The QLD Strata Magazine | March 2024

The QLD

STRATA MAGAZINE MARCH 2024

All tapware must be a certain standard and star rating Page 10 | Mahoneys

In our high-rise, we pay higher levies per level. Is this fair?

Page 14 | Hynes Legal

What happens to voting deadlines when the AGM is reconvened?

Page 26 | Tower Body Corporate

About Us LookUpStrata is Australia’s Top Property Blog Dedicated to Strata Living. The site has been providing reliable strata information to lot owners, strata managers and other strata professionals since 2013.

As well as publishing legislative articles to keep their audience up to date with changes to strata, this family owned business is known for their national Q&A service that provides useful responses to lot owners and members of the strata industry. They have created a national network of leading strata specialists across Australia who assist with 100s of the LookUpStrata audiences’ queries every month.

Strata information is distributed freely to their dedicated audience of readers via regular Webinars, Magazines and Newsletters. The LookUpStrata audience also has free access to The LookUpStrata Directory, showcasing 100s of strata service professionals from across Australia. To take a look at the LookUpStrata Directory, flip to the end of this magazine.

Meet the team

Nikki began building LookUpStrata back in 2012 and officially launched the company early 2013.

With a background in Information Management, LookUpStrata has helped Nikki realise her mission of providing detailed, practical, and easy to understand strata information to all Australians.

Nikki shares her time between three companies, including Tower Body Corporate, a body corporate company in SEQ. Nikki is also known for presenting regular strata webinars, where LookUpStrata hosts a strata expert to cover a specific topic and respond to audience questions.

Nikki Jovicic Owner / Director

Liza came on board in early 2020 to bring structure to LookUpStrata. She has a passion for processes, growth and education. This quickly resulted in the creation of The Strata Magazine released monthly in New South Wales and Queensland, and bi-monthly in Western Australia and Victoria. As of 2021, LookUpStrata now produce 33 state based online magazines a year.

Among other daily tasks, Liza is involved in scheduling and liaising with upcoming webinar presenters, sourcing responses to audience questions and assisting strata service professionals who are interested in growing their business.

Liza Jovicic Sales and Content Manager

Learn more here → https://www.lookupstrata.com.au/about-us/ You can contact us here → administration@lookupstrata.com.au

Disclaimer: Strata legislation is updated regularly. The information in this magazine is based on the legislation at the time of publishing.

2 www.lookupstrata.com.au www.lookupstrata.com.au 2 2www.lookupstrata.com.au

Contents 20 BCCMA changes coming in 2024

4 Cleaning the car park

Todd Garsden, Mahoneys

William Marquand, Tower Body Corporate

6 Insights into Strata Finance

22 Can our executive committee force lot owners to de-sex pets?

Lannock Strata Finance

8 Should the building manager report breaches of by-laws to the committee?

Michael Kleinschmidt, Bugden Allen Graham Lawyers

24 Should all committee members be involved in decision making?

Chris Irons, Strata Solve

Chris Irons, Strata Solve

10 All tapware must be a certain standard and star rating

26 What happens to voting deadlines when the AGM is reconvened?

Todd Garsden, Mahoneys

William Marquand, Tower Body Corporate

12 Can the body corporate buy or lease a lot owner’s parking space for EV charging?

28 Conflict of interest? The builder owns half the lots and sits on the committee

Altogether Group

Todd Garsden, Mahoneys

14 In our high-rise, we pay higher levies per level. Is this fair?

Frank Higginson, Hynes Legal

16 Why it’s critical for OC’s to follow Capital Works Fund Report recommendations.

Asset Strata Valuers

18 Responsibility for cleanup costs after a burst fire hydrant

30 Can a letting pool manager own units and include them in the rental pool?

Frank Higginson, Hynes Legal

32 The SCAQ Difference SCAQ

34 The QLD LookUpStrata Directory

Tyrone Shandiman, Strata Insurance Solutions

Thanks to our sponsors

SC Seymour Consultants

STRATA COMPLIANCE REPORT SPECIALISTS

Cleaning the car park Our car park spaces are exclusive use, and the rest is common property. Who is responsible for cleaning the car park?

The December 2023 edition of The QLD Strata Magazine includes an article by Will Marquand about cleaning garages. The Q&A indicates that the body corporate is responsible for the cleaning. In my present building, it’s assumed that since the parking spaces are assigned to units and numbered accordingly, they are part of the unit’s exclusive use area. As such, owners are responsible for cleaning their parking space, and the body corporate cleans the rest of the common area. Is this correct?

Schemes have committees to find a pathway through these issues.

Maintenance of exclusive use areas is generally the responsibility of the lot owner, so the interpretation here sounds correct.

For reference, see the below link for a handy guide on exclusive use responsibilities: Exclusive use - maintenance responsibilities.

However, you also have to consider the practicalities of building management.

