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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


01 Dec 2021

Model Rules for an Owners Corporation

How will this affect and improve Owners Corporation Compliance?

We have listed below important changes affecting stakeholders and members of the Owners Corporation. It is advisable that non-compliance with those changes, can lead to penalties and significant liability for owners if not adopted appropriately in accordance with the new amendments.  
New requirements affecting the Owners Corporation records keeping and setup require thorough understanding of the new legislation and will need to be dealt with by the Manager carefully. The Manager will have to carry out additional work to follow those regulations, assist with the compliance process and ensure that there are no oversights exhibited by the Owners Corporation as of 1st December 2021.  
Inversely the new amendments contain significant positive changes that streamlines processes, delegates more powers to apply rules and legislates the enforcements of levying extraordinary fees incurred by the Owners Corporation to the appropriate owners impartially.       
The changes include: 

1. Owners Corporation Tier Classification
The new Act has created a tier system to classify your property and the parts of the legislation which will apply to it. Click here to read more.

2. Insurance Costs and Levies
The new Act has given greater flexibility in requiring owners who benefit disproportionately from insurance to pay a greater contribution with the creation of a new “lot entitlement” distribution process. Click here to read more.

3. Committee Membership 
New rules apply to whether your Owners Corporation is required to have a Committee and the number of people allowed and/or required to be on that Committee. Click here to read more.

4. Common Seal
Your Owners Corporation can now decide on whether and/or when to use its common seal.
Click here to read more.

5. Maintenance Plan
The new legislation outlines requirements regarding the preparation and approval of a maintenance plan and fund for your OC. Click here to read more.

6. Public Liability insurance
The new legislation outlines requirements regarding the level of Public Insurance your Owners Corporation is required to hold. Click here to read more.

7. AGM Proceed Without Quorum - Managers can pass interim resolutions
The amended legislation will allow Managers to pass certain interim resolutions in certain circumstances.
Click here to read more.

8. Power to Commence Legal Proceedings
An Owners Corporation may now commence legal action by ordinary resolution for claims up to $100,000 which should assist larger Owners Corporation to pursue a legal matter when there are several owners who may be less interested in any action. Click here to read more.

9. Audit of Financial Statements
The new legislation outlines requirements or the auditing its financial statements on a tier by tier basis.
Click here to read more.

10.  Altering Common Property by Owner
The amended legislation clarifies the circumstances under which a lot owner may make adjustments to common property. Click here to read more.

11.  Authorised Entry to a lot
Where access to a lot is required to conduct work on common property, the rules have been amended to make this access easier. Click here to read more.

12. Disposal of Goods Abandoned on Common Property 
There have been significant changes to the rules relating to abandoned goods on common property in the new legislation. Click here to read more.

13. Insurance for Multiple Single Dwellings 
An Owners Corporation may vary the insurance requirements for a subdivision with multiple single dwellings. Click here to read more.

14. Ballot Rules
New rules apply to the conduct of ballots for your Owners Corporation. Click here to read more.

15. Interim Special Resolutions
New rules apply to special resolutions which should make it easier for Owners Corporations to make decisions where there are large number of owners who don’t attend the meetings. Click here to read more.

16.  Contract of Appointment 
Contract of Appointment must not include terms that limits and allows the Manager to Automatically renew their contract. Click here for more details.

17.  Duties of Manager 
Additional duties and responsibilities have been assigned to the Owners Corporation Manager.
Click here for more details.

18. Manager’s Report
Additional information is required from the Manager to include in the Manager’s report as part of the AGM Notice. Click here for more details.

19. Making Rules
Owners Corporation may make rules in respect of building alteration, Payment Plans, Tobacco Smoke and Fire safety Procedures. Click here for more details.

20. Occupiers and guests
Occupiers will be responsible for a guests’ behaviour. Click here for more details.

21. Retirement Village
Separate provisions relating to fees, maintenance fees, obligations of initial owner, appointment of a Manager and Rules. Click here for more details.

22. Availability of register
A lot owner must not authorise a representative to request a copy of the register. Click here for more details.

23. Complaints
A Complaint cannot be made in respect of a lot owner’s liability. Click here for more details.

24. VCAT Procedures
Changes made to the Act to empower VCAT. Click here for more details.

25. Eligibility for Registration
It is and offence to act as Manager without being registered. Click here for more details.

26. Proxy
Changes made to the Act to empower VCAT. Click here for more details.

27. Creation of plans - Amendment to Subdivision Act 1988
Developers have obligations on how the structure of creating a  plan is documented and implemented when the plan registers and the owners corporation is created. Click Here for more details.