On the 11 December 2023 the NSW strata and community title legislation changes came into effect.

If you live or work in strata or community title it is important that you are aware of the changes to the law as follows: 

Original Owners Votes

•  If a scheme comprises of more than two lots the amendments provide that the value of a vote cast by an original owner, usually a developer, of a strata scheme may be reduced.

Strata Committees

• Committee member removal now only requires an ordinary resolution and once removed they’re not eligible to be on the committee for 12 months.

• Where it is called for, an election for a committee can take place at any general meeting, not just the AGM.

• A call for nominations to the committee must be included in the general meeting notice.

• A member with a conflict of interest must be excused from voting and discussion on that matter.

Strata Managers

• Must provide notice to the owners corporation 6 months prior to expiration of their agency agreement.
• Fair Trading can recommend to NCAT that a compulsory agent be appointed to manage dysfunctional strata schemes.

Internal Funds Transfer 

• Under the amendment for internal funds transfers, the owners corporation must, within three months of the transfer, decide at a general meeting, if the funds should be repaid, and if yes, how it should be done – via a simple reverse transfer or by special levy.

Emergency Repair Levies 

• The amendments will reduce from 30 days to 14 days the time period for payment of a special levy for urgent repairs. This amendment is for necessary building repairs to mitigate any serious and imminent threats to the health and/or safety of building occupants.

Work Quotes

• Multiple quotations for works exceeding $30,000 will now be required for all schemes – small and large – Also, the comparative quotations will need to be for people or companies that are not connected with each other.

Pets

• A pet bond or fee can no longer be charged by the owners corporation.
• A by-law cannot impose unreasonable burdens on people with assistance animals.

By-laws

• Under the changes, owners corporations may consolidate the by-laws for the scheme only by special resolution – whether or not a by-law has been amended, repealed or added.
• Two lot strata schemes do not need to pass a resolution to issue a ‘Notice to Comply’ regarding a by-law breach.

Books and Records

• The strata roll and other mandatory records must now be kept electronically.

Rentals

• Rental agents will be required to give tenants and lessees a copy of a strata scheme’s by-laws and strata management statement on commencement of a lease and whenever documents are updated if they are not provided by the landlord or head tenant.
• Rental agents will have to provide the owners corporation notice that a lot has been leased or subleased if the notice hasn’t been provided by the landlord or head tenant.
• Tenants can give notice of the lease to the owners corporation if the landlord, head tenant or rental agent fails to do so. In giving notice of the lease or sublease the regulations may prescribe the documents or other evidence a tenant must provide.

Service of Documents

• The regulations may provide for the service of documents, including by prescribing additional methods of service.

Meetings

• General Meeting Notices – time period for notices increases from 7 days to 14 days.
• Company Nominees – number of votes to be limited in a similar way to the way proxy votes are limited.
• AGM – Delivery of development documents by the developer must be done 14 days before the first AGM.

Community Titles 

• Most of the above proposals will also apply to Community Title regulations.

Strata Renewals

• Allowing a strata renewal committee to operate for 2 years instead of 1 year to reflect the length of time it can take for that committee to develop a strata renewal proposal.
• Permitting the Land and Environment Court to allow a collective sale of a strata building to proceed even though some of the preliminary steps associated with the sale have not been followed correctly (eg; inadequate meeting notice periods) if that has not resulted in a substantial injustice.
• Allowing dissenting owners who do not object in good faith to have costs awarded against them (eg; where an objecting owner is a developer who is trying to obstruct a collective sale to another developer)

More information

NSW Government – https://www.nsw.gov.au/media-releases/critical-reforms-to-strata-laws

Amendment Bill – https://www.parliament.nsw.gov.au/bills/Pages/bill-details.aspx?pk=18511

Timeline – https://www.parliament.nsw.gov.au/bill/files/18511/SPI%20-%20Strata%20Legislation%20Amendment%20Bill%202023.pdf

CLICK HERE NOW FOR STRATA REFORM ADVICE

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist. 

Will your by-laws need updating in line with the new Strata Laws?

Since last week’s article where we spoke about ‘phase 1’ of the strata law reforms, the proposed amendments to the Strata Schemes Management Act 2015 (NSW) have been released.

