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How to eSign a document: electronic signature legality for Management in Australia

welcome to your strata property the podcast for property owners looking for Reliable accurate and bite-sized information from an experienced and authoritative source [Music] hello and welcome I'm Amanda farmer and I have with me today Rina van oust from Stratus Central hey there Arena hi Amanda how are you I'm doing great we are recording this just ahead of the Easter long weekend so it's crazy as it always is before a few days off no doubt the same for you yeah actually I've been away up the coast at a meeting that I had for an AGM that sorry I manage a resort so the actual AGM was in the resort which is always nice to have a different type of meeting where you're not in your normal familiar surroundings nice A little bit of work a little bit of holiday maybe exactly good job well ready to dive into our wins and our challenges for this week hit me with your challenge Rena home an owner that's been emailing me constantly because this particular owners Corporation want to minimize you know their costs in terms of photocopying and Postage and they had a motion pass on their agenda quite a number of years ago before we took over and they also have a Bible to the same effect where anyone that's given their email address is deemed to have given consent to receive all their agenda's meds electronically now I said to them I don't believe that's actually binding my understanding from the strata role is that the Nona can give an address that they want their Communications to be sent to agendas and minutes and levies Etc even if an email address is the only thing that's been given then that can be deemed to be an address for service however I don't believe that a bylaw or a resolution at a general meeting can override that interesting Rena I believe I'm with you there is a regime in our legislation where a new owner is to notify their owners Corporation of their address for service that regime is set out in section 22 of our strata schemes management act in New South Wales a new owner needs to provide what's called a strata interest notice and section 22 tells us what should be in a strata interest notice it must and that's a must specify an address for service of notices so it is generally the job of the lawyer or the commander who is acting for an owner on their purchase of their shiny new apartment they make a point of filling out this strata interest notice and sending it to the strata manager to make sure the strata role can be updated sometimes that doesn't happen and that's why strata managers end up with incorrect details on a strata role because a section 22 strata interest notice hasn't been provided you've mentioned the arena the strata role section 178 tells us what in information must be recorded on the strata role the strata role must include that address for service of notices and that's the address that was notified by the section 22 strata interest notice it also says that an email address must be included on the strata role if the owner has one and if that email address has not otherwise been provided as the address for service so I'm with you I think that a bylaw that essentially attempts to get around this regime in our legislation is quite possibly not a valid bylaw and as convenient as it may be I think owners are still entitled to nominate something other than an email address as their address for service of notices yeah that's fine with standing as well Amanda and I think even for many people including myself like when I sometimes receive an agenda I like to have it in paper so I can write notes on it and I know many owners that I have who are very tech savvy still like to have a copy sent to them because I don't want to spend their own time and money printing it up themselves sometimes so yeah that's what I tried to tell that person and I think that from what you're saying you're confirming what I think is the case I appreciate it's frustrating for some communities where most people have an email address as their address for service and others have a postal address because that means that it does take a lot longer to convene a general meeting because we must have seven days notice of a general meeting if you're going to be posting out agendas you've got to add another seven days usually a little bit more because we're dealing with weekends and we can't count those in our calculation of postage periods strata managers mailing out general meeting agendas that are often having to send them out three weeks before the meeting I think that's kind of the rule of thumb Now isn't it Reena yeah that's that's pretty much the standard yeah I mean because you can't include the date you wish to the agenda you can't include the day of the meeting and now that under that interpretations act it says that it's postage is now seven days deemed to be served not four like it used to because now now it's basically 17 days and I think you're right three weeks is a good term to use as a point of reference to make sure that the agenda is compliant may have like now we've got public holidays coming into the mix so that adds to the notice period time as well yes because the postage period is seven working days so we can't count weekends we can't count public holidays so yeah it is timely that we're talking about this now whereas if you were serving by email then it is deem served after you send it after you hit send on that email as long as it doesn't bounce back to you then it's been served and you can start counting your seven days so you can be convening your general meetings much more efficiently if everyone is being served by email so I know a lot of buildings scramble to get those email addresses as addresses for service but at the moment it is certainly not mandatory not the law that everyone must have an email address for what I hope are obvious reasons thank you Amanda my challenge for this week has come up in our members