When a strata scheme goes wrong, it rarely happens overnight. It builds. A meeting where nobody wrote down what was decided. A fund left a little too lean. A by-law breach left to slide. Each one is small. Together they turn a calm scheme into a stressed one with surprise bills and angry owners.
The good news is that almost all of it is avoidable. Good governance is mostly a handful of sensible habits, applied consistently. Here are the common mistakes New South Wales committees make, and how to steer clear of each one.
If you want the broader context of the role first, start with our pillar guide to strata committee members in NSW.
Mistake 1: poor record-keeping
The single most common failing is not writing things down properly. Decisions made in conversation, votes not recorded, correspondence lost, financial records patchy. It feels harmless at the time. It is not.
Records protect the committee. If an owner challenges a decision or a matter reaches the NSW Civil and Administrative Tribunal (NCAT), the committee that can show clear minutes, recorded votes and proper accounts is in a strong position. The one that cannot is exposed. Keep minutes for every meeting, record who voted how on contested matters, and keep the books current. If you use a strata managing agent, they will usually maintain much of this, but the committee should still check it is happening.
Mistake 2: unclear decisions
Closely related is the vague decision. The committee "agrees to look into" something, or "approves the repairs" without saying which repairs, at what budget, or who is authorised to act. Months later, nobody is sure what was decided, and the work either stalls or runs over.
Good decisions are specific. What is being approved, how much it can cost, who carries it out, and by when. Write the decision in the minutes the way you would want to read it back in a year. It removes ambiguity and it removes argument.
Mistake 3: neglecting the capital works fund
This one costs owners the most money. The capital works fund (once called the sinking fund) saves for major and long-term works: repainting, roof replacement, lift upgrades, waterproofing. When a committee keeps levies artificially low to keep owners happy, the fund runs short. Then a big job falls due, the money is not there, and every owner is hit with a large special levy at once.
Funding maintenance properly is a kindness to owners, even when it raises levies a little now. A scheme that plans its major works and saves steadily avoids the nasty surprises. Our guide to the administrative fund and capital works fund explains how the two funds work and why the planning matters.
Mistake 4: ignoring by-law breaches
By-laws are the scheme rules, covering things like pets, parking, noise and renovations. A committee that lets breaches slide, or that enforces a rule against one owner but quietly tolerates it from another, undermines the whole system. Inconsistent enforcement is one of the fastest routes to a dispute, and it is hard to defend.
Apply by-laws consistently and follow the proper process when a breach continues. By-laws must also be lawful in the first place. Our guide to how NSW strata by-laws work covers making, changing and applying them. Where a breach cannot be resolved, the matter may go to NCAT, so check the current process with NSW Fair Trading or your strata managing agent.
Mistake 5: unmanaged conflicts of interest
Conflicts of interest are normal. The problem is hiding them. A member who has a personal interest in a decision, say a contract that would go to a relative or their own business, should declare it and step back from that decision rather than push it through.
The Strata Schemes Management Act 2015 sets expectations around acting in the scheme interest. The honest move is simple: declare it, record it, and let the rest of the committee decide without you. Confirm the current rules with NSW Fair Trading if you are unsure how a particular situation should be handled.
Mistake 6: treating disputes as personal
Strata brings neighbours into shared decisions about money and property, so friction is inevitable. The committees that handle it well keep it process-driven and unemotional. Follow the rules, keep the records, communicate clearly, and use the proper channels. NSW Fair Trading offers guidance and mediation, and NCAT decides certain matters. A committee that stays calm and procedural almost always comes out better than one that lets a disagreement turn personal.
The habits of a well-run scheme
- Minute every meeting and record contested votes.
- Make decisions specific: what, how much, who, by when.
- Fund the capital works fund for the long term, not just this year.
- Apply by-laws consistently and follow the proper process.
- Declare conflicts of interest and step back from those decisions.
- Keep disputes procedural and use the right channels.
Build the habits with training
Most governance mistakes come from not knowing the rules, not from bad intent. A short course fixes that. Archer Institute offers Strata Members CPD for committee members and lot owners in New South Wales. It is online and self-paced, and it covers the duties, the funds, the by-laws and the meeting process so your committee runs cleanly and avoids the traps above.
Browse the Strata Members CPD course or call our Australian-based team on 1800 069 273 and we will tell you what it covers and how it fits your scheme.
