Keen to join the strata committee? It's a commendable endeavour, but not one to take lightly. Serving on the committee demands time, and effort. Before you put up your hand, ensure you're familiar with who can and can't join. The Strata Schemes Management Act 2015 outlines the rules, and we're here to break it down for you. Let's dive in:
Strata Committee Eligibility
Eligible Candidates:
Sole lot owners: Individuals owning a lot solo.
Company nominees: If a corporation owns a lot, its nominee can join.
Co-owners' nominees: Co-owners or their corporate nominees, if nominated by a non-co-owner.
External nominations: Non-owners can be nominated by a lot owner not running for the committee.
Ineligible Candidates:
Building managers and agents: They're out, unless they're lot owners.
Agents for leased lots: If they're not lot owners, they're ineligible.
Connections to original owners or building managers: Unless disclosed, they can't join.
Unfinancial owners: Those who haven't settled debts before the election aren't eligible.
Remember, disclosure of pecuniary interests is crucial to maintain transparency and prevent conflicts of interest.
So what is pecuniary interest?
Pecuniary interest, a term often encountered in legal and governance contexts, holds significant weight within strata committees. In essence, a pecuniary interest refers to any direct or indirect financial stake or benefit that an individual or their associated entity may have in a particular matter under consideration.
Within the realm of strata committees, a pecuniary interest can manifest in various forms:
Direct Financial Interest: This involves a clear and tangible financial gain or loss that an individual or their connected entity stands to experience as a result of a decision made by the strata committee. For example, if a committee member owns a construction company and proposes awarding a lucrative contract to their own firm, it constitutes a direct pecuniary interest.
Indirect Financial Interest: Here, the financial connection might be less apparent but still exists. It encompasses scenarios where a decision made by the committee could indirectly impact the individual's financial position or that of their associated entity. For instance, suppose the committee is deliberating on proposals to enhance the area's security or beautification, which could potentially increase foot traffic. The committee member who runs the onsite cafe might have an indirect pecuniary interest in supporting such initiatives, as they stand to benefit from the potential uptick in customers and revenue for their business.
Associative Interest: Sometimes, individuals may not directly benefit financially, but their associated entities, such as family members, close business associates, or companies they have vested interests in, stand to gain or lose. Even though the interest is not personal, it still warrants disclosure to maintain transparency and avoid conflicts of interest.
When in doubt about whether to disclose a potential pecuniary interest, it's always safer to err on the side of transparency and make the disclosure. Failing to disclose could lead to accusations of conflicts of interest or even legal consequences down the line. By openly communicating any potential financial interests, strata committee members uphold the integrity of the decision-making process and foster trust within the community. Remember, transparency is key to maintaining the credibility of the committee and ensuring decisions are made in the best interest of all stakeholders.
At Compass Strata, we prioritise transparency, accountability, and excellence, ensuring your strata community thrives while complying with all necessary guidelines. Partner with us today for unparalleled support in achieving strata success.
For additional information on eligibility and pecuniary interests, refer to:
Section 31 and 32 of the Strata Schemes Management Act 2015; and
Schedule 2, Section 18 of the Strata Schemes Management Act.