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We don’t know the set-up of your building. Still, if we considered an underground car park with common property and exclusive use spaces, it may be difficult to arrange an annual pressure clean where each owner was responsible for the costs of cleaning their own exclusive space. It’s hard to oblige owners to pay individually, and the benefits of the cleaning will be lessened if you choose to have your space cleaned, but your neighbours on either side don’t. In these circumstances, the body corporate might organise to clean the whole area, including the exclusive use spaces, and cover the costs.

You can argue about the technical correctness of this but provided you achieve a wider benefit and owners aren’t unfairly disadvantaged, this doesn’t seem like an unreasonable action. In other circumstances, an alternative system may be more appropriate. If you had a building where only half the lots had parking spaces or access to the car park, you might need to introduce a set-up that only applied the cost to the lot owners with spaces. Finding a pathway through these kinds of issues is what schemes have committees for, so if you have questions about your site, refer them to the committee and see what the response is.

William Marquand | Tower Body Corporate willmarquand@towerbodycorporate.com.au READ MORE HERE

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February 2024 - Insights into Strata Finance Strata Finance: It’s a flexible funding facility, not simply a loan.

Recently, we asked our Business Development Managers across Australia to share the most

common misconceptions they hear about strata funding… and the answer was unanimous!

When discussing funding options with owners, they frequently hear, “Oh, a funding facility? That works just like a standard loan, right?”. This notion tends to surface even before we step into a general or committee meeting.

Attribute

Most Conventional Loans

But here’s the reality - a funding facility isn’t the typical run-of-the-mill loan. It doesn’t come with the same upfront commitments or lock-in terms that are usually associated with a conventional loan.

This article highlights the key differences between a conventional loan and strata finance facility, to empower Strata Managers and Body Corporates to make informed decisions about their funding options. We’ve simplified this topic so it’s quick and easy to understand and share with your colleagues and clients.

Lannock Strata Finance

Insights from Lannock’s BDMs

Flexibility to Draw Funds as Needed

Lannock facility Principal and Interest repayments are charged only on the funds drawn, as and when they are used. Approval equals access to funds, but not all the funds are deposited on day one. You simply draw down as needed.

No fees or penalties for early repayment

You are not committed to utilising the entire amount approved.

Repayments are tied to the lot, not the owner

When a lot changes hands, the new owner takes over the repayments and associated levies.

BENEFITS TO CONSIDER IN YOUR FUNDING SOLUTION: Flexible Funding for Fluid Situations in Strata In strata, funding needs can be uncertain and fluid. The full scope of an issue often isn’t clear until professionals assess it and, in some cases, not until they commence work. And that is why a Strata Finance Facility with swift access to approved funds is an effective way for Body Corporates to navigate unpredictable situations and fluctuating costs.

Strata funding also provides a variety of flexible and simple products to cater for the specific requirements of each Body Corporate’s situation. Extendable drawdown periods, length of terms and up to 24-months of interestonly payments, and quick access to draw on funds as required.

Tailored for Strata Schemes Unlike conventional loans, strata funding is extended to the Body Corporate, not an individual.

Strata finance aligns perfectly with the strata scheme’s legal structure and purpose: • It’s extended to the Body Corporate, not an individual • Repayments can be incorporated into ongoing levies, spreading costs over time

• This approach reduces the immediate financial burden on owners by up to 90% in the first year.

• It eliminates waiting for the Capital Works Fund to accumulate the required capital • Immediate access to funding allows prompt repairs or upgrades, enhancing property value and liveability • Prompt remediation of building issues saves money

In the face of unexpected costs or urgent repairs, remember – strata finance is a facility, not just a loan! It’s a solution that has been specifically designed to help Body Corporates navigate financial challenges more effectively and with greater flexibility. Strata finance is about flexibility, not constraint. It’s about simplicity, not complexity and about having the freedom to adapt to the fluidity of changes. It’s about being prepared, not reactive.

So, next time you’re faced with a financial decision, remember, it’s a facility, not a loan!

DELAYS = $$$$: A Summary of Insights from Lannock Strata Finance’s BDMs Strata communities across Australia have faced numerous challenges recently, including changing legislation, COVID-related delays, defects, supply chain issues, inflation, and a shortage of contractors.

• Expanding Scope of Work

Our BDMs, who work closely with these communities, have shared some valuable insights. One BDM highlighted: “Addressing problems when first identified could have led to significant cost savings for my client who delayed works from 2018.” Another BDM added, “Delaying necessary works will inevitably cost you more money!”

• Impact on Residents' Enjoyment and Asset Value

Here’s why, as shared by our BDMs from their recent experiences:

Another BDM points out, “Over time, we’ve seen that issues can worsen, increasing the scope of repairs and costs.”

“Deteriorating assets can negatively affect resident enjoyment of amenities and the liveability of residences. This can then impact occupancy rates and property values,” recounts another Lannock BDM, echoing a conversation with a strata manager.

• Inflation & Rising Costs “I always inform my clients that delaying work often leads to paying more due to inflation and rising material costs,” shares one BDM.

