VIC Can an OC Committee 'override' a resolution made by a Complaints Committee?

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adonis_paradise

Well-Known Member
26 April 2021
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[Disclaimer: I've been editing this for hours, and my eyes are starting to glaze over. I'll post now what I hope is 'acceptable' version, and will re-read and re-edit (if necessary) after a break.]
Hi all.

CONDENSED VERSION:
Q1: Can an OC Committee which has had a complaint against it, 'override' a resolution passed by a Complaints Committee? (ie a resolution they are not happy about?)

Q2: Can a new Owner be made to remove an Aircon (positioned on the Common Property) that the previous owner did not get approval for?


DETAILED VERSION:
One of the Owners in our block of Units filed a Complaint against the OC Committee (of 2020), for giving themselves permission to move their aircons off their balconies and onto the (Common Property) wall of our building (as discussed here).

Two members of the 2020 Committee (let's call them "Larry" and Lisa") are also on the current OC Committee (as Chairperson and Treasurer). They agreed that they should not participate in the Complaints Committee, as they were the subject of the complaint. I should mention that Larry and Lisa are married (they own two flats in the building), and (predictably/understandably) they always present a 'united front' at meetings. Anyway, at the meeting the Complaints Committee passed a motion to remove the two Aircon units which did not have approval (to be placed on the common property wall of the building).

After months of inactivity from the OC Manager, Larry called an OC meeting. He began by overruling(!?) the Complains Committee resolution to have the unapproved Aircon Units removed. He claimed that the Owners Corporations Act 2006 ('The Act') "is silent on the issue of conflict of interest and that Consumer Affairs Victoria has advised that any advice reading a conflict of interest must be sought from a lawyer"
I quoted Sec 117 (2):

A member of a committee or sub-committee of an owners corporation must not make improper use of the member's position to gain, directly or indirectly, an advantage for the member or for any other person.

I argued that just because the Act does not specify every possible thing that might constitute 'conflict of interest', that does not mean it is 'silent'.

Q3: Is this correct?

Larry then went on to describe the unapproved aircons, as having "set a precedent". I reminded him that they are the subject of a Complaint. A Complaint where it had already been resolved that they should be removed. Hardly a 'precedent'. Larry and Lisa became very hostile, and told me that I should "take it up with Consumer Affairs", was that I was "free to make my own investigations".

Larry and Lisa then proposed we change the rules so that everyone can have 2 units on the Common property. I explained that the OC Committee did not have that authority, because of Section 52:

Significant alteration to common property requires special resolution

They claimed that (potentially) 20+ Aircon units on the outside of the building was not a 'significant alteration'. They again dismissed my point, and told me to 'talk to consumer affairs'.

In short, I was outvoted, as the other committee member present was also one of the Owners of an aircons in question, and (as a result of the Complaint) could also potentially be asked to move his off the common property.

Clearly, members of the 2023 Committee whose aircons have been questioned fear that removing even one (which didn't have approval) could 'start the ball rolling' and result in their 'approved but under questionable circumstances' Aircons being moved, so they
A: Overruled the previous resolution
B: Denied that they had a conflict of interest
C: Passed a resolution so that everyone could have 2 aircons on the Common Property.

...and thus retroactively make it 'all ok'.


Finally, Larry & Lisa said nothing could be done about the Unit which had since been sold. I suggested we can have the unapproved Unit removed, and the new owner could take it up w the previous owner.
Q4: Is this correct?

any response appreciated!

ps we have an AGM coming up next week..
 
Last edited:

adonis_paradise

Well-Known Member
26 April 2021
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[time ran out for edits, please add this to the bottom]

I am also a little confused as to what happens w the original Complaint.

We have an AGM coming up next week.. The OC Manager and the owners of the 'aircons on the common property' want to retroactively approve everything, and brush it all off, but the other Owners are annoyed at these ugly airions and want them removed. I'm not sure what needs to be said and done at the AGM..

any response appreciated!
 

Rod

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27 May 2014
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Ans to Q1: Yes. The OC complaints sub-committee is subordinate to the OC.

Ans to Q2: Most likely no. What did the OC tell the prospective purchaser about non-compliance on the OC certificate? Of course the OC can agree to pay costs of any AC move.

Ans to Q3: Depends. If the OC rules are also silent on the issue, then chances are it is OK to vote. Many, if not most OC resolutions involve a conflict of some kind.

Ans to Q4: Your question is not well written as you gave 2 options. I am going to assume you want to know if you are correct -> no, see ans 2.

You have the option of taking the dispute to VCAT if you remain unhappy, but check the OC rules first as there may well be dispute resolutions clauses in the rules. Keep in mind that if the OC engages a lawyer to assist, that is money coming from all owners, including yourself.
 

adonis_paradise

Well-Known Member
26 April 2021
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Hi Rod.

Thanks for the response. If I may follow up:

re: Q1: How can Complaints against OC Committees function then, ie if a (biased) OC Committee can overrule any motions passed by the (unbiased) sub committee?

re: Q2: Wow, I didn't know about (Sec 151) OC Certificates (thanks!). Could the Complaint in question possibly come under the purview of:

(vii) liabilities and contingent liabilities of the owners corporation including any liabilities or contingent liabilities arising from legal proceedings;
(viii) contracts, leases, licences and agreements affecting the common property;
(x) notices and orders served on the owners corporation;

..?

re: Q3: By abstaining from being in the sub-Committee, weren't Larry and Lisa conceding that they DID have a conflict of interest?

thanks heaps, much appreciated!
 

Rod

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re: Q1. This is a hypothetical question unrelated to your issue. The situation is no different to many other sub-committees in other organisations. Some are functional, some dysfunctional.

re: Q2. Yes, take your pick of (vii) and (viii).

re: Q3. Yes, but is unlikely to make any difference to the result. Your issue appears to be at the OC level.
 

Rod

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OC level rather than at the complaints sub-committee level.

BTW, passing a motion forcing owners to move AC units previously approved will likely result in the OC paying for the move.