Below we explain the new proposed strata laws and share the timeline for their introduction here.

Original Owners Votes

•  If a scheme comprises of more than two lots the proposed amendments provide that the value of a vote cast by an original owner, usually a developer, of a strata scheme may be reduced.

Strata Committees

• Committee member removal now only requires an ordinary resolution and once removed they’re not eligible to be on the committee for 12 months.
• Where it is called for, an election for a committee can take place at any general meeting, not just the AGM.
• A call for nominations to the committee must be included in the general meeting notice.
• A member with a conflict of interest must be excused from voting and discussion on that matter.

Strata Managers

• Must provide notice to the owners corporation 6 months prior to expiration of their agency agreement.
• Fair Trading can recommend to NCAT that a compulsory agent be appointed to manage dysfunctional strata schemes.

Internal Funds Transfer

• Under the proposed amendment for internal funds transfers, the owners corporation must, within three months of the transfer, decide at a general meeting, if the funds should be repaid, and if yes, how it should be done – via a simple reverse transfer or by special levy.

Emergency Repair Levies

• The proposed amendments will reduce from 30 days to 14 days the time period for payment of a special levy for urgent repairs. This amendment is for necessary building repairs to mitigate any serious and imminent threats to the health and/or safety of building occupants.

Work Quotes

• Multiple quotations for works exceeding $30,000 will now be required for all schemes – small and large – Also, the comparative quotations will need to be for people or companies that are not connected with each other.

Pets

• A pet bond or fee can no longer be charged by the owners corporation.
• A by-law cannot impose unreasonable burdens on people with assistance animals.

By-laws

• Under proposed changes, owners corporations may consolidate the by-laws for the scheme only by special resolution – whether or not a by-law has been amended, repealed or added.
• Two lot strata schemes do not need to pass a resolution to issue a ‘Notice to Comply’ regarding a by-law breach.

Books and Records

• The strata roll and other mandatory records must now be kept electronically.

Rentals

• Rental agents will be required to give tenants and lessees a copy of a strata scheme’s by-laws and strata management statement on commencement of a lease and whenever documents are updated if they are not provided by the landlord or head tenant.
• Rental agents will have to provide the owners corporation notice that a lot has been leased or subleased if the notice hasn’t been provided by the landlord or head tenant.
• Tenants can give notice of the lease to the owners corporation if the landlord, head tenant or rental agent fails to do so. In giving notice of the lease or sublease the regulations may prescribe the documents or other evidence a tenant must provide.

Service of Documents

• The regulations may provide for the service of documents, including by prescribing additional methods of service.

Meetings

• General Meeting Notices – time period for notices increases from 7 days to 14 days.
• Company Nominees – number of votes to be limited in a similar way to the way proxy votes are limited.
• AGM – Delivery of development documents by the developer must be done 14 days before the first AGM.

Community Titles

• Most of the above proposals will also apply to Community Title regulations.

Strata Renewals

• Allowing a strata renewal committee to operate for 2 years instead of 1 year to reflect the length of time it can take for that committee to develop a strata renewal proposal.
• Permitting the Land and Environment Court to allow a collective sale of a strata building to proceed even though some of the preliminary steps associated with the sale have not been followed correctly (eg; inadequate meeting notice periods) if that has not resulted in a substantial injustice.

• Allowing dissenting owners who do not object in good faith to have costs awarded against them (eg; where an objecting owner is a developer who is trying to obstruct a collective sale to another developer)

More information

NSW Government – https://www.nsw.gov.au/media-releases/critical-reforms-to-strata-laws

Amendment Bill – https://www.parliament.nsw.gov.au/bills/Pages/bill-details.aspx?pk=18511

Timeline – https://www.parliament.nsw.gov.au/bill/files/18511/SPI%20-%20Strata%20Legislation%20Amendment%20Bill%202023.pdf

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact US

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

An owner is entitled to appoint a “person” to act as his or her proxy at a general meeting of an owners corporation.

But does that allow an owner to appoint a company as his or her proxy rather than an individual?  The answer might surprise you.

