This article discusses what VIC can owners do when the committee refuses to follow the model rules process for dispute resolution.
Question: How can we make the committee follow the model rules for dispute resolution when they refuse to meet with us about a breach notice?
Our strata manager issued us with a breach notice at the committee’s request. We asked how to respond if we disagreed with the notice and were told to provide a formal written reply, which we did. The strata manager confirmed they had forwarded our response to the committee.
We then heard nothing for four weeks, until a final breach notice arrived. When we asked about this, the strata manager said the committee does not have to meet with us because our complaint would be against them, and told us to contact VCAT. They also said a grievance meeting only occurs if a formal complaint is submitted.
We pointed out that the dispute resolution process in our model rules has not been followed and asked again to meet with the committee, but they continue to refuse. Without having to engage a lawyer, how can we require the committee to follow the model rules and meet with us to discuss the matter?
Answer: It may pay to wave the big stick (VCAT), to bring everyone back to the table to speak softly (compromise solution).
The powers given to owners corporations (OC) in respect to alleged breaches and ‘Dispute Resolution’ more broadly are often misunderstood, as are the practical applications of a Breach Notices/Notice of Breach/Notice to Rectify Breach.
Without knowing the alleged breach or the accuracy of the allegation, there are a few key points here.
Firstly, a notice to rectify an alleged breach only has lawful effect under section 155 of the Owners Corporations Act 2006 (the Act), following the receipt of a formal complaint under section 152. Namely that this;
155 Notice to rectify breach
- If the owners corporation decides to take action under this Part in respect of an alleged breach, it must give notice of the allegation to the person alleged to have committed the breach.
Cannot occur unless/until this taken place;
152 Complaints
- A lot owner or an occupier of a lot or a manager may make a complaint to the owners corporation about an alleged breach by a lot owner or an occupier of a lot or a manager of an obligation imposed on that person by this Act, the regulations or the rules of the owners corporation.
And following that, the provisions outline that a Grievance Meeting must occur, whereby the Grievance Committee (usually the ‘regular’ committee wearing a different hat, unless members have been specifically delegated to comprise the Grievance Committee) should hear both sides of the dispute, and decide whether to do nothing and explain why, OR escalate the matter to VCAT on behalf of the OC, OR issue a notice for an alleged breach (following which a Final Notice of Breach may be issued).
Further, a recent VCAT hearing (Owners Corporation 1 PS723350Q v Owners Corporation 2 PS723350Q (Owners Corporations) [2025] VCAT 592) received media attention due to the tribunal member’s finding that an owners corporation requires a Special Resolution to initiate a proceeding for anything other debt recovery, or seeking damages up to $100,000. Or put another way, a Special Resolution of all owners is required to escalate a breach situation to VCAT.
There is, however, no such restriction or limit upon individuals from lodging matters individually against an owners corporation and/or their manager.
So, practically speaking, what does this all add up to insofar as the circumstances have been described?
- The Notice of Breach was not properly issued and therefore would not have any lawful effect. This is true of the Final notice that followed.
- Whether or not it is addressed further is a matter for you to consider – sometimes a conversation can prevent a taxing legal process and bring everybody back into a working-relationship or compromise. Though this does seem to have been attempted and unsuccessful.
- While the committee cannot lodge a complaint, one of their members or the manager could, to which the grievance meeting would follow and then the committee would have to make a decision if it wanted to seek to enforce a notice of breach.
- In terms of having the manager and committee follow the Act and Model Rules, coming back to a conversation may help. Outlining what the process is, your view on the matter at hand, and seeking a confirmation that either there will be a discussion with a view and intent towards a mutually agreed outcome, OR the proper, lawful dispute resolution process will be followed, is not unreasonable.
- If you find that the committee and/or manager decline to do so, you may need to consider lodging a VCAT application regarding the matter. Without knowing the particulars of the alleged breach and dispute, it’s difficult to comment on the value of doing so or on alternative pathways to a better situation. However, advising that this is being considered is often enough to bring greater compliance and a higher standard of acting. It’s an unfortunate step to have to take, but at the risk of butchering Theodore Roosevelt, it may pay to wave the big stick (VCAT), to bring everyone back to the table to speak softly (compromise solution).
- Of course, if the behaviour in question is indeed a breach, the committee cannot take any effective action other than the lawful pathway laid out.
Alex McCormick
SOCM
alex@socm.com.au
P: 03 9495 0005
This post appears in Strata News #770.
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Read next:
- VIC: Q&A Section 155 – Notice to Rectify Breach
- VIC: Q&A Can an owners corporation revoke a resolution?
- VIC: Building Better Strata Committees
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