Resources for strata companies

A strata company has the following general duties:

• Control and manage the common property for the benefit of all the owners of lots.
• Properly maintain the common property and keep it in good and serviceable repair.
• If necessary, renew and replace the common property (regardless of whether the damage or deterioration arises from wear and tear, inherent defect, or some other cause).

Most strata companies must maintain an administrative fund for administrative expenses including those related to the control and management of the common property.

In addition, all strata companies with 10 lots or more, or which have a replacement value of $5 million or greater, are required to have a 10 year maintenance plan and reserve fund to support the long-term planning and upkeep of common property.

A strata company must prepare, and submit for approval at their annual general meeting each year, a budget that takes into account the 10 year plan for the scheme.

A strata company can incur expenditure beyond the approved budget including on managing and maintaining common property. Section 102(6) of the Strata Titles Act 1985 sets out the circumstances where a strata company can incur this expenditure and limits the amount to $500 for each lot in the strata titles scheme (or another amount approved by the strata company) for each financial year.

For more information:

• How a strata scheme operates: fact sheet.
• Managing finances and insurance: fact sheet.
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

All strata companies with 10 lots or more, or which have a replacement value of $5 million or greater, are required to have a 10 year maintenance plan and reserve fund to support the long-term planning and upkeep of common property.

The 10-year plan will help strata companies and strata councils plan for the future of their scheme, stay on top of maintenance and repairs, and help ensure the funds are available when they are required.

The reserve fund is money (in most cases raised by levies) that has been put aside to fund the maintenance, repair, renewal or replacement of common property or personal property of the strata company – and is outlined in the 10-year plan. 

The 10-year plan needs to include:

• A list of all items of common property and personal property of the strata company, which the strata company anticipates will require maintenance, repair, renewal or replacement over the next 10 years, and include the estimated costs of the covered items.
• Other information set out in regulation 77 of the Strata Titles (General) Regulations 2019. An example of other information includes the name of the person or persons who created the plan.

Every strata property is different. That’s why it’s up to each strata company to identify which items they wish to cover in their 10-year plan.

When the strata company is preparing its budget for each financial year it must take into account the 10-year plan for the reserve fund, if the 10-year plan is a requirement of the strata company.

The 10 year plan must be approved by owners at an annual general meeting by ordinary resolution. The 10-year plan also needs to be revised at least every five years and extended to cover the next 10 years. 

For more information:

• Managing finances and insurance: fact sheet.
• Strata Titles (General) Regulations 2019 (refer to Regulation 77).
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

If you’re not sure what the by-laws are for your strata titles scheme, the best place to start is by asking your strata company or strata manager.

They should be able to resolve your enquiry without you having to look any further.

One of the three scenarios described below will apply to your strata titles scheme and its by-laws.

What you'll see through these scenarios is that some schemes follow the by-laws set out in the Strata Titles Act 1985 (STA), with a variation depending on when your scheme was registered, and others register their own by-laws with Landgate. Each is legally valid.

It’s important to note that:

1. The STA was amended on 1 May 2020. These amendments included changes to the ‘default by-laws' that were in Schedule 1 and 2 of the STA immediately before it was amended on 1 May 2020. (These changes clarified the language used, classified by-laws as governance or conduct, and deleted by-laws that were no longer required).
2. If a scheme was registered before 1 May 2020, the scheme can continue to use the default by-laws as amended by the changes that were made to the STA on 1 May 2020.

Scenario one

Applies to:

• Schemes registered on or after 1 May 2020 for which no by-laws were lodged for registration as a scheme document.

Your scheme’s by-laws are:

• The governance by-laws in Schedule 1 and conduct by-laws in Schedule 2 of the STA that have been in effect since 1 May 2020. A copy of these by-laws can also be found in the WA Strata Living Guide for ease-of-reference.

Scenario two

Applies to:

• Schemes registered before 1 May 2020 that use the by-laws in the STA and whose strata company has not registered its own by-laws with Landgate.

Your scheme’s by-laws are:

• The by-laws as amended by Schedule 5 clause 4 of the STA. A copy of these by-laws can be requested from your strata company or by sourcing a historical version of the STA via the Western Australian Legislation website and consolidating them with Schedule 5 clause 4 of the STA.

