What Happens When You Don’t Pay Your Strata Fee

Stratarama What Happens When You Don’t Pay Your Strata Fee

If you have lived in either a townhouse or an apartment in South Australia, you might know something about Strata Title and fees. 

Here is everything you need to know about a Strata Corporation and the regular levies (or strata fees) paid by the Owners. 

What Is a Strata Titled Property?

Strata titled properties are a form of property type for which you can own to reside in or own to invest in. It is significantly different to Torrens titled properties, where you own your whole property and the land it encompasses. With a Strata property, you will be a part Owner of common land and common property and be a member of a community of Owners with responsibilities and obligations towards one another this shared property and towards each other.

This type of property ownership is not just limited to residential buildings either, as some Strata or Community titled properties in South Australia may be made up of Commercial buildings or sheds or even a mixed-use property of commercial and residential lots or units. 

Here are the many types of building that may be part of a Strata Titled Property:

• Office
• Townhouse
• Warehouse
• Apartment
• Homette
• Industrial unit
• Retail shops

So now that we have an idea of what a Strata titled property is, why are the unit Owners invoiced Stata costs/strata fees/ levies, and what are these levies for? Where do these fees go? and what are these fees comprised of? 

Learn more about Strata Title: What Is A Strata Title: What You Need To Know 2021

What Is A Strata Fee?

Strata Fees are more commonly known as strata levies or contributions. These funds are being raised to put towards the group’s ongoing running costs, maintenance and insurance. The maintenance is specifically for common property and common areas such as; 

• Driveways
• Fencing
• Gardening
• Gate repairs
• Stair maintenance
• Pool maintenance
• General Building repairs (roofing, guttering, windows, doors, and external walls
• Lift maintenance
• Common services and equipment such as;            
  • Electrical costs
  • Water costs
  • Fire protection services
  • Alarms
• Other costs such as; 
  • Management services
  • Legal services
  • Debt collection
  • Consultant fees
  • Building and Liability Insurances as mandated
  • Other Insurances either required by State Law or optional

The frequency and amount of fee that every Owner needs to contribute are decided annually at the AGM annual General Meeting) by the Unit Owners in attendance (or voting by proxy). 

If managed professionally, part of the services provided by the strata manager likely is to provide your group with a proposal for a budget based on what they believe your Strata Corporations annual costs to be (and long term costs). 

A Strata fee/ Strata levy is usually paid quarterly, based on Annual (plus long term) expenses. These will be distributed by your Strata Managers or the Treasurer when self-managed, in line with the agreed amounts to raise at the last Annual General meeting.

This, of course, also varies between the different states and depends on the strata laws in place.

However, there are three main types of strata fees:

• Administrative Fund Levies: These are expenses incurred each year, such as cleaning, electricity, plumbing, gardening, insurance, water, etc., recurrently

• Sinking Fund Levies: These are expenses made for long-term upkeep and maintenance work, not occurring every year, such as painting, roof replacement, timber works, etc. This works essentially as savings account for a rainy day, but with some idea of what that rainy day may bring.

• Special Levies: these are generally one-off levies called for a specific purpose such as unknown maintenance, emergency works and shortage of funds. These are often works that were not budgeted as part of a sinking fund (or the group may not have a sinking fund). Perhaps a project where funds were being raised needs to be prioritised sooner than expected or were more expensive than originally anticipated. Again these works would not be recurrent annual expenses but more one-off projects such as a driveway replacement or guttering replacement.

Learn More About Strata Fees: Everything You Need to Know About Strata Fees in South Australia

What Does My Strata Fee Cover?

Your Strata Fees or Strata levies will go towards all of the items as mentioned earlier and more. Each property is different, so the short and long term costs of running and maintaining these properties are also very different. For example, one group may have a large area of common ground, which requires substantial and regular gardening. In contrast, another may have a small amount of common ground, mainly just a carpark. Some Corporations may pay all the water usage through one common meter paid for by the Strata fees, whereas another may have individual water meters on each unit.

