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I’m a new member of my EC. One of the owners has put in a request to do some pretty major work to his unit. Many other units have had similar work done over the years. Our strata manager has recommended we put in a by-law to:
“indemnify the OC for any changes and possible damage to the common property caused as a result of these works and the costs are charged back to the unit owner”
Is this a usual by-law? I understand what it means but I can’t work out if it’s beneficial or not.
Thoughts?
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Hi
You have touched on one of my pet issues, as a Court Strata and Construction expert you would be surprised if I told you how many court cases I have on the matter of renovation works carried out by Lot Owners with or without the Owners Corporation (OC) approval. Having a bylaw for the works which states that the lot owner will be responciable for any damage to the common property is simply not good enough.
There are so many issues that need to be considered by the OC in any Owner making an application to renovate their unit, especially in multi level buildings. Not the least of these is will the work affect the structural integrity of the building. We are giving expert opinion evidance on three matters in the Supreme Court at the moment regarding works carried out by Lot Owners on their units, that has caused major damage to the Strata Complex, two are million dollar claims. One is to do with the coring of a new floor waste in a bathroom renovation, from the coring process the operator drilled through a presessed slab structural cable which cased further pre-stressed cables to be over loaded and resulted in the slab dropping some 30mm which caused structural cracking to the internal walls, damaged the unit ceiling below, burst the water pipes in the bathroom casing flooding the a number of units and the list goes on. Another is to do with removing the carpeting to a unit and placing floor tiling with in floor heating, the issue is that the owner didn’t fit thermal or sound insulation and as such the Unit below is now used as a sauna with loud background music provided free of charge. The lot Owner of the New Sauna is suing both the lot owner above and the OC. The disappointing point about all of this litigation is that it could have been so easily avoided by applying a bit of common sense.
Some Other issues (not an exhastive list) that need to be addressed when a lot owner wants to carry out refurbishment work on their unit and in fact the OC if it wants to refurbish the Strata Complex are:-
1) are any walls being removed? Or doorways inserted? Or holes drilled through walls or the floors? Then you need to have a structural engineer to review the owners plans ( even if these plans have been done by a structural or other engineer) to advise whether the works will have any structural effect on the building.
2) will the proposed works have any effect on another unit or common propery
3) will any waterproofing membranes be damaged or new membranes fitted? If so the OC should engage a Building Consultant to inspect the new membranes to ensure the works comply and that the works are proceeding to the submitted plans
4) will the works need Council approval or the issuance of a Building Approval and subsequent certification.
5) is any floor covering being replaced, if carpet it must have a sound rated underlay, if timber flooring whether floating or full timber or tiled it must have an approved sound and heat insultaion installed, with a DBA Rating certificate issued to the OC.
6) what will be the working days and hours, what rules will be applied to the storage of materials, the Removel and/or storage of building waste, what tradesman parking will be allocated, who wil be responsible for cleaning of the common property and so forth.
RECOMMENDATIONS
A) The OC should have a set of renovation by- law/s developed that clearly details the procedure to be followed by all Owners when they wish to renovate their units. The by-law/s should deal with the above issues and others that may be specific to your OC.
B) The by-law/s should also place a number of obligations on the Lot Owner, including meeting all costs in the OC reviewing the works for approval, including engineers reviews, inspections etc.
C) The executive committee must enforce the Renovation By- law/s. No applications for renovation should be approved unless the EC is of the view that all of the requirements have been met.
The above may seem over the top or may be considered expensive to implement however we have worked with both large and small Strata Schemes to set up the protocols and by-laws and the cost has been considered minimal when weighed up against the benifits. The outcome is that the Owners most valued property (both the lot and common property) is protected, arguments are minimized between Owners regarding requests for renovations, the stress and workload on the EC is greatly reduced and all Owners know that any works are properly assessed, overseen and will result in works that maintain the structural integrity of the Strata Complex.