q a forum just a couple of weeks ago there was an interesting discussion going on about electronic signatures and I'm wondering if you might have come across this Arena I've been asked by a member in our Forum what happens if somebody sends in a proxy form which must be signed our legislation says proxy forms must be signed by the owner of the lot and it looks like the form has been signed by the owner simply typing their name into the form it's not a signature that looks like it's been done by hand someone's just typed their name into the form this person who I imagine as a strata manager has said I've rejected this form and I've asked for original signatures I've been told that it has been signed electronically because this person didn't have access to a printer and that I should accept it Amanda do I need to accept it I have a view on this which I've shared with that member have you come across this Arena the electronic signing of proxy forms yeah it's funny I just had one of these recently and it's the first time I've had one where they've just typed up their name and obviously Electronics images are fine in terms of people using electronic means to sign you know with it like you know even like has a thing where you can either adopt a signature or you can you know use your own one that you've you know so you're talking about a scanned in signature that looks like someone's done by hand yeah or sometimes like you know even if you haven't got one to upload you can actually just adopt one that they give you but when it came someone is typing it up I said that we couldn't accept that I didn't think that it was correct because to me I mean anyone can do that I can do that so at least with an adopted one I mean someone's gone to some effort I mean I suppose there is no logic there I don't know but that's right we only had it once and we said uh and plus it was a new owner so I didn't know the owner at all was a new owner so I thought you know is this legit because I haven't had a problem with proxies previously with someone forged someone's signature so that's why I'm a bit wow I'm sort of a bit scarred yeah well this is such a great conversation to be having because everything that you've just said comes into this and needs to be considered so when I was discussing and debating this in the Forum the platform certainly came up as I think I might have asked the question was it docusigned and if so that is a piece of software that issues a certificate after you've signed it and that certificate gets emailed usually to both parties if you're signing a contract but certainly the person who signed will have in their inbox a certificate verifying that has been signed through and you have that layer of proof If you like and security and I suggested to this member if it's been then request the certificate the member has come back to me and said Amanda it hasn't been docusigned I've just been told that it's just been typed in they didn't have access to a printer that then sent me off to actually do some real lawyering and to look up the electron transactions act and this is legislation that we have across the country I'm looking at the New South Wales version the electronic transactions act does deal with electronic signatures and section 9 is the relevant section dealing with signatures and it does say that if a document needs to be signed then it is legally signed electronically if there is a method used to identify the person and to indicate their intention to sign a document so I read that as well the person has written their name somewhere on the document and that method has to be reliable in light of all the circumstances and the person who requires the signature so in this example it would be the owners Corporation is required to consent to receive the signature in that form so this is where your comments they're in are about your experience in the past where this was a new owner you didn't know them this wasn't something that you'd previously agreed to this wasn't the practice of that owners Corporation and on that basis you decided that you as the agent of the owners Corporation wouldn't consent to receive the communication that way might have been different if there was a and there was a certificate that was given that you could rely on well but also to a matter in this case there was only there was two owners and only one had put their name on it so ah there you go well that wasn't properly signed anyway yes I was wondering what so so one person's typing it up it's two owners I'm thinking well you know is it it's a new owner I don't know anything about these people you know you don't know what the intentions are sometimes and then I think that under the eighth the chairperson is the person who decides whether they accept the proxy or not yes true good point yeah good point so look my reading of this and I've only had a quick look at it for the purpose of providing some guidance in the member Forum I think it is legally valid and acceptable that you could sign a document this way but the bottom line seems to be that both parties need to consent to receiving the document that way and the circumstances need to be taken into account so I've said to this member do you know the owner have you had a phone call with them have they confirmed that it was them who typed the name in or are these just emails going back and forth make sure that you're very aware of what's actually happening in reality if your chair is going to accept this proxy as being valid yeah I mean it does make sense what you're saying Amanda because an electronic signature is just a made-up thing anyway when you think about it like in terms of someone not but sometimes people use you know they adopt their own signature it's something that they've actually made up themselves I mean it's not really it's an image file and sometimes people use you know if you look at word you can do like your name and running writing and things like that sometimes people use those tools to sign off and that's