Question: If owners have already approved a sinking fund budget for an amenity, can a subsequent motion to spend up to double that amount on improving the same amenity be allowed?
Section 98 (1)(a)(i) of the BCCM Standard Module states that a person chairing a general meeting must rule a motion out of order if the motion, if carried, would conflict with, amongst other things, “a motion already voted on at the meeting”.
If owners have already approved a sinking fund budget for an amenity and a motion is proposed to authorise capital expenditure for improving that amenity up to double the budgeted amount, should this motion be ruled out of order?
Answer: There is a difference between a motion that approves a budget and one that approves expenses.
No. There is a difference between a motion that approves a budget and one that approves expenses. Budgets are simply estimates that are adjusted based on overspending or underspending at the end of a body corporate’s financial year.
Accordingly, the motions do not conflict – the body corporate would, at some point, need to recover any spending in excess of what was budgeted for (provided there were no other costs which were equivalently underspent on) through a special levy, at the following year’s annual general meeting to recover the deficit or amending the existing budget that was approved.
This position was confirmed in Mountainview [2003] QBCCMCmr 308:
“…the body corporate believes that it has sufficient funds to undertake the proposal contemplated in either motion 9 or 10, and has not proposed a special levy. I consider this is all within the contemplation of the legislation. This office does not undertake any “big brother” or overseeing role of ensuring that a body corporate has sufficient funds to undertake its proposals. Bodies corporate are independent entities responsible for self management…”
This post appears in the August 2024 edition of The QLD Strata Magazine.
Liam Boudin Mahoneys E: lboudin@mahoneys.com.au P: 07 3007 3724