It is clear that Strata Management businesses are not impacted by COVID 19. Each and every Strata Manager has the opportunity at the end of each month to withdraw their Strata Management fees. It is the members of a community that are most impacted.
The community in a strata scheme or a community association have a right to participation through meetings. Obviously, due to social distancing laws, face to face meetings are outlawed.
We are somewhat shocked that Service NSW (Fair Trading) have not moved to amend the Strata Schemes Management Regulations 2016. A simple amendment to those regulations would have permitted meetings to be conducted through platforms like Zoom, by post or through the avenue of electronic voting. Unfortunately, Fair Trading have only seen fit to provide the ability to delay an annual general meeting by 6 months. This means that Strata Managers, Strata Committees and Community Associations are left to resolve the conduct of their strata schemes without the assistance under present laws.
The Community Land Management Act 1989 does not provide for any form of voting other then face to face meetings. Those managing community associations, only have the ability to delay annual general meetings.
In relation to Strata Schemes, Clause 14 of the Regulation states:-
14 Other means of voting–owners corporation and strata committee
(1) An owners corporation or strata committee may, by resolution, adopt any of the following means of voting on a matter to be determined by the corporation or committee–
(a) voting by means of teleconference, video-conferencing, email or other electronic means while participating in a meeting from a remote location,
(b) voting by means of email or other electronic means before the meeting at which the matter (not being an election) is to be determined by the corporation or committee (
“pre-meeting electronic voting” ).
(2) Without limiting subclause (1) (b), the other electronic means of voting may include requiring voters to access a voting website and to vote in accordance with directions contained on that website.
(3) If a matter may be determined partly by pre-meeting electronic voting, the notice of the meeting must include a statement that the relevant motion may be amended by a further motion given at the meeting after the pre-meeting electronic voting takes place and that consequently the pre-meeting vote may have no effect.
(5) A motion that is to be determined partly by pre-meeting electronic voting must not be amended at the meeting for which the pre-meeting electronic voting is conducted if the effect of the amendment is to change the subject matter of the original motion.
(6) If a motion that is to be determined wholly or partly by pre-meeting electronic voting is amended at the meeting for which the pre-meeting electronic voting is conducted, the minutes of the meeting distributed to owners must be accompanied by notice of the change and a statement setting out the power to make a qualified request for a further meeting under section 19 of the Act.
Service NSW has clearly indicated that, there is no automatic allowance for electronic voting due to COVID 19. Service NSW have determined that electronic voting must be adopted by either the strata committee or the owner’s corporation before proceeding.
A number of associations and schemes have determined to use the electronically postal voting program as a means of continuing to conduct an AGM. If the preliminary steps of adopting an electronic voting system has not been followed, the authority of the meeting will be drawn into question.
It is worth noting that, if a meeting is conducted not in accordance with the Strata Schemes Management Act 2015 or its Regulations, motions passed in that meeting are null and void. Hence, if your Strata scheme or association have not adopted electronic voting in accordance with Clause 14, everything you determine is liable to be overturned at NCAT.
Obviously, general motions and activities will not be challenged and therefore will carry on as if they had legal authority. Unfortunately, controversial actions are vulnerable under the new regime if Clause 14 has not been followed to the letter.
We are currently considering a situation where an Owners Corporation wants to raise a special levy over three years for the installation of three lifts. The lifts are not broken, the capital works plan has considered that these lifts are necessary. The Strata Committee wishes to push this special levy through, so the lifts can be built in 2021 to 2023.
This action is by itself out of step with the holy pattern that usually occurs during COVID 19 era. Most of all, it is dangerous in that, even if the resolution is passed, any one lot owner can make an application to NCAT and have the motion overturned.
It is vital that, if electronic voting is being used for controversial issues, that the imposition of the electoral voting system is only done after an assurance that the scheme has complied with Clause 14