What to Do When an Owner Won't Pay or Won't Comply

Every self-managed committee eventually meets the owner who, after everything, just won't. You've sent the friendly reminder and the formal one, offered a payment plan, had the quiet word, tried mediation — and the levies are still unpaid, or the unapproved renovation is still there, or the dog is still barking at 2am. This is the point most committees dread, because it feels like it's now about lawyers, tribunals and money the scheme can't spare. It doesn't have to be as bad as it feels — but the endgame only works if you approach it as two different problems, not one. An owner who won't pay is a debt to recover. An owner who won't comply is a by-law breach to enforce. They run through different forums, different notices, and different remedies, and the fastest way to lose either is to muddle them together. This guide assumes you've already run the fair, escalating process (if you haven't, start with Chasing Overdue Strata Levies Fairly and How to Handle a Dispute Between Owners Before It Escalates) and picks up at the hard part: what to actually do when that process has been exhausted and the owner still won't budge.

Two different problems, two different paths

Before you do anything formal, be clear which problem you actually have — because the answer changes everything downstream.

• Won't pay is a debt. Unpaid levies are money owed to the owners corporation, and the remedy is debt recovery — a monetary claim, usually starting in your state's strata tribunal or a low-level court, that ends in a judgment for the amount owed plus (often) interest and recovery costs. There is no "notice to comply" for money; there's a demand, and then a claim.
• Won't comply is a breach of a by-law (or of the Act). The remedy is enforcement — a formal notice to comply / contravention notice, and if that's ignored, a tribunal order requiring the owner to do (or stop) something, sometimes with a penalty. There's no money judgment at the end; there's an order to behave.

Some owners give you both at once — the owner in dispute over a renovation who has also stopped paying levies in protest. Even then, run them as two separate matters. Withholding levies is never a valid answer to a by-law dispute, and letting the owner tie the two together ("I'll pay when you fix the roof") is exactly the confusion that stalls recovery. The money is owed regardless; pursue it on the debt track while the conduct issue runs on the enforcement track.

Why keeping them separate matters

• Different forums and forms. A debt claim and a by-law enforcement application are usually filed differently, sometimes in different bodies, with different prescribed notices. Mixing them invites a procedural knock-back.
• Different evidence. A debt case turns on the ledger — what was levied, what was paid, what's outstanding. An enforcement case turns on the by-law and a documented pattern of breach. Neither helps the other.
• Different leverage. Levies keep accruing every quarter, so time is on the scheme's side in a debt matter. A by-law breach can be causing ongoing harm to other owners now, so it's usually the more urgent of the two.

First: make sure your process is actually watertight

The single most common reason committees lose a case they were right about is a hole in their own process. Before escalating either track, confirm:

• The debt or breach is real and documented. For arrears: a clean ledger showing each levy validly raised (properly resolved at a general meeting), each payment, and the running balance. For a breach: the exact registered by-law, and dated evidence of the breach — not a single complaint.
• The levies were validly struck. A recovery claim assumes the contributions were properly determined by the owners at a general meeting and correctly notified. If the levy itself is shaky, the debt is too.
• You followed the fair ladder and can show it. Reminders sent and dated, a payment arrangement offered, mediation or conciliation attempted for a conduct dispute. Tribunals expect to see this, and in several states it's a precondition.
• Enforcement has been consistent. If you've let other owners breach the same by-law without action, selective enforcement will be thrown back at you. Same rule, same way, for everyone.
• No committee member is conflicted. Anyone with a personal stake in the matter should step out of the decision.

Get these right and the formal step is a short, clean process. Skip them and you hand the other side a win on procedure alone.

When an owner won't pay: the recovery endgame

You've run the reminder ladder and offered an arrangement, and the levies are still unpaid. Here's what the formal end looks like.

Step 1: The final demand (and, where required, a prescribed notice)

Send a final letter making clear that formal recovery will commence if the debt (or an agreed arrangement) isn't settled by a stated date. In several states a notice of this kind — in a prescribed form, giving a set period — is a legal precondition before you can start proceedings. Get the form and the timing right; a home-made letter may not satisfy the requirement, and skipping it can sink the claim.

