Changes to Strata title legislation
The long awaited reforms to Strata Title Legislation have finally been passed by the NSW Government and are expected to commence from 1 July 2016.
There are over 90 changes in the legislation, including new procedures relating to the conduct of AGM’s, Building Defects & Inspections and the payment of a Building Bond by the original owner for schemes where construction is commenced after 1 July 2016.
Some of the proposed changes that will affect owners of existing strata schemes include:-
The Executive Committee
- The name of the Executive Committee will be changed to the Strata Committee
- Nominations for the committee may be made before the Annual General Meeting and the names of those nominees are to be included in the notice of the Annual General Meeting
- In certain circumstances tenants may nominate a ‘tenant representative’ to the executive committee (however the tenant representative will not be entitled to vote)
- Strata Managing Agents and Building Managers will not be eligible for election to the committee
Annual General Meetings (AGM’s)
- Tenants will be entitled to attend the Annual General Meeting of the Owners Corporation and Notices of the Annual General Meetings must be provided to all tenants at least 7 days prior to the meeting, however tenants will not be entitled to vote
- The number of proxies that may be held by any one person will be limited to 1 person (for schemes under 20 lots) or not more than 5%of the total number of lots in any other case
- Quorum provisions will change whereby in the event a quorum for a meeting (currently 25% of owners entitled to vote) is not present within ½ hour of the commencement of the meeting, the chairperson may declare a quorum is present and proceed with the meeting
- Voting on motions may be conducted by secret ballot
- Developers will be unable to vote on motions that are related to building defects
- Each Annual General Meeting must contain a motion to determine how the Owners Corporation will deal with debt recovery proceedings
Strata Managing Agents
- The maximum term a Strata Manager may be appointed will be 3 years
- Strata Managers will be required to report to the Owners Corporation at each Annual General Meeting the amount of any 3rd party commissions received during the previous 12 months and the amount of 3rd party commissions likely to be received in the coming 12 months
Financial Matters
- The name of the Sinking Fund will be changed to the Capital Works Fund
- The Owners Corporation may agree to allow owners to pay levy arrears via payment plan
- The Owners Corporation will no longer be required to provide detailed accounts at the AGM, however a summary of income and expenditure over the last 12 months is to be included in the meeting notice. Owners may request detailed accounts prior to the meeting
These are just some of the 90+ changes to the Strata Legislation. To find out more visit the NSW Fair Trading website and search Strata Reforms’.
