Enter your email Address

LookUpStrata

Strata Information Leading to Open Discussion

  • The Strata Magazine banner
  • Subscribe to LookUpStrata banner
Australia's Top Property Blog Dedicated to Strata Living
  • Home
  • What is strata?
    • Strata Legislation – Rules and ByLaws
    • What is Strata?
    • Glossary of NSW Strata Terms and Jargon
    • Understand Strata Management with this Five-Minute Guide
    • Cracking the Strata Fees Code
    • Strata Finance
  • Strata Topics
    • Strata Information By State
      • New South Wales
      • Queensland
      • Victoria
      • Australian Capital Territory
      • South Australia
      • Tasmania
      • Western Australia
      • Northern Territory
    • Strata Information By Topic
      • COVID-19
      • By-Laws & Legislation
      • Smoking
      • Parking
      • Noise & Neighbours
      • Insurance
      • Pets
      • Your Levies
      • New Law Reform
      • Maintenance & Common Property
      • Committee Concerns
      • NBN & Telecommunications
      • Building Defects
      • Renting / Selling / Buying Property
      • Strata Managers
      • Building Managers & Caretakers
      • Strata Plan / Strata Inspection Report
      • Apartment Living Sustainability
    • Strata Webinars
      • NSW Strata Webinars
      • QLD Strata Webinars
      • VIC Strata Webinars
      • ACT Strata Webinars
      • SA Strata Webinars
      • WA Strata Webinars
    • Upcoming Strata Events
  • Blog
    • Newsletter Archives
  • The Strata Magazine
    • The NSW Strata Magazine
    • The QLD Strata Magazine
    • The VIC Strata Magazine
    • The WA Strata Magazine
  • Advertise With Us
    • Site Sponsors
  • About Us
    • Testimonials for LookUpStrata
  • Help
    • Ask A Strata Question
    • Q&As – about the LookUpStrata site
    • Sitemap
Home » Bylaws » Bylaws NSW » NSW: Strata Resolutions – What is Required?

NSW: Strata Resolutions – What is Required?

Published December 4, 2020 By David Bannerman, Bannermans Lawyers 12 Comments Last Updated April 21, 2023

Share with your strata community

0 shares
  • Share
  • LinkedIn
  • Email

This article is about strata resolutions in NSW schemes, including ordinary and special resolutions. When the owners corporation is making a decision, which resolution is required and why?

Strata owners corporations will, over time, need to make decisions about a wide range of matters. Some decisions can be made by the strata committee or by the strata managing agent under delegated authority, but the most important decisions will need to be made by a resolution of the owners corporation at a general meeting. To ensure the legality of such resolutions, it is important to be aware of the different kinds of resolutions contemplated by the legislation, when they are required and how to make them.

GET NOTIFIED WHEN WE PUBLISH NEW Q&AS, NEWS AND ARTICLES TO THE SITE

The following issues need to be considered:

  • Have quorum requirements been satisfied? No resolution will be validly made if quorum requirements are not satisfied.
  • What kind of resolution is required? An ordinary resolution may be sufficient, but in some circumstances, the legislation may require a special resolution or a unanimous resolution. Also, a resolution amending or revoking an earlier resolution usually must be of the same type, i.e. a special resolution is required to amend or revoke a special resolution and a unanimous resolution is required to amend or revoke a unanimous resolution unless the unanimous resolution involves common property, in which case it may be amended or revoked by special resolution.
  • Has the resolution been validly made? Each type of resolution must satisfy specific requirements. The resolution must be framed as a resolution of the specified type and the required level of support must be achieved. Simply achieving the required level of support is insufficient, e.g. a resolution not framed as a unanimous resolution is not a valid resolution simply because it receives unanimous support.
  • Are there any additional statutory requirements? For example, certain resolutions will not be effective without the written consent of specified persons or without additional action, such as registration.

In theory, only a simple majority is required, but there are some factors that make it more
complicated:

The following issues need to be considered:

  • Initially, a vote will be determined by a show of hands according to number of lots owned. However, a person present and entitled to vote can demand a poll, in which case the vote will be determined according to unit entitlements.
  • An owner’s vote will not be counted if the owner is not financial.
  • The vote of an original owner will be discounted by two thirds if the unit entitlement of the original owner’s units is at least half the aggregate unit entitlement for the scheme.
  • A developer or lessor of a leasehold strata scheme cannot vote in relation to matters concerning building defects or their rectification.

Special resolutions are required in a wide range of circumstances, e.g. where a decision involves:

  • Transfer or lease of common property or grant of an easement over common property.
  • Acquisition of additional common property.
  • Alterations/additions to common property.
  • A determination that it is not appropriate to maintain part of the common property.
  • Amendment/revocation of by-laws

A special resolution requires that no more than 25% of the votes cast, by unit entitlement, are against the resolution, i.e. a 75% majority of those present and entitled to vote. This is subject to the same complicating factors as applies to ordinary resolutions.

Pending legislative changes in relation to sustainability infrastructure will change this. Where a special resolution is required, it will be sufficient, in the case of a “sustainability infrastructure resolution”, if it is opposed by less than 50% of owners entitled to vote, i.e. reducing the bar from 75% support to 50% support.