The type of items each Strata must cover is detailed above. However, if you are looking at purchasing a Strata unit, to determine what the costs are for that property, look at the most recent financial statements or budgets to get an idea of the regular costs. Then look at the last few sets of minutes to determine if any long term projects are being considered or already approved for the group, and whether or not these costs are incorporated in the existing levies and strata fees, or if a special levy is anticipated to cover the cost of the works.

How Are Strata Fees Calculated?

The strata fee that you need to contribute is decided by the body corporate at the AGM. The Members determine the amount that owners need to pay by owners, but after reviewing and considering a budget put together by your group’s Manager or the Committee.

Members can accept the budget or vote to amend it. However, this budget needs to consider all the group’s ongoing regular expenses and any unexpected expenses that may come.  

The strata fees will be different for every Strata unit complex, depending on the required recurrent expenses and/or agreed to by the Members. Some groups, for example, may have common lighting as a recurrent expense, and others may not. Factors that go into determining these fees include:

the age, location, property type, insurance costs, operational costs, amenities and more. 

In some Strata Corporations, there may be other premium amenities that can also add to the group’s costs, such as pools, gyms, elevators, function centres and much more. 

All of this will increase your strata fees needed to cover the ongoing costs. 

This fee may be set to be paid in variable frequency options, such as paying your contributions/ levies. Annually or quarterly (most common). This will be decided at your AGM. 

Learn More About Strata Fees: How are Strata Fees (levies) calculated?

What Happens if I Can’t Pay My Strata Fee?

Unit Owners are responsible for paying the strata fees (levies) on time when due, as pre-determined by the Corporation at a Members meeting. 

If you cannot pay your levy on time, it is important to reach out to the Strata Manager or Committee for your group and request an extension or alternative for payment. The total cost of your levy is always your responsibility, and just as you need to pay your other invoices, such as electricity, you must also pay the Strata Corporation. If you do not, there will be consequences such as interest and reminder fees applied to your account and could also result in Debt collection action taken against you or, in instances of long term arrears, Court actions. 

In instances where you are struggling due to hardship, ignoring your incoming levies will not assist you. Reaching out quickly to express the issue with your Manager or Committee, so you can work together to get you back on track is vital. Communication is always the right approach to these matters.

When your levy is overdue, you also lose voting rights at your meetings (except on decisions requiring a unanimous vote). This means that you are losing your voice for decision making. 

Remember that if you are dissatisfied, holding back, your levy fees will not resolve any issues. Maintaining your voting rights is the best way to be heard on any matters. Also, suppose the group does not have sufficient funds to cover the costs of running the group. In that case, you may find that additional levies are also raised to keep the Strata Corporation able to transact its financial and maintenance obligations. These shortfalls, in turn, put additional pressure on all unit Owners.

How Do I Avoid Levies in Arrears?

Strata Management Companies usually provide three or more weeks notice for a levy (unless it is an emergency). They will also provide some time after the due date, before interest and reminder fees are added to your account. 

Work out your budget in advance. If your quarterly levies are financially draining as a lump sum, perhaps consider getting in advance and then paying into your account more regularly so that you can pay in smaller sums each month?

Where possible, before purchasing a unit, ensure that you understand the quarterly fees and the current condition of the property to determine whether this is a unit that you can personally afford, not from the purchase price but the ongoing cost perspective. For example, if the minutes and condition of the building highlight that there are major future works on the horizon, and there are few funds in the Strata Corporation account to put towards these works, do you have enough fund reserves personally to contribute your portion of ongoing costs in the years ahead?

Who Is Responsible for The Payment of Unpaid Strata Fees

The group can review and determine how and when funds are raised for certain items, and collectively the group can negotiate at a meeting what the fees will need to be to ensure the group meets its obligations. Some of the group’s costs, for example, are quite fixed. Members can obtain quotes for items to try and lower the ongoing costs or one-off maintenance costs. Still, they need to do the works, or to meet their electricity costs, for example, cannot be removed from a budget as they need to be met, and so the group must ensure that whatever levy/ fees are being raised, are sufficient to meet the group’s needs. If enough funds aren’t raised, the group could find an impact on the health and safety of the residents in the building. 

Once the Members set a contribution level/ levy at a meeting, each Owner must pay these levies to ensure compliance under the Strata Titles Act 1988 and ensure that the group can meet its costs.

