
Mismanagement of a strata property not only affects your enjoyment but also affects the property’s market value – after all, no one wants to buy a problem.
Knowing this, it may be wise to have a compulsory strata manager appointed if your strata committee or strata manager is dysfunctional and does not maintain the property well.
1. You will have to apply to NCAT for an order to appoint a compulsory strata manager
If an owners corporation, strata committee, or strata manager in New South Wales becomes dysfunctional or fails to carry out its obligations, a lot owner can apply to the NSW Civil and Administrative Tribunal (NCAT) for an order appointing a new strata manager. Referred to as a compulsory strata manager, they can exercise all or specific functions of the owners corporation, the strata committee, or its office bearers.
A compulsory appointment usually occurs when the owners corporation, strata committee or current strata manager:
- is being negligent of its duties. They may be failing to insure the building, keep records, organise AGMs, or maintain common property)
- is non-compliant with the state law and regulations
- is mismanaging funds, or
- is ignoring orders.
2. A properly-appointed compulsory strata manager can replace your existing strata manager or strata committee
The order can grant a strata manager powers to exercise all or specific functions of the owners corporation, strata committee or office bearers. These responsibilities are agreed upon by the owners. The contract is formalised by the Tribunal, so that there is clear authority and responsibilities outlined for the strata manager.
A “section 237 appointed” strata manager will replace any existing strata manager, and any existing strata managing agent agreement is automatically terminated.
A compulsory appointed strata manager owes a duty of care to act in the best interests of the owners corporation. However they are not obliged under s237 to consult with owners on matters before acting.
Originally published on 24 April 2019
Updated on 19 July 2021
Categories: Committee member information, Enhancing Community Living, Liveability, New South Wales