Strata Management

Strata Management

A strata scheme is a type of subdivision of a piece of land that allows one large freehold lot to be divided up into many smaller lots. There are different types of strata, with many rights, rules, obligations, documents and processes attached to them. Every scheme has its own set of by-laws to regulate the conduct of owners and occupiers of lots and to govern the scheme. Every scheme has a strata company comprising the owners of the scheme.

Living in a strata titles scheme

Residential strata titles schemes provide grouped housing with a community atmosphere. This, combined with smaller areas to maintain and the use of common facilities, can make strata titles schemes an attractive option for many people. Strata titles schemes are also practical for industrial and commercial developments.

 

Common Property

Common property is property that is jointly owned by all owners in the strata titles scheme as tenants in common and is not contained within any lot.

The certificate of title for your lot indicates that you own the specified lot on a specified plan, and that you own a share in the common property (if any) on the plan.

 

Strata Company

A strata company for the strata titles scheme is comprised of all the current owners of lots in the scheme. A strata company comes into existence automatically on the registration of the strata titles scheme.

 

Strata Councils

Strata council duties to the strata company.

Members of the council will have these statutory duties imposed on them to:

  • act honestly, with loyalty and in good faith in the performance of their
  • exercise a reasonable degree of care and diligence in the performance of their
  • ensure they do not make improper use of their position as a member to gain, directly or
  • inform the council in writing of any conflict of interest as soon as practicable after they become aware of the

Strata Managers

Many strata titles schemes will employ a strata manager to assist the council to carry out some of the duties of the strata company. The strata manager may be a company, partnership or an individual. This does not remove the need for a strata council.

While the strata manager is employed by the strata company, the quality and level of service the strata company receives from the strata manager often depends on effective instruction and control of the strata manager by the strata company or the strata council.

The strata manager must:

  • have a written contract with the strata company that specifies the scheme functions the strata manager is to perform and the strata manager’s
  • act honestly and in good faith to the strata
  • exercise a reasonable degree of skill, care and
  • hold minimum education requirements as set out in Schedule 4 of the Strata Titles (General) Regulations 2019.
  • provide a statutory declaration to the strata company before entering into a strata management contract, which must:
    • declare that the national criminal record checks required have been obtained and are less than three years
    • if applicable, disclose the identity of any convicted person, the role of the person in the business of the strata manager and particulars of the offence(s)
    • declare that there are no other convictions for property or dishonesty
  • have a good working knowledge of the
  • not make improper use of information acquired as strata manager for a strata company to gain an advantage for themselves or someone else, or cause a detriment to the strata
  • not make improper use of the position of strata manager to gain an advantage for themselves or someone else, or cause a detriment to the strata
  • take reasonable steps to ensure that the strata manager’s employees comply with the
  • have professional indemnity insurance of not less than $1,000,000 for any one
  • inform the strata company in writing as soon as they are aware they will obtain a financial benefit, which conflicts with their duty to the strata company (i.e. a conflict of interest).
  • inform the strata company in writing as soon as they are aware they have or are likely to receive a commission (of more than $100 from any single supplier in the course of a year).
  • control the funds of the strata company in a separate or pooled trust account for the strata company which:
    • cannot be
    • for separate accounts, the words “trust account” are prefixed to the account
    • for pooled accounts, the strata manager’s name prefixes the account name (which must include the words “trust account”) and fees and charges for each scheme are charged to separate
    • may be an interest-bearing
  • Alternately, if authorised to do so, the strata manager may use the strata company’s own
  • be able to account separately for money that the strata manager pays or receives on behalf of the strata
  • provide the strata company (within a reasonable timeframe but in any event within seven days’ after being given notice) with accounting information about:
    • the name, number and balance of each account operated by the strata manager on behalf of the strata
    • details of money paid to or received, or any transactions entered into by the strata manager on behalf of the strata
  • give the strata company’s auditor access and any other information in relation to accounts operated on behalf of the strata