Intro:  Welcome to Your Strata Property. The podcast for property owners looking for reliable, accurate, and bite-sized information from an experienced and authoritative source. To access previous episodes and useful strata tips, go to

Amanda Farmer: Hello and welcome. I’m Amanda Farmer and I have with me today Reena Van Aalst. Hi, Reena.

Reena Van Aalst: Hi, Amanda.

Amanda Farmer: How are you?

Reena Van Aalst: Good thanks. How are you?

Amanda Farmer: Doing very well. I’m actually really excited the first thing I want to announce is that this is the 50th episode of this podcast.

Reena Van Aalst: Congratulations.

Amanda Farmer: And I’m so glad that you have been with me since the very beginning. Episode 002 I think it was that you joined me.

Reena Van Aalst: Yes.

Amanda Farmer: And here you are with me on Episode 050 so it has been nearly a year that I have been doing this and let me tell you it’s going very fast. And it has been a whole lot of fun and I intend to keep going for the foreseeable future.

Reena Van Aalst: It’s great.

Amanda Farmer: Now if anybody’s just tuning in for the first time, this episode with me and Reena is a little bit different to my usual episodes.

If you already have a listen to Episodes 046 and 048 you will know what I mean. Every 2 weeks or so Reena and I are offering our listeners an insiders’ look behind the scenes at the workings of strata law and strata management; we are having a chat about  the week’s wins and frustrations just as Reena and I would normally do over coffee or on the phone.

And we want to share this side of our work with you because we think that you our listeners who I know are strata managers, lot owners, committee members. We think there is a whole lot of value in you joining in these conversations and benefiting from Reena and my combined experience perhaps even learning from our mistakes and learning what not to do when we talk about the trouble that we’ve had.  So thank you very much for joining us this is one of those episodes. Reena, do you want to jump in to add anything in there?

Reena Van Aalst: No. It’s been a pleasure, Amanda to be doing this. I think that people will learn a lot from our experiences. I think that day to day running’s and sort of little bits and pieces of different events that happen in strata schemes provide some insight for those who have experienced something similar or have a similar problem in their building.

Amanda Farmer: Yes and that’s a good reminder actually to- send us in your not only your comments if you like this format, how can we do it differently or improve and any questions, topics that you want us to discuss specific things that you are going through at the moment that you think Reena or myself might be able to help you with.

So you can shoot those straight through to me or just post a comment or a question in the comments section under this episode on the website So Reena, how’s your week been?

Reena Van Aalst: Yes, it’s been pretty good actually so far, as I said, Amanda. Things are obviously heating up for me at the moment in terms of new buildings and

Amanda Farmer: Yes.

Reena Van Aalst: doing lots of proposals. So yes, I’ve been quite busy.

Amanda Farmer: Awesome. Good on you. I’ve actually had a recent trip to Melbourne to attend the multi-owned properties forum which Deakin University runs. Nicole Johnston at Deakin University and I have a few things to report about that in one of our upcoming episodes. So that’s how I’ve to spend my week and it was a whole lot of fun.

Reena Van Aalst: Right.

Amanda Farmer: Okay. So Reena, do you want to start? What has been frustrating you this week in the world of strata?

Reena Van Aalst: So I was approached by a former client who is in a different building and they have a problem with a BMC member. It is a 6 lot BMC and unfortunately this representative from one of the strata plans is highly provocative, he swears at meetings, he’s just disruptive and it’s been really hard for the BMC which is the Building Management Committee for those that don’t know what that means.

If you look at the new developments that we have shopping centres and buildings you know side by side that makes your common facilities at BMCs is a vehicle used to allow those to function.

Amanda Farmer: Yes.

Reena Van Aalst: And they provided me with a copy of their strata management statement to see if there’s anything that we could do in regards to being able to curtail  this person’s behaviour or at least go back to strata plan where he has been appointed and see what we can do in that regard.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: But unfortunately the SMS which is the strata management statement which governs how the BMC is ran is silent in relation to the behaviour of a member.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: And we are aware because through correspondence that I received from a member that basically in this BMC this particular person is the chairperson of the strata plan. and he’s basically applauded for his conduct because he seemed to be championing their rights.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: And unfortunately in this particular BMC there’s a commercial entity within the stratum lot. And of course, as we know from experience there’s always friction between residential- not always.