If you are an owner in a Strata Corporation, then the costs of maintaining and running the Strata are a collective responsibility of the Unit Owners. This means that there is a responsibility upon you to pay your levies/ fees. 

You, the Unit Owner, is responsible.

In some commercial situations, the Commercial lot Owner may choose to include the Strata levies into their Lease arrangements with their commercial Tenants. This does not remove the responsibility of paying the Strata levy from the Unit Owner. It merely means that they can choose to recoup the costs from their commercial tenant, provided it is part of their lease.

Final thoughts

Before you decide to invest/own in a strata property, you need to understand all these factors so you are aware of your obligations and the group’s costs. You must do your research so you know how everything works before you make an informed decision.

If you have any questions about strata management in Adelaide, contact us at:

Stratarama

office@stratarama.com.au 

08 8276 0426

It’s your Community.

This article and the information provided represent general advice and do not consider any specific financial situations, objectives, or needs of an individual or Body Corporate/ Strata Corporation. Before you decide whether to acquire a certain product, you should read the relevant product disclosure statement, policy wording and/or consult your Insurer.

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Why Is Strata So Expensive: Understanding Your Strata Fee in 2021

Stratarama Why Is Strata So Expensive: Understanding Your Strata Fee in 2021

As a Strata Manager, we see many different levels of contributions raised by various groups across Adelaide.

Each unit owner sets their level of contributions or levies based on the recurrent annual expenditure they foresee (budgeting) and their long-term cost for larger projects (a sinking fund or a series of one-off special levies). These decisions are made at the Annual General Meeting.

Under both the Strata Titles Act 1988 and the Community Titles Act 1996, it is required that all owners of the Corporation consider the proposed budget for the ongoing expenses of the group. This budget should be put forward for the consideration of the Members by the group’s appointed Treasurer, or in the instance where the Strata or Community group is professionally managed, this budget may be compiled and presented by them at the request of the group as part of management services.

Comparing the line items of a budget against the previous year’s budget and/ or last year’s actual expenditure is a fantastic method to determine what funds will be needed to be budgeted over the coming (or forward) period. The annual (recurrent) expenses should all be accounted for within the budget covering items that the group faces annually. 

These costs may or may not include grounds maintenance, general repairs, utilities (water and power), insurance premiums and possibly insurance excesses, management, tax, banking, legal fees, and more.

At this meeting, a simple majority will pass the budget, where a quorum has been formed.  

All owners are responsible for their contributions (levies) to the group for the following 12 months.

Tony Johnson from the Lookup Strata website has answered several levy-related questions before. Check them out here: 

https://www.lookupstrata.com.au/sa-increase-levies/

Why Are Strata Fees So High?

As discussed above, if you fee the levies are high/ expensive, you need to determine what factors are creating the cost? Attend your Annual General Meetings and get involved in the group business to discuss and understand where these costs come from.

Whether fees are higher or lower are determined by the Owners themselves, as outlined above. Strata Corporation Members may look to minimise recurrent costs by managing the group themselves, finding a value for a money manager, shopping around for a reasonable grounds Contractor, reviewing insurance costs and utility providers, to find the most cost-efficient options for the group, however as always, Buyer Beware when the fees are low, make sure that the service remains high.

The level of strata fees requiring to be contributed will be different for every Strata unit complex, depending on the recurrent expenses that the Corporation faces. Some groups may have common lighting as a recurrent expense. Others may not. 

Some Corporations may choose to pay the water usage charges from the Strata (based on having one water meter on-site). In contrast, others may have SA Water break this up and send the invoice directly to the Owner, thereby removing this line item from the Strata Corporations budget and expenses.

Some factors which determine the contributions include:

· age of the building

· location

· type of property

· maintenance costs – Has the group been well maintained, lowering the need for repairs?

· insurance costs – Has the group been well maintained, which has lowered the risks associated with insurance claims, lower premiums, lower excesses for fewer claims.

· operational costs

· amenities: pools, gyms, elevators (lift maintenance), function centres and much more

· Legal fees or Debt collection costs

· Utilities (common power), shared water

How Are Levies (Contributions) Paid?

