Who pays for an EGM to pass a reno by-law?

You have answered your own question in your final comment.

Unless the owner has gathered the signatures of 25 per cent of owners or if the OC can put up an argument that the by-law would benefit the majority of owners, then the renovator should pay all the costs.

• This reply was modified 1 month, 3 weeks ago by .

Actually, there are a variety of approaches when it comes to renovations, and renovation by-laws. Strata law requires that any major renovation be approved as a special resolution (ie, majority for, less than a quarter against) at a general meeting, any minor renovation be approved as a normal resolution at a general meeting (ie, a majority for, and some buildings have delegated this to the strata committee), and any cosmetic renovation does not require approval. The Owners Corporation mainly has sway over a renovation which involves common property; so check out the “Common Property Memorandum” to get a rough idea of what is which. The purpose of a “renovation by-law” is to transfer the maintenance and replacement tasks of any common property affected in the renovation, from the Owners Corporation to the owner of the lot that is doing the renovation. The Owners Corporation can also manage the use of its common property during the renovation and set conditions about working hours, rubbish removal, tradies parking etc, and also require the work to be done properly, by licenced and properly insured tradies, builders etc.

Many buildings have a section in their by-laws that set out the conditions for renovations, which, if your building has done this, will simplify the approval and renovation process, since you will just have to follow that by-law, and so your own renovation by-law can become a paragraph just basically setting out what parts of the common property are being affected in the major/minor renovation, and a summary of the work to be done.

In my building, we have such a by-law on carrying out any renovations, which details the application procedure, how the work is to be carried out, etc. We ask owners to apply to carry out a renovation. They list the work they want to do, and the type of renovation (cosmetic, minor, major) is determined by all parties. If it is for a minor renovation, then the strata committee in our building can approve it (ie, under s.110(6)(b)) but that might not be the case in other buildings.

If the work is a major renovation (or minor that requires approval at a general meeting), then the strata committee reviews it,  and if there are no obvious issues, the committee asks for the owner to sign an agreement that they will submit a motion at the next general meeting to carry out the work, and that they will agree and approve a renovation by-law for their work to be registered after that meeting, to take on the maintenance responsibility for the work. They can then sign that agreement (usually 2 pages, listing the work, and confirming the terms of the agreement), and then the strata committee lets the renovation proceed. At the next general meeting there is a motion put to approve (retrospectively) that renovation and register the by-law.

There is a small risk that at the general meeting the owners won’t approve the renovation, but this is very unlikely, because the strata committee is recommending it (and has a voting block). Legally, the renovation between the time it is done, and when the next general meeting is held, is an “unauthorised renovation”, but it is the strata committee’s job to deal with those, and it has already done so, by arranging for the owner to sign an agreement to pursue the general meeting motion and approve a renovation by-law to be registered, at the next opportunity.

An owner wanting a renovation is provided with samples of earlier renovation applications, and they normally prepare the paper work themselves, or with their builders assistance. Without lawyers! Minimum costs, and no nuisance of holding more general meetings. Works smoothly and cheaply. The building benefits from successful renovations, and there is no need to delay them or make them harder to arrange by holding more general meetings that owners don’t care about. However, some strata managers like the extra income that all this kerfuffle involves, so you might need to explain to the strata committee that there is a better way of arranging all this.

We’ve been through this a few times in my 6-lot building and in every case the lot owner wanting to renovate pays all costs associated with the application. Recent applicant told me it cost him about $1000 to get his approval prepared and through the Committee. that’s chicken-feed compared with the cost of the Reno.
The one exception was when two lots owned by the same person raised the possibility of installing aircon. We decided to prepare an aircon bylaw that would cover all six lots. The strata manager sent me a few model bylaws and to reduce cost, I adapted one of those to suit our needs. I got the Committee to check it over at every step so when it came time to vote, it sailed through. Everyone shared the cost of that exercise, including the two lot owners who said they had no interest in aircon.

Quirky wrote:

Strata law requires that any major renovation be approved as a special resolution (ie, majority for, less than a quarter against) at a general meeting, any minor renovation be approved as a normal resolution at a general meeting (ie, a majority for, and some buildings have delegated this to the strata committee), and any cosmetic renovation does not require approval.

I assume the strata law being referred to is in NSW.  I’m in the ACT and our Unit Titles Management Act does not distinguish between major, minor and cosmetic. The default owner’s corporation rules require a special resolution for alterations and modifications, which by implication covers all alterations and modifications.  How is the split between major, minor and cosmetic defined?  This seems to be a useful approach, if it can be defined clearly.

tina wrote:

Please refer to Sections 109 and 110 of the Strata Schemes Management Act 2015 (NSW). There are lists of what is considered “cosmetic” or “minor renovation”.

The Strata Schemes Management Regulations also has a supplementary list of definitions.

• This reply was modified 1 month, 1 week ago by .