VIC: Q&A Can an owners corporation revoke a resolution?

This article is about whether an owners corporation can revoke a resolution in Victoria.

Question: Can an owners corporation revoke a previous resolution? If so, what is the process?

Answer: In Victoria, OCs have clear processes for making and, when necessary, revoking decisions.

Owners corporation (OC) decisions, known as resolutions, aren’t always set in stone. Sometimes, new information or changing circumstances mean a rethink is needed. For example, an OC approves a special resolution to proceed with legal action against a builder for defects. However, after receiving legal advice, the OC learned that the case was unlikely to succeed or would be too costly. It may decide to reverse the resolution and explore alternative dispute resolution options instead.

In Victoria, OCs have clear processes for making and, when necessary, revoking decisions. The Owners Corporations Act 2006 outlines 3 primary types of resolutions:

1. Ordinary Resolutions: These require a simple majority of votes cast. They cover routine matters such as maintenance decisions, budget approvals, and committee elections. To revoke an ordinary resolution, the OC can pass a new ordinary resolution at a general meeting or through a ballot, provided the motion is properly included in the meeting agenda or ballot notice.
2. Special Resolutions: These necessitate at least 75% approval from all OC members. They pertain to significant decisions like imposing special levies exceeding twice the annual budget, major alterations to common property, leasing or licensing common areas, amending or revoking rules, initiating some legal proceedings (excluding debt recovery or rule enforcement), and borrowing amounts exceeding the annual budget. To revoke a special resolution, the OC must pass another special resolution following the same stringent requirements.
3. Unanimous Resolutions: These demand 100% agreement from all OC members. They are reserved for critical decisions, including disposing of common property, altering lot boundaries, or amending lot liability and entitlement. Revoking a unanimous resolution requires achieving unanimous consent again, ensuring all members agree to the change.

It’s essential to recognise that if the OC has entered into contracts or legal obligations based on a resolution, revoking that resolution may not be feasible without potential legal or financial repercussions. Additionally, if a resolution pertains to statutory obligations, such as maintenance duties, revocation may not be lawful.

Fabienne Loncar
Moray & Agnew Lawyers
E: floncar@moray.com.au
P: +61 3 8687 7319

This post appears in the February 2025 edition of The VIC Strata Magazine.

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