Step 2: Decide who runs the recovery

For a modest, clear-cut debt, a committee can often lodge the claim itself through the state tribunal's straightforward process. For larger debts, a mortgagee in the picture, an owner who disputes the amount, or anything headed for court, engage a strata debt-recovery lawyer or agent. Their reasonable costs are, in many states, recoverable from the defaulting owner on top of the debt — so professional help often costs the scheme little in the end.

Step 3: Lodge the claim in the right forum

Recovery of unpaid contributions generally starts in the state's strata tribunal or a low-level civil court, depending on the amount and the state. The claim is for the outstanding levies, plus authorised interest, plus reasonable recovery costs where the state allows them.

Step 4: Enforce the judgment

Winning is not the same as being paid. A judgment is an entitlement you may still have to enforce — through garnishee, a charge over the lot, or in the last resort a forced sale — usually with legal help. Many owners pay once a judgment lands; for those who still don't, this is firmly lawyer territory.

When an owner won't comply: the enforcement endgame

You've had the conversation, sent the neutral letter, offered mediation, and the breach continues. Here's the formal path.

Step 1: Issue a valid notice to comply

Most states provide a formal notice to comply (or contravention notice) that puts the owner on notice that continued breach can be taken to the tribunal. Do it properly: confirm the exact by-law and the evidence, satisfy any prerequisite (some states require the committee to first resolve to issue it, or even a general-meeting vote), use the prescribed form or minimum content, and give the required time to remedy. A defective notice is the most common reason enforcement cases fail.

Step 2: Apply to the tribunal for an order

If a valid notice is ignored, apply to the state tribunal or adjudicator for an order requiring the owner to comply. The application sets out the by-law, the documented breach, the notice served, and the specific order you're asking for. These processes are designed to be used without lawyers, though complex matters may warrant advice.

Step 3: The tribunal orders compliance — and sometimes a penalty

A tribunal can order the owner to do or stop the thing (remove the unapproved structure, cease the nuisance, restore common property), and in some states impose a civil penalty for continued breach after a notice. The order is binding; a further breach can itself be the basis for a penalty.

Step 4: If they still won't — enforce the order

An owner who ignores a tribunal order is in a much weaker position — repeated or wilful non-compliance can escalate to penalties and, ultimately, enforcement through the courts. At this stage you're almost always working with a strata lawyer.

The formal paths by state

The bodies, notices and remedies differ by jurisdiction. These callouts cover both tracks — debt recovery and by-law enforcement — for the four largest states; the same shape (prescribed notice, then tribunal or court) applies everywhere, with local names and timeframes.

South Australia, Tasmania, the ACT and the Northern Territory follow the same two-track shape — a debt claim for arrears (with their own interest and cost rules) and a breach/enforcement path for conduct — through their respective tribunals or courts. Confirm the exact notice, forum and timeframes for your scheme before lodging anything.

A reality check on cost, time and goodwill

Formal action is a tool, not a reflex. Before you commit, weigh:

• Money. Tribunal filing fees are modest; a lawyer for a contested matter or a court claim is not. In a debt matter much of that may be recoverable from the owner — in an enforcement matter, usually not.
• Time. From notice to hearing to an enforced outcome can run months. A barking dog or unpaid quarter won't feel urgent to a tribunal list.
• Goodwill. You still have to live next to this person, and so do the owners who'll read the minutes. Formal action against one owner is visible to all of them.
• Proportionality. A large or growing arrears, or a breach genuinely harming other owners, clearly warrants pressing on. A trivial or one-off breach rarely justifies the cost — and a committee that reaches for the tribunal over small things loses the room.

None of this is a reason not to act — an owner who won't pay is unfair to every owner who did, and an unremedied breach erodes the by-laws for everyone. It's a reason to act deliberately: pick the matters worth the fight, and run those properly.

When to bring in a professional

Hand it over — or at least take advice — when:

• The debt is large, disputed, or has a mortgagee involved. Contested recovery and judgment enforcement are lawyer's work.
• The owner has lawyered up. Meet representation with representation; don't let a committee volunteer freelance against a solicitor.
• The matter involves threats, harassment, or safety. That's a police matter, not a by-law one — the committee handles only any separate by-law or common-property angle.
• You're unsure the levy was validly struck or the notice was valid. A short advice now is cheaper than a claim dismissed on a technicality.