because it's running writing people think oh that's more like a signature it but what you're saying I think it makes perfect sense like if you know the person and you both agree that yeah I know who you are I can't get to it you intended to sign it under the ACT it's all about intention and you intended to use this method yeah yeah yeah so I think we're going to see more of that it won't be the first time that this has come up that's for sure and proxy forms being often controversial exactly well I mean as we know um these things obviously can affect outcomes so sometimes you know every proxy may have a purpose Beyond its original intention of just giving someone the right of their vote to be exercised at a meeting yeah every proxy counts over to your win for this week Rena yeah so um we've been managing a scheme compulsory since last year and it's taken quite some time for us to finally get the scope of works that the engineer had completed a draft was completed last year in November and then it was finalized in February and I went through the whole report I did a very in-depth report letter just to note key sections of the tender works so that owners could actually like rather than you know like on this page it refers to this so that everyone had the key areas identified and we decided that we would hold a meeting with all the owners and have the engineer come so the owners could decide even about the scope of works that needs to be completed part of the reason also was to discuss funding options that we're going to need in the future when Once the tender actually is issued to builders the other thing also was there were some optional works that were included where whereby by having the Builder there at the same time doing a number of other remedial works it would actually be probably expedient and cost effective to undertake some other work such as the entrance way it's really unsightly it's dangerous it really needs to be repaired and even though this is not part of the work so it that were ordered by the tribunal it's probably good for the owners to consider whether or not it would be a good idea why you have the Builder there and costs would be much less than having a little come out just to do that particular piece of work in the future and so it was a really you know owners had could ask questions of the Builder they asked him whether da was required it was actually quite a really productive meeting and it was agreed by everybody at the meeting that they would like to proceed with the optional works and get a separate costing to see how much it would cost and depending on that I was going to then put that to um the owners even though we're the ones that had the voting rights at the time when we're putting for the pricing and the funding the other thing also that people liked about the meeting was that I asked them what they thought and whether or not I would force alone upon them and I said no what I would be doing is putting it forward to all owners and in a sense treating them like announced Corporation because the majority of people don't want a loan well then I think that's probably the way to go and I had an email come I think a few days later saying thank you like you know even though you didn't have to include us in the discussion and seek our opinion you know you actually did that and also about the funding because many many owners that do have the funds don't want to spend the money on paying interest and you know this work is going to be more than I'd say two million dollars so we're talking about significant funds so even though even if the majority of the amount is raised by special 11 and then the balance could be funded through a loan at least then you know people haven't have the ability to vote even though they don't really forget about as such but to have their voices heard about how they would like to proceed what I note is that you know if people are given an option to exercise their their opinions and to be heard I think it helps with managing the scheme in a sense I'm only the custodian of the adults Corporation for a very short limited time you know either one year or two years depending on the term of the appointment but I think for managers it's important that even if you do have the power you should exercise it cautiously and and fairly and at least people know then at the end of the day everyone did get a say to the extent that it is sort of democratically able to be under a compulsory managed scheme but I was actually surprised that everyone's saying yeah we've got this work done it's been long overdue I think some of the people that were the recalcitrant people that had not really wanted the work to be done seemed to I mean they didn't say much but they're pretty much I think out voted in terms of people saying this has been going on too long and it should be done as quickly as possible um yeah some really key points there even though you are the compulsory manager and you have all the power there is a time and a place to exercise that power there may be some decisions like when you first come in the first few months you've got to get that money in the bank you've got to raise those levels you've got to pay an insurance premium whatever it is that's urgent you're dealing with that very quickly and then after settling in getting to know the owners then getting to know you there are opportunities for you to Canvas opinions and take those into account for all the reasons you've just said Reena too to part ways down the track if you do end up parting ways or perhaps they end up engaging you as a long-term voluntary manager but for the owners to feel that they have had some control of their face so I think that's quite a skillful way to manage and when we hear about bad experiences with compulsory management which I I do hear a lot of in my circles it is often because there wasn't any flexibility any consideration given to these opportunities to operate as a quasi-democracy let's say that that's a that's a good term