SOMETIMES IT TAKES LEAPS AND BOUNDS: GETTING MAJOR SPENDING APPROVED

Proper and timely maintenance is one of the most important parts of administering a community titles scheme. A body corporate has a strict statutory duty to maintain its common property (including utility infrastructure) and assets in a good and structurally sound condition.

It is not enough to merely take ‘reasonable steps’ or ‘attempt’ to keep the common property in good repair. It is a positive obligation to ensure the requisite steps are taken. It has been held that:

“… the statutory duty to maintain is breached “as soon something in the common property is no longer operating effectively or at all, or has fallen into disrepair” …”[1]

In many instances, compliance with the strict maintenance duty can be costly and time consuming. However, such considerations are ultimately irrelevant and must not be used as an excuse for not undertaking maintenance[2].

Sometimes however it can be a real battle to get the maintenance works approved. Here are some considerations which may assist a committee getting major expenditure works across the line.

What Is the Relevant Limit for Major Expenditure?

The relevant limit for major spending is important as the legislation imposes additional requirements where spending exceeds the amount. The amount will differ between schemes.

As an example, if your scheme is regulated by either the standard or accommodation module, the limit will be either:

1. an amount set by ordinary resolution at a general meeting; or
2. where an amount has not been set, the lesser of:

• • an amount calculated by multiplying the number of lots by $1,100; or
  • $10,000.

Setting a realistic major spending limit helps to strike a balance between enabling the committee to efficiently discharge the body corporate’s maintenance obligations and ensuring that substantial expenditure is subject to appropriate approval and oversight.

The Need for At Least Two Quotations

If a motion is put forward to approve maintenance works above the relevant limit for major spending, at least two quotations will need to be obtained and considered. This requirement applies irrespective of whether the motion is to be considered by the Committee or at a general meeting. 

However, if for exceptional reasons it is not practicable for two quotations to be obtained and considered, a single quotation can be considered. The legislation provides the following example for an exceptional reason:

“…The fact that goods with the necessary characteristics are only obtainable from a single source would be an exceptional reason for not obtaining 2 quotations for the supply of the goods.”[3]

What Should the Committee Consider When Obtaining Quotations?

Obtaining quotations for maintenance works is a time-consuming, and in many cases stressful, task. Some key factors to be considered include the following:

1. that the quotations provided are for the same maintenance works. While the quotations do not need to propose the exact same method for undertaking the works, it is crucial that the issue requiring maintenance will be rectified by the proposed method;
2. whether a project manager is required for the maintenance works. A project manager can be of great benefit to take away some of the burden and responsibility from the committee members who are unpaid volunteers and generally not experts in maintenance works;
3. what the timing requirements are and the estimated timeframes provided. It is not uncommon for two different contractors to provide vastly different timing estimates for completion of the works. The timeframes provided should be considered in light of objectives and the anticipated impact on occupiers;
4. whether the contractors have the expertise and licenses required to undertake the works. Engaging a contractor that does not have the required expertise and/or license could have dire consequences (i.e. the maintenance works failing and extra costs being incurred to remedy the issue/s);
5. that the quotations are capable of being accepted following any approval. It is relatively common for quotations received to expire within a stipulated timeframe (i.e. 30 days or 3 months); and
6. that the contractors hold sufficient indemnity and public liability insurance. This will become relevant in the unfortunate event that damage or loss results from the actions of the contractor. Any contractor should be asked to provide a certificate of currency for insurance held.

What Steps Can the Committee Take to Get Owners Onboard?

Getting owners to approve maintenance works can be difficult. This is because owners may not always appreciate the importance of the body corporate’s maintenance obligations and may be struggling financially and do not want to pay additional levies to fund the works.

Some of the following steps can be useful:

1. an expert being engaged to provide a report on the maintenance works required;
2. informal ‘town hall’ style meetings with owners. Depending on the complexity of the matter, it can be useful for an expert and/or the project manager to attend these meetings to help explain what works are required and why;
3. circulars to be issued providing regular updates as to the steps taken to date and the next steps required; and
4. comprehensive explanatory notes to be provided for any motions.

Ensuring that there are enough funds (and owner support) to meet maintenance obligations is a crucial responsibility for committees, because, as we see so often, ignoring a maintenance issue does not make it go away.

Article Contributed by Peter Hunt, Director and Founder at Mathews Hunt Legal.

Peter Hunt will be guest speaking at our Gold Coast Strata Finance Seminars on the 07/10/2026 Register now and meet Peter in person!

[1] Enderley Gardens [2024] QBCCMCmr 60 (14 February 2024)

[2] See for instance Lorella Court [2023] QBCCMCmr 477 (6 December 2023)

[3] See s.163(6) of the Body Corporate and Community Management (Accommodation Module) Regulation 2020 or s.173(6) of the Body Corporate and Community Management (Standard Module) Regulation 2020.