We are a small Body Corporate and need to increase our levies by 16% from the beginning of our financial year in order to ensure that we have enough income to meet our expenses. Someone told our Chairperson that the Trustees are only allowed to increase the levies by a maximum of 10% without owners’ permission, but we are all Trustees – how can we get around that?
We are a small Body Corporate and need to increase our levies by 16% from the beginning of our financial year in order to ensure that we have enough income to meet our expenses. Someone told our Chairperson that the Trustees are only allowed to increase the levies by a maximum of 10% without owners’ permission, but we are all Trustees – how can we get around that?
PMR 21
(3) The body corporate may, on the authority of a written trustee resolution—
- increase the contributions due by the members by a maximum of 10 per cent at the end of a financial year to take account of the anticipated increased liabilities of the body corporate, which increase will remain effective until members receive notice of the contributions due by them for the next financial year; provided that the trustees must give members notice of such increased contributions by notice in terms of rule 25, with such changes as are required by the context;
But in this example, all the owners are Trustees so don’t make it a Trustee resolution – make it a Body Corporate resolution. Get all the owners to agree to it. Technically you need an ordinary resolution to approve a budget but an ordinary resolution can only be done at a meeting and arranging a meeting takes time. So rather do it on a Round Robin basis. For the example above there were only 4 sections so I suggested doing a Round Robin Unanimous resolution to avoid any problems, but technically if there are more owners you can also do a special resolution – as long as it carries a higher voting percentage than an ordinary resolution (majority vote) does.