This is what needs to happen at a strata property AGM
Understanding what happens at this compulsory annual meeting is key to contributing to important discussions and decisions during your strata property AGM
An owners corporation must meet at least once each year at its annual general meeting (AGM) to discuss matters of the strata property. The strata property AGM is the main opportunity for owners to discuss issues relating to their property and elect the committee representatives for the year ahead.These are some of the most important things your owners corporation should do during a strata property AGM:
- Review last year’s strata property AGM minutes
- Decide whether to audit accounts
- Discuss last year’s strata property financials
- Decide on the annual fire safety consultant
- Review the strata property’s insurance policies
- Decide on the number of committee members required and elect the representatives
- Appoint or reappoint the strata manager, building manager and other service providers
- Additional agenda requirements
Review last year’s strata property AGM minutes
After confirming the minutes of the last strata property AGM as accurate, the owners corporation should discuss:
- What was carried out over the year
- Any matters still outstanding
- What needs to be improved to get matters in order.
Decide whether to audit accounts
The owners corporation must vote to decide about auditing the accounts if they have a choice in the matter. In New South Wales and Victoria, an annual financial statement audit is mandatory for a strata property with 100 lots or more. In Queensland, annual audits are required for all body corporate communities(except for two-lot properties. A special resolution is required during a strata property AGM to resolve not to have an audit.
Discuss last year’s strata property financials
Prior to the meeting, owners should review the strata property’s current financial position and the forecasted budget.
The strata property AGM is a chance for any owner to raise concerns about spending or any abnormalities they have noticed on the financial reports and discuss levy arrears. Decisions on matters related to third party payments, such as insurance renewals, council fees and agency fees are also discussed. The capital works fund, sinking fund or maintenance fund will also be reviewed. If the owners corporation decides the forecasted budget is accurate and sufficient to cover operational expenses, they will vote to approve the budget and levies.
Review the strata property’s insurance policies
The owners corporation must review the insurances in place and decide if they are sufficient during the strata property AGM. It’s also wise to consider whether any additional insurance policies, office bearers insurance, machinery breakdown cover and catastrophe cover are required.
Decide on the annual fire safety consultant
Does your strata property need an annual fire safety statement completed? If so, the owners corporation must disscuss the annual fire safety statement and vote on whether the existing fire consultant will remain in place at the strata property AGM.
Decide on the number of committee members required and elect the representatives
During the strata property AGM, the owners corporation must decide on how many members the strata committee should have. Limitations of numbers vary depending on what state you live in and how many lots your strata property has. For example, in New South Wales and Victoria, strata properties with more than 100 lots must have at least three members.
Once this has been decided, the owners corporation must then vote on committee members for the year ahead. Existing members can put themselves forward for re-election. Any other owner who is financial at the time of the strata property AGM (i.e. has no outstanding levies) can also nominate themselves to be on the strata committee. Once the strata committee is elected, the members of the committee decide who is to hold the office-bearer positions.
Appoint or reappoint the strata manager, building manager and other service providers
At the strata property AGM, the owners corporation will decide whether to reappoint the current strata managing agent or end the current strata manager’s contract. The terms of the agreement and responsibilities are determined in the contract. The manager can be appointed for a period 12 months at a first AGM, after which their services are reviewed in the next AGM. If the manager’s performance during this period is satisfactory, their services may be extended for a maximum period of three years.
In addition to a strata manager, your owners corporation may also decide to appoint a building manager to help the committee manage the common property. The owners corporation is responsible for choosing the right manager for your building, defining the terms of engagement, retaining a copy of the contract and evaluating their performance at regular intervals. This may be discussed at the strata property AGM.
Your owners corporation may need the help of other professional service providers such as legal counsel, insurance companies, debt recovery agencies and tradespeople. Based on their service record, certification and previous experience, your owners corporation may decide to renew the contracts or choose new agency partners altogether during the strata property AGM.
Additional agenda requirements
New South Wales
It is also a legislative requirement to prepare or review a 10-year capital works fund plan, consider any agreements for the supply of electricity, gas or any other utility relevant to the property. If the building is still under applicable statutory warranties, the owners corporation must consider building defects and rectification matters.
Can a meeting be held without a quorum?
In New South Wales and Queensland, a quorum for a general meeting is when at least 25 per cent of the people eligible to vote to attend in person or by proxy, or the owners in attendance and eligible to vote, hold in total 25 per cent or more of the strata property’s total unit entitlement. If there is no quorum after 30 minutes of the meeting commencement, the chairperson may adjourn the meeting for at least seven days.
In New South Wales
Rather than adjourn the meeting, the chairperson may declare those persons present to constitute a quorum, meaning that the meeting can go ahead.
If at the adjourned meeting a quorum is not present after 30 minutes, the people who are there (whether in person or otherwise) can form a quorum if:
- The chairperson is present in person
- A body corporate manager (exercising the powers of the chairperson) is present in person—if the chairperson is not.
The quorum for an annual general meeting is at least 50 per cent of the total votes or lot entitlements. The annual general meeting can still go ahead without a quorum but it can only make “interim” decisions.
The owners corporation can act on interim decisions after 29 days only if it has not received either a:
- Petition of owners representing 25 per cent of the total lot entitlements
- Notice of a special general meeting.
Having set up the very first strata scheme in Australia back in 1948, we’ve come a long way in our knowledge and experience across a variety of property types. Whether you are new to strata management or an active committee member, we have developed an extensive library of resources to assist you. Click here to download our FREE Community Living guide on committee management. For a consultation to review your current by-laws with the Kemp Peterson team, click here. To find out more about the services we offer, click here for a free strata assessment.