Scenario three

Applies to:

• Schemes who have registered their own by-laws with Landgate. A strata company has broad powers to make, amend and repeal by-laws and may create and register their own by-laws that are different to the by-laws in Schedule 1 and 2 of the STA. These by-laws cannot be inconsistent with the STA, the Strata Titles (General) Regulations 2019, or any other written law.

Your scheme’s by-laws are:

• Available through your strata company or strata manager (on behalf of the strata company) or you can order a copy online via Landgate’s website at the Certificate of Title/associated title documents page. To order, you will need the scheme by-law document number that is endorsed on the last page of your strata/survey-strata plan.

For more information:

• Living in a scheme: fact sheet.
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

If someone in the strata titles scheme has breached a by-law the issue can be reported to the strata council or strata manager of the scheme. If the strata company wishes to take enforcement action, it must first provide a written notice to the person who is alleged to be acting in breach of the by-law.

This notice provides fairness and must set out the:

• by-law that it is claimed that the person has breached
• facts relied on as evidence of the breach
• action that the person must take to avoid breaching the by-law
• an explanation of the powers of the State Administrative Tribunal (SAT) if an application is made to SAT to enforce a by-law.

The strata company can also apply to SAT to enforce a by-law.

A strata company can make an application to SAT if the:

• person breaching the by-law has been given the written notice referred to above and has contravened the notice or
• contravention has had serious adverse consequences for another person or the
• person has contravened the by-law on at least three separate occasions.

SAT has power to make any order it considers appropriate to resolve the by-law enforcement proceeding.

If SAT is satisfied the by-laws have been contravened, SAT can make an order that requires one or more of the following:

• pay a specified amount to the strata company by way of penalty
• take specified action within a period stated in the order to remedy the contravention or prevent further contraventions
• refrain from taking specified action to prevent further contraventions.

A penalty for the breach of a by-law of up to $2000 can also be imposed by SAT. This money is payable to the strata company.

For more information:

• Resolving disputes: fact sheet.
• Visit SAT’s website and select Applying to SAT.
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

Strata insurance is complex, so it’s important that you speak to your strata council members and/or strata manager to understand the arrangements in your scheme.

Here are some considerations to help you get started:

• All strata companies for schemes must hold insurance that covers the common property in the scheme (including fixtures and building improvements on the common property) to replacement value against risks of fire, storm and tempest (excluding damage by sea, flood or erosion), lightning, explosion and earthquake. The strata company for a single tier strata scheme does not have this obligation in certain specified circumstances, including if the strata company passes a resolution without dissent that the obligation does not apply.
• If you are in a strata scheme, the strata company must also hold insurance in respect of the parts of the scheme buildings that comprise the lots in the scheme to replacement value against risks of fire, storm and tempest (excluding damage by sea, flood or erosion), lightning, explosion and earthquake. An exception to this is for single tier strata schemes, for which different rules apply. If you are in a survey-strata scheme, you are responsible for insuring your lot against those risks.
• Strata companies must also hold a minimum of $10 million public liability insurance, although again special rules may apply in single tier strata schemes.
• Workers Compensation Insurance may also be required. Strata companies may choose to insure for other risks such as office bearers’ liability.
• A number of insurance companies offer insurance policies tailored to the unique needs of strata companies. Type ‘strata insurance WA’ into your search engine to find some options.
• Sections 97 to 99 of the Strata Titles Act 1985 cover insurance matters. Schedule 2 Part 5 of the Strata Titles Act 1985 covers insurance for single tier strata schemes.

For more information:

• Managing finances and insurance: fact sheet.
• Speak to your strata council members and/or strata manager.
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

WA strata law defines a strata manager as a person who is authorised by a strata company to perform a specified scheme function. A scheme function means a function of the strata company, or an officer of the strata company.

The strata company decides whether to engage a strata manager. There is no legal requirement for a strata company to engage a strata manager.

A strata company can function with a council and strata company council members are protected from civil liability provided they act in good faith.

However, strata managers are typically appointed to help keep everything in your strata running smoothly. They help the strata company to fulfill all their legal obligations, such as: co-ordinating annual general meetings and council meetings, preparing budgets, issuing levies to owners and paying invoices, and arranging insurance.

While the strata manager is employed by the strata company, the quality and level of service the strata company receives from their strata manager often depends on effective instruction and control of the strata manager by the strata company’s council.