Corporations may set different payment methods. The Corporation will set an Annual level of contribution for each fund applicable (Administration and Sinking) then these Annual contributions may be imposed for Annual payment, or broken down into smaller levy payments (usually a quarterly contribution), to assist with Owners being able to raise funds, and also to help with cash flow for the Corporation. 

Are Strata Fees Negotiable?

It is the Members of the Corporation at the Annual General meeting who set the level of contributions. As such, the levies are collectively negotiable every year. However, once the group has successfully moved to adopt a level of contribution, this is set until the next AGM. 

Whilst we talk about the Group members negotiating on the levies to be raised, the budget should offer considerable guidance on what is or is not achievable when setting levies. For example, once committed, your utility costs, insurance, amenities, etc., are fairly fixed each year. 

To raise a level of contribution less than your general expenses in the forward period would result in the group spending more money than they are raising. This would either deplete a reserve of funds or simply require the group to present yet another levy to cover the costs.

So, there is a minimum amount that each group must raise, depending on what the individual costs of that group are (which we have discussed above). If enough funds aren’t raised, the group could impact the health and safety of the residents in the building. 

For items that are not recurrent or fixed, the group members have a greater ability to negotiate with one another at the meeting regarding the contribution for those costs. 

This may mean, allowing in the Administration fund, a contingency for items, it may mean setting a Sinking fund for future projects, or agreeing with each other, that instead of having a large sinking fund, that the group commit to calling special levies to cover the cost of project works when they arise. 

The Strata and Community Titles Acts vary in respect to these requirements in South Australia. It is important to note that these are varied again in other States in terms of what is or isn’t legally required to be raised.

What is a Sinking Fund?

The Sinking Fund is like a forced savings account. The Members fix a level of savings at the AGM, be paid each year by each member, and put away projects in the future. This may include larger maintenance items that are not attended to each year, such as typical painting, guttering, roofing, fencing, timber rot, and other such things. 

It may include long-term maintenance items on amenities in larger-scale properties, such as considering replacing an Elevator or resealing a shared pool. 

Ensuring that when these items require maintenance, the group has the funds available to undertake the repairs. Such budgeting would include a prospective timeframe for the works, i.e. the group believes that painting will be required in 3 years to prevent rot, or a report on the roof indicated an expected life expectancy of 5 years.

The Sinking funds set by the Corporation Members may also be for improvements to the complex, rather than just repairs. Perhaps the Members passed motions to improve the property: This could include rendering the complex, installing security gates, landscaping or other one-off larger scale projects.

What is a Special Levy?

A special levy may be raised for a one-off project item. This works the same as a Sinking fund contribution, in that you are raising funds for non-recurrent costs, but rather than increasing savings for several projects, the levy has been called purely for one project such as those mentioned above. 

This could still be broken down into smaller payments the same as a Sinking fund contribution, or it may be called by the members to be raised all at once. It is possible that the special levy may not be for proposed works. Instead, some maintenance emergency that was not anticipated by the group may be for emergency works but now has to be completed urgently.

Unpaid Levies? What if I don’t pay?

When an owner cannot (or chooses not) pay their Strata levies at or before the due date, interest is calculated against the overdue amount. Overdue Reminder fees may also be charged.

When a unit is “Unfinancial“, that unit Owner/ Corporation Member does not have any voting rights within the Corporation until the debt has been collected.

The Corporation requires these funds to meet its obligations on all of the expenses that we have discussed above. By paying the levies late or not at all, the Owner is placing the group’s financial obligations at risk. As such, the ability for the Corporation to recoup these funds through actions such as reminder fees and interest, to keep Owners attentive to paying their levies is essential. 

Should these actions not be sufficient, the Corporation may send the debt on to a Debt Collection Agent to follow up. If the funds are not recovered, the matter may be taken to court for judgement on clearing the debt. These actions will add extra financial burden on the Unit Owner, and it is therefore recommended that owners make every endeavour to pay their levies on time. 

An owner who is aware that they will have an issue paying their levies on time should reach out to the Corporation via their Office Bearers or Strata Manager to determine if a payment plan can be implemented, depending on the individual scenario and when the funds are required to be outlaid on expenses. A Corporation can’t consider someone’s immediate circumstances if they are unaware of any financial hardships.

