:

  1. 1st Letter of Demand by strata manager for unpaid levies

  2. 2nd Letter of Demand by strata manager for unpaid levies

  3. 3rd Letter of Demand by strata manager for unpaid levies

  4. 4th Letter of Demand by lawyer/debt collector for unpaid levies

  5. Legal proceedings for debt recovery are commenced

This post appears in Strata News #464.

Leanne Habib
Premium Strata
E: info@premiumstrata.com.au
P: 02 9281 6440

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About Leanne Habib, Premium Strata

Leanne is leading the conversation in strata and community management across Australia. With a distinguished career spanning over 25 years and holding credentials as a licensed Strata and Community Manager and Real Estate Managing Agent, Leanne has masterfully redefined the essence of premium strata service. Her approach, honed through years in senior roles within top-tier agencies, is unwaveringly client-focused, ensuring that expectations are not only met but consistently exceeded.

As a pivotal member of the Strata Community Association (SCA) and the CEO of the award-winning Premium Strata, Leanne, together with her team of seasoned strata managers, embodies a commitment to unparalleled service excellence. Beyond steering Premium Strata and Premium Building Management, her influence extends across the property industry as a leading voice. Leanne's insights on legislative updates and industry shifts are invaluable, offering guidance to lot owners on intricate strata matters and fostering effective and informed strata management practices.

Leanne is a regular contributor to Lookupstrata. You can take a look at Leanne’s articles here .

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