Question: When raising additional funds for remedial works, is the amount divided equally or by lot entitlement?
Our body corporate is authorising remedial works and maintenance such as roof repairs, painting of the whole building etc. Additional funds are required for the work as there are not enough funds in the sinking fund.
Is the amount divided equally between the number of units OR should the amount be divided by the size of the units [1 bedroom and 2 bedrooms etc]? I only have a 1 bedroom unit and the other units are 2 and 3 bedrooms.
Answer: The expenditure should be divided on the basis of unit entitlement as recorded on the CMS.
The expenditure should be divided on the basis of unit entitlement as recorded on the CMS. This is automatically the case if funds are being used from the admin or sinking fund. If funds are being raised via a special levy the motion to approve this should state that the levy is being raised using unit entitlements. If a different method is being applied there may be a reasonable reason for this, but you would expect this to be clearly outlined in the motion and explanatory notes and may require the consent of all owners to be approved.
This post appears in Strata News #481.
William Marquand Tower Body Corporate E: willmarquand@towerbodycorporate.com.au P: 07 5609 4924