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Valid Committee Decisions

Committee decisions need to be made on a regular basis to administer the body corporate and its common property. The way in which decisions are made should reflect the priority of the matter to be considered. Factors of urgency and cost are the most common areas of determining the most appropriate method to make the decision.  

In this article, we explain the different ways in which committee decisions can be made and also bust a few myths on how some decisions purported to be valid, are in fact not.   

Formal committee decisions can be made in two different ways. Either at a committee meeting or by vote outside of committee meeting, called, held and recorded in the minutes in accordance with the regulations. Any other decision made that do not follow these requirements, is not a formal decision until ratified at a later meeting. Making informal decisions to then seek ratification at a later stage needs to be carefully considered, particularly if the matter is contentious or likely to be disputed as there will be no basis to act on the decision until formally recorded. 

The full details on how these meetings are to be conducted can be read here. We have also summarized some of the key areas for making valid decisions including meeting notices, voting and minutes that are often forgotten when committees make decision without the guidance of a body corporate manager. 

Committee meeting notices 

Written notice of a meeting must be given to each committee member including non-voting members. The notice must be given at least 7 days before the meeting or at least 2 days if all voting members agree in writing or at the last meeting. 

Each lot owner must be given a copy of the notice and agenda (unless they request otherwise) to the address for service of notices recorded in the roll which can be via postal address, via email or both. It must also be put on the body corporate notice board, if any. 

There is no requirement under the Small Schemes Module for notice of committee meetings. 

Passing the motion 

A motion is passed at a committee meeting if a majority of voting members present and entitled to vote are voting in favour of the motion. If there is a tied vote, the motion is lost. 

A committee member is considered present if they attend the meeting personally, by proxy or by electronic means (if authorised by the committee). 

For example, if there are 7 voting members present, a majority is 4 members. If there are 6 voting members present, 4 votes will still be needed to pass a motion. 

Minutes of a committee meeting 

The committee must keep full and accurate minutes of each committee meeting. Full and accurate minutes include: 

  • date, time and place of the meeting 
  • names of people present and details of the capacity they attended the meeting in (e.g. a committee member or a lot owner) 
  • details of proxies tabled 
  • for motions submitted by lot owners 
    • when the motion was submitted to the secretary 
    • the name of the person who submitted it 
    • if the type of motion cannot be decided by the committee, the reasons it was not decided 
    • details of any notice given to the submitter of the motion—if the committee requires more time than the ‘decision period’ to decide the motion 
  • for each motion voted on at the meeting 
    • the wording of each motion voted on 
    • the results of voting, including the number of votes for and against 
  • details of any correspondence, reports, notices or other documents tabled 
  • time the meeting closed 
  • details of the next scheduled meeting 
  • secretary’s name and contact address. 

The minutes of a committee meeting must be given to each lot owner within 21 days of the meeting, unless the lot owner has told the secretary in writing that they do not want to receive a copy of the minutes. 

Voting outside a committee meeting 

The committee can make decisions without holding a committee meeting. 

To vote outside a committee meeting, the secretary (or another member of the committee authorised by the majority of voting members) must give, at the same time: 

  • written notice of the motion to all committee members 
  • notice of the motion to all lot owners. 

Committee members need to return their written votes to the secretary within 21 days of the notice being given. 

Committee members can contact one another before or during the vote. 

There are different requirements for notice and returning votes in an emergency. 

Passing the motion 

The motion is decided if: 

  • a majority of the voting members of the committee entitled to vote on the motion (and not just a majority of those who return a vote) agree to the motion 
  • half or more than half of all the voting members of the committee do not agree to the motion. 

If the committee members do not decide within 21 days of receiving notice, the motion will be considered ‘not passed’. 

A record of the motion that was voted on must be given to all committee members and all owners within 21 days after it has been decided. 

The decision about the motion must also be confirmed at the next committee meeting. 

Emergency vote 

In an emergency, notice of the motion only needs to be given to those committee members that it is practical to contact. 

Votes can be made verbally or by another appropriate form of communication. Advice of the motion can be given to owners when it is reasonably practical to do so. 

Any motion voted on outside a committee meeting must be confirmed at the next committee meeting. 

