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VIC: Can an owners corporation revoke a previous resolution?

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Question: Can an owners corporation revoke a previous resolution? If so, what is the process?

Answer: In Victoria, OCs have clear processes for making and, when necessary, revoking decisions.

Owners corporation (OC) decisions, known as resolutions, aren’t always set in stone. Sometimes, new information or changing circumstances mean a rethink is needed. For example, an OC approves a special resolution to proceed with legal action against a builder for defects. However, after receiving legal advice, the OC learned that the case was unlikely to succeed or would be too costly. It may decide to reverse the resolution and explore alternative dispute resolution options instead.

In Victoria, OCs have clear processes for making and, when necessary, revoking decisions. The Owners Corporations Act 2006 outlines 3 primary types of resolutions:

  1. Ordinary Resolutions: These require a simple majority of votes cast. They cover routine matters such as maintenance decisions, budget approvals, and committee elections. To revoke an ordinary resolution, the OC can pass a new ordinary resolution at a general meeting or through a ballot, provided the motion is properly included in the meeting agenda or ballot notice.

  2. Special Resolutions: These necessitate at least 75% approval from all OC members. They pertain to significant decisions like imposing special levies exceeding twice the annual budget, major alterations to common property, leasing or licensing common areas, amending or revoking rules, initiating some legal proceedings (excluding debt recovery or rule enforcement), and borrowing amounts exceeding the annual budget. To revoke a special resolution, the OC must pass another special resolution following the same stringent requirements.

  3. Unanimous Resolutions: These demand 100% agreement from all OC members. They are reserved for critical decisions, including disposing of common property, altering lot boundaries, or amending lot liability and entitlement. Revoking a unanimous resolution requires achieving unanimous consent again, ensuring all members agree to the change.

It’s essential to recognise that if the OC has entered into contracts or legal obligations based on a resolution, revoking that resolution may not be feasible without potential legal or financial repercussions. Additionally, if a resolution pertains to statutory obligations, such as maintenance duties, revocation may not be lawful.

Fabienne Loncar
Chambers Russell Lawyers
E: floncar@chambersrussell.com.au
P: 03 8639 9804

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About Fabienne Loncar

Fabienne Loncar is a partner at Chambers Russell Lawyers with over 20 years of experience providing strategic, results-driven legal services to a diverse range of industry stakeholders. She advises on all aspects of owners corporation law including defect claims, legislative compliance, and dispute resolution. Fabienne combines technical expertise with a client-focused approach. She brings a strategic perspective and innovative thinking to each matter, delivering practical, actionable advice while anticipating future challenges. She is dedicated to being approachable and accessible and is recognised for her ability to guide committees and managers through complex legal and regulatory landscapes efficiently and effectively.

Her expertise includes advising and representing owners corporations in defect claims, non-compliant cladding disputes and recovery actions. This work also involves providing guidance on the interpretation and application of owners corporation legislation and rules, ensuring ongoing compliance with legislative changes. Fabienne’s experience extends to managing plan of subdivision and boundary disputes that impact property rights and shared spaces, as well as representing clients in VCAT and other tribunal hearings with a strong focus on advocacy and dispute resolution.

Fabienne’s additional expertise includes drafting and amending special rules, contracts and other governance documentation and coordinating multi-jurisdictional litigation, including urgent injunctions, complex claims and both commercial and residential disputes. There is also a strong focus on thought leadership and industry engagement through presenting at seminars, contributing to publications and delivering tailored education to committees, managers and other stakeholders.

Email: floncar@chambersrussell.com.au
Phone: 61 3 8639 9804

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