Legislation recommending sweeping changes to the strata industry passed last month, and will affect Owners Corporations. The Strata Scheme Management Bill and Strata Scheme Development Bill contains around 90 changes to the existing laws, on issues including collective sale, renovations, proxy farming, defects and parking. These laws are not effective immediately – at this stage it is anticipated that the new laws will commence on July 1, 2016.
These are the major changes in brief:
According to a preliminary reading of the legislation, developers are expected to be the most impacted, with new rules regarding maintenance plans and retaining 2% of sales deposits for building defects claims. Developers would be liable for understated estimates of future levies and prevented from becoming the strata manager of their development for at least 10 years.
Owners Corporation Committees
Owners Corporation Committees, to be called Strata Committees, will need to meet more rigorous disclosure and due diligence requirements. Any decision made in good faith by the committee will relieve them of personal liability. The liability will instead, be shared across the Owners Corporation as a whole.
New Ways To Vote
The draft legislation is looking to allow technology to make full participation in AGMs easier.
Currently, owners must attend in person or by postal vote. The proposed legislation would allow electronic voting as well as secret ballots.
Strata Managers will be required to disclose insurance and other commissions annually. SSKB already discloses this information to you.
In the meantime if you have any questions, contact your SSKB Community Manager or if you’d like to know more, the NSW Fair Trading Department has information on their web site.