Question: Can residents attend a pre-AGM budget meeting, or is it a closed committee-only meeting?
Are residents allowed to attend a budget meeting which is planned to be completed before the AGM, or is it a closed meeting for the body corporate committee only? Can the committee have secret meetings?
Answer: A budget meeting is procedurally the same as any other committee meeting, and owners have a right to attend and observe.
A budget committee meeting is legally the same (from a procedural point of view) as any other committee meeting. The requirements are prescribed under the applicable regulation module for the scheme.
Accordingly, it is not a ‘closed’ meeting, and owners have a right to attend and observe the meeting in accordance with the usual requirements set out in the regulation module.
An owner of a lot, or lot owner’s representative, can attend any meeting of the committee, provided they give the secretary written notice of their intention to do so at least 24 hours before commencement of the meeting. The regulation modules set out certain information that must be included in such a notice.
An owner attending a committee meeting can only observe the meeting, and cannot speak to the committee unless invited to do so (the committee can revoke authority at any time). Also, there are certain prescribed circumstances in which the person can be asked to leave the meeting, including when discussion or voting is taking place on an item of business concerning by-law contraventions, legal proceedings involving the body corporate, or other types of disputes.
Your question refers to ‘tenants’ attending committee meetings. There is no right for a tenant (occupier) to attend committee meetings (unless they are also an owner or an owner’s representative). Of course, the committee (by a majority) can invite non-owners and third parties, including a tenant, to attend committee meetings. However, that discretion rests entirely with the committee (and any approval granted could be revoked at any time).
Formal meetings and a committee decisions take place ‘behind closed doors’ or in ‘secret’ meetings. Of course, that does not restrict or prevent committee members from liaising and communicating with one another outside of the formal meeting procedures to discuss matters relating to body corporate business.
This post appears in Strata News #808.
Jarad Maher
Grace Lawyers
E: jarad.maher@gracelawyers.com.au
Can a BC committee fund admin budget items from the sinking fund without approval from lot owners? It appears that over $80,000 (40% of sinking fund) has been used for maintenance and legal disputes ($30,000+) and the committee is trying to get this approved at AGM .
Hi Anthony
It depends on the committee’s spending limit and whether the expenditure is in relation to a single project or part of a series of separate proposals.
Your reference to the committee trying to get it approved at the AGM (which I assume you mean retrospectively ratified) might suggest that there are concerns or issues with the committee’s power to authorise the expenditure – otherwise there would be no need to obtain any further approval at a general meeting.
Jarad
Jarad…am a bit confused.
The Q seemed to turn on transferring monies from one fund – in this case, the Sinking fund – to pay for expenses appropriate to the other fund, ie the Admin fund.
I didn’t think this is allowed, regardless of spending limits etc.
Am I missing something?
Regards
Ross Anderson AQUO
Thanks Ross.
As is usually the case with these forums, there is insufficient information to understand the crux of the issue, or determine with any certainty whether there has been any legislative non-compliance.
Certainly, it is impermissible to transfer monies between the admin and sinking funds, though it appears in this case that there may not have been a transfer between funds per se, but the application and payment of monies from the incorrect account.
Whilst those two things might be considered the same, the legislation treats them quite differently, with the transfer of funds between accounts attracting offence penalties (where a body corporate manager is involved), whereas payments made from the wrong account do not.
A question arises as to whether the specific expenditure in this case is in fact correctly administrative expenditure. Whilst reference is made to ‘admin budget items’, both maintenance and legal fees could be characterised as either admin or sinking fund expenditure – depending on their precise nature.
The sinking fund is for spending of a capital or non-recurrent nature and other expenditure that should reasonably be met from capital, so it depends on the nature of the maintenance and legal fees in question as to their proper characterisation.
In either case, the issue is a legal one, and not something a body corporate can resolve to take a different approach to – irrespective of whether that decision is made at committee or general meeting level.
Of course, if the expenditure is unanticipated and no (or inadequate) provision has been made for it in the budgets then, regardless of how it is appropriately characterised, the body corporate must fix a special contribution on owners towards the liability.
Jarad…many thanks again, especially for drawing my attention to the distinction between transferring monies between the 2 funds -v- misapplication of monies from 1 of those funds to payment. Another subtlety I’ll have to get my head around.
Regards
Ross
Many thanks for this Jarad.. Comprehensive and readable, as always. (LookUp #808 – Sep 8th 2026.)
All owners should be encouraged to attend all Cmttee meetings, especially the Budget Planning Meeting (BPM) … and permitted to ask Qs from the floor. After all, it is our home, our money and our say.
But often this attendance is fairly pyrrhic, because the general practice is to not distribute the draft budget, or any other documents, to those owners who do attend… so we do not know what the Cmttee is talking about.
To make matter worse, at our scheme, the draft budget was not even tabled at our last BPM, so even the Cmttee didn’t know what it was they were talking about. Seems the Kitchen Cabinet aka the Executive Committee, finalised the budget out of session after the BPM.