Interested in learning more about how Strata Finance can benefit your Owners Corporation?

Don’t hesitate to reach out to our team.

We’re here to help you navigate your funding options and make the best decision for your strata community.

Jason Triplett Business Development Manager QLD P 0467 777 272

E jason@lannock.com.au W www.lannock.com.au

Should the building manager report breaches of by-laws to the committee?

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Should the building manager report breaches of by-laws to the committee? In our building, there are members of the committee who commit breaches. How can we deal with those?

Your building manager should only do what their contract requires.

Your building manager (aka, caretaker, or onsite manager – the technical term is ‘caretaking service contractor’) should only do what their contract requires. There is no standard contract for caretaking duties in Queensland, so it can and does vary from building to building.

I know from experience it is commonplace for there to be arrangements about what the caretaking service contractor does in relation to by-laws. It really does depend on how this is represented in the contract: perhaps it is a requirement to ‘report’, or it could be to ‘work with the committee’, or it could be to ‘assist’. The bottom line, though, is this: none of those contractual arrangements changes the fact it is the committee’s responsibility to enforce by-laws and nor does it change the fact that an individual (which can mean an owner or an occupier, aka, tenant) can have by-laws enforced.

question about how by-laws can get enforced against committee members, as I assume from your query that the committee members are not enforcing by-laws when it is in relation to them.

This is general information only and not legal advice.

Chris Irons | Strata Solve chris@stratasolve.com.au READ MORE HERE

I think your best bet is to look at this excellent by-law enforcement flowchart: By-law enforcement applications, prepared by the Commissioner’s Office. It answers your

Helping the strata community navigate their building concerns B U I L D I N G C O N S U LTA N C Y

RE PAIR S O LU TIO N S

•

Defect reports and forensic engineering

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Scope of works

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Dilapidation and risk surveys

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Dispute mediation and expert witness

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Contractor procurement and cost validation

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Construction management

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Capital works funds/maintenance plans

• • • • • • •

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Technology driven solutions (incl. AI)

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Façade assessments

Emergency make safe Fire water damage restoration Leak detection Contamination response Building repairs Cost validation services Technology driven solutions (incl. AI)

T O L E A R N M O R E , C O N TAC T: 1300 735 720 sales.au@sedgwick.com

1300 654 599 sales.au@sedgwick.com

All tapware must be a certain standard and star rating

Can the committee introduce a by-law stating that all tapware in the lots must be a certain standard and star rating?

Our body corporate has shared water meters.

Some units in our 8 lot scheme have been renovated since the build in 1970 and we’d like to arrange a plumbing audit on lots. Can the committee introduce a by-law stating that all tapware in the lots must be a certain standard and star rating?

The body corporate can inspect lots to assess whether the tapware is of good condition – but cannot require owners to upgrade or improve better tapware.

Maintenance obligations and standards are set out in the legislation and the by-laws cannot increase the standard imposed on owners.

Any by-law that seeks to impose a higher standard would be contrary to section 180(1) of the BCCMA.

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Relevantly, section 211(3) of the Standard Module provides: The owner of a lot included in the scheme must maintain the lot in good condition.

Adjudicators have held that “good condition” does not mean current standards or a minimum star rating. It means that it is serving its purpose and not in disrepair.

The body corporate can inspect lots to assess whether the tapware is of good condition – but cannot require owners to upgrade or improve better tapware.

Todd Garsden | Mahoneys tgarsden@mahoneys.com.au READ MORE HERE

11

Can the body corporate buy or lease a lot owner’s parking space for EV charging?

Can we place an EV charging station in a visitor car parking space? Alternatively, can the body corporate buy or lease a lot owner’s parking space for EV charging?

Decreasing visitor car spaces could potentially violate your development approval.

Visitor spaces are commonly designated as common property and are typically incorporated into your development consent, often with a minimum requirement. Decreasing these spaces could potentially violate your development approval (DA).

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If contemplating adjustments to a lot owner’s parking space, engage in transparent communication to discuss the proposal, potentially negotiating lease terms or obtaining consent for installation. It’s important to note that altering the use of a private space to public may necessitate local government approvals.

Altogether Group eaustin@altogethergroup.com.au READ MORE HERE

the altogether academy Helping to educate and innovate for a better tomorrow.

At Altogether, we’re a multi-utility service provider on a mission to make the world a brighter place.

We’re passionate about creating sustainable communities. Leaders in the utility industry, we continuously lobby the government on matters to help improve customer protections.

With imminent legislation changes on the way, we’re also well positioned to help Strata Managers and Body Corporates navigate their way through the new obligations and rights.

That’s why we’re here to help with the Altogether Academy.

Altogether Academy is a program that will educate, empower, and support all strata managers, while covering education topics such as: • Energy fundamentals • Embedded networks • Sustainable technology such as electric vehicle charging capability • Utility data and metering • Government reform and utility regulation The program will give you the opportunity to learn from some of the energy industry’s most experienced voices, learn soft skills and take part in networking opportunities. Take control of your career, embrace Altogether Academy and talk to a Senior Energy Consultant today.