Amanda Farmer: Often yes.

Reena Van Aalst: But there tends to be friction between residential and commercial interests.  So that’s been my frustration that in a sense someone has said why don’t you use the code of conduct but that’s not really binding. I mean it’s nice to have it but I don’t think it’s not an instrument that we can use to enforce for changed behaviour.

Amanda Farmer: And this person is swearing at meetings, generally intimidating others?

Reena Van Aalst: Yes.

Amanda Farmer: Being a bully?

Reena Van Aalst: Yes.

Amanda Farmer: The other members how many are the members of the BMC in terms of reps? So actual people are there that are reps of the committee?

Reena Van Aalst: Yes. It’s a 6 member BMCs.

Amanda Farmer: Okay.

Reena Van Aalst: So there are other 5 members.

Amanda Farmer: Okay and not of them are willing to say hey mate pull your head in?

Reena Van Aalst: Oh, they do but I mean they have.

Amanda Farmer: And nothing changes?

Reena Van Aalst: No this is where it comes to seek my advice because someone like this who acts in such a

Amanda Farmer: Yes, disruptive.

Reena Van Aalst: Intimidating and disruptive way doesn’t really care what other people think and unfortunately, their strata managing agent has tried as well. So in a sense, I just want a second opinion but unfortunately, we’ve all come up with the same answer.

The thing to know that in the Strata Schemes Management Act Section 35E allows an owners corporation to remove a strata committee member by a special resolution. But unfortunately, there’s nothing that’s equivalent in the strata management statements or in the Development Act that allows a member to be removed.

Amanda Farmer: Yes. Yes and his strata scheme you think is there continued to elect him as a BMC rep because they think his awesome.

Reena Van Aalst: Yes.

Amanda Farmer: And going to continue to annoy everyone.

Reena Van Aalst: Yes.

Amanda Farmer: What does it take to amend the SMS to include requirements relating to behaviour? Do you know?

Reena Van Aalst: I think yes. I haven’t had a look at that yet. I think in terms of what parts were changing some are unanimous.

Amanda Farmer: Yes.

Reena Van Aalst: Some are special and some, if it’s got to do with shared facilities, depend on the percentage

Amanda Farmer: Yes.

Reena Van Aalst: contribution but I think it was unanimous to change it unless it was relating to the shared facilities then it would be based on their contribution and the vote would be by majority where it would be yes, percentage contribution to the shared facilities.

Amanda Farmer: Yes, so this highlights the difficulties with amending strata management statements. It’s something that I spoke about when Chris Duggan came on the show. They are very hard to change because as you said often you need unanimous resolution whereas for strata by-laws you need a special resolution.

Reena Van Aalst: Yes.

Amanda Farmer: So I mean that would be my first port of call to have a look at the strata management statement and see if you could propose a new clause to be inserted which relates to the conduct of BMC members, committee members.

And where they don’t meet a code of conduct and you’d established a separate code of conduct which will be linked to that clause in the SMS then there are ramifications. So for example, there can be a motion put for them to be removed from the committee.

Reena Van Aalst: Yes.

Amanda Farmer: In my experience dealing with bullies and people who like to intimidate and get some sense of satisfaction from abusing their apparent position of power if it is made difficult for them to conduct themselves in that way.

So every time they disrupt a meeting, use bad language, are abusive or intimidating then those 5 other members who are there say ‘mate, this is not on, this is not how our committee functions. That is not appropriate or acceptable behaviour and you’re going to be asked to leave the meeting if that’s how you want to conduct yourself. Because we feel harassed and intimidated and we don’t feel that we can continue to carry on this meeting in a productive way if that’s how you’re going to behave. So you either behave or you leave the meeting’.

If that happens enough times is it this person going to get fed up with having to toe the line so to speak constantly being pulled up by the other committee members. Are they eventually going to say ‘this is no fun anymore. I’m not going to stand for the committee next year’.

Reena Van Aalst: Well, I think 2 of the meetings that I was aware of that I was told about that someone did that and I think the managing agent you know tried in his capacity as the chairperson of the meeting to do that.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: But as we know in terms of human nature people don’t like confrontation.