The value of the above can be no better proved then a recent matter that Integrated was engaged on. The Strata Complex had Just had a compulsory Strata Manager appointed, there were five court actions between various lot owners as well as lot owners suing the OC. All this litigation was to do with renovations, we meet with the Strata Manager and suggested that Integrated set up a written procedure to how applications for renovations should proceed and have a renovation by-law developed to support the procedures. Within 4 months we had all renovations approved and all litigation dropped, the Strata Manager handed over the management of the scheme back to the owners with a new EC appointed and Integrated has continued to be engaged to inspect works as they proceed and have also now dealt with another two renovation applications.
As I hope you have realized by now renovations are rarely simple and all need to be reviewed and overseen to ensure the Owners greatest asset is always the number one concern in assessing and approving renovations. Integrated has particular expertise in this area, with our business being the only Engineering and Building Consultancy specialist providing specific Strata Support Services we are the go to firm. If we can be of help even if it’s just meeting with your EC to give some direction advice (which we would do at no charge if you come to our office) please give us a call or drop us an email.
Chris Mo’ane AIAMA, MASBC- CPC
GMD Integrated Consultancy Group
Engineers and Building Consultants
Principal Sposor OCN, Corporate Members SCA and FPAIt is not up to the OC to engage someone to determine if new membranes comply, or if any other works comply. That would place the OC in a very difficult position.
Standard drafting of approval given for renovations and any related by-laws will include wording to the effect that the lot owner will ensure that the work will be carried out in a professional manner by licensed tradesmen, that the work will meet any applicable standards, and the owner is responsible for any maintenance of that work in the future.
If the OC inspects work carried out by an owner then it could be claimed that it is responsible for it.
How does an OC protect itself from unauthorized renovations. From what I have learnt from flat chat, if an owner decides to remove the aluminum sliding doors to the balcony and replace them with French doors without permission then the OC may be liable for future repairs/replacement. So what does an OC do? Do they stop anyone with a tool belt around their waist and ask where they are going and what do they intend to do? Or place a sentry at the driveway entrance and check every ute, van or truck that comes in?
I in all honesty, someone could have materials delivered and work done whilst most people are at work. Then there are the owners/ residents who don’t say anything about anything in the complex believing that it for someone else to take care of, such as the EC. But if the EC members aren’t home or don’t see anything, then they can’t do anything. I know that some residents have had work done on their units. I know from the building materials that have been left in the visitors car spots and the skip bin left blocking the driveway for a week. And I have heard rumors about changes some owners have made. No one ever questions or complains (except me). The EC isn’t concerned taking on an it will be alright attitude. But what could they do anyway? Get the swat team in the break down the door and check the unit for suspected changes? Even if an owner sells and the real estate photos show changes, they can say the last owner changed it! OCs need to be protected from owners doing whatever they want but expecting others to suffer the consequences.
I think it may be easier than you think. Pass a by-law that says owners are responsible for any unauthorized changes to common property, their repair and maintenance and the results of any damage done to common property and personal property as a result of the unauthorized work. The responsibility passes to the next owner if the unit is sold. This by-law doesn’t cancel out the owner’s requirement to inform the EC about and seek permission for changes to common property but it does include common property that has been altered by previous owners.
You would also, obviously, have a by-law covering authorized works with terms and conditions attached.
Of course when I say ‘easier than you think’ this doesn’t take into account a collective desire by owners to get what they can out of an imperfect set of controls.
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I would have thought that the Strata Schemes Management Act 1996 already covers owners doing things that affect common property.
I realise that the issue of making ‘future’ owners liable is different but I would have thought if the ‘owner’ remains the same couldn’t action be taken against the owner on the basis they contravened sections 116 (Owners, occupiers and other persons not to interfere with structure of lot or services to lot) and/or sections 62 to 65C (MAINTENANCE, REPAIRS, ALTERATION AND USE OF COMMON PROPERTY AND FIRE SAFETY INSPECTIONS) of the Act? Wouldn’t an OC be able to seek damages/restitution that way?
I am a big believer in the KISS prinicple (Keep It Simple Stupid). The passing of numerous bylaws can make understanding and enforcing of bylaws a nightmare. While I realise it is not always possible (smoking and parking bylaws being two example that spring to mind) it is better to operate on a few well understood and simple principles than have lots of unique bylaws.