We know this can be a difficult conversation to have. However, getting in front of the issue before it escalates and additional fees have accrued against the unit would be far better for all parties and may prevent additional hardship. 

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What Is A Strata Title: What You Need To Know 2021

Stratarama What Is A Strata Title: What You Need To Know 2021

The plural of “stratum” is “Strata. Generally speaking, the term Strata is used to mean a layer within a structure or layers within something. So, what is a Strata Title? In terms of property, a Strata title is a form of Property Title ownership.

One form of buildings on a “Strata Title: may be apartments such as a group of units over a various number of levels, however as a Strata Title, it can more broadly cover other building styles provided the property title is lodged as a Strata Title i.e Townhouses, flats, homettes may be part of a Strata Title.

The Title will encompass an area of common property, where each unit owner has a share in the ownership, rights, and responsibilities for that common area, and individual units or lots (which may include a subsidiary specific for that unit such as a garage or storeroom). This form of property Title was first introduced in Australia in 1961.

In South Australia, if you are not purchasing a property with common ownership areas, you would be looking to purchase a “Torrens Title” property, where you own all the land, all the buildings, within your defined Title/ plan.

What is a Strata Plan?

A Strata Titled Property will need to have plans which outline the boundaries of the lots (units), and common shared areas along with the unit entitlements. These entitlements are the values (like a percentage) for which each unit must contribute as their share towards these common costs (read below).

The Strata plan is a registered plan usually consisting of several pages which make up the strata plans – a plan showing the individual lots in relation to the common property (depending on the number of levels of the site, there may be several pages), a plan showing the overall property block in relation to the surrounding properties and page outlining the entitlements.

These plans will also highlight any encroachments on the common property or subsidiaries, along with any easements which may be part of the property plan. The plans are a vital part of knowing not only what is and isn’t your property, what is or isn’t common property, but what else may affect yourself or the group.

A strata titled property is not limited only to residential buildings but also may consist of commercial property. Each plan is different.

A strata title plan is used for the representation of all strata Corporations.

Where is a Strata Title Plan Lodged in South Australia?

Strata Title plans in South Australia are lodged at the Land Titles Office (LTO).

The registered Strata Title plan, has a unique number which is an identifier for that Property such as Strata Corporation 0000 Incorporated. 

Why do unit Owners pay Strata Fees?

When you own a unit/ lot within a Strata Title, then each unit would need to pay Strata levies or contributions towards the common expenses of the group such as insurance, maintenance, administration, utilities, and more. A Sinking fund may also be created by the Strata Corporation for which a levy would be paid by all unit Owners for future major works.

Why are Strata Titles Important?

Strata and Community Titled properties are important property types because they facilitate ownership of some form of the property whilst being part of a community that maintains a common collective area/ part of the property.

This is important because not all people looking to get into the property market could afford to purchase a house in the area of their choosing outright, or perhaps afford the upkeep on the property alone. This is a shared responsibility that can make it easier for some to purchase into, or perhaps a smaller pocket of property in which to maintain and fund.

This could assist first home buyers to get into the property market, people looking to downsize, investors, or those looking to be part of a community. Strata Titled properties won’t be what every property purchaser is looking for but will be the perfect fit for others.

It is highly advisable that anyone looking to purchase a unit within a Strata Corporation understands what they are purchasing, what their ongoing rights and responsibilities are, along the specifics of that property/ complex.

Consider what is a Strata Corporation, and then review the details specific to that site such as the Articles relevant to the complex. Before becoming a strata property owner, it is important for you to understand the various concerns and obligations you are to fulfill.

It is important for you to understand the reasons behind these different regulations and how you can responsibly fulfill them. Take the time out to carry out your own research before investing in a strata property so that you may make a decision that is better for you.

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What is Body Corporate? Your Questions Answered

Stratarama What is Body Corporate? Your Questions Answered

A Body Corporate is the general term used throughout Australia to encompass all forms of shared Titles. A Body Corporate is any Legal Corporate entity. This terminology is a general term to cover the various names used across all the different State legislations. In South Australia, our forms of Body Corporate properties are Strata or Community scheme. Strata is a term shared with some other States, however other Body Corporate names in other States include Owners Corporation

The term Body Corporate when discussing Strata or Community Title refers to a group of property Owners who collectively have part ownership in a Land division, on which each of those Owners also have private and exclusive use of a section, where a unit, townhouse, apartment or other unit/ Lot is established.