Amanda Farmer: Yes, that’s right.

Reena Van Aalst: And unfortunately you know the meetings when there’s shouting and people have done that then he sort of does become quiet. But then it’s always a very strained situation and I think something have to be done about it long-term. Because again, people don’t want to come to meetings when he acts like that. Most people are doing this on a voluntary basis.

Amanda Farmer: Of course.

Reena Van Aalst: They think ‘Why do I need to put up with this type of behaviour. I’m not getting paid for this’. So

Amanda Farmer: Yes. Yes.

Reena Van Aalst: So yes, I think we just need to sort of look at that one and see how it progresses and whether or not they are any other legal means of being able to perhaps remove him from the BMC.

Amanda Farmer: Yes. I know when dealing with these types of people it often gets worse before it gets better that’s what

Reena Van Aalst: Yes.

Amanda Farmer: I advise committees when I’m assisting them and it does take a group of people preferably more than one who are willing to stand their ground.

Reena Van Aalst: Yes.

Amanda Farmer: Who are willing to have that kind of confrontation for it can be an extended period of time to send the message I’m not all saying that it’s easy but it is definitely effective and in the strata context I mean there’s lots of things that you can be doing as you said in terms of removing that person from a strata committee by a special resolution, calling all breaches of by-laws and things like that. And that process is there but it’s usually not the legal process that brings

Reena Van Aalst: No.

Amanda Farmer: these things to ahead. It’s usually those practical steps, those consistent steps towards asserting your own rights as a human being not only as a committee member to be respected, to be listened to.

Reena Van Aalst: [responded in agreement]

Amanda Farmer: And this people eventually get sick of that and they think well I can’t sit here and abuse this 5 other people anymore because wow, all of a sudden they won’t stand for it. I’ve got better things to do. I’ve got other people to bully and then move on. But it doesn’t happen quickly.

Reena Van Aalst: No.

Amanda Farmer: And at least from my point of view there isn’t an easy legal answer.

Reena Van Aalst: No, not in this case. I think there is a provision in the strata management statement to allow meetings to be held in writing. So I think where it is possible where things can be decided just in writing by a yes or no vote then that’s what I suggest to be an alternative.

Amanda Farmer: Yes.

Reena Van Aalst: to having face to face meetings, especially if there are parts that they can all meet and discuss and agree on.

Amanda Farmer: Yes.

Reena Van Aalst: Or any other type of yes or no type of motions and they are probably best held not in writing but rather in face to face meetings.

Amanda Farmer: Yes, that’s a really good

Reena Van Aalst: Yes.

Amanda Farmer: a really good practical solution.

Reena Van Aalst: Yes.

Amanda Farmer: Okay let us know how you go with that one if you have any updates?

Reena Van Aalst: Yes.

Amanda Farmer: Hopefully you have a happy ending with that story. So my frustration this week and it’s more so my clients’ frustration. But it’s something I want to talk about for our listeners because I’m sure they’ve been in a similar situation.

This is a building where an extended period of works has been carried out by a contractor. It’s sort of like a balcony refurbishment so this building spends a lot of money and a lot of time getting their balconies done.

The project is just about to finish and the final payment is due to the contractor. Now, one of the lot owners whose on the ground floor has said that some of his property not only his personal property some statues and things that he had on his terrace but part of his lot property. So within his terrace has been damaged by the work that the contractors have done. They dropped things down below and things like that and he wants to claim against the contractor for that damage. He is in the process of getting some quotes together. But it’s looking like might be in the vicinity of about $10,000 worth of damage he says and he says that the owners corporation should hold back part of the last payment on account of that damage to his property.

Now the owners corporation is mindful that it has an obligation to the contractor under the contract they have together to pay that contractor the final payment. But at the same time, this lot owner is complaining that there has been damage to his property and he says he is entitled to be reimbursed.

And I know that this owners corporation, in particular, has a particular view of the claim. They think that the lot owner is trying it on a bit and that the claim is sort of pumped up and they are not that interested in pursuing the claim.

They like the work that the contractor has done and they’ve come to me saying look, what are our obligations in this situation? Should we be paying the contractor his final payment, should we be paying any attention to what this lot owner is claiming? What do we do? So have you ever been in that kind of situation, Reena?

