Law reformers seek input for new strata rules

| 06/04/2011

(CNS): The Law Reform Commission is seeking public comment on a discussion paper aimed at modernising the rules that govern local strata schemes. The paper is based on comments submitted in a consultation exercise conducted over two years ago about the existing legislation, which had been called into question. The commission found problems in the management of strata schemes and a lack of regulation over their termination. Deficiencies in the law were first highlighted in the wake of Hurricane Ivan by the then president of the law society Charles Quin before he was appointed to the local judiciary.

Quin had pointed to a need to reform the existing laws and regulations dealing with strata following the problems local lawyers encountered when trying to deal with the destruction of properties in the aftermath of the September 2004 hurricane.

The commission said that during the public consultation exercise a wide variety of issues were raised but the most common was the ineffective management of strata schemes and insurance matters. There was wide support, the commission said, for a comprehensive overhaul of the laws and regulations relating to strata schemes. Since then, a number of amendments to the law have taken place but there are still several issues outstanding.

Given the complexities regarding various problems, from management to insufficient regulation governing the termination of strata schemes, the commission said it had decided to deal with these matters first while it continues consultation on the reform of the creation of strata schemes and regulation of the staged development of schemes.

Matters discussed in the paper and provided for in the bill include duties of corporations; preparation and auditing of financial statements; levy of contributions on proprietors; bye-laws including bye-laws granting exclusive use of common property; regulation of executive committees; regulation of meetings; and insurance, including insurance deductibles.

The commission is now inviting comments and suggestions on those to be submitted in writing by 17 May 2011 to the Director of the Law Reform Commission, 3rd Floor Anderson Square c/o Government Administration Building or sent by e-mail to Cheryl.Neblett@gov.ky.

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Comments (7)

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  1. Hope this is sent to Cheryl says:

    Here are my recommendations:

    1) The Strata money should NEVER at any time be under the control of the developer. On many occasions, the developer has used the Strata money for expenses that should be Developer costs.
    2) Before the strata is handed over to the real owners, they should be a government agency that ensures that the developer has completed his job to the real owners’ satisfaction. And please do not say Planning does this before they issue a CO. I personally know of a strata where almost all the units have faults with all the major items such as leaky roof, leaky walls, malfunctioning sewer, no landscaping, electrical not working, plumbing issues. The owners did try to get Planning involved and Planning indicated there is nothing they can do. Instead Planning continued to issue CO to the developer for more units in the same development.
    3) The Developer should be responsible for all costs until the strata is handed over to the real owners to encourage them to complete projects on time. (see #1)
    4) The Developer should be responsible for all costs on some items for a period of time after handover to the owners (usually normal expected life) of some items especially the sewer system. Almost ALL the stratas on this island have been plagued with faulty sewer systems installed by the developer that is transferred to the strata adding high costs to the homeowners to have the issues fixed at their expense.
    5) There must be some government agency to report bad developers to ensure they do not continue to profit from sub-standard work. Planning does not in any way assist (see #2).

  2. Lazarus says:

    Having been involved with a number of strata committees in my lifetime, I see that problems usually arise through a lack of oversight by the owners & tenants.  I find that few strata residents are interested, able and qualified to do the various roles a strata needs, and therefore the odd few that do volunteer usually do something wrong, either because they are not equipped for the job, or they are milking it for their own benefit.

     

    As a result, I doubt that many real changes to performance will occur, no matter how the law is amended.  While volunteers are in short supply, crookedness will prevail.

  3. Suspicious says:

     I am suspicious of the new outcropping of property management agencies that are profiting from the strata fees.

    Let’s take a very close look at this.  

    1.)  Can stratas look into the re-insurance,self insurance route???

    2.) Can gardening fees get realistic?

    The COST of strata keeps a lot of people from buying property here and I think it is becoming a profit center….just LOOK at the big boys developers who are now also "property managers"…they are NOT doing it for free folks.

    Fix the strata costs at Britannia and you will have the solution.  Excellent case study for these lawmakers!!!

    • Door Not Hitting Me in the Behind says:

      Suspicious- Let me tell you how it is. Look at the financials presented to you. Call around and find out what is reasonable for landscaping and other expenses. Get an agreed price for your strata- they can’t keep you from doing this. Demand to see contracts and payouts on behalf of the strata- this should be in your by-laws somewhere. An audit will reveal nothing- quite likely you’re dealing with a “ghost company.” You can figure out an entire budget by yourself if you just get off of your ass! When you’ve accomplished this then you have the problem of what to do with the information. I did it- this island was way too “charming” for me; I had to leave.

  4. Sheena Conolly says:

    Strata ByLaws

  5. Door Not Hitting Me in the Behind says:

    A couple of comments, here- you don’t want to keep the developer on board any longer than necessary and you sure as hell don’t want the chairman to cast a tie-breaking vote.

  6. Anonymous says:

    How ya goin’ to do an audit when records are kept in a looseleaf binder (See Strata (A) Bill? Seems like a lotta stuff gets lost in loose leaf binders, eh, McCarron?