Annual general meeting

When should we have an annual general meeting?

The strata corporation must hold the next annual general meeting no more than 15 months after its last meeting. An annual general meeting should be held in every calendar year [Strata Titles Act 1988 (SA) s 33(4)].

Approval for structural work

An owner in our block of units wants to put awnings on the outside of the building to shade her kitchen windows from the afternoon sun. Does she need permission from the corporation to do this?

Yes. The decision to alter the external appearance of the units must be taken by the corporation. A special resolution of the corporation will be required to grant permission for this work [s 29].

Attendance by proxy at meetings

I am a member of the management committee but find it hard to get to every meeting. Can I appoint a proxy (someone to vote for me) for these meetings or at general meetings?

If a member of the management committee is unable to attend a committee meeting, they can appoint another unit holder as their proxy [s 35(7)].

However, for a general meeting, there are strict rules about the appointment of a proxy: the nomination must be sent in writing to the secretary of the strata corporation; it must specify whether the nominated person is nominated to attend and vote at all meetings, and in relation to all matters, on behalf of the unit holder, or only at specified meetings, or in relation to specified matters, on behalf of the unit holder [s 34(3a)].

In addition, a proxy attending a general meeting has strict obligations in relation to disclosure of interest (see Voting: Proxy voting: Disclosure of interest).

Auctions and sales

Can I sell my unit at anytime? Can I hold an auction in my unit when I wish to sell it?

Yes. There are no limitations on the sale of a unit by the unit holder, but you will need the corporation’s permission to place an auction or sale sign on common property.

Auditing

Do we have to make sure the corporation books and records are audited?

This depends on whether your strata corporation has appointed a strata manager or agent to receive and hold money on behalf of the corporation. A manager or agent must keep money in a trust account and has a legal obligation to have the trust account audited at regular intervals [s 36H]. The Strata Titles Act 1988 (SA) does not require a member of the corporation who is the treasurer or holds corporation money to have accounts audited; however the appointment of an auditor is sensible to make sure that a proper statement of accounts has been prepared. This should be balanced against the cost of auditing the accounts.

Bank Accounts

How do we open a new bank account in the name of the corporation?

The Strata Titles Act 1988 (SA) s 26(1)(c) gives the corporation the power to open and maintain a bank account. The bank will require evidence that the account holder is an incorporated body. This could include a copy of the deposited Strata Plan, a copy of the common property title or a copy of the deposit slip. These can all be requested from the Lands Titles Office with payment of the prescribed fee.

A strata manager can be asked to open a bank account for the corporation. If there is no strata manager, the bank may also wish to see evidence that the individual/s opening the account on behalf of the corporation have the power to do so. Minutes of the general or management committee meeting giving authority to open the account would usually be accepted.

Books and records

I have recently been elected treasurer and secretary of our corporation. What sort of books and records do I have to keep?

The requirements in relation to maintaining and keeping records of the corporation may be delegated to a strata manager. If this function is not delegated, as the treasurer, you must keep all accounting records relating to receipts and expenditure of the corporation and management committee.

As the secretary, you are responsible for administrative and secretarial matters for the corporation and the management committee. Record keeping is part of this function. If the function of maintaining and keeping records has not been delegated to a strata manager, you must keep: a register of the names of the unit holders; minutes of all meetings; notices and orders served on the corporation; copies of correspondence received or sent by the corporation; notices of meetings of the corporation and its management committee; documents received by the strata corporation from the original registered proprietor.

For further detail, see The Strata Corporation, Records.

Calling meetings and initiating action

I have advised the secretary of the strata corporation that repairs are needed to my water pipes due to tree root damage, but she has taken no action. What can I do?

If the damage is the responsibility of the strata corporation, and the secretary is not acting when requested, the unit holder could approach any two members of the committee, or if the corporation does not have a management committee, the unit holders of one fifth or more units, and ask them to convene a general meeting. If the situation becomes an emergency, the unit holder could have the repairs done and bill the strata corporation. If all else fails, the unit holder could take the strata corporation to court, either to force them to take reasonable action, or to recover costs of repairs.

Car parking

Visitors to other units often park in my space, or on common property, obstructing my access. What can I do to stop this?