Reena Van Aalst: Yes, I have actually and normally what I sort of recommend is that the committee actually approach the owner just to see what the larger damage has been and whether or not it’s just worth  putting it through as a claim to start off with the contractor.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: Yes. It could be a spurious claim. It’s really hard to know but the damage could be real as well. So I think there’s got to be sort of both sides of the argument have to be taken into consideration.

Amanda Farmer: Yes.

Reena Van Aalst: And I think in my experience normally you know if the contractor wants to keep sort of in with the owners corporation and do future work they might just pay part of 50% meet the person halfway.

Maybe the owners corporation might contribute some amount. It just depends on the damage cost to the lot owner’s personal property and the relationship that contractor has with them. Whether they want to keep it in the future or sort of the damage. Sometimes little things can cause big problems as you and I know.

Amanda Farmer: Yes.

Reena Van Aalst: in our experience, so it just depends I think if you want to be penny wise pound-fully sure.

Amanda Farmer: Yes.

Reena Van Aalst: So what was the quantum of the amount?

Amanda Farmer: Well, it’s looking like maybe about $10,000.

Amanda Farmer: But the lot owner hasn’t put in all of his quotes yet and I’ve certainly taken the same view as you. Look, let’s put it to the contract. You might find this is been a big job. The owners corporation has so far been happy with them and as some form of compromise without admitting any liability, the contractor might be willing to put some money on the table and even if it’s not the full amount that the lot owner is claiming it might be enough for the lot owner.

Reena Van Aalst: Yes.

Amanda Farmer: to be satisfied at the end of the day. So that’s definitely going to be their first step. But something I wanted to highlight to them is the fact that the owners corporation is the one that has the contract with builder. The lot owner is simply a part of the owners corporation and if the owners corporation determined that it wanted to comply with its contractual obligations and make that last payment to the contractor that would be fine.

But it doesn’t stop the lot owner later coming back and saying to the owners corporation well, ‘I have a claim against you owners corporation. Because your contractor has damaged my lot property so what are you, owners corporation going to do about it’.

So as much as they want to settle that account and move on I’ve been very careful to advise them that at the end of the day their obligation may lie to the lot owner to fix that damaged property. And if they paid up the contractor and the contractor’s moved on it may be difficult to later go back and try to claim that back from the contractor. So it’s probably a good idea that it all gets resolved now

Reena Van Aalst: Yes.

Amanda Farmer: as smoothly as possible.

Reena Van Aalst: Yes. Well, let me know how that goes too, Amanda.

Amanda Farmer: Will do. So moving on from the frustrations, any wins this week, Reena? What’s the good news?

Reena Van Aalst: This actually was a win that I found out about earlier this year. It was actually a scheme I used to manage and the committee members forwarded me a copy of the actual adjudication results.

So what had happen was 2 years ago an owner decided that he wanted to install a gas line to his property. Now that property is actually a separate part -not part of the main building. It’s quite a unique situation to this scheme where it’s actually an old sort of heritage house on the same land occupied by the owners corporation and apparently he said that he had a meeting with the secretary at that time. The secretary said yes, go ahead mate just install it.

So sometime later that was never sort of mentioned at any meeting, he went ahead and installed it and of course, you know it’s all over the common property. It’s going through the garage opposite side of the building, it’s quite ugly to look at, it’s also got a gas line so it’s quite dangerous if it hasn’t been installed properly.

So at that time we wrote to him and said he had no consent to do this, he needs to provide us with evidence that it’s been installed safely. In the meantime that we require him you know to remove it. And of course, we knew it wasn’t going to happen because the type of person that he was and the fact that he had claimed continuously that he had been given approval by this committee member which is verbal.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: We said if we look at all the minutes this is a building of 100 lots you know you can see every application. There’s normally at least half a dozen applications renovations and other things always on the agenda so you know I don’t believe that he didn’t know that he needed to have a formal application.

