Income Recovery: Lost Income Recovered for a NSW Strata Scheme
Written by Murray Cameron on 21.08.2026.
For years, a large Sydney strata scheme (Scheme A) had a legal right to be reimbursed for shared facility costs. That income simply wasn’t collected.
The previous managing agent couldn’t execute a straightforward invoicing obligation, despite repeated requests from the committee.
When Strata Real Estate Services (SRES) took over, the outcome changed. The scheme recovered over $100,000 in backdated income, plus an ongoing monthly reimbursement, within months of handover. This illustrates Lost income recovery.
This is what that recovery took — and why most managing agents never get there.
The Situation
Scheme A and Scheme B arrangement overview
Scheme A did not have adequate onsite garbage facilities. It had a long-standing arrangement with its neighbouring scheme, Scheme B. Scheme A’s residents used Scheme B’s garbage room. In exchange, Scheme B’s residents were granted access to Scheme A’s pool and BBQ area. Under the terms of that arrangement, Scheme B contributed to the pool and BBQ maintenance. Scheme A’s managing agent invoiced those costs. Consequently, this arrangement impacted Lost income recovery for Scheme A’s managing agent.
The previous agent never issued those invoices. Scheme B’s residents kept using the pool and BBQ area. Scheme A kept paying to maintain them. The committee raised it repeatedly with the previous Strata Manager but Nothing changed.
Frustrated, and facing a broader pattern of service failures, the committee moved Scheme A’s management to SRES, appointed at an Extraordinary General Meeting. SRES conducted the handover from the outgoing agent at no cost to the scheme.
Why This Happens — And Why It’s Fixable
Reason 1: The previous agent did not understand the legal basis for the claim.
As a result, they failed to invoice for the cost, affecting Lost income recovery.
Without a clear read of legal instrument which created the obligation and what it actually required, an agent simply did nothing.
On appointment, the SRES strata manager’s first step was not to chase Scheme B — it was to review the strata records and title documents to confirm exactly what Scheme A was legally entitled to recover, and from when.
Reason 2: Uncollected income is usually a symptom of an unresolved operational gap.
The previous agent had never addressed a practical shortfall the original developer left unresolved — there was no proper mechanism onsite to isolate and quantify the actual maintenance costs attributable to the pool and BBQ area. Without that, there was nothing defensible to invoice. However, they then failed to take action to remedy that shortfall so they could invoice for the costs.
SRES met with the committee and building manager to identify the exact onsite gaps, then arranged quotes to close them — minor equipment that allowed maintenance costs to be correctly identified and installed. This allowed the billing on a monthly basis to commence.
Reason 3: Recovery requires a proper financial process, not a single invoice.
Fixing the arrangement going forward doesn’t recover what was already lost. SRES formally notified Scheme B in writing of its obligation, the previous agent’s failure to act on it, and the invoicing that would follow. Working with the in-house SRES CPA accountant, the team built a proper invoice template, began monthly billing, and — critically — went back through the financial records to reconstruct and back-bill every quarter owing since the arrangement first took effect.
The Result
- Over $100,000 recovered in backdated reimbursement owed to Scheme A.
- An ongoing monthly reimbursement now in place for pool and BBQ maintenance costs, correctly invoiced and collected as a matter of course.
- A committee that no longer has to raise the same issue meeting after meeting.
The Bigger Picture
This was one of several issues the committee faced under its previous managing agent — others included unresolved defects, Home Owners Warranty claims, long-term one-sided contractor appointments, and ongoing maintenance failures. We’ll cover those in future case studies.
Your situation in your Strata Scheme may be very different to the above, however our expertise, history and knowledge will greatly assist you to fix any issues you may have.
I would be happy to discuss your issues and how you can change management to Strata Real Estate Services at anytime.
Murray Cameron
Managing Director
Strata Real Estate Services
Your Strata, Our Expertise.
Contact Strata Real Estate Services to discuss your scheme, or to arrange a confidential review of your current management arrangements.
Sources: Strata Schemes Management Act 2015 (NSW) s142 – Common property rights by-laws; NSW Fair Trading – Strata and property complaints; NSW Government – Strata repairs and maintenance