Question: We recently held a general meeting to obtain approval to reline broken pipes damaged by roots. As this is an ongoing problem, do we have to hold a meeting every time this maintenance needs to be done?
Our Sinking fund is formulated each 5 years by a quantity surveyor.
In our sinking fund, we have a very large sum for “unforeseen”.
Our complex is 33 yrs old.
We held a general meeting to allow us to use these “unforeseen” funds to reline broken pipes under the complex driveway.
The problem with roots in broken pipes is a continual problem.
Do we require a General Meeting each time this happens to pass a motion to use these funds?
Answer: Approval via the committee or body corporate is still required even if you have listed an item in your budget or sinking fund.
The requirements for holding a meeting are based on the spending levels of your site.
The Committee has a spending limit starting at up to $200 per lot with an option to extend this at a general meeting if required. So, if you have a 40 lot scheme, and the Committee spending limit is $200, the Committee can authorise expenditure of up to $8000, inc GST.
Expenditure over the Committee spending limit needs to be approved at a general meeting. Here you need to consider the major spending limit which establishes if you need more than one quote. This limit is the lesser of:
- $1,100 multiplied by the number of lots in the scheme
- $10,000.
or
These figures are both GST inclusive.
It’s worth noting that the approval via the committee or body corporate is still required even if you have listed an item in your budget or sinking fund.
In your comment you mention that you have a large sum set aside for unforeseen circumstances. It’s not quite clear what this means or how this is worded in your documents. Technically, body corporates can’t budget for contingencies, with all monies raised supposed to be allocated for a specific purpose. This can get a bit murky when it comes to sinking funds, where there can be a wide ranging report covering a multitude of potential costs, but only loose regulation of how amounts are raised and actually spent.
Still, as things stand it seems like your scheme is in good position. You have a maintenance issue that needs to be fixed and funds available to resolve it. Next step should be to organise some quotes and have the preferred option approved by either committee or body corporate.
See the BCCM website for more info on spending limits.
This post appears in the May 2022 edition of The QLD Strata Magazine.
William Marquand
Tower Body Corporate
E: willmarquand@towerbodycorporate.com.au
P: 07 5609 4924
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