Unit occupiers have an obligation under the articles to make sure that their visitors do not park in other unit holder’s spaces, or parts of the common property not authorised for parking. The upset unit occupier can first talk to the other unit occupier about the problem. If the unit occupier is a tenant, the unit owner may also be approached, as they have an obligation to take reasonable steps to ensure that the tenant complies with the articles. If there is no resolution, the management committee or the corporation may be asked to intervene. If the problem continues, it is suggested that a community mediation service be approached. If the articles of the corporation provide for a penalty to be imposed for a breach of the articles, the corporation may impose a penalty on the unit occupier. As a last resort, an application can be made to the Magistrates Court for an order to prevent future breaches. If a court order is not complied with, fines or even gaol sentences can be imposed.

Corporation Records

I am worried about the corporation’s finances. Can I can look at the books and records of the corporation to put my mind at ease?

Yes. The corporation must keep the minutes of meetings for 30 years and accounting records and correspondence for seven years. As a unit holder you can apply to the secretary or a committee member or the strata manager, and they must arrange for you to see the information you require within five business days after the request. Most information is provided free of charge to unit holders but some copying charges may apply. You may also arrange to have quarterly bank statements for all accounts maintained by the corporation. See The strata corporation: Access to information.

Corporation address

What is the strata corporation’s official address?

The official address of the corporation is that shown on the certificate of title issued for the common property in the name of the strata corporation. A corporation must keep a letter box with its name clearly shown on it for postal deliveries to the site. A post office box can only be used as the address of a corporation in districts where there is no postal delivery service. A document may be served on a strata corporation, its secretary or treasurer by posting or delivering to the address of the corporation.

Exclusive use of common property

One of the owners in the block was granted 'exclusive use' of a large part of the common property by the corporation some years ago. We feel that this is an unfair situation. How can we regain this common property for use by all owners?

The corporation can agree, by unanimous resolution, to grant exclusive use of the common property for a set period [s 26(4). A unanimous resolution is also required to revoke the exclusive use or for it to continue past the agreed date. If the exclusive use was granted for a set period then a unanimous resolution at a general meeting would be required for it to continue past the agreed date. If the exclusive use is not limited by time, it was an invalid resolution, as the Act requires any unanimous resolution allowing a unit holder exclusive use of a part of common property to be for a specified time.

One of the owners has fenced in common property next to their unit for their own use. Can they do this?

Excluding others from common property is contrary to the articles, as is using common property as a garden for a unit holder’s own purposes. The corporation can agree, by unanimous resolution, to grant exclusive use of the common property for a set period. Such a decision would need to be made at a general meeting. The corporation or management committee may treat this behaviour as a breach of the articles and go through the steps of communication – mediation – penalty (if possible under the articles) – Magistrates Court minor civil action. See Disputes.

Fences

The fence around my unit is old and needs to be replaced. Should the corporation pay for a new fence?

Generally, fences are common property and therefore the responsibility of the strata corporation. The corporation must maintain the common property to an acceptable standard, which may involve replacing or repairing the fence.

However, a strata plan could specify that a fence is part of a unit, or a fence erected by a unit owner may not be common property. If the fence is not common property, you as the unit owner, are responsible to maintain it. In fact, in this case, the corporation could require you to replace the fence. Legal advice should be sought in these situations.

How many members are allowed on the management committee?

For the last 5 years at each annual general meeting, our corporation, comprising 20 units, has elected a presiding officer, secretary, treasurer and 7 other management committee members. This number of people on one committee seems to me to be too many. How many people are there supposed to be?

There is no maximum number for a management committee. A general meeting of the corporation can fix the numbers for a management committee and must elect the presiding officer, secretary and treasurer. If a unit holder thinks the management committee is too large they could raise this at a general meeting.

Improvements to common property

Some of the unit owners want the corporation to install hand rails on the common stairs. What would be necessary to have the work approved?

As the common stairs are shared by all unit holders, they are considered common property. A simple majority vote at a general meeting can approve this addition to the common property. The corporation is responsible for public risk in the common property area and it may be sensible to install these rails.

Investing funds and borrowing money

Our strata corporation is holding funds put in by the unit owners. Where can we invest these surplus funds? Similarly, if the corporation wanted to borrow money, are there any restrictions?