What does Body Corporate do?

Each body corporate will consist of either Commercial, Residential or mixed-use units/ lots. Depending on the body corporate, the site may also be tiered in terms of a primary, secondary type situation.

The body corporate, as mentioned above is the group of Strata or Community unit Owners whose role and responsibility are to ensure that the collective property is maintained, insured and safe for use by all Residents, Owners, Tenants and Visitors.

To fulfill these duties, the body corporate members must have regular meetings and determine the actions required to ensure both compliance and best practice for all members. To do this, many body corporate members may engage a body corporate manager (Strata Manager/ Community Title Manager) to assist them in the day to day running of the property group.

We said above that body corporate refers to being a legal corporate entity, as such there are obvious parallels between a body corporate property member and a board member of a Company. Both must ensure the safety, compliance and best practice for all within their body corporate, and effectively sit on a board to make these decisions. In fact, an older form of Strata Title here in South Australia, was actually Company Title units, showing this clear parallel. Several Company Title units’ properties still operate in SA today.

Who runs the Body Corporate?

As mentioned above, the Members of the body corporate run the body corporate. The Members are the unit owners and they may engage a Manager to assist them.

What Is The Difference Between A Body Corporate Manager And A Property Manager?

The body Corporate Manager or Strata Manager is engaged by the body corporate members to work with all members of the Corporation to deal with the matters mentioned above (common strata insurance, building maintenance, the raising of funds for ongoing works, compliance and all matters that are common). With-in each of these lots or Strata units either a body corporate member resides, or leases out their unit (residentially or commercially). When that unit is leased, the Owner of the unit (the same as they might with a Torrens Titled home) may choose to employ a property Manager to collect the rents, run checks on the Tenants to ensure compliance of their lease agreements, find suitable tenants and the like. The property Manager will address matters purely based on behalf of that one unit owner engaging them. Having a great Property Manager and great Body Corporate Manager who are able to communicate to one another effectively may reduce the work and issues faced by the individual unit Owner.

The above article will explain things in regards to a body corporate which is a Strata Title in South Australia, such as:

• How are body Corporate fees Calculated? And what do they cover?
• Why are Body Corporate Fees high?
• What happens if I don’t pay my Body Corporate Fees?
• How can I reduce my Body Corporate Fees?
• What is included in my Body Corporate Fees?
• Why are Body Corporates important?
• Can we self-manage our Body Corporate? / Can we do our own Body Corporate management?

Want to learn more? Check out our other articles:

• Why Communication Is Vital In Strata
• How Do I Call a Strata Meeting in South Australia?
• How Do I Terminate A Strata Manager
• Who can be a Strata Manager?
• What makes a Good Strata Manager?

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Why Communication Is Vital In Strata

Stratarama Why Communication Is Vital In Strata

Communication within a Strata or Community Corporation is vital to ensure that large decisions are made correctly and with all the required information. Communication is also vital to the day to day running of your Body Corporate.

Whether Strata or Community Corporation Committees are communicating with each other, their Manager or a third party, ensuring that the communication is relevant, clear and contains all the necessary information to ensure that it is effective.

Your Strata Manager must also communicate effectively, efficiently and regularly when there is a matter for the Strata Members to address. A good Strata Manager will provide the necessary skills to communicate the Strata body’s decisions to the insurers, the Tenants/ Agents, and any Contractors engaged in providing quotes or maintenance for the property. Presenting the right information in a clear, positive manner can be the difference between smooth and effective management and major errors being made, including Contractors or Residents feeling frustrated and/ or undertaking projects that are not in line with the Strata Corporations approvals.

Modern technology means that sometimes communication may not even involve two parties. For example, access to an online Owners Portal may mean that some Owners can find the information they need in their own time (provided that the right information is properly entered into the portal, with all the information required).

With more and more Owners and Residents accessible via email, Strata Corporation Members can be kept better informed promptly of matters affecting their Communities. It is able to reach more people quickly!