I realise in practice every Strata Scheme has, according to it size and location/demographics, its own way of operating and therefore need for rules but sometimes it seems to me that OCs often feel the need to enact unique bylaws to solve problems without looking at the existing ones carefully enough.
Yes, that’s true … if you are aware of any changes that have been made. The first many ECs are aware of changes is when they have a sticky-beak when a unit is put up for sale. Then it all gets messy if common property has been altered and the unit is sold.
In that case it has been legally established that if the previous owner had changed common property without permission or knowledge of the Owners Corp and the replacement breaks, the Owners Corp is liable to repair the new installation, despite the fact that they didn’t approve it. The example given of changing cheap sliding doors to expensive bi-fold French windows is a real one.
I too believe in the KISS principle but this is strata and nothing is simple. have a look at this posting from about a year ago. As I’ve said elsewhere, there’s logic, there’s common sense … and then there’s strata law which often seems to employ neither.If you want to be alerted when anyone replies to your posts or responds to this topic, please register and login, then you will be able to subscribe to the topic. The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers. NB: Longer threads may spill over to additional pages - look for the numbers on the bottom right, under the last post.
It is very tricky – we had an owner who did extensive renovations a number of years ago with approval, we have now discovered that they did a number of other things including installing an electric meter in their lot with related rewiring etc. and installation of gas piping through the common property into their unit. We are looking at putting in a by-law to cover those things to make it clear that they are responsible for those works. We have been advised that some of the electrical wiring is dangerous and we have to fix that asap.
Another owner went ahead with other extensive renovations including removal of a load-bearing wall with no approval from either the OC or the Council. We had to stop the work going any further until everything was sorted.
In my lot I found when I was having some work done that a load-bearing wall had been partly removed in the past and was being propped up with newspaper. I had to get a bricklayer to put in a supporting beam.
So there are two issues, work can have a serious effect on the integrity of the building, and an owner can later require the OC to repair/maintain work or structure that strictly speaking is not their responsibility.
I like Jimmy’s suggestion, it covers off most bases other than the ongoing issue of work being undertaken that compromises the integrity of the building.
Hi Jimmy, I had a read of the post including a reference to unauthorised sliding doors (post 7) and your suggestions (post 5) and was fascinated. Our OC has struggled with this issue and found no way to address it. Your posts make a very strong case for a bylaw and sets out a good method for protecting OC’s against unauthorized changes.
So if a strata enacts a bylaw that specifies that:
“owners are responsible for any unauthorized changes to common property, their repair and maintenance and the results of any damage done to common property and personal property as a result of the unauthorized work (and that) the responsibility passes to the next owner if the unit is sold”
Then responsibility and presumably expense passes to all future owners but in the absence of such a bylaw the responisbility and expense reverts to the OC. Have I read this correctly?
And if I am drawing the correct conclusion what you are saying is a very strong case for a bylaw
I would have such a by law say that “owners are responsible for any unauthorized changes made to common property within or on their lot” or words to that effect. Many owners are not aware that common property is not only outside their unit. And in my case we have an EC who believes if others can’t see it it is not common property, including exterior features!
Owners in my complex would read such a by law as giving them permission to do unauthorized changes as long as they maintain them. This clause perhaps should be tacked on the end of the clause that says you cannot change common property. We have had an owner change common property without permission. This owner was made to pay for an engineers report and then pay for works to meet standards noted in the report. This unauthorized change cost this owner alot. Should be a penalty attached to the discovery of unauthorized works as a deterrent from people just getting a few friends around and knocking down a wall.
Absolutely right. The two have to act in conjunction – you need your by-laws to say you can’t make changes to common property without permission but if you do, you and subsequent owners are responsible, not just for their repair and maintenance, but for any damage the changes may cause to the rest of the building.
FYI: A friend recently sold an investment property and as part of the disclosures to the new owner, he had to state that he hadn’t made any changes to common property while he was in possession of the apartment.
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