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Strata Managers Summary of Amendments | 1.Owners Corporation Tier Classification

One of the key important changes to the Act is to identify the Tier Category (Tier 1-5) that your Owners Corporation will fall under. This will involve deployment of the change on the legal records, carry out further regulatory requirement checks depending on the number of occupiable lots and take necessary steps to meet any further requirements driven from this change.

The tiers are structured as follows:

Tier One: More than 100 occupiable lots;

Tier Two: 51 to 100 occupiable lots;

Tier Three: 10 to 50 occupiable lots;

Tier Four: 3 to 9 occupiable lots; and

Tier Five: 2 occupiable lots or a services only Owners Corporation.

Find out more at https://www.legislation.vic.gov.au/as-made/acts/owners-corporations-and-other-acts-amendment-act-2021 

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Strata Managers Summary of Amendments | 2.Insurance Costs and Levies

Owners Corporations will have greater power to levy fees to specific lot owners for additional expenses that are directly contributed by a specific lot owner’s use of their lot when the existing lot liability (apportionment of cost) would not sufficiently take account of these additional costs.

An Owners Corporation may ask a lot owner to pay:

An increase to an insurance premium that has been caused by gross negligence or a wilful act of the lot owner themselves, their tenant or guests;

Consider whether Lot entitlements and liabilities are different and, if they are, whether it would be fairer to apportion the cost of replacement and replacement insurance based on Lot entitlement.

An insurance excess if a claim relates directly to the owner’s lot; and

Fees to cover damage to the common property that has been caused by a lot owner and is not covered by insurance.

It’s important to note that occupiers of lots are considered responsible for their guests’ behaviour, and consequently, they may both be liable for any breach of the Owners Corporations’ rules.

​Find out more at https://www.legislation.vic.gov.au/as-made/acts/owners-corporations-and-other-acts-amendment-act-2021 

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Strata Managers Summary of Amendments | 17.Duties of Manager


28 Oct 2021

Procurement Duties and Responsibilities:

  • must take reasonable steps to ensure that any goods or services are procured at competitive prices and terms;
  • must not to exert pressure to influence the outcome of a vote; and
  • must, before a Contract is entered into, give written notice to the chairperson disclosing the commission, payment or other benefit the Manager is entitled to receive a commission, payment or other benefit.

Further, the Manager must, upon request, provide the Owners Corporation’s financial statements of bank records. Records within 3 years, must be provided immediately and other records, as soon as practicable.

The manager may need to consider sourcing multiple quotations for repair & maintenance as required and depending on the costs and the nature of the service, the manager may provide recommendation on other reasonable factors (e.g. previous quotes by the same contractors for the same type of job, knowledge of reasonable pricing having regard to experiences in engaging contractors for other Owners Corporations). 

Discloser of any Supplier Relationship, Commission, Payment or benefit received:

Disclose any beneficial relationship, commission, payment or other benefit that the manager is entitled to receive from the supplier whom a contract is proposed to be entered into for the supply of goods or services to an Owners Corporation. 

  • Example of ‘beneficial relationship’ is where the Supplier is:
  • the Manager;
  • an associate (including director, employee family relation, representative) of the Manager;
  • a corporation/firm which the Manager/associate is a member;
  • a corporation which the Manager/associate can exercise control; and
  • an executive officer, trustee, beneficiary.

Example of ‘Commission or Benefit’ is with respect of insurance contracts, the Manager must disclosure the percentage of the commission rather than the actual amount. 

The above Duties and Disclosure obligation must be given in the Manager’s report to be resolved and adopted at each Annual General Meeting.

​Find out more at https://www.legislation.vic.gov.au/as-made/acts/owners-corporations-and-other-acts-amendment-act-2021