Common mistakes

1. Treating "won't pay" and "won't comply" as one problem

They have different forums, notices and remedies. A debt is recovered; a breach is enforced. Running them as one matter — or worse, accepting an owner's "I'll pay when you fix X" — stalls both.

2. Letting arrears drift because formal action feels drastic

A quarter overdue is an easy claim; two years overdue is a large debt, a strained scheme, and in some states a recovery you were required to have started already. The debt track is routine — use it early.

3. Serving a defective notice

A home-made letter where a prescribed form was required, a notice without the committee resolution some states demand, or too short a remedy period — any of these can void the step and send you back to the start. Match the form and timing exactly.

4. Enforcing selectively

Pursuing one owner for a breach you've tolerated in others is the flaw most likely to sink an otherwise-good case. If a by-law is enforced at all, enforce it consistently.

5. Skipping straight to the tribunal

Formal action without the documented ladder — reminders and an offered arrangement for money, an informal word and mediation for conduct — leaves your case exposed and burns goodwill a smaller step might have saved.

6. Winning and then stopping

A judgment or an order is an entitlement, not a result. If the owner still won't pay or comply, the matter moves to enforcement — plan for that step rather than assuming the paper ends it.

Frequently asked questions

An owner is withholding levies because they're unhappy about a repair. Can they do that?

No. Levies are owed regardless of any dispute about the scheme's conduct — there's no lawful "set-off" for a grievance about maintenance or a by-law. Pursue the arrears on the debt track as you would any other, and handle the repair or conduct issue entirely separately. Letting an owner bundle the two is exactly the confusion that lets a debt grow.

Do we really have to chase a small debt, or can the committee just write it off?

The committee has a duty to recover money owed to the scheme — it belongs to all the owners, not the committee to forgive. In some states you're actually required to commence recovery once a debt passes a set age. Writing it off informally is generally not the committee's call and is unfair to the owners who paid.

Can we recover our legal and tribunal costs from the owner?

Often, for debt recovery — many states allow reasonable recovery costs and authorised interest to be added to what the defaulting owner owes, which is why professional recovery can cost the scheme little. For a by-law enforcement matter, costs are usually not recoverable, so weigh the cost against the harm before pressing on. Confirm what's recoverable in your state.

The owner ignored the tribunal order. Now what?

An ignored order puts the owner in a much weaker position. For a money judgment, you move to enforcement — garnishee, a charge over the lot, or ultimately a forced sale, generally with legal help. For a compliance order, continued breach can itself trigger penalties and further court action. Either way, this is the point to be working with a strata lawyer.

Can the owners corporation pay for this out of levies?

Yes, where the scheme itself is the proper party — recovering the scheme's debt or enforcing the scheme's by-laws is a legitimate owners corporation expense. What levies can't fund is one owner's purely private quarrel with another. For anything significant, having owner support (a general-meeting resolution) is prudent as well as, in some states, required.

Quick checklist

• [ ] You've identified whether this is a debt (won't pay) or a breach (won't comply) — and are running them separately
• [ ] The levy was validly struck / the exact by-law is confirmed, with a clean dated record of the debt or breach
• [ ] The fair ladder was followed and can be evidenced — reminders and an arrangement for money; an informal word and mediation for conduct
• [ ] Enforcement has been consistent across all owners
• [ ] Any required prescribed notice (final fee notice / notice to comply) used the correct form, prerequisites, and timeframe
• [ ] The claim or application is lodged in the right forum for your state and the amount
• [ ] You've weighed cost, time and goodwill, and the matter is worth pursuing
• [ ] A professional is engaged where the debt is large/disputed, the owner is represented, or safety is involved
• [ ] You have a plan to enforce a judgment or order if the owner still won't comply

Related resources

• Chasing Overdue Strata Levies Fairly
• How to Handle a Dispute Between Owners Before It Escalates
• Strata By-Laws: How to Make, Change, and Enforce Them Legally

This guide is general information for self-managed strata schemes in Australia. It is not legal advice. Debt-recovery procedures, by-law enforcement, prescribed notices, interest and cost rules, and the tribunals or courts that hear these matters are set by each state's strata legislation — always check the rules that apply to your scheme, confirm what your owners have resolved, and seek professional or legal advice before commencing recovery or enforcement, or for anything involving threats, harassment, or safety.