A few weeks ago, we held a national webinar with Tyrone Shandiman from ACIL about Advocating for Change Against Unfair Practices in the strata industry. During the webinar, a QLD question was asked concerning insurance renewals, and Tyrone provided a response. Chris Irons from Strata Solve attended the session and contacted us after viewing the webinar to add a little extra to the response including information about a restricted issue. We invited Tyrone Shandiman and Chris Irons to join us and discuss the question in more detail.
Table of Contents:
- QUESTION: Against owner’s objections, our committee wish to keep the gates open in our gated community. Is the committee able to make this decision?
- VIDEO: Restricted Issues, Committee Decisions and Insurance Renewals
Question: Against owner’s objections, our committee wish to keep the gates open in our gated community. Is the committee able to make this decision?
I am a lot owner in a gated complex. Our committee appears determined to have the gates left open, having taken this step more than once without consulting the lot owners and despite receiving owner complaints.
This action was first taken by the committee in 2021 with no consultation with lot owners. An owner survey at that time made it clear that this decision went against the wishes of the majority, who were in favour of keeping the gates closed. The committee has again taken this action. Several lot owners lodged written objections to the committee, which have been ignored.
What steps can be taken to rectify this situation?
Answer: A ‘restricted issue’ is an issue which the committee is not permitted to decide upon.
Under Qld strata legislation, there is something called a ‘restricted issue’ for a committee. As the name suggests, this refers to issues that the committee is not permitted to decide upon. Section 52 of the Standard Module (equivalent provisions of other Modules) provides for what is a restricted issue. Of relevance to the scenario you describe is s52(1)(b), reproduced below:
- changing rights, privileges or obligations of the owners of lots included in the community titles scheme
While we can’t comment on the specifics of your case, we’d suggest that a decision about the gates being open or closed is very likely a restricted issue, based on (b) above.
Where to from here? While we acknowledge that you have raised objections and a survey has been conducted, ultimately, this requires a motion to be submitted to the committee for them to rescind their original decision. You could potentially refer to the ‘restricted issue’ information above when doing so. If that motion fails or is not properly considered, you’d then have the option of proceeding to the Commissioner’s Office to dispute same.
Just a note about your comments re: this decision being ‘against the wishes’ of the majority of lot owners. Decisions in strata are about what is reasonable and not what the majority wants. There may well be compelling reasons why the committee is doing what it is doing (we don’t know what they could be, but put that aside) and the fact that you and others do not like it isn’t automatically grounds to have it overturned. You need an objective basis for that – which is what the ‘restricted issue’ discussion above might entail.
Of course, if this scenario is indicative of a committee that isn’t making reasonable decisions regularly, despite owners trying to hold them to account, then it might be time to consider looking at replacing the committee with candidates who will perform the role more correctly.
This is general information only and not legal advice.
Chris Irons
Strata Solve
E: [email protected]
P: 0419 805 898
This post appears in Strata News #748.
Video: Restricted Issues, Committee Decisions and Insurance Renewals
Question: Our strata insurance for the original AGM in our new building was valid until the 31 July 2020 with insurance company A. The following year it was paid on the 30 May 2021 to our body corporate management company’s own insurance company B. Every year after, our AGM is in July or August. We’re never given the chance to vote the insurance premium down as we vote after it’s already been paid. Is this legal?
Key points covered in Tyrone’s and Chris’s response:
- Under Queensland legislation, even if a committees can do something like renew insurance, a committee’s power to decide on something like strata insurance renewal can be restricted. This is known as a restricted issue.
- It can be impractical for owners to vote on insurance renewals due to time constraints.
- Owners can still be involved in the process:
- Attend committee meetings (with limitations on participation).
- Request to be involved in getting alternate quotes.
- Become a committee member.
- Change the body corporate’s financial year to align with insurance renewals (if necessary).
- If there are conflicts between owners and the committee, address them directly. Don’t use insurance as a bargaining chip.
- Be aware of changes in brokers/insurance companies. Owners have the right to inspect committee records to see if the change was authorised.
Recommendations:
- Be honest about your motives if you have an issue with the committee.
- Committees should act in the best interests of the owners and consider all options, e.g., owner-sourced quotes.
Watch the short video in full to hear the detailed discussion between Tyrone Shandiman and Chris Irons.
Video presenters:
Tyrone Shandiman
Strata Insurance Solutions
E: [email protected]
P: 1300 554 165
Chris Irons
Strata Solve
E: [email protected]
P: 0419 805 898
Article author:
The Lookupstrata Team
This post appears in Strata News #699.
Have a question or something to add to the article? Leave a comment below.
Read next:
- QLD: The committee: a body corporate decision maker
- QLD: New Rules for Lot Owners Submitting Motions to the Committee
- QLD: Q&A Body Corporate Decision Making
Visit Strata Committee Concerns OR Strata Legislation QLD pages.
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