This article about the coming Strata Title Act reforms in WA and how this will change the way to terminate strata scheme has been supplied by Landgate.
Strata reforms are proposing a new termination process to end a strata scheme.
It will involve terminating a scheme by majority vote, but the proposed steps to terminate strata scheme include much more than just a vote. There will be a whole process that must be followed and includes key safeguards for owners. Landgate understands the protection of property rights is important and every strata owner’s circumstances must be considered.
Currently there are three ways a strata scheme can be terminated:
- by unanimous resolution of owners
- by application to the District Court by an owner or registered mortgagee
- by application to the District Court by a person who supported a resolution
which was not unanimous, to ask for the vote to be treated as unanimous if either:
- a special resolution was reached, or
- the person applying was part of the majority who voted to terminate.
These options have all proven long, complex and costly with uncertain outcomes.
Currently no detailed proposal is required to apply for a termination. There are no safeguards in place for those objecting to the termination, or for vulnerable owners, and the District Court is given no guidance on how to deal with a termination application.
Reforms propose a transparent majority termination process that must be followed including a vote by all owners and, if that vote passes, a mandatory procedural and fairness review by the State Administration Tribunal (SAT) to consider all owners’ views.
Termination applications must:
- contain information that is needed by all owners to make an informed decision
- be served on all owners, mortgagees, and the strata company
- give owners at least three months to consider the proposal before voting
- ensure the vote is properly conducted
- undergo a SAT review if the required vote is attained.
Majority termination cannot occur without a SAT review and SAT must be satisfied that the termination process was properly followed, that each owner will get fair market value for their lot and that the termination is just and equitable. Reforms to the Strata Titles Act 1985 will provide guidance on these things for SAT to assist its decision.
Any owner who objects to a termination will have consumer protections.
Strata Reforms – Terminate Strata Scheme WA
This article first appeared on the Landgate website.
This post appears in Strata News #116.
Are you interested in more information about the WA Strata Title Act reforms and the ways to terminate strata scheme WA or more general information about strata title and Legislation in WA? Visit our FactSheet: Strata Law Reform OR FactSheet: Strata Information WA
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