Important practical consequences for all Owners Corporations
We have uncovered a recent Victorian Civil and Administrative Tribunal (VCAT) decision which has important practical consequences for all Owners Corporations when seeking to recover unpaid fees from a lot owner in the form of a brought forward balance.
The decision was made by Member Reid on 28 August 2026 in Owners Corporation PS415135N -v-Imam [2026] VCAT 704, dismissing an Owners Corporation’s fee recovery application due to a “brought forward” balance on a Final Fee Notice. This decision concerns the level of detail required in Final Fee Notices before amounts can be recovered through the Tribunal.
Background: What Happened?
The Owners Corporation issued a Final Fee Notice seeking payment of arrears. The notice included a “brought forward” balance, which contained previous overdue levy fees and interest. The line item did not state a due date or separately identify the individual levies and charges making up the amount described as “brought forward”.
The “brought forward” amount included not only unpaid levies, but also Magistrates’ Court legal costs and other debt recovery charges. During the recovery process, the Owners Corporation was able to provide historical fee notices and a ledger to prove that the fees contained in the Brought Forward balance were validly raised, however VCAT did not accept that this fixed the problem with the Final Fee Notice. The application was dismissed with no recovery of the claimed amount, interest or costs.
Why does this matter?
A Final Fee Notice contains columns for due date, description and amount. Member Reid considered that this requires each unpaid amount being claimed to be listed separately. A lot owner must be able to see from the Final Fee Notice exactly what amounts are sought and when each amount became due.
A line such as “brought forward” or “opening balance” does not provide enough information to the specific charges being claimed, even where the total is made up entirely of validly raised, unpaid levies. On this reasoning, a later ledger or historical fee notices may not cure the lack of itemisation on the Final Fee Notice itself.
The decision also indicates that VCAT may not separate recoverable levies from unrecoverable charges within a combined balance. If valid and invalid items are mixed into one lump sum, the Tribunal may refuse to make an order for any part of that lump sum.
What Owners Corporations should do?
We consider that there is too much risk in leaving a brought forward balance on the owners corporations Final Fee Notices. The Tribunal is likely to strike out the entire Brought Forward balance amount.
Owners Corporations should consider taking the following steps:
- Stop using “balance brought forward”, “opening balance” or similar entries in Final Fee Notices;
- Remove those lines even when they show a $0.00 amount;
- List each unpaid levy or other recoverable amounts separately;
- Include the due date, a clear description and amount for every item claimed; and
- Confirm that each item was first raised in a proper Fee Notice.
The statutory notice process must be followed carefully; a genuine debt my still become difficult or impossible to recover at VCAT if the Final Fee Notice does not clearly identify each amount claimed.
Owners Corporations and managers should review their current notice templates and software before issuing further Final Fee Notices to ensure fees can be recovered.
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