NSW lot owners are wondering about the level of communication they could expect from their Strata Managers.
Jump directly to the QUESTION you are after:
- QUESTION: Can Strata companies charge owners who request Strata ByLaws to give to a tenant?
- QUESTION: Can the Strata Committee insist that the Strata Manager seeks approval before actioning any type of work on their behalf?
- ARTICLE: Commissions and Training Services | What does my Strata Manager have to disclose?
Question: Can Strata companies charge owners who request Strata ByLaws to give to a tenant?
Answer: No I don’t believe so, but it would depend on the terms of the agency agreement that the owners corporation has with the owners corporation and the by-laws registered with the scheme.
This post appears in Strata News #401.
Question: Can the Strata Committee insist that the Strata Manager seeks approval before actioning any type of work on their behalf?
Can the Strata Committee insist that the Strata Manager seeks approval before actioning any type of work on their behalf?
SITUATION: Unit Owner had engaged a plumber to fix an internal water leakage in a rental unit. The leak returned & Strata didn’t liaise with the owner & sent another plumber to access the problem resulting in a charge to the Owners. The Strata Committee asked the lot owner to pay this bill.
Understandably the Owner is unhappy that they were not consulted as they could have sent the original plumber to fix the problem. This is a new Strata Manager & the Strata Committee instructed them at the first AGM to contact the Committee before arranging any repairs or inspections for their approval.
We an arrangement in place with the previous Strata Management Company because we had been overcharged for unnecessary work that had been carried out without our knowledge.
Answer: If the arrangement is not approved by the Owners Corporation, the Strata Manager may not contact the building as they are not legally required to.
Regarding the appointment of a strata manager, some buildings do ask that the Strata Manager contacts the Strata Committee or a member of the Strata Committee for approval for works before proceeding. This arrangement should be documented in the Strata Managers agency agreement which must be approved at a General meeting. If the arrangement is not approved by the Owners Corporation, the Strata Manager may not contact the building as they are not legally required to.
Regarding charging of an invoice to an owner, this is not generally something that is allowed unless there is a specific by-law for the scheme that allows for cost recovery. I’m not sure why the Strata Manager would pass on the cost of a work order to the owner in this instance. It seems to me that the Strata Manager must have actioned a lot owner repair which they shouldn’t have organised anyway.
The owner has 2 options:
- Pay the invoice to keep the peace. I would then pass the invoice onto the old plumber to pay as it was their original repair that caused the problem. If they original plumber doesn’t pay, you could follow this up with the Master Plumbers Association for decision (assuming that they are member of the Master Plumbers).
- Dispute the invoice with strata and state that it is unlawful to pass on an invoice to the lot owner without the lot owners approval. If this isn’t resolved after this dispute, you could lodge a complaint to NSW fair trading to have this resolved.
ARTICLE: Commissions and Training Services | What does my Strata Manager have to disclose?
Section 60 of the Strata Schemes Management Act 2015 (NSW) places a responsibility on strata managing agents of strata schemes to report the following matters at annual general meetings:
- Whether any third-party commissions or training services have been provided to or paid for the agent in connection with exercising the functions of the scheme for the previous 12 months, and the details of any such transaction.
- The estimated amount or value of any such commissions or training services that the agent believes are likely to be provided to or paid for the agent in the following 12 months.
The disclosure of such information must be recorded in the meeting minutes.
‘Training services’ is defined within the Act to include a training course or service (including attendance at industry events such as conferences).
If strata managing agents do not fulfil such responsibilities then the owners corporation can apply to the Tribunal, to make an order that any commissions accepted by the agent are to be paid to the owners corporation. In addition, strata managing agents can receive a fine of up to $2,200 for failure to disclose such information.
Under s 57 of the Act it will be an offence for an agent to receive commissions or training services that are not of a kind permitted by the agent’s terms of appointment or approved by the owners corporation.
Additional disclosure requirements of strata managing agents, include:
As soon as practicable after becoming aware that commissions or training services provided to or paid for the agent differ from any estimate, the strata managing agent must disclose the variation to the strata committee and provide an explanation.
Although, it should be noted that these requirements do not apply to training services or remuneration provided directly to a strata managing agent by their employer agency.
This post appears in Strata News #278.
Have a question about Strata Manager Communication or something to add to the article? Leave a comment below.
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Please note: this is general information and does not constitute legal advice. If your scheme us undertaking strata renewal we recommend you obtain legal and financial advice specific to your circumstances.
This article has been republished with permission from the author and first appeared on the Thoughts From a Strata lawyer website.
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