In this case, the committee couldn’t have approved it anyway because there is no renovations by-law to allow such installation. Anyway, to try to calm things down the committee suggested that he get a by-law drafted. They would call for an AGM in his behalf and we provided him with the estimated cost for the meeting in terms of our time as managing agent and disbursements which he agreed to pay.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: So then the AGM is held and unfortunately the motion is defeated and he becomes quite angry at that he had gone to the expense of calling the meeting and that he had followed the committee’s advice by submitting a by-law which obviously he had gone to expense time to take.

Part of the issue was that the committee members had spoken against the by-law as well. But then again, as you know 25% of members are eligible and entitled to vote at the meeting that needs to actually vote again or more than 25% for special resolution.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: And unfortunately he didn’t. The by-law was defeated and then he took the application to NCAT to state that the owners corporation had unreasonably withheld consent.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: So, have you ever come across those type of cases, Amanda?

Amanda Farmer: Yes. Yes, I have and I’m very interested to see what the result of this one was.

Reena Van Aalst: Yes.

Amanda Farmer: because we get wildly bearing results.

Reena Van Aalst: Yes. Well, NCAT actually denied the application.

Amanda Farmer: Wow.

Reena Van Aalst: So that basically the owners corporation had the right to refuse to allow him to install a gas line which affected property and yes. So we’re quite pleased with the results we have obviously lots of minutes, lots of letters that we had to back up that we have written to him asking him to remove it, that it was unauthorised.

Amanda Farmer: And that it was dangerous I suppose.

Reena Van Aalst: Yes. Yes.

Amanda Farmer: That would have been a big point.

Reena Van Aalst: I mean he gave us a certificate from a plumber, but I don’t know, in terms of how satisfactory that was after the event.

Amanda Farmer: [responded in agreement]

Reena Van Aalst: And you can just see it going along the car park line and so it was unsightly in a sense. You know, today you would never have a gas line going through a car park where you can see it on the ground.

Amanda Farmer: Yes. Yes. That’s a great result and I have to say in my experience it is an unusual one whether work has already being done.

Reena Van Aalst: Yes.

Amanda Farmer: That I usually find that NCAT.

Reena Van Aalst: Yes.

Amanda Farmer: It is on the side of permitting the installation to remain in place sort of there.

Reena Van Aalst: Yes, that’s been my experience.

Amanda Farmer: Yes.

Reena Van Aalst: I was actually quite surprised about that and obviously the committee was quite pleased with the result but yes.

Amanda Farmer: Yes.

Reena Van Aalst: They are normally on the side of caution. They do say that consent has been unreasonably withheld and that it doesn’t affect anyone.

Amanda Farmer: Yes.

Reena Van Aalst: So in this case, it was, on the contrary, had occurred.

Amanda Farmer: Yes.

Reena Van Aalst: So it was unusual.

Amanda Farmer: And did you get a direct order for him to remove it?

Reena Van Aalst: No. No.

Amanda Farmer: Okay. So what was the order?

Reena Van Aalst: From memory, it was that basically the owners corporation were not unreasonable and therefore they were able to reject by-laws. So he was trying to make that by-law an order and they said no so.

Amanda Farmer: Well, that’s really interesting because then the installation is still there.

Reena Van Aalst: Yes.

Amanda Farmer: There isn’t an order trying to remove it. The fact is it remains unauthorised and illegal.

Reena Van Aalst: Yes. Yes.

Amanda Farmer: And I suppose for the owners corporation to take that next step.

Reena Van Aalst: Yes.

Amanda Farmer: And then apply for an order that he remove it.

Reena Van Aalst: Remove it; yes so obviously I’m not sure what’s happened in that respect because I’m no longer the manager of the scheme.

Amanda Farmer: Yes.

Reena Van Aalst: But I’m sure that if they think that it’s still necessary they’ll probably take that next step.

Amanda Farmer: Yes or they just might revel in this win for now.

Reena Van Aalst: Yes, that’s right.

Amanda Farmer: Excellent. That is a good news story. Thanks for that, Reena. Well, for my part maybe not so much for a win but it’s something that I enjoyed this week. I actually met with a committee for a small building in Sydney’s Eastern suburbs. A 4-lot scheme and they are quite excited about embarking on the collective sale process.

Reena Van Aalst: Wow.

