NEWSLETTER ISSUE 1 APRIL 2010

Welcome to the first issue of the Progressive Strata Services newsletter. We  would  like  to  thank  all  those  who  participated  recently  in  our  first  survey.    It  has  been  great  to capture  a  snapshot  of  what  services  our  Executive  Committee  members  are  aware  of  and  how  useful they are in assisting them in the management of their schemes.

So what is going to happen as a result of the survey?

a)    Some of you indicated that you were not aware that we provide access to the schemes     f inancials on line.    Those treasurers who were not able to use this service before our survey,   and showed an interest in doing so in the future, have now been provided with what they   require to do this from now on.  We have since found that all owners can access these reports   with their unique password, so if you can’t find your password letter please email us at     accounts@prostrata.com.au.

b)  This  newsletter  is  also  as  a  result  of  the  feedback.    A  number  of  people  thought  this  would  be  a   worthwhile service  and some stated that updates on relevant court cases would be helpful.    Towards this end  a summary of the vital information that all schemes should be aware of,   which  came out of Siewa’s case is over the page.    The majority who  were interest in provision of a newsletter stated quarterly would be frequent   enough  and  we  will  endeavour to  full-fill this request.   A  few  queried  if there  would  be  a  charge,   the answer is no.  We intend for this to be a service that Progressive Strata provides it’s     Executive Committee’s.

c)  A new addition will be some evening talks put on by various experts.   Whilst only Executive   members receive this newsletter, any current owner can attend.  Details of the first of these  is   in the box below.

d)  We were pleased  to  note  that  the  vast  majority  of  those  who  responded  to  the  survey  indicated   that they found our  AGM agendas and levy notices easy to read/understand.

Colin Grace – Director of Grace Lawyers, will give a talk on 25 May 2010 at 6.30pm at Eastern Suburbs Leagues Club at Bondi Junction.   The subjects he will cover over approx. an hour are:

i) the powers of the Executive Committee

ii) construction defects (HOW)

iii) common property – what is it?

There will be a question and answer time at the end followed by tea and coffee. A fee of $15 will be charged to the scheme regardless of who attends (only Executive members have been sent this newsletter, however you may wish to place this on the notice board as other owners may be interested in coming and reading this document).  To book a seat please email reception@prostrata.com.au  BEFORE 5pm on 14 May 2010.

Siewa’s case  – a Supreme court case about repairs and maintenance

In  2006  a  case  which  affects  all  schemes  was  determined  in  the  Supreme  Court  –  Equity  Division.  Whilst  a  lot  of  the  case  was  spent  on  an  argument  over  who  was  responsible  for  a  membrane  on  a balcony,  Judge  Brereton  made  the  following  comments  which  impact  on  all  schemes.    The  below  is self  explanatory,  (I  have  removed  the  other  cases  referenced,  if  you  wish  to  receive  a  full  copy  of  these paragraphs,  or  the  complete  case,  please  email  –  reception@prostrata.com.au).        I  have  made  bold the important facts.   The judge said: …. “4 The duty to  maintain involves an obligation to keep the thing in  proper  order by acts of  maintenance before  it  falls  out  of  condition,  in  a  state  which  enables  it  to  serve  the  purpose  for  which  it exists.    Thus  the  body  corporate  is  obliged  not  only  to  attend  to  cases  where  there  is  a  malfunction,  but also  to  take  preventative  measures  to  ensure  that  there  not  be  a  malfunction.    The  duty  extends to  require  remediation  of  defects  in  the  original  construction  of  the  common  property.    And  it  extends to  oblige  the  owners  corporation  to  do  things  which  could  not  be  for  the  benefit  of  the  proprietors  as  a whole or even a majority of them. 5  It  follows  that  as  soon  as  something  in  the  common  property  is  no  longer  operating  effectively or at all, or has fallen into disrepair, there has been a breach of the s 62 duty.……..”

These  are  very  strong  words.    The  outcome  here,  due  to  the  breach  by  the  Owners  Corporation  was over  $400,000  payout  to  the  owner.    As  well  as  the  schemes  own  legal  fees  to  defend  the  case  brought against  them  by  the  owner.    An  expensive  lesson  indeed.    What  does  this  mean  to  each  scheme  in NSW?   The  scheme  has  to  repair  something  as  soon  as  it  no  long  functions  as  it  was  intended.    Eg  if paint  is  cracking  it  is  no  longer  protecting  the  wood  underneath,  so  will  start  to  rot.      Also  the  scheme is  required  to  undertake  preventative  maintenance,  such  as  that  to  a  lift  or  garage  door  –  to  ensure longevity, which is similar to one getting an oil change etc done to a car. Your  AGM  agenda  for  this  year  has  a  motion  on  it  to  review  your  sinking  fund  assessment  obtained  in the  last  few  years,  so  you  can  plan  to  effect  work  when  it  is  scheduled.  Thus  complying  in  part  with  this case.

Suggested subjects for the future

If  there  is  a  subject  that  you  would  like  us  to  cover  via  guest  speakers  (or  in  our  newsletters)  please  go to  our  website,  and  use  the  “Existing  Clients”  tab,  and  log  your suggestion  via  the  “Misc  request”  form as we try to make this new service as relevant as possible to you, our clients.

Did you know that

Progressive  Strata  Services  provides  an emergency  after  hours  service  –  for  urgent  repairs?    For  more detail visit our website, select “Our Services” tab at the top of the home page.