Case Studies
Tackling Arrears Head On

One of the biggest problems Owners Corporations can face is members who do not pay their levies or fees on time. Maybe they do not understand what their fees pay for. Maybe they think they can hold off on paying. Maybe their Owners Corporation just is not a priority. It is an issue most Owners Corporation managers face and one that most leave in the hands of VCAT. Not Strata Plan. We look beyond individuals and focus on the whole. That means, our debt recovery policies are most stringently applied where they are needed most.

CASE STUDY: 15 Moore Street, Moonee Ponds

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  • A mid-sized, 17-lot building with a long history of slow/late payment
  • Individually, owners only owe small amounts
  • None of the arrears are overdue enough to pursue legal action
  • Regardless, the Owners Corporation has insurance and utility bills to pay for, and not enough time to chase people through VCAT

Most active committee members or chairpeople are familiar with the feeling.

The bills are piling up, there is not enough money to pay them, outstanding debts from other members would cover them and you have paid all your fees.

Trust us when we say, this is every bit as frustrating for Strata Plan as Owners Corporation managers as it is for you.

Unfortunately, managers are often hamstrung by legislative requirements that mean the fastest road to legal action and VCAT is some 60 days after fees are overdue. Even then, an order from VCAT is no silver bullet and when it does work, it can take another month for the money to show up.

This was the case at 15 Moore Street in Moonee Ponds. With a high level of arrears, increasing amount of overdue bills, just over $700 in the bank but low amount of individual debt, Strata Plan recognised that the conventional methods of debt recovery just would not cut it.

Strata Plan got on the front foot to alert the committee and chairperson to the worsening financial situation and presented a targeted communication campaign to be sent to all owners.

In less than three weeks, over 50% of overdue fees were collected and the Owners Corporation’s bank account rose rapidly to over $17,000.

While most Owners Corporation managers focus their efforts on individual lot owners with high amounts of overdue fees, Strata Plan also tracks the financial performance of its Owners Corporations on an overall level, to ensure our debt recovery efforts go where they are needed the most.

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