Of course, not everything has an immediate answer, and some matters require research. Sometimes just an acknowledgement that your query has been received and that your Manager will do some investigation can be the difference between stressing and patiently waiting for the information you need.

Your Community Manager can only contact you if you keep your contact information up to date.

If you want to receive your communication by email instead of snail mail, please advise the Manager. In recent years we have all seen mail delivered by post slow down considerably, with fewer Australia Post requirements to deliver as promptly as they once did.

Email is not going to be the right solution for everyone, but if you check your email regularly, remember that this is your Community if you have it delivered to your phone. If you want to get the latest information about what is happening, (when it happens) you may want to consider checking with your Manager if you have email recorded as your preferred correspondence delivery method. You may also want to check that the best, current and most regularly checked email is the one held on file in your Strata Managers office.

Remember your manager doesn’t work 24/7; however, they should provide you with a contact for maintenance emergencies in an emergency. If it is not an emergency, leave an email – just remember to give your Manager time to receive and read it during business hours.

Communication is a two-way street, and your Manager can best provide you with clear, important information when equipped with the best way to reach you. Whether the matter at hand is a complaint about a neighbour, a matter for the next meeting agenda, or a maintenance issue, clear communication from all parties will be the most effective way to assist and work with one another. This provides clarity for all parties involved.

If Stratarama is your Managing Strata Agent, why not contact us at office@stratarama.com.au to provide us with your current and best contact information and confirm your preferred method of correspondence delivery.

If Stratarama does not currently manage you and feel that your existing Manager isn’t providing the clear and effective communication, your Strata Corporation in South Australia requires, why not reach out to us today to discuss how we may be able to assist you in the future.

Want To Learn More About Strata?

What makes a Good Strata Manager?

Who can be a Strata Manager?

How are Strata Fees (levies) calculated?

Strata Management in Adelaide: Everything You Need To Know

How Do I Call a Strata Meeting in South Australia?

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How Do I Call a Strata Meeting in South Australia?

Stratarama How Do I Call a Strata Meeting in South Australia?

An Extraordinary General Meeting can be called by the Secretary, any two members of the Management Committee or one-fifth of the unit Owners (i.e one-fifth of the number of units in the complex per the  Strata Title Act 1988.

At least 14 days’ notice needs to be provided to all Owners before the meeting, along with an agenda containing the proposed motions so that Owners are aware of what is being voted on.

Depending on the items on your agenda, will depend on whether these motions can be passed by a simple majority of the Owners able to vote (financial members have no voting rights except for unanimous resolutions)  or whether a special or unanimous resolution must be passed.

Your agenda should not only detail all the necessary motions but also have attached any quotes or corresponding information/ documentation which would assist the Members in making their decision and to ensure that those who may submit a proxy, are familiar in advance of all the specifics.

Related:

How Do I Terminate A Strata Manager

Provided that the above steps are followed correctly, your meeting will be duly convened correctly and Owners/ Members will be bound by the decisions made at this meeting.

For the Strata Corporations, 50% is the required number of units that must be represented in order for a quorum to be present at the meeting, and therefore for the business to be able to take place.

For simple ordinary resolutions to be passed at a meeting, the group will first need the above quorum to be present. Then the decisions can be passed by the majority. For example, if you are an Owners in a group of 6 units, where 4 Owners attend, a majority of that quorum would by 3.

If only 3 Members attended (remembering that your quorum is only 50%), then a majority decision would be passed by 2 Unit Owners present and able to vote.

Don’t forget that some Owners may elect to appoint a proxy for the meeting, and that proxy vote will count as part of your quorum (provided the elected proxy is of course present at this meeting).

Further, remember that decisions made by the Strata, for the Strata require input from the Members. As such, it is vital that all Owners be issued the agenda/ meeting notice for this meeting, with a sufficient timeframe for the notice.

Whilst not all Owners will necessarily attend the meeting, and some may not provide a proxy either, they must be given the opportunity to consider the matters on the agenda and determine whether or not they will attend/ appoint a proxy. All Owners have the right to consider the business before the group.

Strata. It’s Your Community.

