www.teyslawyers.com.au © Copyright TEYS Lawyers 2013 Nicole Wilde, Senior Solicitor, TEYS Lawyers Melbourne (03) 9600 1128

A Sneak Peek at the Latest VCAT Strata Decisions

Owners Corporation Managers who wear other ‘hats’ at a property must be careful to ensure costs and fees are raised in accordance with the correct procedure…

Lot owners take their owners corporation manager and retirement village management company to VCAT over their method of charging ‘retirement village management fees’ and owners corporation fees.

A retirement village scheme, being run out of a strata title property affected by an owners corporation. The manager in this case was not only the owners corporation manager, but also the retirement village manager. The manager therefore wore two hats. Whilst it was wearing the owners corporation manager hat, it was required to ensure any fees raised from lot owners was done according to the statutory method in the Owners Corporations Act 2006. When the manager was wearing its retirement village manager hat, it was required to charge costs to lot owners in accordance with a separate contractual agreement it had with individual lot owners.

VCAT found that when issuing invoices to lot owners, there was a period where the manager did not distinguish between ‘owners corporation fees’ and ‘retirement village fees’.

Managers who wear multiple ‘hats’ should be very careful to make sure that in the context of owners corporation fees, there is a specific statutory procedure for the method on which those fees may be calculated. In addition, there is a requirement to issue formal notices and final notices for such fees. The compliance with the statutory procedures allows owners corporations to successfully recover unpaid fees through VCAT. Non-compliance with those procedures can result in significant delays in recovering unpaid fees.

Case Reference: Dallimore v Cotham Road Pty Ltd (Owners Corporations) [2013] VCAT 1740 (3 October 2013)

6 November 2013