SCAN H ERE

For more information, or visit altogethergroup.com.au

power. water. data

In our high-rise, we pay higher levies per level.

Is this fair?

In our 10 level, 60 lot building, all lots are similar, but unit entitlements are not. Levies increase per level even though we all have equal access to facilities. Can unit entitlements be reviewed and adjusted?

Our 60 lot scheme with lots distributed evenly over 10 levels is about 20 years old. It is administered under the BCCM legislation as an Accommodation Module. All lots are similar but their lot entitlements for the admin fund and sinking fund are not. Each level pays about 2.5% more than the one below.

This year, for example, the level 10 lots are paying about $2,500 or 24% extra. We all have equal rights of access to the same facilities, e.g. lifts, pool, gym, boat pontoon, etc. Can the lot entitlements be reviewed so that each lot pays its fair share?

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This is in the ‘too hard’ basket for government, and it has been since 2011.

This would appear to be a very clunky way to attribute a proportionate share of the body corporate costs. As it sits right now, the only way to change it is really by a resolution without dissent, meaning the lower level owners would have to agree to pay more as the upper level owners paid less. As you would expect, these types of motion rarely pass.

This one is really in the ‘too hard’ basket for government at the moment, and it has been since 2011.

Frank Higginson | Hynes Legal frank.higginson@hyneslegal.com.au READ MORE HERE

FREE BY-LAWS ASSESSMENT THE TIME TO ACT IS NOW With legislative reform on its way and the strata sector thriving, review your by-laws to ensure they remain relevant & enforceable.

1. Prohibit smoking in common areas

Reasons to review your by-laws now

2. Prepare for the wave of electric vehicles 3. Ensure pet applications are enforced 4. Effectively deal with nuisance

Get your obligation-free assessment on whether your by-laws are valid and enforceable.

hyneslegal.com.au/by-laws

Why it’s critical for OC’s to follow Capital Works Fund Report recommendations.

By James Bouteris

The Capital Works WorksFund Fund(CWF) Forecast (CWFF) report is that a document thatrecommended outlines the The Capital report is a document outlines the recommended capitalwithin worksa projects within and a strata property and advises Owners capital works projects strata property advises Owners Corporations (OC’s) Corporations (OC’s) to reserve funds to cover future maintenance and major to reserve funds to cover future maintenance and major expenses. Proactive OC’s who expenses.

Proactive OC’s who adhere to help these recommendations not onlyinhelp adhere to these recommendations not only prevent major capital expenses the prevent major capital expenses the future alsoproperties. help to increase the market future but also help to increase thein market value but of their value of their individual properties.

Neglecting the recommendations outlined Neglecting the recommendations outlined in the Capital Works Fund Report is in the Capital Works Fund Report is detrimental to OC’s for several reasons. The detrimental to OC’s for several reasons. The primary purpose of preparing the report primary purpose of preparing the report is to minimize annual costs associated is to minimize annual costs associated with critical building elements such as with critical building elements such as waterproofing, roof repairs, and Workplace waterproofing, roof repairs, and Workplace Health and Safety (WHS) considerations Health and Safety (WHS) considerations through preventive maintenance, thus through preventive maintenance, thus ensuring the well-being of residents and ensuring the well-being of residents and the longevity of the property. the longevity of the property.

Numerous buildings along the eastern Numerous buildings along the eastern seaboard of Australia, some exceeding a seaboard of Australia, some exceeding a century in age, face structural challenges century in age, face structural challenges like failing roof timber struts, collapsing like failing roof timber struts, collapsing retaining walls, and early signs of concrete retaining walls, and early signs of concrete cancer due to insufficient waterproofing. cancer due to insufficient waterproofing.

The consequences of not addressing these The consequences of not addressing these issues promptly can lead to more extensive issues promptly can lead to more extensive problems over time, especially in regions problems over time, especially in regions experiencing higher rainfall. experiencing higher rainfall.

CONTACT US

P: 1800 679 787

While legislation in Queensland and New While legislation in Queensland and New South Wales emphasizes the importance South Wales emphasizes the importance of proactive preventive maintenance, it of proactive preventive maintenance, it does not impose a mandatory obligation does not impose a mandatory obligation to act on the Capital Works Fund Report to act on the Capital Works Fund Report recommendations. Some OCs choose to recommendations. Some OCs choose to ignore the suggested preventive measures, ignore the suggested preventive measures, including essential actions like waterproofing, including essential actions like waterproofing, gutter and roof repairs, and ventilation system gutter and roof repairs, and ventilation system maintenance. This negligence can result in maintenance. This negligence can result in larger and costlier problems a decade later, larger and costlier problems a decade later, particularly for aging buildings. particularly for aging buildings.

We would argue that the legislation falls We would argue that the legislation falls short by not enforcing a minimum standard short by not enforcing a minimum standard for setting aside funds for future needs. for setting aside funds for future needs.