Want To Learn More About Strata?

What makes a Good Strata Manager?

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Strata Management in Adelaide: Everything You Need To Know

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What makes a Good Strata Manager?

Stratarama What makes a Good Strata Manager?

In South Australia, it is standard practice to appoint a manager at a properly convened meeting of a Corporation (either an Annual General Meeting or an Extraordinary General Meeting) and these contracts (management agreement) will usually run for a 12-month term. The Management agreement will have outlined the term of appointment. The Agency agreement may also outline other terms of the contract, including termination periods, termination notice periods and termination notice procedures.

Many times Members think changing Strata Managers is a difficult process, in reality, it is not difficult, but reaching out to your other Owners and discussing your group with them, is always an important part of making any changes. Strata Owners may need one Member to start this conversation, because often if you are thinking of changing strata managers, there is a good chance that now is the time discuss it with the rest of the vested Owners. You may find out that others are having the same issues, or you may find that perhaps your concerns were a one-off issue, that has since been resolved.

Contract Termination At A Meeting

The Annual General Meeting (AGM) is usually the time when the Body Corporate (Strata Members) will review the services and costs of the previous period, and review with the current manager will the terms proposing a renewal of the existing management agreement. At that time, the group may not wish to renew the services of the current strata management and alternatively appoint a new management company. To appoint a Body Corporate Manager (new or current) requires an ordinary resolution to be passed. Ordinary resolutions require a simple majority to pass and are how most decisions are made unless the Act, articles or bylaws specify otherwise.

Strata and Community Titled Properties in South Australia may also call an Extraordinary meeting prior to the AGM to cancel the services of a strata manager. The contract term will still need to run its course until the duration ends. However, the group have made their decision prior to the AGM date bypassing the ordinary resolution at this EGM to terminate the services of the current managers and appoint a new manager. If your group is contemplating changing Managers, we would suggest holding an Extraordinary General Meeting before the Annual General Meeting and after the contract has lapsed or is due to lapse. One of the reasons this may be preferable is if you hold an AGM with the management you do not want to continue with, they will no longer be authorised to act on your behalf and are therefore unable to carry out any instructions given. Another reason to do it this way is to give your new manager the opportunity to get to know your group and begin carrying out the everyday tasks and acting upon the instructions received at the AGM.

When Is It Worth Changing Strata Managers?

Body Corporate Members may consider reviewing the service of their Managers, in the same manner, they review other ongoing maintenance, contracts and works. Members should consider what a Good Strata Manager is? What service are we receiving? Are the services we receive at a reasonable and commensurate value? Only the Strata Members can determine whether or not now is the right time to consider ending a strata managing agent agreement. 

If the Owners believe that current management has breached their duties under their agreement or the relevant legislation, then it may be advisable to seek legal advice on if and how the contract can be terminated prior to the management agreement term ends. If a decision cannot be reached between the two parties on early termination, the corporation may seek out dispute resolution as set out in the Strata Titles Act or the Community Titles Act (whichever is applicable).

It may be worthwhile speaking with your other Owners before running any meeting, to determine if the issues that you may be experiencing are common to others in the group, and therefore if there is a desire by Members to formally discuss those matters and/ or a desire by others to consider a change in body corporate management.

How Do I Call An Extraordinary Meeting

An Extraordinary General Meeting can be called by an Office Bearer, any two members of the Committee or by a certain percentage of the Owners (this number varies slightly depending on if you are a Community Title or a Strata Title). At least 14 days’ notice needs to be provided to all Owners before the meeting, along with an agenda containing the proposed motions so that Owners are aware of what is being voted on.

What Happens Next?

Once the meeting is held, and the motion passed to managers, an elected representative will need to notify both the outgoing Strata Manager and the incoming Strata Manager.

The outgoing Manager is then bound by law to provide the new Manager with all of the Corporation records and the funds held, in accordance with the provisions/ timeframes noted in the Act and/ or management agreement. This is the Handover. 

Looking to change Managers? Stratarama is here to assist you every step of the way. Contact us by clicking on the link for an obligation-free proposal. Wanting to come on board? Our friendly team will arrange a smooth transfer from start to finish, assisting and guiding you on all the steps.

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