Fighting an unfair committee

Barbara Francis & Rus Littleson

Nerida Pohl has provided an update on the committee scandal at her inner-city building …

“In our building, three out of the five committee members – all supportive of the manager/developer – have been controlling affairs unfairly for the past 10 years – and it needs to stop.”

“It is now 10 years since our managers locked residents out of common property assets that we purchased. This makes our building look decidedly second-rate. Residents are forced to move in and out via the busy street into our elegant lobby instead of via our private, safe and undercover goods lift to the level 2 storage cages. The committee even usurped our residential lounge for their real estate business.”

“All visitors are told the building has no visitor car park and must use the commercial carpark. The car park operator and our owners’ corporation manager share common ownership.”

“The local council has been on the case for five years telling the manager that they must give us back the 50 visitors car spaces and our residential meeting room, and to get large furniture trucks from disrupting the amenity of the street at our front door.”

“Trying to legitimise misuse of our property and without consulting the 500 apartment owners, the stacked committee has spent several hundred thousand dollars of the fees we pay them by engaging lawyers and town planners in appeals to the Planning Tribunal and our local council.” “The managers are interminably dragging out the process to keep us locked out of our property, so all these third parties can continue profiting from using it instead.”

“Last September I thought we had a win; the Planning Tribunal addressed an application by the manager to annexe our undercover goods lift for the retail area. The Tribunal agreed our undercover loading dock was well built for our use and that the busy commercial street outside our single glass entry door was not suitable for residents’ removal trucks to use. Sadly, the Tribunal finding has not resulted in any remediation.”

“I would like to ensure the owners know what is going on, but the committee is unfairly and actively preventing me from being able to communicate with the owners.”

“Legally, if I ask for the contact details of all owners, the manager must forward the register immediately. In this building, the committee won’t let them. That is why I have had to letter-drop all residents instead of posting 500 letters to them.”

We Live Here believes it is outrageous that a committee and a manager can prevent an owner from viewing the owners’ corporation members’ roll. Committee members should be aware of how their behaviour will be viewed by the courts.

Under the Owners’ Corporation Act 2006, members of committees must

  • Act honestly and in good faith
  • Exercise due care and diligence
  • Act in the interests of the owners’ corporation
  • Not make improper use of their position to gain a direct or indirect advantage for themselves or anyone else.

If the committee members cannot prove that they acted in good faith, they can potentially lose their immunity under section 118 of the Act. Then the members would face significant personal liability.

We hope the owners are galvanised by Nerida’s appeal.

If you are having problems with an owners’ corporation controlled by a developer or any vested interests, please let us know.

Latest version of the Owners’ Corporations Act 2006

The Owners’ Corporations Amendment Act 2021 was the result of the long, drawn-out review of the Owners’ Corporations Act 2006 that began in 2015 and meandered through issues papers, options papers, exposure drafts and several revisions.

With these amendments incorporated, the Owners’ Corporations Act 2006, Authorised Version 19 is now available.

The release of version 19 of the Act underlines a notable failure of the government. Since 2018, this Act has had embedded within it the amendments of the Short-stay Accommodation Act 2018. The short-stay amendments have yet to go under the public review which was promised for February 2020.

Some of the more significant features of the newly amended act include:

Five tiers of owners’ corporations

There are different rules according to the number of occupiable lots, divided into tiers: Tier One, more than 100 individual lots; Tier Two, 51 to 100 lots; Tier Three, 10 to 50 lots; Tier Four, 3 to 9 lots and Tier Five, a 2-lot or services-only subdivision.

Levies and insurance

Other changes introduced under the amended Act may reduce insurance and other inequities between lot owners. While ordinary fees levied must still be based on lot entitlement, OCs may separately levy lot owners for:

  • an excess amount, or increased premium, attributable to an insurance claim if the claim was caused by the actions of a lot owner or occupier or guest;
  • damage caused to the common property by a lot owner or occupier, if it is not covered by insurance, or if the cost is less than the excess amount.

VCAT has also been empowered to make an order requiring a lot owner to pay the owners’ corporation’s costs incurred for recovering an unpaid amount from the lot owner.

Proxies – five per cent limit

Section 89D of the Act states that a person must not vote as a proxy on a resolution at a meeting of the owners’ corporation on behalf of more than five per of the lot owners, or more than one lot owner if there are 20 or less occupiable lots.

There’s more to unpack

We shall look at other aspects of the amended Act, including the Short-stay Accommodation Act amendments embedded within it in next month’s column.

You can download the Owners Corporations Act and amendments from our website at welivehere.net/acts

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