Serving as a trustee of a Sectional Title Scheme comes with considerable responsibility. Trustees are entrusted with making decisions that affect the financial wellbeing of the body corporate, the condition of common property and the daily lives of residents. These decisions can involve substantial expenditure, legal obligations and competing priorities, making it understandable that trustees will sometimes have different opinions about the best course of action.
Disagreements can arise over maintenance projects, levy increases, contractor appointments, financial planning and the enforcement of conduct rules. Each trustee may approach these matters with different experiences, concerns and expectations. When these disagreements remain unresolved, important decisions can be delayed, maintenance problems may worsen and owners may begin questioning whether their scheme is being managed responsibly.
At Fitzanne Estates, we understand that trustees often undertake these responsibilities voluntarily while managing their own professional and personal commitments. Having clear decision-making procedures, access to reliable information and a proper understanding of governance responsibilities can help trustees work together more effectively.
Why Do Trustees Disagree About Important Decisions?
One of the most common causes of disagreement is the need to prioritise expenditure when a scheme has limited financial resources. Trustees may agree that several maintenance projects are necessary while holding different views about which should receive immediate attention.
Consider a Sectional Title Scheme where the roof requires repairs, the security system is becoming unreliable and the exterior painting is overdue. One trustee may be concerned about the security risks facing residents, while another believes that delaying roof repairs could result in more extensive water damage. A third may be worried about the scheme’s available funds and the possibility of introducing a special levy.
Each concern deserves consideration because the consequences of these decisions affect the body corporate and its members. Trustees need sufficient information to assess the urgency, financial implications and potential consequences of each proposed project.
Disagreements may also arise when trustees have different interpretations of the scheme’s rules or uncertainty about their legal authority. Personal experiences can influence how individuals approach complaints, maintenance requests and financial decisions, particularly when trustees have previously been affected by similar issues.
Recognising the reasons behind disagreements can help trustees address the underlying concerns and work towards decisions supported by relevant facts.
Understanding the Legal Framework for Trustee Decisions
The Sectional Titles Schemes Management Act and the applicable prescribed management rules establish the framework within which trustees must exercise their powers and responsibilities.
Trustees need to understand the requirements governing meetings, notices, quorum, voting and resolutions. These procedures are important because decisions must be properly authorised before they can be implemented on behalf of the body corporate.
Certain decisions fall within the trustees’ authority, while others require approval from members of the body corporate through an ordinary, special or unanimous resolution, depending on the matter and the applicable legal requirements.
For example, trustees may have authority to approve routine expenditure within the approved budget. However, certain significant changes to common property or other matters specifically regulated by legislation may require additional approval.
Before making a decision, trustees should establish whether they have the necessary authority, whether the expenditure has been appropriately provided for and whether any further approval is required.
Understanding these requirements can help prevent disputes about the validity of decisions and reduce the risk of expenditure being authorised incorrectly.
How Poor Decision-Making Can Affect the Financial Health of a Scheme
When trustees cannot reach decisions about necessary expenditure, the financial consequences may extend well beyond the original issue.
A maintenance project that is postponed for several months may become more expensive as the condition of the affected infrastructure deteriorates. A minor waterproofing problem, for example, could eventually result in damage to ceilings, walls and electrical installations if repairs are repeatedly delayed.
Disagreements about levy increases or reserve fund contributions can also affect the scheme’s ability to plan for future expenses. Trustees are responsible for overseeing the body corporate’s financial affairs and ensuring that appropriate provision is made for maintenance, repairs and replacement of major capital items.
Where financial decisions are delayed, the scheme may struggle to meet its obligations or find itself facing unexpected expenditure that requires additional contributions from owners.
Trustees should therefore consider the long-term financial implications of their decisions and assess whether delaying a particular expense could create greater financial pressure in future.
Preparing for Trustee Meetings That Lead to Informed Decisions
The quality of information available before a meeting can have a significant influence on how effectively trustees make decisions.
Trustees should receive an agenda identifying the matters requiring consideration, together with relevant supporting documentation. Depending on the issue, this may include financial reports, maintenance assessments, quotations, correspondence, photographs or recommendations from qualified professionals.
Where a major repair is being considered, trustees should understand the nature of the problem, the available repair options, the estimated costs and the consequences of postponing the work.
It is also useful to establish which decisions are required at the meeting and whether any information is still outstanding.
Trustees should be given a reasonable opportunity to ask questions and consider the available evidence. Where specialist knowledge is required, obtaining advice from an appropriately qualified professional can assist the committee in evaluating its options.
Meetings should be conducted respectfully, with discussions focused on the responsibilities of the body corporate and the practical implications of each proposed decision.
The Role of Sectional Title Scheme Managing Agents in Supporting Trustees
Professional Sectional Title Scheme Managing Agents can provide valuable administrative and operational support when trustees are considering complex matters.
