WA: Strata Council Accountability Under WA’s New Legislation

Question: Under the new WA strata legislation, can a member of the Council of a strata company be fully responsible for their dysfunctional performance? What penalties apply?

Can a member of the Council of a strata company be fully responsible for their dysfunctional performance, non compliance with bylaws and breaches and any other wrong decisions, especially financial, by not acting in the best interest of strata owners and exposing strata owners to unnecessary costs? What kind of penalties could apply under the new legislation?

How can lot owners protect their funds so no money is wasted?

Answer: No liability attaches to the office bearers of the Council for anything that the person has, in good faith, done or omitted to have done.

In section 141 of the Strata titles Act 1985, it says specifically, this section applies to a person who is or has been a member of the Council of a strata company, including when acting as an officer of a strata company, or an individual authorised under Section 136(2) by a corporation to perform the corporation’s functions as a member of the Council or an officer of the strata company.

Protection from liability

Subsection 2 says No civil liability attaches to a person to whom this section applies for anything that the person has, in good faith, done or omitted to be done —

1. in the performance of a function under this Act or scheme by-laws; or
2. in the reasonable belief that the act or omission was in the performance of a function under this Act or scheme by-laws.

Subsection 3 says A liability that would, but for subsection (2), attach to a person attaches instead to the strata company.

It doesn’t matter how big or bad a job they make of running the place improperly or incompetently or inefficiently or cause legal action. No liability attaches to the office bearers of the Council and the strata company has to wear liability even if they are exposed to legal risk and unnecessary costs. As far as penalties, there are no penalty, no liability attaches to the council member.

How can lot owners protect their funds so no money is wasted? The simple answer is to take an active part in the management of your strata. Get on the council. You can attend various educational courses run by SCA or other service providers and learn more about how to run a strata company or take an active part in a council.

This post appears in Strata News #568.

Shane White
Strata Title Consult
E: shane.white@stratatitleconsult.com.au