Unanimous resolutions are required in a more restricted range of circumstances, including where a decision involves:

  • A two lot scheme deciding not to establish a capital works fund.
  • A two lot scheme deciding not to insure the building, where the buildings in each lot are physically detached
  • Distribution of surplus funds in the administrative fund or capital works fund.
  • Amending or revoking an earlier unanimous resolution, not being a resolution dealing with common property.
  • Winding up the strata scheme

A unanimous resolution requires that no vote is cast against the resolution, i.e. a 100% majority of those present and entitled to vote. This is subject to the same complicating factors as apply to ordinary resolutions, except that an owner does not need to be financial to vote on a unanimous resolution.

Conclusion

It would be a worthwhile exercise for strata schemes and their strata managing agents to consider these issues and develop procedures to deal with them.

We have considerable experience with these issues and could help you pre-empt difficulties in this area.

Bannermans Lawyers
T: 02 9929 0226
Suite 702, 2 Elizabeth Plaza
North Sydney NSW 2060

This post appears in the December 2020 edition of The NSW Strata Magazine.

Have a question about strata resolutions or something to add to the article? Leave a comment below.

Embed

Read next:

  • NSW Dispute Resolution: 6 Tips For Conflict Management
  • NSW: Quorum Requirements for the AGM

The information contained in this article is general information only and not legal advice. The currency, accuracy and completeness of this article (and its contents) should be checked by obtaining independent legal advice before you take any action or otherwise rely upon its contents in any way.

Visit Strata By-Laws and Legislation OR NSW Strata Legislation.

Looking for strata information concerning your state? For state-specific strata information, try here.

After a free PDF of this article? Log into your existing LookUpStrata Account to download the printable file. Not a member? Simple – join for free on our Registration page.

Share with your strata community

0 shares
  • Share
  • LinkedIn
  • Email

About David Bannerman, Bannermans Lawyers

David Bannerman, Principal, established the firm in 2007 as a sole practitioner under the business name Bannermans Lawyers. The firm provides high quality specialist legal services to the strata, development, construction and insurance industries and with its expertise and industry experience has become Sydney’s leading strata law firm, employing over 30 staff, including 19 highly skilled lawyers.

Bannermans acts primarily for owners corporations and strata managers, but also has many builder, developer and insurer clients. While the firm’s focus is on the greater Sydney area, the team is increasingly providing services throughout regional NSW.

David's LinkedIn Profile.

David is a regular contributor to LookUpStrata. You can take a look at David's articles here .

Comments

  1. Julia Lee says

    November 7, 2023 at 6:22 pm

    A resolution has passed in the past EGM, where three attendees agreed to replace air conditioning units for a commercial building. The air conditioning units are to run on a schedule from 9am-5pm weekdays.
    I own two lots in a commercial building, but my operating hours run outside of business hours (as an after-school care, i.e. weekends and after 5pm weekdays). This means that my business does not even have the advantage of using the air conditioning units (that run only during business hours).
    There are a total of 25 lots to this building, and those who I spoke with are not happy with the passing of this resolution and the ridiculous quoted price.
    In addition, my levy costs for this installation are disproportionately higher than all the other lot owners and I was not provided this levy report until recently (less than a month ago). I have tried discussing with Strata Management but have been told they are following the law.
    Nb. The resolution was passed in early September 2023. I reside in NSW.
    What is the best solution?

    Reply
    • Matthew Jenkins says

      November 9, 2023 at 6:30 am

      Hi Julia

      We have responded to your comment on this article: NSW: Q&A Owners Corporation Committee Decisions

      Reply
  2. Anthony B says

    October 24, 2023 at 3:07 pm

    Can a motion be put forward (whether requiring a special or unanimous resolution) changing the necessity of a special/unambiguous resolution for matters requiring one hitherto, to needing only an ordinary resolution ?

    Or are matters as defined or implied in the legislation as needing a special or unanimous resolution immutable ? (This is for NSW)

    Reply
    • Matthew Jenkins says

      October 25, 2023 at 6:06 am

      Hi Anthony,

      Short answer is no. If the legislation specifies the type of resolution required, you cannot have a resolution that permits a lesser resolution for those matters. Section 270 of the Strata Schemes Management Act 2015 prohibits contracting out of the Act.

      Reply
  3. Keith DICKINSON says

    February 22, 2023 at 11:04 am

    If the owners of a Strata decide to vote to pay for removal of trees that are not common property but part of a lot ,does this require a Special Resolution of 75% and is the owner of the lot who is receiving this financial benefit entitled to vote on the issue

    Reply
    • Matthew Jenkins says

      February 27, 2023 at 7:58 am

      Hi Keith,

      I have responded to your comment within this article: NSW: Q&A Strata Title Trees and Hedges – What Can & Can’t the OC do?

      Reply
  4. Dede says

    May 10, 2022 at 8:07 pm

    Should a motion to terminate your existing strata managing agent be a special resolution, unanimous or ordinary motion?
    Thank you

    Reply
    • Nikki Jovicic says

      May 11, 2022 at 7:38 am

      Hi Dede

      This Q&A should assist: Question: We are lot owners in a small 8 lot commercial strata building. What is the procedure for changing strata managers? What happens if this procedure is not followed?

