This document summarizes key changes introduced by the Unit Titles (Management) Bill 2011 in New South Wales, Australia. It outlines new responsibilities for strata executive committees, including around privacy, disclosure, outsourcing, conduct and liability. Executive committee members can now be personally liable for dishonest or reckless actions. The bill also introduces new codes of conduct, tighter rules around contracts and appointments, and refinements to sinking fund plans and budget approval processes.

1. Surviving
the
Transi=on
to
the
ACT
Unit
Titles
(Management)
Bill
2011
Presenta=on
July
2011
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

2. A
New
Suite
of
Legisla=on
Unit
Titles
Act
2001
Unit
Titles
(Management)
(Act)
Schedule
2
–
Schedule
4
–
Default
Schedule
1
–
Codes
Schedule
3
–
General
Execu=ve
CommiLee
Rules
(previously
of
Conduct
Mee=ngs
Process
&
Procedure
ar=cles)
1.1
Execu=ve
CommiLees
1.2
Strata
Managers
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

3. The
Environment
is
the
Big
Winner
• New
defini=on
of
sustainability
infrastructure
• Ordinary
resolu=on
to
install,
finance
and
grant
easements
• Requires
considera=on
of
long
term
benefits
• May
be
acquired
as
trustee
for
tax
reasons
• Service
Contracts
may
need
to
show
environmental
sustainability
measures
• OC
rules
must
not
prohibit
or
restrict
sustainability
or
u=lity
infrastructure
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

4. More
Responsibility
on
Execu=ve
CommiLees
• Responsible
for
compliance
with
Privacy
Act
Privacy
• Requires
privacy
policies
and
procedures
• Annual
disclosure
of
insurance
and
commission
Disclosure
• Requires
knowledge
of
managers’
insurance
commission
• Tighter
constraints
on
all
service-­‐type
contracts
• Requires
greater
focus
on
short-­‐term
for
contractors
and
employees
(other
than
strata
Outsourcing
manager
and
services
contractors)
• New
code
of
conduct
for
execu=ve
commiLee
members
Conduct
• Requires
knowledge
of
Act
and
higher
standards
• Personally
liable
for
dishonesty
and
recklessness
Liability
• Requires
due
diligence
processes
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

5. What
is
Recklessness?
reckless
/
adjec&ve
1.
• Failing
to
repair
and
maintain
uLerly
careless
of
the
common
property
known
to
consequences
of
ac=on;
be
a
risk
to
health
and
safety
without
cau=on
–
• Failing
to
take
advice
on
recklessness,
noun
Macquarie
Dic=onary,
4th
Edi=on
workplace
safety
• Entering
into
a
major
contract
or
transac=on
without
legal
advice
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

6. A
$10
latch
and
10
minutes
work
would
have
saved
this
boy’s
life
Iman
Akter
Mostafa,
aged
three
(top
led),
died
when
he
fell
from
a
window
of
a
strata
scheme
in
Kogarah
in
2009.
hLp://
www.chw.edu.au/parents/
kidshealth/building_falls/
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

7. A
New
EC
Code
of
Conduct
1. Understanding
of
Act
2. Honesty
and
fairness
3. Care
and
diligence
4. Best
interest
5. Compliance
6. Nuisance
7. Unconscionable
conduct
8. Conflict
of
interest
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

8. What
Is
Reasonable
Care
&
Diligence?
For
example:
diligence
/
noun
constant
and
earnest
effort
to
accomplish
• Checking
references
and
what
is
undertaken;
persistent
insurance
policy
of
a
new
strata
manager
exer=on
of
body
or
mind
• Considering
external
advice
Macquarie
Dic=onary
4th
Edi=on
and
only
ac=ng
otherwise
in
special
circumstances
• Finding
out
about
responsibili=es
and
=me
limita=ons
in
building
defect
maLers
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

9. What
Is
Unconscionable
Conduct?
• Serious
misconduct
or
something
unfair
or
unreasonable
• Conduct
which
shows
no
regard
for
conscience
• Conduct
which
is
irreconcilable
with
what
is
right
or
reasonable
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

10. For
Managers
the
Devil
is
in
the
Detail
• 2
year
max
developer
appointments
• Subsequent
3
year
terms
include
op=ons
• EC
must
disclose
insurance
commission
annually
• Transfers
subject
to
ordinary
resolu=on
approval
not
to
be
unreasonably
withheld
• Dismissal
for
14
consecu=ve
days
absence
• Cer=ficate
and
inspec=on
income
to
be
paid
to
the
OC
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

11. Lower
Bar
for
Budget
Approval
• Ordinary
resolu=on
rather
than
special
for
approving
the
budget
• Prudent
budge=ng
clarified
to
include
maintaining
common
property
in
good
condi=on
on
a
day-­‐to-­‐day
basis
• Clearer
rules
about
what
funds
can
be
used
for
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

