Short answer
Compulsory strata management is where NCAT (the NSW Civil and Administrative Tribunal) appoints a strata managing agent to run a scheme, sometimes with the powers of the owners corporation and its office holders. Under section 237 of the Strata Schemes Management Act 2015, NCAT can do this — on its own motion or on the application of an interested person, such as a lot owner — where a scheme is not functioning, or not functioning satisfactorily. It’s a last-resort remedy for dysfunction, granted cautiously.
Who can ask for it
NCAT may make the order on the application of an interested person (for example, an owner of a lot in the scheme or an officer of the owners corporation), or on its own motion. It takes decision-making out of the owners’ hands, so it isn’t done lightly.
The grounds (s 237)
NCAT can appoint a compulsory managing agent where, broadly, the owners corporation:
- is not functioning or not functioning satisfactorily; or
- has failed to comply with a requirement imposed on it under the Act; or
- has failed to perform one or more of its duties; or
- owes a judgment debt.
In practice this covers schemes that can’t make decisions, are deadlocked, don’t maintain common property, don’t raise adequate levies, or don’t keep proper records.
A high bar — and a last resort
Tribunals treat compulsory appointment as a serious step that removes owner control, so it’s reserved for genuine dysfunction backed by clear evidence — not ordinary disagreements. If your scheme is only struggling with the workload, that’s not dysfunction; it’s a systems problem.
The way to avoid ever needing it
Most schemes that end up here got there through drift — missed meetings, unraised levies, records that fell apart. A well-run self-managed scheme doesn’t have to mean heroic volunteers: you’re a self-managed strata and a system such as Straita does the work — levies, meetings, key dates, records and money — while the committee just approves the decisions. Good systems keep a scheme functioning, which is exactly what keeps it out of NCAT’s hands.
Primary sources
- Strata Schemes Management Act 2015 (NSW) — s 237 — orders by NCAT for the compulsory appointment of a strata managing agent.
- NCAT — NSW Civil and Administrative Tribunal — the tribunal that hears strata scheme applications.