Question: The owners of six lots do not contribute to the reserve fund because they never use the common areas. Was this decided at the inaugural AGM?
We have a common area with a lawn and paved driveway. Four units use this area to access their lots. The other six units access their lots from the street. The six units decided not to contribute to the reserve fund because they never used the common lawn or paved driveway. Would the decision about which units contribute to the reserve fund have been made at the inaugural AGM when the units were first built in 1991?
Answer: If a scheme levies differently than unit entitlement, it can only be via a by-law. If no by-law was lodged, levies must be by unit entitlement.
Section 100 of the Strata Titles Act 1985 details the requirements of a strata company, and it must, under section 100(1)(c), raise amounts determined by levying contributions on owners of lots in two ways.
- In the portion of the unit entitlements of their respective lots or
- If the scheme by-laws provide for a different basis for levying contributions
This means if a scheme wants to levy differently than unit entitlement, the only other option is via a by-law.
If a by-law was registered on the strata plan in 1991, following the Inaugural General Meeting, then yes, they may levy as per the by-law. If no by-law was lodged, levies must be by unit entitlement.
This post appears in the June 2025 edition of The WA Strata Magazine.
Jamie Horner
Empire Estate Agents
E: JHorner@empireestateagents.com
P: (08) 9262 0400
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