The Act states that surplus funds should be in prescribed investments. In general terms this means a bank, building society or similar institution which does not expose the funds to great risk. If a strata manager or agent is authorised by the corporation to receive or hold money on the corporation’s behalf, that money must be held in a trust account.

Under the Strata Titles Act 1988 (SA), the strata corporation can borrow money to carry out its functions [s 26(1)(b)]. The articles can state who is authorised to borrow the money and from which financial institutions.

Management committee meetings

Can I attend management committee meetings even though I am not on the committee?

You can only attend those meetings with the committee’s permission, or if the articles allow your attendance, or a general meeting decides you can attend.

Management committee vacancies

Recently some members of our management committee resigned and this left the committee without a secretary. What do we do?

The management committee can appoint a person to fill a casual vacancy until a permanent appointment is made at the next general meeting. The position of secretary must not be left vacant more than six months [s 23(5)].

If the number of resignations takes the number of members below the number required for a quorum, and there is difficulty filling vacancies, decisions can still be made, but they will need to be ratified at the next committee meeting with a quorum, or at a general meeting of the corporation.

Negligence and Insurance

A tree on common property overhangs the street and drops berries. I am worried that a member of the public might suffer injury. Are we responsible?

If a member of the public, or a unit holder, suffers injury as a result of the negligence of the strata corporation, then the strata corporation may be liable. This may include the strata corporation’s negligence in not pruning or maintaining trees in a safe manner. All strata corporations must hold public liability insurance to the value of 10 million dollars to cover these risks [s 31(2) and reg14(1)].

Does the corporation’s insurance cover a burst hot water service?

An insurance policy does not normally cover wear and tear. Unit owners and the corporation have a duty to maintain their equipment. However the building damage caused by a leaking hot water service may be covered.

Notice of meetings

A general meeting of our group has been called but they have given me a notice posted less than 14 days before the date of the meeting. Are the decisions of the meeting legal?

Written notice of the time, place and agenda of a general meeting must be given to all unit holders at least 14 days before the date of a meeting [s 33(3)]. Contact the secretary if you have not received a notice. You could point out that any decision made at the meeting would be invalid as the meeting was not properly called, and any decisions would need to be ratified at a properly convened meeting.

Ongoing costs

What types of costs are involved if I wish to own a strata unit?

Apart from the usual expenses associated with owning land (council rates, water and sewerage, gas, electricity etc.), as a member of the strata scheme you will be required to contribute to the costs associated with the running and maintenance of the scheme. These can be split into two categories: recurrent fees (those that occur on an annual basis), and costs for the long term maintenance of the scheme (often referred to as a sinking fund). Inquiries should be made with the strata corporation that administers the scheme to find out these additional costs.

Painting and gutters

Can the corporation oblige unit owners to clean the gutters on their unit?

Gutters and roofs are common property. There is no reason why unit owners could not agree to clean their own gutters to reduce maintenance costs, but there is no legal obligation to do so. If a unit owner does not or cannot clean their gutters, the corporation remains liable for repairs. A thorough clean before winter is good preventative maintenance.

Can owners decide to save maintenance costs by painting the outside of their own units?

The corporation could agree to this arrangement but it carries some risks in that the end result could be poor or inconsistent. The corporation is liable in the first instance for fixing the external paintwork on a poorly painted unit.

Quorum

I live in a block of 8 units. At our annual general meeting only three people turned up. Is this a quorum?

No business may be transacted at a general meeting unless a quorum of at least half the unit owners is represented (in person, or by validly appointed proxy, or by remote communication if this has been allowed)[s 33(5)]. In your particular strata corporation, four persons entitled to vote would constitute a quorum. If a quorum is not present, the meeting must be adjourned for at least one week, but not more than 14 days, and written notice given to unit holders of another meeting. Then if after one half an hour of the relevant time less than half of the unit holders are represented, those present are entitled to work as a quorum. See General Meetings, Quorum.

Rates

I have bought a unit in a block of three. Do all three owners individually have to pay the water and sewerage rates and the council rates?