Amanda Farmer: So that’s the new system here in New South Wales that came in with our new Act at the end of last year where 75% of lot owners can approve the sale or the redevelopment of the entire building. So that’s a big change from previously needing 100% of lot owners and the interesting thing about this scheme is that whilst it a  4-lot scheme there are 3 owners who support this collective sale and 1 owner who we think probably won’t be on board.

So that 4th owner is not a member of the committee so I didn’t meet with that person. But the committee is specifically wanted to meet just to chat about what this process is, how it works, what kind of meetings they have to have, what kind of plans they need to put together.

And they are actually working together with a real estate agent who has some developer contacts and a couple of developers who look at the building. And are interested and think that there’s some value there in a redevelopment. So they could well be one of the first to go ahead with this and I know there are few other buildings out there. And lawyer colleagues of mine who are having the same discussions with buildings. And it will be interesting to watch this space and see how it goes.

Reena Van Aalst: They are looking to sell it like to basically redevelop the whole lot and increase the number of apartments or keep it the same, Amanda?

Amanda Farmer: Well, the interesting thing is because the part of Sydney that it’s in and I won’t say the suburb just to keep the confidentiality. But it is a waterfront suburb and they are one of the few unit blocks in the street.

Interestingly, it’s actually mostly houses, very large, very expensive houses and they have had some interest from I’m not sure if it’s a developer or just a private purchaser. For somebody who would like to build a standalone home, quite a magnificent home.

Reena Van Aalst: Wow.

Amanda Farmer: And they think that there would be in the order of multiple millions of dollars to gain doing that kind of redevelopment. So I’m not sure that they get the higher density but if they were to do a standalone, very high-level dwelling they seem to think there’ll be some value in that for somebody.

Reena Van Aalst: Yes, because you know I live in the Eastern suburbs also, where I actually approached council about this and because it’s only a few apartment blocks. There are about 3 or 4 in the whole street. Now you can’t build apartments anymore.

Amanda Farmer: Yes.

Reena Van Aalst: So, therefore if we were to re-develop our apartment, it would have to be only the same number of lots-you couldn’t actually add anymore lots.

Amanda Farmer: Yes, interesting.

Reena Van Aalst: Yes, so I think for some people it just maybe to become home or perhaps more up market apartments like newer apartments.

Amanda Farmer: Yes and that is definitely one of the first steps that I have advised this building and buildings thinking about this should do is to start talking to a valuer really early in the piece.

At some point you do have to have an independent valuation done. I’m talking about a different valuer who comes in at the beginning as your valuer- The building’s valuer who can let you know what the highest and best use of the property is and what kind of money you might be looking at if you were to go to an auction and also take in to account the compensation value that you have to be paying to your lot owners which is generally more than just the market value. It has to take into account things like moving costs, they have to pay stamp duty in any new property, whether they have any unique circumstances like they run their businesses from their home which would have to be taken into account.

So you really need to start doing your numbers really early in the piece and of course talking to council about what might be possible. Because fair enough if you’re not doing the redevelopment yourself you’re trying to attract developers but it would help to be able to say hey we’ve done our homework, we’ve spoken to the council and this is what we think are potential uses for this parcel. And get those people interested to take it on for you.

Reena Van Aalst: That sounds interesting so yes let’s just see how it goes along.

Amanda Farmer: Yes.

Reena Van Aalst: Whether house or another 4-lot scheme is the way they choose to proceed.

Amanda Farmer: Yes. Yes, definitely. I’ll keep you posted on that. There’s a few excited lawyers in strata land looking at this new part of the Strata Schemes Development Act and we are all watching each other and talking to each other about how these matters are playing out so very interesting.

Reena Van Aalst: Okay.

Amanda Farmer: Well, anything else to add Reena before we wrap up and say goodbye?

Reena Van Aalst:  No. Thanks, Amanda. It’s been wonderful and I’ll see you soon.

Amanda Farmer: No worries. See you soon. Catch you next time.

Reena Van Aalst: Bye.

Outro:  Thank you for listening to Your Strata Property. The podcast which consistently delivers to property owners reliable and accurate information about their strata property. You can access all the information below this episode by the show notes at You can also ask questions in the comment section which Amanda will answer in her upcoming episodes.  How can Amanda help you today?

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