Are the owners corporation managers unlawfully adding on additional fees to levies in arrears? – Brett, VIC
Q: Our levy notices are sent out quarterly. During covid times, I have neglected to pay them by their due date. I have then received a Levy Arrears notice:
That notice includes noting the outstanding fee and noting that the maximum penalty interest has been applied (and I have been instructed that this was approved by the OC).
This is not in dispute. I believe that the 10% penalty interest is allowed by legislation, and is also a fair and reasonable amount.
However, the Owners Corporation Manager (Network Pacific Strata Management) have added on an additional $55 “Final Arrears Notice charge”, twice each for my two body corporates (residential area, and common commercial/residential area), totalling an additional $220 in fees, on top of approximately $50 in penalty interest. If that penalty interest is 10%, then through that additional fee they are charging me a 50% penalty for being in arrears!
When asked about that fee I was told:
“In respect to the charge of $55.00, please note that this is a Final Arrears Notice Charge which is applied to fees that have remained outstanding for seven or more days after the Fees are due and payable. Therefore, the Arrears Notice Fees were automatically sent out due to the fact that your OC Fees due on 01.01.21 have not been paid.”
Note: An owners corporation cannot charge a lot owner any other fees or charges, such as an ‘administration fee’, for overdue owners corporation fees.
Further, an owners corporation manager cannot require a lot owner to pay any fees due to the manager under the contract.
Who is in the right here? Are they unlawfully adding on additional fees?
A: As different management companies will have varying methods and fees involved with levies in arrears, it may be best to contact the strata management company for further clarification while also raising your concerns.