We propose that a 30% target of the We propose that a 30% target of the recommended annual budget be a recommended annual budget be a mandatory allocation, believing it would mandatory allocation, believing it would serve as a prudent measure for OCs to allocate serve as a prudent measure for OCs to allocate funds for unforeseen expenses annually. funds for unforeseen expenses annually.

W: www.assetstratavaluers.com.au

E: workorders@assetstratavaluers.com.au

Issues we typically identify in properties over 60 years old include sagging roofs, water penetration, mold buildup, cracked tiles, damaged concrete pathways, potholes, rusted gutters and pipes, flooding balconies, potential concrete cancer, rusted balustrades, and inadequate fire equipment. Proactive OCs not only prevent major repairs but also protect the property’s value by adhering to a minimum financial benchmark.

The Strata Role Inspection, a prerequisite for purchasing Strata Titled properties, gauges the proactive nature of the OC. This inspection influences the saleability of individual units and the overall appeal of the complex.

Neglecting preventive maintenance not only impacts the complex’s financials but also diminishes its market value and increases insurance premiums over time.

It is imperative, especially for properties exceeding 100 years, to prioritise annual preventive maintenance to avert major repairs and maintain or improve their market value.

We, at Asset Strata Valuers, tailor our CWF reports specific to the subject property. Our reports are detailed and provide current and up to date costings and rates. We can include major repairs into the CWF budget avoiding special levies therefore making it compliant to the ATO rules that can be used as a tax deductions for some individuals.

James, Martyn, Bryan, Sam and Cameron from the Asset Strata Valuers team are qualified and ready to help!

LEADERS IN STRATA PROPERTY VALUATIONS Providing strata valuation reports of exceptional standards.

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Why Choose Us

Reputable Industry Leaders Wealth of specialist knowledge Comprehensive, timely and affordable strata valuation reports

Areas of Service NSW, QLD, ACT and VIC

Transparent and detailed reports All properties physically inspected

CONTACT US 1800 679 787

www.assetstratavaluers.com.au workorders@assetstratavaluers.com.au

Responsibility for cleanup costs after a burst fire hydrant

A fire hydrant burst and caused water damage to apartments across multiple floors. Who is responsible for removing and replacing flooring and excessive electricity use from dehumidifiers and fans? Is temporary accommodation provided?

In our apartment building, a faulty fire hydrant burst and caused water damage to apartments across multiple floors. Apartments have a mix of hybrid flooring and carpet tiles. Our body corporate has arranged for specialists to remove moisture from the building structure.

Dehumidifiers and fans are running 24 hrs around the building and within units.

Who is responsible for carpets and hybrid floor removal and replacement? Where fans are located in units, who is responsible for the excessive electricity use? Does the body corporate insurance provide temporary accommodation for the duration of the repairs?

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Where the strata insurance does not respond to the damaged flooring, the costs and responsibility for removal and replacement fall to the lot owner and their contents/landlord’s insurance.

Carpets and other temporary flooring (such as floating floors) within an owners’ lot are considered contents items and are not covered by the strata insurance. The exception is floating floors. Some strata insurance policies include automatic or optional cover for floating floors. Where the strata insurance does not respond to the damaged flooring, the costs and responsibility for removal and replacement fall to the lot owner and their contents/ landlords insurance.

Excess electricity usage for drying equipment is generally claimable. You will need to substantiate the excess usage; potential ways to do this is either by showing the actual increased usage on the next bill compared to the previous year’s bill, or the contractor may be able to provide details of the electricity usage of their machines.

Temporary accommodation for owner occupiers is generally covered by strata insurance if the property is deemed uninhabitable due to damage to the building and/or during the repairs. This is an automatic cover for most strata insurance policies on the market. However, the strata insurance will not respond to temporary accommodation costs for tenants or if the unit is uninhabitable due to damage to contents, such as carpets and/ or uninsured temporary flooring. However, landlords can generally claim loss of rent for the period a tenanted lot is uninhabitable due to building damage and repairs.

It’s important to understand that strata insurance will not cover loss of rent or temporary accommodation if the property is uninhabitable solely due to damage to items not included in the policy, such as carpets.

However, these costs may be covered by the property owner’s landlord insurance or contents insurance, particularly if there is an extension in the policy for loss of rent or temporary accommodation.

In this instance, we suggest the building speak with their broker for specific advice about their claim and circumstances.

Tyrone Shandiman | Strata Insurance Solutions tshandiman@iaa.net.au READ MORE HERE

BCCMA CHANGES COMING IN 2024 Late last year the Queensland Government passed the Body Corporate and Community Management and Other Legislation Amendment Bill 2023. We currently expect the new laws to come into effect sometime in the first quarter of 2024.

The key changes • Allow an owner or occupier’s car to be towed if it is parked in contravention of the by-law without the need to firstly enforce the by-law through the contravention notice process and Commissioner’s Office.

• Allow a body corporate to ban smoking on the common property (not just substantially enclosed areas) or an outdoor area of a lot.