Amanda actually yeah and I think I'm not sure why people really don't do that because I know people that's more time the issue is it's in the day it's not our building and therefore the building does belong to the owners and and I think in our role obviously we're appointed by the tribunal because that there is dysfunction but it's part of trying to deal with the dysfunction if you try and do the best for the majority of people then I think most people will see that effort and try and be more helpful and responsive in terms of anything that else that sort of that comes up that people are more amenable to hearing about it and being able to say yeah we're happy to do more and I was surprised that people wanted to do more than just they were happy to do more things to improve their building and other things that had come up were obviously fire things that we've already been addressing one of the recommendations was to get a lift audit done we've got that done now we're going to start you know because lift is like over 40 years old that had been upgraded like 20 years old but obviously now most of them know that their lips don't have a lifespan in more than 20 years on average so we're doing all those things concurrently so there's gonna be a lot of money being spent but I was really happy to hear that people were wanting their building to be improved that was really heartening for me as a manager because most people don't want to spend any money and I understand that to a to some extent but when people say no this work needs to be done it's long overdue it does make it easier for us as managers to to manage schemes like that nice one well it'll be good to see all of that rolling out thank you for sharing that win Rena my win relates to a little strata scheme tiny scheme two lots I have been working with one of the owners in that two lot scheme and I might have alluded to this particular dispute in a past episode this is a scheme where one owner has 65 of the total unit entitlement and the other owner has 35 percent so so reasonably unusual in two light schemes usually we like to see equal unit entitlements so there is no one owner with complete control but not so in this case and therefore my client was finding it very difficult impossible really to get repair and maintenance work done on the common property that was only affecting her lot so she had some water penetration quotes that come in at about a hundred thousand dollars to fix this problem so her neighbor was not at all interested in approving that and we were in the middle of tribunal proceedings fast forward a little bit and the other lot owner listed her property for sale and tribunal proceedings were paused while that was happening and the new owner came in it wasn't clear to my client or myself how much that new owner was informed about the financial situation of the strata plan or the legal proceedings and I remember saying to my client fingers crossed here's hoping you've got a really nice really understanding law-abiding neighbor who is willing to consent to this work being done understands legal obligations and doesn't have to be dragged through tribunal proceedings and lo and behold that is exactly the owner who bought in and I received an email very recently saying Amanda no need for the tribunal proceedings I have met my neighbor whilst my neighbor is a little traumatized a little shocked and surprised about this they understand their obligations as a strata owner they understand the strata law and work is commencing in two weeks time oh my God I can't believe it Amanda was this um scheme managed by a spider manager or self-managed no strata manager self-managed for many many years and the outgoing owner who's no longer the owner had been there for many many years and was running accounts and running meetings and essentially doing their best and not doing a terrible job but when it came time to meet this big expense it was clear that just wasn't going to happen without a tribunal order yes there is I was going to ask you man about that was if they did Australia search what records they would have seen in terms of this dispute oh yeah very little if any I think yeah and I remember my client telling me that she would be at home because she lived in the property she'd be at home and she would see people coming for the open for inspection and she would think oh I just really want to tell them what's going on I want to go and tap them on the shoulder which I suppose there was nothing stopping her doing that but that might have created a whole other can of worms uh she didn't do that she left it to the out going over the vendor to meet their disclosure obligations whatever they may be in the circumstances and as a matter of law I think I can say they are not as extensive or as onerous as they should be in strata as for what our vendors need to disclose yeah I always get concerned about these two lot schemes Amanda without Spider-Mans look at that they're more common than what I think people would know because I think oh we can disadvantage it ourselves and we can it's funny I've got actually got someone that I know who's known in one of my buildings his son lives in a two lot scheme and he's actually asked me for your details that I provide knowing that you've done a lot of these types of things but I think that you know again oh we don't need a strata manager we can just you know hold out they don't have a proper AGM or anything and this is a problem I think that yeah there's someone trying to do a search I think they'd be not knowing what they're getting into yes well this time last year I did some education for the Australian Institute of conveyances and I I was engaged to do a CPD session and I suggested the topic of small schemes two lot schemes and attempting to educate conveyancers who are the ones advising their purchases on contracts about precisely what these things are how to identify them what the relevant legislation is and what to look out for and warn their clients about and