Each of the units in your block will be billed separately for council and sewerage rates. However, unless there are separate water meters for each unit, there is no way to determine a unit's water usage. Contributions are normally paid by unit entitlement; a unanimous resolution is needed to change this arrangement. SA Water offers the following billing options: sending one lump sum bill for water usage every three months to the strata corporation secretary; dividing the bill in percentages nominated by the corporation and billing owners separately; dividing the bill equally between the unit owners and billing them separately. Whatever the billing arrangement, the strata corporation is ultimately responsible to SA Water for the bill. Private water meters may be installed to each unit to determine how the SA Water account should be divided. There are costs associated with the installation and reading of private meters.

Renting

I am renting out my unit. Do I have to tell the strata corporation? What rights do the tenants have in relation to the strata corporation? Can they attend and vote at meetings? What happens if my tenants cause problems for other unit occupiers?

The unit holder must immediately notify the strata corporation of any change in the occupancy of the unit. Tenants do not have any voting rights in relation to the unit. However you may appoint your tenant as your proxy to attend general meetings and vote. You have an obligation to ensure your tenants abide by the articles of the strata corporation. It should be noted that it is not possible for a strata corporation to restrict your rights to rent your unit or to specify to whom the unit can be rented.

If your tenant causes the unit to be used for an illegal purpose, or interferes with the peace, privacy or comfort of other residents, the affected residents could approach the South Australian Civil and Administrative Tribunal SACAT for an order that your tenants be evicted.

Salt (rising) damp

I own a unit in a group where two of the other units have plaster falling off from rising damp. Why should I pay for damage inside their units?

The building foundations are common property and the corporation is therefore responsible for maintaining the damp course that protects the walls. The corporation has an obligation to make good damage caused by rising damp that can be shown to come from the soil through the foundations.

Trees

Who is responsible for a tree located in a unit holder's yard?

Generally this needs to be determined by looking at the definition of what is a yard and common property on the strata plan. Reference to the care of trees within unit subsidiaries could be made in the articles so that any costs associated with the tree (including damage and trimming) can be apportioned between the unit owner and the corporation.

Voting

Our strata manager has sent the owners a postal form to vote about which painting quote to accept. Is the result binding on all owners?

No. The Act only provides for decisions to be made by a general or management committee meeting. Postal voting is not provided for in the Act.

What is common property?

I have paid for my blocked sewer pipe to be cleared, but the secretary refuses to reimburse me, claiming it was not common property. Who should pay?

The issue of what is and what is not common property can cause many disputes. Generally speaking, the boundary of a unit is the internal surface of its walls, floors and ceilings, and a unit can also include an area known as a ‘unit subsidiary’ marked on the strata plan as being for the exclusive use of a particular unit, for example, a carport or garden area.

Common property comprises any land or space that is not within a unit, and such things as pipes, drains or electrical wiring that are not for the exclusive use of a unit. The strata corporation has a responsibility to maintain the common property. However, if the corporation carries out work that wholly or substantially benefits a particular unit, or group of units, then responsibility for payment may be placed on those unit owners. In past court cases, ‘benefit’ has been interpreted as meaning something more than ongoing maintenance. If the pipe serves only your unit it could be argued that the clearing of the pipes should be at your expense. The cause of the blockage may also be relevant to who pays the bill. If it was clearly your fault, for example, your child’s toy blocked the pipe, then you may well have a responsibility to pay for clearing and possibly even repairs. On the other hand, if the blockage was caused by roots from a tree on common property then the corporation is liable.

White ants

I am the owner/occupier of a unit in a block of 12. Recently the corporation has decided to have each unit treated for white ants. I suffer from asthma and I am concerned about pesticides and their effect on my family and the environment. Can the corporation force me to undertake this work?

The corporation has an obligation to administer and maintain the common property for the benefit of all unit holders. This includes protecting the units from white ants as they come from outside the unit boundaries. Any white ant damage to a unit will need to be made good by the corporation. As the proposed work is for the benefit of the entire block of units the corporation would be allowed to treat your unit and recover the cost.

You could approach the presiding officer with your special reasons for an exemption or suggest an alternative treatment for your unit. If a suitable resolution cannot be reached, it is suggested you approach a mediation service. Finally, if there is still no satisfaction, the Magistrates Court can make a decision on the matter. It is advisable to obtain legal advice in this situation.