 Is it Possible for an Owner to Appoint a Company as their Proxy?

Owners in strata buildings regularly appoint other people to act as their proxies at general meetings of owners corporations.  Invariably, those proxies are individuals, often other lot owners.  But is it possible for an owner to appoint a company as his or her proxy to vote at a general meeting of an owners corporation?  If so, who is entitled to exercise voting rights on behalf of the company as proxy?  The answer lies in the Strata Schemes Management Act 2015 (Act) and other legislation.

An Analysis

An owner is entitled to appoint a “person” to act as his or her proxy at a general meeting: cl 23(3) and 26(1), Sch 1 of the Act.  However, the Act does not provide a definition of a “person”.  But it is clear that a person can be an individual or a company for several reasons.

First, the Interpretation Act 1987 says that in any Act “person” includes an individual or a company: section 3(3) and Sch 4.

Second, the expression “person” is used throughout the Act in a way that makes clear that it can include both an individual or a company.  For example:

• section 7 expressly provides that a person can be a company for the purpose of determining whether a person is connected with another person;
• section 10(2) prohibits an owners corporation delegating any of its functions to a person unless the delegation is specifically authorised by the Act and it is clear that a “person” in that context would include a strata managing agent which would typically be a company;
• section 12 allows the owners corporation to employ any person that it thinks fit to assist it exercise its functions which includes a building manager which typically carries on business through a company;
• section 22 requires a “person” who has an interest in a lot that gives the person a right to cast a vote either personally or by nominee at meetings of the owners corporation to give the owners corporation written notice of that interest – in that context, a “person” clearly includes a company which owns a lot which is able to cast a vote via a company nominee.

There are other indications from the language used in the Act that a person is not limited to an individual but can include a company.  For example:

• The Act gives a co owner of a lot (which could be company) the right to vote at a general meeting in certain circumstances: cl 23(4) and (5) Sch 1;
• An original owner (i.e. the developer) can cast a vote by means of a proxy in certain circumstances (and a developer is almost invariably a company): cl 25(5) and (6), Sch 1; and
• A building manager or strata manager can vote as a proxy provided that their vote does not result in them obtaining a material benefit (and a building manager and strata manager are typically a company): cl 25(7), Sch 1.

Moreover, the expression “person” where used in legislation has repeatedly been interpreted by the Courts to mean both an individual and a company: see In the matter of Metal Storm Limited (in liquidation) (Receivers and Managers Appointed) (No. 2) [2019] NSWSC 1682.

There are other reasons why an owner can appoint a company as his or her proxy.  For example, a company can be appointed as an attorney under a power of attorney and the appointment of an attorney is similar to the appointment of a proxy given that in both cases a person is appointing another person or company to act as his or her agent.

And in sphere of company law, a shareholder can appoint a “person” as his or her proxy to vote at meetings of a company and it is clear that the person who is appointed as the proxy can be either an individual or a company: see section 249X of the Corporations Act 2001.

Finally, there is nothing in the Act which explicitly prohibits an owner appointing a company as his or her proxy.

Who Exercises Proxy Voting Rights?

Where an owner appoints a company as his or her proxy, the company itself cannot exercise voting rights as the proxy.  So who does?

Obviously, a company that is appointed as a proxy needs to appoint an individual to exercise the powers of the company as a proxy.  That would typically be done by a written notice given by the company to the owners corporation specifically empowering the individual to act on behalf of the company as proxy at meetings of the owners corporation.  Normally, that individual would be the company secretary or a director of the company.  But as long as the person is properly authorised by the company to exercise proxy voting rights on its behalf, and the owners corporation has notice of that authority, he or she may do so.

Conclusion

Whilst it is uncommon for an owner to appoint a company as his or her proxy, that situation can arise.  When it does, an individual with the authority of the company that the owners corporation has notice of is able to exercise the company’s proxy voting rights on behalf of the owner.

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

On Friday, 5 June 2020 new COVID-19 strata regulations commenced.

These regulations introduce four key changes that will affect strata managers, owners corporations, community associations, precinct associations and neighbourhood associations across New South Wales.

The new regulations make it easier for strata managers to convene and hold general meetings and committee meetings.

