Question: We need to raise a $1 mill special levy for remedial repairs. Due to quote issues, we need to repeal the special levy. Are owners unfinancial if they haven’t paid the special levy?
Our large strata complex needs to raise a $1 mill special levy to carry out remedial water ingress repairs. After reviewing all documents sent by the strata management company and remedial engineer, there are issues with the quotation.
We need to call an EGM to repeal the special levy. The strata manager delayed sending the documentation, and the invoice is due in a few days. Will owners lose their voting power if they have not paid their special levy?
Answer: It depends.
The answer is, it depends.
If the notice for the meeting is sent before the first instalment (or total amount) of the levy is due, the owners will be financial, provided they do not have any other contributions or amounts outstanding.
Section 4(1) of the Strata Schemes Management Act 2015 defines unfinancial owner as:
unfinancial owner means an owner of a lot in a strata scheme who has not paid all contributions levied on the owner that are due and payable and any other amounts recoverable from the owner, in relation to the lot.
Clause 23(8) of Schedule 1 of the Strata Schemes Management Act 2015 provides as follows:
(8) Voting rights cannot be exercised if contributions not paid
A vote at a general meeting (other than a vote on a motion requiring a unanimous resolution) by an owner of a lot or a person with a priority vote in respect of the lot does not count if the owner of the lot was an unfinancial owner at the date notice of the meeting was given and did not pay the amounts owing before the meeting.
If the notice for the meeting to rescind the special levy was sent after the special levy (or instalment) was due and an owner has not paid the special levy (or instalment) prior to the date of the meeting, the owner will be unfinancial and will not be entitled to vote on the motion.
This post appears in Strata News #710.
Matthew Jenkins
Bannermans Lawyers
E: enquiries@bannermans.com.au
P: 02 9929 0226
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