• Provide stronger pet approval mechanisms for occupiers seeking permission and to reduce the issues which the committee can take into account (such as type, number or size).

“Critically for bodies corporate, all by-laws will need to be updated to reflect these changes to ensure they can be enforced when the new rules come into effect.”

Other changes • Provide a new mechanism to terminate, and sell, a community title scheme if it is no longer economically viable for the scheme to continue to operate.

• Assist principal bodies corporate in enforcing by-laws against subsidiary owners and occupiers, providing better rights to body corporate records within a layered arrangement.

• Updating the codes of conduct for body corporate managers and caretaking service contractors.

• Allowing adjudicators to authorise lesser insurances for the scheme (rather than needing the Commissioner to approve such applications).

• Allowing bodies corporate to change their financial year by ordinary resolution once each 5 year period without the need for an adjudicator’s order to do so.

• Removing reference to the use of a body corporate seal.

Next steps Feel free to contact our dedicated body corporate team if you: • have any questions about the amendments, • need help implementing them for your scheme; or • would like a free review of your by-laws.

General advice / by laws

Dispute resolution

Assignments

Amalgamation /termination

www.mahoneys.com.au

Liability limited by a scheme approved under Professional Standards Legislation

Off plan (BMS / CMS)

Free By-Law Review Queensland strata laws are changing.

ACT NOW TO UPDATE YOUR BY-LAWS Your by-laws must reflect the changes to ensure they can be enforced.

Key reasons to have your by-laws reviewed and assessed: make sure they comply with the changes ban smoking in common areas remove cars from common property update the pet approval process Contact our dedicated body corporate team at info@mahoneys.com.au for a free review and assessment of your by-laws.

www.mahoneys.com.au

Brisbane office L 18, 167 Eagle Street Brisbane Qld 4000

Gold Coast office L 2, 235 Varsity Parade Varsity Lakes Qld 4230

p 07 3007 3777

p 07 5562 2959

Can our executive committee force lot owners to de-sex pets?

A “dot point” clause in our body corporate by-laws forces lot owners to de-sex all pets living in our eco-village. The eco-village is not high-density accommodation. Is this by-law enforceable?

In 2020, Adjudicator Sutherland had to decide whether a by-law that required all cats and dogs to be de-sexed before being permitted to stay within a community titles scheme was valid or not. The by-law was worded such that the committee could not give approval for the pet if it was a dog or cat and was not de-sexed.

Care should be taken when drafting a pet by-law or seeking to enforce one that requires the de-sexing of pets.

The learned Adjudicator found that the by-law granted the committee discretion on whether to approve a pet or not but locked down the committee’s discretion about giving approval too far. The restriction on the committee’s discretion meant that the by-law, as it was drafted, was not

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reasonably proportionate and was contrary to the interests of lot owners and occupiers.

As for the requirement to de-sex cats and dogs, Adjudicator Sutherland referred to material published by the RSPCA on the benefits and considerations of de-sexing, including the earliest that the procedure could or should be carried out. The by-law was not flexible enough to enable the committee to make necessary exceptions for puppies or kittens that were too young to be de-sexed (generally), or for animals of valuable breed (specifically).

It’s important to note that the learned Adjudicator was considering a by-law under the Building Units and Group Titles Act 1980 and was, therefore, sitting as a Referee. While there are similar principles in the Body Corporate and Community Management Act 1997(BCCM Act), the Adjudicator’s reasoning does not perfectly translate. Accordingly, care should be taken when drafting a pet by-law or seeking to enforce one that requires the de-sexing of pets. See Marina Residences** [2020] QBCCMCmr 648**

When the new section 169B of the BCCM Act commences sometime this year, the position above will change. The new tests will include whether a requirement to de-sex is a reasonable and appropriate condition and whether the refusal to approve on the basis that an animal is not de-sexed is defensible under one of 8 specific defences; see section 169B(6) here Body Corporate and Community Management and Other Legislation Amendment Act 2023 - Queensland Legislation - Queensland Government.

If regulation of pets in your scheme is an issue, it’s important to take advice early about how the 2023 amending Act affects current pet by-laws.

Michael Kleinschmidt | Bugden Allen Graham Lawyers michael.kleinschmidt@bagl.com.au READ MORE HERE

Should all committee members be involved in decision making?

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Can a committee consult only certain committee members, or should all committee members be involved in decision-making?

I disagreed with the committee in the past and have now been excluded from conversations about what’s best for the community.

Committees exist to make decisions, and those decisions get made as a group.

Committees exist to make decisions, and those decisions get made as a group. That said, the method by which a committee gets to that decision-making point is less clear. Individual committee members might have specific knowledge and expertise, which makes it logical they would be consulted in certain situations and perhaps even to the exclusion of other committee members.

Or from a purely practical perspective, if a committee member is severely stretched for time at a given instant, it might make sense they not be consulted or not consulted as much.

