questions & answers

In strata titled apartment buildings, decisions related to the common property or for the common good, are made via resolutions. A resolution is an agreed and documented decision made by an owners corporation either at a meeting or by ballot.

There are different types of resolutions. Generally the more significant or costly the decision is, the more owners corporation members are required to agree.

There are three main types of resolutions.

1.     Ordinary resolutions

An ordinary resolution requires at least 50% of all lot entitlements in the scheme voting in favour.

Most day-to-day decisions made in owners corporations are ordinary resolutions. Examples of decisions typically made through ordinary resolution include approving the owners corporation budget, property insurance, confirming the accuracy of minutes, and electing a committee.

Lot owners who do not pay fees, lose the right to vote on ordinary resolutions (however they can vote on special or unanimous resolutions).

The owners corporation committee can be delegated the power to make ordinary resolutions on behalf of the owners corporation. Unless otherwise delegated, the legislative default is for the committee to have all the powers and functions that may be exercised by the owners corporation, except for matters requiring a unanimous or special resolution.

2.     Unanimous resolutions

A unanimous resolution is passed by all lots voting in favour of a resolution.

It is required for the following:

• Changing the plan of subdivision (including changes to lot liability and/or entitlement).

• Disposing of all or part of the common property.

• If there is no common property, resolving for each lot owner to arrange their own insurance.

• If there are multiple single dwellings with common property, resolving for each lot owner to arrange their own insurance.

3.     Special Resolutions

A special resolution requires at least 75% of all lot entitlements voting in favour.

A special resolution is needed when:

• Obtaining a loan that exceeds the amount of the annual fees of the owners corporation.

• A significant alteration to common property which is not in the maintenance plan, is not an immediate threat to safety or will prevent significant damage.

• Extraordinary payments from the maintenance fund.

• Making or amending the rules.

• Commencing legal proceedings claiming over $100,000 that is not enforcing the owners corporation rules or recovering fees.

• Leasing or licensing any part of the common property.

• Obtaining a lease or license over any land.

• Providing a service or entering into an agreement to provide a service to lot owners, occupiers, or the public.

• Raising a levy that is more than twice the current annual fees.

Under a special resolution, if at least 50% of all lot entitlements in the scheme vote in favour, and no more than 25% vote against, it becomes an interim special resolution.

Interim Special Resolution

An interim special resolution occurs when at least 50% of all lot entitlements in the scheme vote in favour, and no more than 25% vote against.

An interim special resolution cannot be acted on for 29 days. When an interim resolutions occurs, a notice must be sent to all owners within 14 days of the meeting or the ballot close.

In the 29 day period from voting, if:

• Over 25% of lot entitlements object, the interim resolution fails.

• Less than 25% of the lot entitlements object, the resolution becomes binding on day 29.

In Victoria we don't currently have a lower threshold for anything that requires a special resolution, although this is something many councils, peak bodies and owners have been advocating for.

Don’t forget that you have a voice to your political representatives! You – apartment owners and renters are becoming increasingly important in our cities and your numbers are growing. And as the number of people living in apartments increases, so does your voice. If you think strata legislation needs to be updated in Victoria, you can always raise this with your State representative.

In New South Wales they have a sustainability infrastructure resolution. The key difference between a sustainability infrastructure resolution and other special resolutions is that a sustainability infrastructure resolution requires that no more than 50% of the value of the votes cast at the meeting vote against the measure, provided certain conditions are met.

If you (or anyone else) abstain from voting, your vote will not be counted towards the required majority. Essentially, there is no difference between a no vote and abstaining from voting as they will have the same effect.

Ballot and voting information is available on the Consumer Affairs Victoria website.

Different owners, whether owner occupiers or landlords/investors, will have different drivers. It’s important to understand who you’re working with, and not to make assumptions about landlords/investors. Don't treat investors as one homogenous group. Are they locals? And you can talk to them? Are they international investors?

You might have to think about translating communications if you have a high percentage of investors that that live in a non-English speaking country.

Wherever possible, reach out via email or phone and get to know some of the more engaged landlords/investors in your building. Think about asking them to join the committee. It's amazing how many people are shy about nominating publicly, but are quite chuffed when asked personally.

A good committee structure is one that represents the full spectrum of lot owners (the collective owners) not just the owner occupiers.

All that said, it’s likely investors will have an interest in maintaining property value and ensuring their apartment will attract a good rental rate and long-term tenancies. For example, renters are starting to ask about EV charging so as a landlord, I’d be supporting the installation of EV charging in my building. And don’t forget to remind landlords on your owners corporation that their investment is likely to be a tax deduction.

In short, yes. Major decisions and costs will nearly always require a some kind of resolution. All owners must be given an opportunity to vote in a resolution. But of course, not everyone is going to come along to a meeting or submit a ballot. You need to work with your committee / owner corporation manager to confirm the type of resolution needed.

There is a difference between survey (polling) and voting electronically at a meeting or by ballot.

To use a platform to record a legally enforceable vote will require the platform to be able to produce a record of who (lot/name), if they are a proxy and their vote – Yes or No. Ideally the platform would also identify if they are entitled to vote (financial). There needs to be a mechanism to allow for a poll vote as well (voting by entitlement). These platforms aren’t free. Some may already be integrated into your strata managers software or your building managers software.

If you simply want to consult with your residents and/or owners corporation members, you could use a survey platform like Google Forms, Microsoft Forms or Jotform.