      You may also wish to read the other Q&As within this article for further information about terminating your strata manager.

      Reply
    • Matthew Jenkins says

      May 11, 2022 at 3:51 pm

      A motion to terminate your existing strata manager requires an ordinary resolution at a general meeting in accordance with section 50(3) of the Strata Schemes Management Act 2015. You should first ensure that you are able to terminate the agreement in accordance with the agreement.

      Reply
  5. David Bannerman says

    September 29, 2021 at 12:49 pm

    Hi Adalazie, this sounds like an identical query that we have recently received and there is a potential conflict. Please contact our office on (02)9929 0226 to discuss.

    Reply
  6. Adalazie says

    September 29, 2021 at 6:12 am

    Two matters were discussed at our AGM yesterday that were not specified on the agenda. . The first was under ‘Maintenance’ and a number of items were raised orally (including by me.).

    The other matter required a special resolution. It was introduced orally in our Zoom meeting by a new owner, under a heading our new Strata Manager placed on the agenda called ‘Matters Arising.’

    The matter was to change a security light on an external wall to a sensor light.

    I am concerned (though I eventually voted for it) that significant matters that require special resolutions can be raised orally under a general heading at a meeting.

    Don’t matters for special resolutions need to say what they are and give particulars?

    Many thanks in advance for your reply.

    Reply
    • Liza Admin says

      April 13, 2022 at 12:10 pm

      Hi Adalazie

      The following response has been provided by Leanne Habib, Premium Strata:

      No motion, whether ordinary or special, can be resolved unless it appears on the notice/agenda of the general meeting.

      Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Search For Strata Articles

  • Advert Stratabox
  • StrataBox Advert
  • Advert: StrataLoans
  • Advert: StrataLoans
  • Advert: StrataLoans
Subscribe Newsletter

TESTIMONIALS

"LookUpStrata should be compulsory reading for every member of a Body Corporate Committee. It provides the most understandable answers to all the common (and uncommon) questions that vex Body Corporates everywhere. Too often Committee members do not understand what Body Corporates are legally able to do and not do. LookUpStrata helps educate everybody living in a Body Corporate environment for free." John, Lot Owner

"It's the best and most professional body corporate information source a strata manager could have! Thanks to the whole team!" MQ, Strata Manager

"I like reading all the relevant articles on important issues on Strata living that the LookUpStrata Newsletter always effectively successfully covers"
Carole, Lot Owner

"Strata is so confusing and your newsletters and website are my go-to to get my questions answered. It has helped me out so many times and is a fabulous knowledge hub." Izzy, Lot Owner

Quick Login

Log In
Register Lost Password

Categories

  • Contact a Strata Specialist on the LookUpStrata Directory
  • Ask Us A Strata Question
  • New South Wales
  • Queensland
  • Victoria
  • Australian Capital Territory
  • South Australia
  • Tasmania
  • Western Australia
  • Northern Territory
  • ByLaws & Legislation
  • Smoking
  • Parking
  • Noise & Neighbours
  • Insurance
  • Pets
  • Levies
  • Law Reform
  • Maintenance & Common Property
  • Committee Concerns
  • NBN & Telecommunications
  • Building Defects
  • Renting / Selling / Buying
  • Strata Managers
  • Building Managers and Caretakers
  • Strata Reports / Plans
  • Sustainability

Recent Comments

  • William Marquand on QLD: What does Strata Insurance cover? What do we need to disclose?
  • Tyrone Shandiman on QLD: What does Strata Insurance cover? What do we need to disclose?
  • Liza Admin on SA: Q&A Strata Regulations About Car Parking Rules
  • Liza Admin on SA: Q&A Rights to have pets for residents in strata
  • Tyrone Shandiman on NAT: Q&A Yearly Increases To Strata Insurance
  • Tyrone Shandiman on NAT: Q&A Yearly Increases To Strata Insurance
  • Tyrone Shandiman on QLD: What does Strata Insurance cover? What do we need to disclose?
  • Robert Budniak on NSW: E-Bike and E-Scooter Battery Fires in Strata on the Increase
  • stephanie nicholls on WA: Q&A What Do Strata Fees Cover? How are Increases Calculated?
  • [email protected] on VIC: Q&A Process to change the Registered Owners Corporation Rules

WEBSITE INFORMATION

  • Privacy Policy
  • Terms and Conditions of Use
  • Terms of Use for Comments and Community Discussion
  • Advertising Disclosure
  • Sitemap

SCA Membership

SCA WA Membership

ASK A STRATA QUESTION

Disclaimer

The opinions and/or views expressed on the LookUpStrata site, including, but not limited to, our blogs and comments, represent the thoughts of individual bloggers and our online communities, and not those necessarily of LookUpStrata Pty Ltd. In all instances, information should not be taken as advice and independent legal advice should be consulted.

CONTACT US VIA EMAIL

Copyright © 2024 · LookUpStrata ® Pty Ltd · All rights reserved