"A Shocking Abuse of Power?" Residents of some of Victoria's most prominent high-rise apartments are preparing to take legal action against one of the state's largest strata management companies, alleging a comprehensive and intricate scheme of overcharging and aggressive debt collection practices.
On January 30, 2026, it was reported that a lawsuit is set to be filed in the Supreme Court of Victoria against Bluestone OCM, accusing the firm of engaging in misleading actions, unethical behavior, and violating the Owners Corporations Act. This legal challenge is spearheaded by Wilbur Tong, representing his family's apartment at the 47-story Marina Tower in Docklands. The suit will advocate for all owners in any Victorian strata scheme managed by Bluestone since 2020, who might have received misleading fee notifications on an opt-out basis.
Bluestone claims to manage over 45 residential buildings, including notable structures like the 100-story Australia 108 in Southbank and the Premier Tower, sometimes referred to as the "Beyoncé Building," located in the central business district (CBD).
The lawsuit names three defendants: Bluestone OCM Pty Ltd along with two owners corporations associated with the Marina Tower. Tong’s family has faced significant challenges; their Docklands apartment remained unoccupied for roughly 18 months during the COVID-19 pandemic due to damage incurred by a tenant. While Tong invested $25,000 in repairs and attempted to manage the mortgage, the family fell behind on their owners corporation levies temporarily.
From late 2022 to mid-2024, Tong reports that they paid back $24,000 in levies, yet Bluestone allegedly continued to pursue them for what they claim was an inflated debt of $8,000. Notably, in November 2024, Tong's family received a statement indicating they owed over $13,400, despite Tong asserting that there were no outstanding levies at that time.
Upon reviewing the statements, Tong discovered that a significant portion of this balance consisted of legal fees and costs associated with debt recovery. When he began questioning what he perceived as irregularities and unclear financial reporting, Bluestone charged the family a “special fee” of approximately $5,500, which Tong interpreted as a trust deposit intended to cover anticipated legal expenses for potential litigation against them.
Tong firmly believes that their situation exemplifies a clear abuse of power. He stated, "Most average owners or residents will find it difficult to comprehend the financial reports and understand their legal rights."
Aarahnan Raguragavan, the principal solicitor at Potentia Litigation, emphasized that this legal action seeks to confront a pervasive lack of transparency within strata management. He posits that many other apartment owners may have unknowingly received illegal levies and charges. "It’s a sophisticated operation that could easily go unnoticed by the average lot owner," he remarked. "The management culture in apartment buildings appears to have been exploited, creating a chaotic environment."
When contacted for comment, Bluestone denied any wrongdoing, asserting that their operations are anchored in ethical practices and transparency. In their statement, they expressed, "We adhere to rigorous policies and oversight measures that are routinely evaluated to ensure fair and lawful practices in the best interests of the communities we serve."
Bluestone is well-known and holds significant influence in the strata management sector, overseeing numerous buildings in both urban and suburban locations. This class action emerges against a backdrop of increasing scrutiny on strata and owners corporation laws in Victoria, particularly regarding excessive administrative and debt recovery fees deemed unlawful by the Victorian Civil and Administrative Tribunal (VCAT).
With the Labor government actively promoting strata living as a viable option for more Victorians, Consumer Affairs Minister Nick Staikos commissioned an independent review of existing strata laws last year. An expert panel, led by former consumer affairs minister Marsha Thomson, was tasked with providing recommendations on various issues, including unethical management practices, undisclosed commissions, and provisions for owners facing financial hardships related to fees. They also examined the contentious requirement for unanimous agreement for collective sales of strata assets and assessed the effectiveness of regulations on short-stay accommodations.
In response to inquiries about the review, Staikos’ office informed The Age that the minister is currently evaluating the panel’s recommendations and will respond "in due course." A spokesperson mentioned that the government plans to release the review alongside their own responses, though a timeline for this remains unspecified.
"One in four Victorians resides in properties governed by an owners corporation—we aim to ensure they are protected and treated justly," a spokesperson for the minister stated.
Potentia Litigation is actively seeking other affected owners from Victorian properties managed by Bluestone OCM before officially filing the lawsuit in late February.