the number one thing being unequal unit entitlements well you've got two schemes and one person has the majority unit entitlement those ordinary resolutions are very hard to get past if you're wanting something done and you're not the majority holder so to be warning incoming purchases about that the impact of that from Australia a law perspective it's often not something conveyancers are armed with and that became a very engaged session for sure but even if the entitlements are equal if one votes four and one votes against it's still lost so oh you're right yeah exactly yeah so like I think I always walk past the duplex and I just think oh my God anyway I would ever own one is if I own both lots and went to one hour and I shouldn't say that on your podcast remember but anyway it's probably ruined up everyone that's thinking of buying in a two lot scheme oh no they are tricky and it comes down when I have clients talking to me about difficulties in Turlock schemes developer clients who want to build these schemes and want to keep one and I say to them they say oh Amanda how can I wrap it all up so that I'm protected and there's a few things you can do in bylaws before the plan is registered for sure but if you do have equal unit entitlement and I do recommend that because I think for a Savvy purchaser it's not a great marketing strategy if you're trying to sell next door with the Lesser unit entitled one but I say it depends who buys it and you don't have control over that it depends who buys it and it depends who the tenant is if they are an investor and they're going to put a tenant in there often because that's what it comes down to do you get along with your neighbor at the end of the day and that matters more in the smaller buildings than it does in our larger multi-stories oh oh much more but I think also sometimes um when people have different views on how to run a scheme it's like a marriage in a way in a sense it's that sort of analogous because you know one person may want their kid to go to a certain School the other person may say no public school's fine it's it comes down to that sort of philosophical differences in how people think about property how people think about investment you know people worry more about it whether it's your own home you want it to be functional if it's an investment perhaps you're only worried about your Returns on investment and nothing else so it becomes like ideological difference between owners in terms of how they deal with these types of issues for sure the other point that I wanted to make with this this win is that sometimes a situation that just seems impossible or incredibly difficult to resolve and you can't see the solution on the horizon sometimes that freezes people and it stops them from taking the first step or the next step or the next step or filing that mediation application or commencing those tribunal proceedings but this is a great example and I see this often I've got another one in my inbox actually that I'll have to add to the spreadsheet where really difficult situations are resolved because somebody sells or they move out and they never would have done that if they weren't being called to account if those proceedings were not on foot if the pressure wasn't on if they weren't having to pay lawyers fees if they didn't see the writing on the wall if you never take that first step to exercise your legal rights you may not have this kind of a win and it's absolutely a big win in this situation oh I totally agree man and I actually had a compulsory managed scheme that we were looking after where there were two owners and one on a sold the problematic owners sold and then after that when our compulsory time was over I said you know I mean she was quite Savvy and she was really good she was someone that had legal background and I said to I don't think you need a manager I think you can store this yourself and with the new owner because it was so nice she agreed and she had taken all the steps that you were saying even at the last minute the I know after she sold she had her truck and she blocked her garage so she couldn't get out of her garage for like you know nearly two days I was like the last time I had a Vengeance I think but yeah but I mean like you said if you and if she hadn't pushed and pushed like what you've said and taken those steps and you know and sometimes that's what it takes to sometimes force a sale in such a way that people think you know what I don't need the hassle and you can actually do it sort of indirectly that's right and sometimes that's you can't see that on the horizon or you can't see what the solution is going to be or how it's going to pan out but you do know that there is a next step to take and that's the best thing you can do is just take the next step and I'm often saying to my clients in difficult situations what's the alternative what will happen if you do nothing and if you stay in this leaking apartment or whatever the situation is if you've made the decision you don't want to sell then what other option do you have but to take this step and see how it turns out and that's not a legal decision that's a personal decision to weigh up those things but I absolutely have seen some good outcomes in hard situations where the difficult owner or neighbor has moved on yeah it's fantastic man it's a really really nice story well it's been a really nice chat with you this afternoon Rina van asked head off and enjoy your long weekend as best you can try and stay away from those emails I'll try another giggle I don't think so catch you next time bye okay bye thank you for listening to your strata property the podcast which consistently delivers to Property Owners reliable and accurate information about their strata property you can access all the information below this episode via the show notes at .yourstrataproperty.com you can also ask questions in the comments section which Amanda will answer in her upcoming episodes how can Amanda help you today [Music] foreign