Depending on the terms of the management agreement, Sectional Title Scheme Managing Agents may assist with preparing meeting agendas, compiling financial information, obtaining maintenance quotations, maintaining records and explaining the procedures required for particular decisions.
For example, where trustees disagree about a proposed maintenance project, the managing agent may assist by gathering quotations, providing information about the approved budget and coordinating the appointment of an independent specialist where authorised.
This information can help trustees understand the available options and the financial implications associated with each proposal.
It is important for trustees to understand that appointing a Sectional Title Scheme Managing Agent does not transfer their governance responsibilities to the agent. Trustees remain responsible for exercising the powers and duties assigned to them under the applicable legislation and rules.
A clear understanding of the management agreement helps establish which matters the managing agent can administer and which decisions require formal trustee or member approval.
When trustees and Sectional Title Scheme Managing Agents understand their respective responsibilities, decisions can be properly documented and implemented through the appropriate procedures.
Why Accurate Minutes and Resolutions Are Essential
Proper meeting records are particularly important when trustees have different opinions about a proposed decision.
Minutes should accurately record the resolutions adopted, relevant voting outcomes and the actions authorised by the trustees. They should also identify responsibilities assigned to particular individuals and any further steps required before implementation.
For example, if trustees approve repairs subject to receiving a revised quotation, the resolution should clearly record that condition. This helps ensure that the managing agent and other parties understand the extent of the authority granted.
Accurate records provide continuity when trustees resign or new committee members are elected. They also assist when owners request information about expenditure or question how a particular decision was reached.
Where a disagreement results in a formal vote, the outcome should be recorded in accordance with the applicable rules.
Maintaining proper documentation helps trustees demonstrate that decisions were considered and authorised through the appropriate governance procedures.
Managing Conflicts of Interest and Personal Relationships
Trustees have fiduciary duties that require them to act honestly, in good faith and in the interests of the body corporate.
A potential conflict of interest may arise when a trustee has a personal or financial connection to a matter being considered by the committee.
For example, a trustee may have a business relationship with a contractor who has submitted a quotation for work at the scheme. In such circumstances, the trustee must comply with the applicable disclosure and conflict-of-interest requirements.
Personal disagreements between trustees can also affect the way meetings are conducted. When discussions become focused on individual relationships or past grievances, the committee may struggle to address the matters requiring attention.
Trustees should ensure that discussions remain relevant to the decision being considered and that everyone has an appropriate opportunity to contribute.
Where relationships have become particularly difficult, independent professional guidance may help trustees understand the relevant procedures and address governance concerns.
What Should Trustees Do When They Cannot Reach a Decision?
When a disagreement remains unresolved, trustees should first establish whether they have all the information necessary to make an informed decision.
If the disagreement concerns technical maintenance requirements, obtaining an independent assessment may help clarify the urgency and scope of the proposed work.
Where financial concerns are involved, trustees may need updated financial reports, information about available reserve funds or advice about the scheme’s budgeting obligations.
If the uncertainty concerns the interpretation of legislation or the scheme’s rules, professional legal or governance advice may be appropriate.
Trustees should also determine whether the matter can be resolved through the voting procedures provided for in the applicable rules or whether approval from the body corporate’s members is required.
When an important decision is delayed, the committee should consider whether any interim action is necessary to protect residents, prevent property damage or meet existing legal obligations.
The reasons for the delay and the steps being taken to resolve the matter should be properly recorded.
Keeping Owners Informed When Decisions Are Delayed
Owners may become concerned when maintenance work remains outstanding, expenses increase or important projects appear to be receiving little attention.
Trustees should ensure that owners receive appropriate information about significant matters affecting the scheme, particularly where delays may have financial or practical consequences.
For example, if a planned maintenance project has been postponed while additional quotations are obtained, owners should understand why further investigation is necessary and when an update can reasonably be expected.
Communication should be accurate and respectful, with appropriate regard for confidential information and the body corporate’s legal obligations.
Clear explanations can help owners understand the challenges trustees are addressing and provide opportunities for constructive participation where member decisions are required.
Strengthening Trustee Knowledge for Better Scheme Governance
Effective trustee decision-making requires an understanding of sectional title legislation, financial responsibilities, meeting procedures and the proper management of common property. Trustees who are familiar with these requirements are better equipped to evaluate information, participate constructively in discussions and make decisions that support the long-term interests of the body corporate.
Fitzanne Estates provides professional sectional title management support and encourages ongoing trustee education to help scheme executives understand their governance responsibilities. If your body corporate is experiencing difficulties with decision-making or would like guidance from experienced Sectional Title Scheme Managing Agents, contact Fitzanne Estates to discuss our management services and trustee training opportunities. With appropriate knowledge and professional support, trustees can make informed decisions that contribute to the responsible management of their scheme and the wellbeing of the community they represent.