The only powers strata managers have are those given to them by the strata company. There must be a written contract between the strata company and strata manager. Generally, the strata manager cannot make decisions on behalf of the strata company and cannot do anything that requires a resolution of the strata company. A person who supplies services to the strata company, such as gardening or maintenance, will not be considered a strata manager because they are not authorised to perform the functions of the strata company.

For smaller schemes, it may be preferable for one of the lot owners to serve as a volunteer strata manager. These managers are not required to take out professional indemnity insurance or obtain the required educational qualifications.

For more information:

• The role of strata managers: fact sheet.
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

Strata managers can be paid (a professional) or can volunteer. Either way, strata managers must act in the best interests of the strata titles scheme and operate within a legislated framework of responsibilities.

Strata managers

A strata manager is engaged by the strata company under a strata management contract to take on specified duties and powers of the strata company for a fee.

There are legal requirements to be met by professional strata managers, such as holding the relevant educational qualifications and criminal record checks. They must also provide a periodic return to Landgate with general information about the schemes they manage.

Refer to Section 143 of the Strata Titles Act 1985 to review the authorised functions of a strata manager.

Volunteer strata managers

To be a volunteer strata manager, the person must be an owner of a lot in the scheme and personally perform the strata manager functions at either no charge or for a small honorary fee. If they do charge, the honorary fee for their duties must not exceed $250 per calendar year for each lot in the scheme.

Volunteer strata managers must have a volunteer agreement (the volunteer equivalent of a strata management contract) with the strata company to take on specified duties and powers of the strata company. However, they are exempt from many of the statutory requirements of strata managers such as the educational qualifications, criminal record checks and periodic returns.

For more information:

• The role of strata managers: fact sheet.
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

When employing strata managers, strata companies should make sure they have a written contract with the strata manager.

This contract should contain details including:

• The strata manager’s and strata company’s name and address for service.
• The Australian Company Number or Australian Business Number of each party with such a number.
• The start and end date of the strata manager’s contract.
• Duties and tasks (scheme functions) the strata manager is to perform and any conditions that are to apply to the performance of those functions.
• Basis of payment of the strata manager.
• Details of which account the strata manager will operate for the money received on behalf of the strata company.
• Requirements for a strata manager to give written reports to the strata company about the functions performed.
• Grounds for which the contract may be terminated and processes to be followed under section 151 of the STA.
• Warranties that:
  • The strata manager will obtain national criminal record checks when required and notify the strata company in writing as soon as practicable if the strata manager becomes aware of convictions for property and dishonesty offences.
  • Relevant persons hold the prescribed education requirements.
  • The strata manager holds and will hold for the duration of the strata management contract professional indemnity insurance at the prescribed level.

For more information:

• The role of strata managers: fact sheet.
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

When a strata management contract is due to end, the strata company may resolve not to extend the agreement. Strata companies need to be aware of any automatic rollover provisions and give appropriate notice to terminate if they do not wish the contract to be renewed.

The strata company may also choose to terminate the strata management contract while it is still in effect if there are proper grounds for termination by the strata company (section 151 of the Strata Titles Act 1983 (STA)).

Proper grounds include situations where the strata manager has breached the contract or one of their statutory duties imposed by the STA.

The STA outlines the steps the strata company is required to take to terminate the strata management contract. Refer to the fact sheet below for a summary of those steps.

For more information:

• The role of strata managers: fact sheet.
• Strata Titles Act 1985 (refer to section 151).
• Contact our Strata Enquiry Line by calling (08) 9273 7047.

Landgate has produced a resolving disputes fact sheet to help lot owners, lot occupiers, and strata companies navigate strata disputes. If you have an issue with the way your strata company is functioning, this fact sheet will guide you through five practical steps to help resolve the issue.

An example of a strata company not functioning properly might be that it is not holding annual general meetings.

Typically, whatever your dispute is, if it cannot be resolved with the strata company, the State Administrative Tribunal (SAT) is the one-stop-shop for strata disputes in Western Australia. The exception to this is debt recovery which is still handled through a relevant court.

You will need to visit SAT’s website to initiate a formal dispute resolution process.

For more information:

• Resolving disputes: fact sheet.
• How a strata scheme operates: fact sheet.
• Visit SAT’s website.
• Contact our Strata Enquiry Line by calling (08) 9273 7047.