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How Are Levies Determined?

One of the most common enquires received by Strata Managers is from lot owners who did not attend the annual general meeting asking why their levies have increased. There appears to be a common misconception that the Strata Manager increased the levies, which is not correct as a Strata Manager does not have the legal authority to change or raise levies.

Generally (with the exception of special levies) strata levies are determined at the annual general meeting of proprietors prior to which notices are issued to all owners. Attached to this notice is a proposed budget.

All owners represented at the meeting and entitled to vote get to vote on the budget or modify the budget as agreed by a majority vote of owners represented at the meeting.

Once the levies have been struck at the meeting, all owners are bound by the Statute to pay the levies agreed at the meeting and the levies struck become a debt of each lot owner to the Owners Corporation at common law, and can therefore be recovered by Court action if necessary.

In addition, for the few proprietors who are consistently in arrears with levies and claim they did not receive their levy notices so they should not have to pay they should be aware of Section 83(3) of the Act which states as follows:

“Regular periodic contributions to the administrative fund and capital works fund of an Owners Corporation are taken to have been duly levied on an owner of a lot even though the notice levying the contribution was not given to the owner.”

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