When the committee can act on its decision 

A committee can act on the passed resolution only if: 

  • no notice of opposition is given (Standard Module only) 
  • there is an emergency (e.g. a burst water pipe on the common property) and the spending is within the relevant limit for committee spending or an adjudicator has authorised the committee to do so
  • the resolution has been previously approved by ordinary resolution at a general meeting 
  • the resolution is of a routine, administrative nature and the cost is not more than the greater of $200 or $5 multiplied by the number of lots in the scheme. 

Decisions the committee cannot make 

The committee cannot make a decision about a motion if: 

  • it is a restricted issue for the committee 
  • it conflicts with:
    • the Act or regulations 
    • by-laws 
    • a motion already voted on at the meeting
  • it is unlawful or unenforceable

If the committee cannot make a decision about what you are wanting, they must let you know and you may have to ask for your motion to be considered at a general meeting. 

You can wait until the next annual general meeting or you may ask for an extraordinary general meeting to be called. 

Learn more about asking for an extraordinary general meeting. 

Small Schemes Module 

For schemes registered under the Small Schemes Module a committee is made up of a secretary and a treasurer. If both positions are held by 1 person, decisions are made by that person. If there are 2 people (in the secretary and treasurer positions) they must agree on any decisions. 

Summary 

As you can see, there is a formal process to follow to make formal decisions, and if this process isn’t followed, the decision may not be valid. If you are in doubt about the validity of decisions your committee is making, please contact our office and we will happily clarify compliance with requirements as listed within the regulations. 

This article was contributed by Grant Mifsud, Partner – Archers the Strata Professionals. 

 

Leave a Reply

  1. Bruce Lorking

    Do these regulations re committee meetings apply to Strata schemes in NSW ?

  2. Sharyn Sherrington

    When reading the requirements for Voting Outside of Committee I initially thought the “notice of the motion to all lot owners” was part of changes to the Act but found this requirement has always been in the Act. Our Body Corporate has only ever notified owners of the decision after the event. Our Body Corporate Manager has never suggested this was not in accordance with the Act and in raising this requirement now our BC Manager advised that most schemes operate this way, i.e. advice of the outcome of the vote, not the notice. Following everybody else does not make it right. Do we need to change our process? I understand the best approach would be to write to all owners querying whether they want to receive the notice of the motion? Once the committee has voted, are we still required to advise owners of the results of the resolution or do owners have to wait until after the next committee meeting when VOC’s are ratified and read in the committee minutes?

    Sharon

  3. Grant Mifsud

    Hi Sharon,

    Thanks for the query. Confirming the requirements regarding notices and minutes as outlined in regulations are clear and consistent with the summary I have provided within this article. The body corporate will need to consistently adhere to these requirements to be compliant with the regulations.

    Thanks and all the best.

  4. Kristie Westcott

    Hi grant, wondering if you can provide some clarity on an issue I am helping my sister with. She has recently signed a commercial lease within a strata building with permitted use clearly stating she is allowed to operate as a dog grooming salon. She confirmed several times with her landlord to check this would all be above board. He said this would be okay. The lease is in place and the Deposit also paid. She has started painting and organised signage. No major renovations are taking place other than fixtures to existing walls for noise cancellation purposes only. No additional walls installed or being removed. Members of the owners committee have started to hassle her, coming into the premises telling her the landlord never notified them or have not had the permitted use approved (the previous occupancy was using as hair dressing salon) and advising her that their intention will be to vote against her opening. I have been searching for days on any information that can help and have not been able to turn up much that is useful. I’ve read the by-laws provided and there isn’t anything very specific that I can see that could support them on this, other than a few strict noise laws. However, my sister is taking all reasonable steps to ensure any issue there is minimised. As I mentioned, the landlord has given full approval for there being animals on premises and they have street access direct into shop, therefore no common access will would be used to ferry animals in and out. It’s seems completely unreasonable, as one of the members stated their main issue would be disease snd infection. The fee for a groom is around the $80 to $100 mark so clearly not the kind of demographic that would be having their pets groomed, as well as that there are quite strict industry guidelines on this type of thing. It’s basically a non-issue as the salon would refuse booking of any such animals, so I guess, we are just looking at any kind of guidance or direction you could provide. Can they actually Vito this and prevent her opening even though there isn’t anything in by-laws. The lease is within NSW.

    1. Smart Strata

      Hi Kristie, This article relates to QLD legislation so we suggest you contact the NSW governing body for each area of enquiry to assist with your queries.

  5. David

    Does this section of the act apply to Victoria ?

    The minutes are not finalised for months .