12. Sinking
Fund
Plans
Refined
PermiLed
Timing
for
new
Amending
plans
payments
plans
• First
plan
4
year
• New
property,
and
• At
least
12
months
review
• Renew
or
replace
old
before
end
of
10
year
• Other
plans
5
year
property
plan
review
• Enforces
prudent
• Express
power
to
budge=ng
amend
at
any
=me
by
ordinary
resolu=on
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

13. BeLer
Insurance
Regime
Improvements
en=rely
of
common
property
Future
Building
regula=ons
eg
exclusions
excess
defined
Compulsory
Addi=onal
debris
and
fee
risks
by
cover
regula=on
Greatest
prac=cable
extent
cover
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

14. ‘Rules’
Replace
‘Ar=cles’
• Pre
UTA
2001
ar=cles
stand
but
called
rules
• Post
UTA
2001
ar=cles
stand
as
rules
if
not
inconsistent
with
new
Act
or
other
territory
laws
• Rules
prohibi=ng
or
restric=ng
sustainability
are
invalid
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

15. Privacy
Laws
Apply
to
Records
Corporate
register
contains
personal
Limita=ons
on
EC
members
have
informa=on
and
human
rights
to
responsibility
for
must
be
separately
privacy
are
privacy
compliance
displayed,
printed
or
propor=onate
emailed
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

16. Personal
Informa=on
Held
by
OC’s
and
Managers
Owners
credit
Names
Tenancy
details
card
details
Property
Bank
account
Addresses
descrip=ons
and
details
for
valua=ons
suppliers
Some=mes
proof
Telephone
Email
addresses
of
personal
numbers
iden=fica=on
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

17. What
Do
Strata
Managers
Do
With
This
Informa=on?
What?
Allowed
or
not?
Give
it
to
strata
inspectors
Required
by
strata
management
laws
Give
it
to
the
execu=ve
commiLee
Probably
not
allowed
under
Na=onal
Privacy
Principles
Give
it
to
web
hos=ng
companies
Probably
not
allowed
under
Na=onal
Privacy
Principles
Give
it
to
strata
management
sodware
Probably
not
allowed
under
Na=onal
providers
Privacy
Principles
Give
it
to
associated
suppliers
for
cross
Probably
not
allowed
under
Na=onal
marke=ng
(e.g.
banks
)
Privacy
Principles
Throw
it
in
the
rubbish
(paper
and
Not
allowed
under
Na=onal
Privacy
redundant
IT)
Principles
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

18. What
Should
Owners
Do
to
Manage
Privacy?
• Limit
informa=on
Protect
• Audit
privacy
collected
to
that
policies
which
is
absolutely
• Secure
info
electronically
and
• Audit
strata
necessary
managers
document
give
traceable
access
only
security
processes
• Use
privacy
policies
Limit
Check
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

19. Dispute
Resolu=on
Changes
“Only
the
OC
can
apply
to
ACAT
for
an
order
about
animal
disputes
–
it
will
be
for
aggrieved
occupants
to
persuade
the
OC
to
take
ac=on”
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

20. General
Mee=ng
Innova=ons
• 28
days
rather
than
21
for
reduced
quorum
decision
to
take
effect
• Absentee
votes
now
allowed
for
any
mo=on
(previously
only
unopposed
or
unanimous
resolu=ons)
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

21. How
We
Can
Help
Your
Transi=on
Execu=ve
commiLee
Compliance
manuals
and
reviews
training
material
Review
of
rules
Standard
privacy
policies
and
procedures
will
be
available
Updates
and
further
thoughts
will
be
available
weekly
via
StrataSpace
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au

22. About
The
Presenter
Michael
Teys
is
the
Founder
and
Principal
Lawyer
of
TEYS
Lawyers.
He
has
a
Bachelor
of
Laws
and
prac=ces
exclusively
in
the
area
of
strata
=tle
law.
He
is
a
Fellow
of
the
Australian
College
of
Community
Associa=on
Lawyers.
He
was
formerly
an
Adjunct
Lecturer
with
Charles
Sturt
University.
He
appears
weekly
on
SKY
News
Business
Channel's
Property
Success
with
Margaret
Lomas
and
is
a
regular
panellist
for
the
property
edi=on
of
Your
Money,
Your
Call
for
the
same
channel.
You
can
find
out
more
about
Michael
at
www.michaelteys.com
TEYS
Lawyers
prac=ce
na=onally
in
strata
=tle
law
represen=ng
owners
corpora=ons,
bodies
corporate
and
apartment
owners.
The
firm’s
prac=ce
groups
include
building
defects,
management
rights,
strata
community
disputes,
by-­‐laws
and
rules
and
levy
and
fee
collec=on.
Subscribe
for
their
free
e-­‐newsleLer
StrataSpace
and
find
out
more
about
them
at
www.teyslawyers.com.au
©
Copyright
2011
Teys
Lawyers
www.teyslawyers.com.au