In your situation, a disagreement should not be grounds for not consulting you. Disagreement is a part of life, and it is absolutely a part of strata committee functioning. It is unrealistic to think all members of a committee would agree on everything all the time. You should not be excluded simply on that basis, and you absolutely should not be excluded from a vote on the issue.

You’ve referenced ‘conversations’ in your query. That makes it seem there have been discussions amongst other committee members that haven’t included you rather than excluded you from voting. Those two things are different. To put it another way, while it is not ideal – far from it in fact – when individual committee members are not consulted on issues, what really matters is your participation in the vote.

If the vote in question is for an outcome that is unreasonable, that is a different issue altogether. If you think that is occurring, you need to make it clear to your committee colleagues that they have a legislated responsibility to not act unreasonably.

Your query could be loosely termed an issue around governance. That’s relatively common, and committees can enhance their governance through training, education and coaching. You may want to consider if that’s relevant for your situation.

This is general information only and not legal advice.

Chris Irons | Strata Solve chris@stratasolve.com.au READ MORE HERE

Strata Solve helps people untangle and resolve their strata issues. Sounds simple when you put it like that, doesn’t it?

Director Chris Irons (pictured, with his strata-approved greyhound Ernest) has an unrivalled strata perspective. As Queensland’s former Body Corporate Commissioner, Chris has seen and heard virtually every strata situation and nuance. He knows that while legislation provides a framework, there are many ambiguities to navigate through and in which pragmatism, commonsense and effective communication are vital.

As an independent strata consultant, Chris provides services which are all about empowering owners, committees, managers, caretakers, and others, to protect their strata interests. With a high-profile media and online presence, and as an accredited mediator, Chris is also able to carefully ‘read the room’ and craft the right narratives in even the most complex strata situation.

Strata Solve is not a law firm. Chris instead thinks of steps you can take before you embark on lengthy, costly, and stressful legal proceedings. Regardless of the client, all people in strata have one thing in common: their substantial investment in the strata scheme. Strata Solve prioritises that investment in each tailored solution we provide.

Get in touch to find out more.

email: chris@stratasolve.com.au web: stratasolve.com.au

25

What happens to voting deadlines when the AGM is reconvened?

If an AGM fails to achieve a quorum and is reconvened, how does this affect the closing date for voting?

Our large body corporate’s AGM is soon.

We have many overseas non-resident owners.

We usually have around five per cent of eligible owners voting on motions and committee elections. The AGM fails to reach a quorum and is reconvened.

How does this affect the closing date for electronic, proxy and in-person voting?

26 www.lookupstrata.com.au

The closing date for vote submissions is the same closing date as your AGM, plus seven days.

If there is no quorum at a general meeting of a body corporate, the meeting must be adjourned to be held at the same place, on the same day and at the same time, one week later.

Voting is extended by the same period, so the closing date for vote submissions is the same closing date as your AGM, plus seven days.

People can vote in-person by attending the adjourned meeting. They also have the additional seven days to submit electronic or postal votes.

Unfortunately, it is a reality that some schemes rarely get a quorum – committee members and other owners familiar with these circumstances often determine to only show up to the adjourned meeting.

As a body corporate, you can vote to lower your quorum size to ten per cent. This motion needs to be passed at a general meeting. If you haven’t done so, we recommend you look at this change.

Still, you indicate you only get five per cent.

You may need to look at alternatives if you want to increase numbers. Writing to owners throughout the year or before the meeting may be a good way to build engagement. Even if you are only pointing out that it costs the body corporate more to hold adjourned meetings, this may bring in some votes.

On a wider level, this may be an issue that legislators must consider. The 10 per cent

quorum was only introduced a couple of years ago, and as a manager, we see it has successfully reduced the number of adjourned AGMs. A better alternative may have been to adopt the NSW system whereby if a quorum is not achieved at the start of a meeting, one can be declared by the people present after waiting 30 minutes to see who turns up. This, at least, lets the meeting proceed with the people who want to be there.

Having used both systems, I can say the NSW one is better.

William Marquand | Tower Body Corporate willmarquand@towerbodycorporate.com.au READ MORE HERE

Conflict of interest?

The builder owns half the lots and sits on the committee

In our 67 lot building, the builder owns half the lots and sits on the committee. Is this a conflict of interest?

Of the 67 units in our two year old body corporate, the builder kept 37 units and is a body corporate committee member.

Is this a conflict of interest? There have been a few relatively minor issues the builder refuses to fix even though they are defects. Can we do anything to limit the builder’s power?

If defects exist, the body corporate should ensure it obtains the appropriate evidence and directs the demand to the appropriate person.

Relevantly, there is sometimes an important distinction to be made between the developer (who owns the properties) and the builder

28 www.lookupstrata.com.au

(who was engaged to construct the properties).

On a rare occasion, the builder and the developer are the same.