The new regulations will also enable documents to be signed by strata managers remotely and without having the seal affixed to them.

The new regulations also extend certain time periods for things to be done.

Learn more about the new strata regulations here: New COVID-19 Strata Regulations

For NSW strata legal, building defects and levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

Government moves to help strata industry with further COVID-19 strata laws.

On 14 May 2020, new laws made by the NSW Parliament as a result of the COVID-19 pandemic commenced.  Those laws amended the Strata Schemes Management Act 2015 and the Community Land Management Act 1989 to enable new regulations to be created to deal with the impact of the COVID-19 Pandemic on the strata industry.

Electronic Voting and Meeting Notices

This means there will be power for new regulations to be released that will, for example, allow:

• Notices of meetings of a strata committee, owners corporation or community association to be served electronically even where there is presently no right to do so;
• Votes to be cast at meetings of a strata committee, owners corporation or community association electronically even if electronic voting has not been approved;
• The seal of an owners corporation or community association to be affixed to documents, and the witnessing of the affixing of the seal to be conducted, remotely;
• An extension of a time period in which a thing is required to be done under strata or community title laws.

The new regulations will be able to override a provision in the Strata Schemes Management Act or Community Land Management Act.  The new regulations have not yet been released.  It is expected that the regulations, once released, will remain in force for up to six months.

Electronic Signed and Sealed Documents

The regulations will provide a welcome relief to many strata managers, owners corporations and community associations.  Importantly, the regulations should allow meetings to be convened and held by electronic means and allow documents to be signed and sealed remotely.

The new regulations will enable strata committees, owners corporations and community associations to make legally enforceable decisions and continue to manage their affairs during the COVID-19 pandemic.

For NSW strata legal, building defects and levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

The Coronavirus has presented new and fundamentally different challenges to strata managers and owners corporations.

The most dramatic and short-term impact of Coronavirus on the strata industry is the affect it has had on the ability of strata managers to engage in face to face meetings with strata committees and lot owners and work from their office.

But there are other impacts the Coronavirus has had and will be likely to have on the strata industry. 

In this article we take a look at some of those impacts:

• General Meetings
• Strata Committee Meetings
• By-laws
• Health and Safety
• Service Contracts
• Public Relations
• And more…

What can you do? Strata Managers and the Coronavirus: Here’s What You Can Do

For NSW strata legal, building defect and levy collection advice contact us here or call 02 9562 1266, we’re happy to assist.

An owners corporation will often approve an agreement at a general meeting. Sometimes the agreement is complex or lengthy and the cost to include a complete copy of the agreement in the meeting notice is prohibitive.

In those circumstances, does the agreement still need to be included in the meeting notice or can it be tabled at the meeting? Approving Agreements at General Meetings

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

The strata legislation contains a number of requirements which must be met for any AGM.

These include requirements for the AGM agenda to contain certain motions and for the AGM notice to be accompanied by various documents.

So, what happens if these requirements are not met? Is the AGM invalid?

A recent decision of the Supreme Court provides helpful guidance on this issue – Supreme Court Strata AGM Guidance.

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

One year later… what are the 5 biggest impacts of the new strata laws?

In this interview with LookUpStrata, Adrian Mueller, partner, JS Mueller & Co addresses the top 5 new strata laws and the changes to owners corporation fines and how they’ll affect you.

Click on the video below to view Adrian’s interview with Nikki from LookUpStrata as he discusses the following:

1. New Strata Laws in Relation to the Way in which Owners will be Able to Vote at Strata Meetings
2. Prohibition on Proxy Farming
3. Renovations
4. Undesirable Habits
5. Removing Abandoned Goods

And, body corporate fines and the 3 main changes.

The full article can be viewed at LookUpStrata.

For NSW strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.

Does a strata committee have the power to make decisions on behalf of an owners corporation?

Should you save yourselves a vote next time a clause in a by-law or a condition in an agreement refers to the approval of the owners corporation?

To vote or not to vote read on to find out Strata Voting and Meetings

For strata legal or levy collection advice please contact us here or call 02 9562 1266, we’re happy to assist.