In circumstances where the developer is separate from the builder, the body corporate does not really have any rights for defect rectification against the developer. Those rights are against the builder (and often, it is the body corporate relying on the developer’s rights to take action against the builder). If the entity is the same, the body corporate still has some rights to exercise, and the developer/builder cannot stop these from being interfered with.

The developer, as the owner of lots in the scheme, would have common interests in a number of ways with other owners and has statutory rights to be involved in the decision making of the body corporate. In relation to decisions made by the body corporate: • At committee level – when a specific issue arises, members are prevented from voting when a conflict of interest arises; and

• At general meeting level - adjudicators have recognised there is no conflict of interest on owners casting a vote. However, the body corporate remains protected as decisions must be reasonable. In circumstances where a lot owner uses their voting power to force unreasonable decisions, other owners have rights to have the decision overturned.

If defects exist, the body corporate should ensure it obtains the appropriate evidence and directs the demand to the appropriate person.

It may need to seek legal advice to identify who that person is.

Todd Garsden | Mahoneys tgarsden@mahoneys.com.au READ MORE HERE

Can a letting pool manager own units and include them in the rental pool?

Is it fair for letting pool managers to own units in the scheme and include them in the rental pool?

In June 2023, Frank Higginson responded to an audience member’s question concerning a letting pool manager who rents units from owners and then sub-lets them. What about letting pool managers who own units in the scheme and include them in the rental pool?

Is this a fair arrangement? In particular, is this an arrangement the Office of Fair Trading would be interested in?

30 www.lookupstrata.com.au

The legislation references disclosure of an ‘interest’ in the letting pool.

The legislation references disclosure of an ‘interest’ in the letting pool, so the obligation to disclose applies equally to ownership of units as well as the leasing back of them. I wouldn’t say the OFT is expressly interested in anything more than ensuring that the interest is disclosed.

Frank Higginson | Hynes Legal

frank.higginson@hyneslegal.com.au READ MORE HERE

SC Seymour Consultants

STRATA COMPLIANCE REPORT SPECIALISTS

Since 2001, Seymour Consultants has applied professionalism, honesty and integrity to every project and built a reputation as a market leader in the Strata Industry.

With a background of over 25 years experience in Quantity Surveying, Construction and Development, you can be sure to benefit from our

experience for your reporting and project based needs.

Specialising in: • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

Fire Safety Auditing, Evacuation Planning & Training Pool Certification Facility Manager & Caretaker Recruitment Lot Entitlement Reporting Building Condition Reports Quantity Surveying

Our main objective is to work in partnership with you as we share a joint interest in the success of each and every project.

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The SCAQ Differen Your property is one of your biggest investments and it should be nurtured and managed so it increases in value.

The value of your strata property depends on the effectiveness of the body corporate and its management.

SCAQ members have you covered.

Engaging a professional strata manager who is a member of SCAQ is the key to maximising the value of your property.

SCAQ members are: • Accountable to industry Professional Standards • Deliver trusted, expert guidance • Protect your investment • Increase your strata knowledge • Save you money • Minimise your risk • Safeguard your fees.

Professional strata manager is not a term regulated or protected by Government. The only professional strata managers who are endorsed or accredited in any meaningful way are those who have been through the SCAQ accreditation and training.

My strata manager is with SCAQ, is yours?

The SCAQ Difference The SCAQ pathway for accreditation and ongoing professional development is recognised nationally and internationally. When you choose a professional strata manager you entrust them with your money and compliance with your obligations, it is important to have someone you know can be trusted.

SCAQ members, unlike other strata managers having rigorous external standards put upon them, and they are answerable to best practice standards across industry.

Members of SCAQ are required to: • Undergoing Mandatory Training and Continuing Professional Development to maintain their membership with SCAQ • Maintain professional indemnity insurance • Meet ethical requirements and conform to a code of conduct overseen by a professional standards committee

Why use an accredited Strata Professional?

The SCAQ accreditation pathway is rigorous and industry leading. It is underpinned by a staged approach to work in the industry, with stages of accreditation taking years to achieve. This supervisory approach helps ensure appropriate mentoring by senior members of industry, as well as bringing participants up to speed on the latest theory and practice in the industry.

This pathway takes years to achieve full competence and certification in it should serve as peace of mind for lot owners that their asset is being managed with professional skill, care and years of experience.

nce Skills of an SCAQ Member SCAQ members learn a variety of skills throughout their education and in an ongoing fashion through classroom style as well as on the job training.

These include: • Financial management • Insurance advisory • Building maintenance • Contract management • Dispute resolution • Administration best practice

SCAQ members are the best in their field, with professional, educational and ethical obligations on them which are second to none in the industry.

If your Strata Manager is not an SCAQ member, we encourage you to make the switch to ensure that your home is protected by the guarantee of quality that comes with SCAQ membership.

Find out more: www.qld.strata.community

Your source of reliable Strata news and information since 2013 Providing detailed, practical, and easy to understand strata information to all Australians.

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SOFTWARE MiMOR

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ACCOUNTANTS Tinworth & Co

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Matthew Faulkner Accountancy

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