[Aquarian]

Thank you everyone for your comments thus far – you are helping make this complex matter a bit clearer.

To give some background facts:

1. there are 14 lots in the block 4 on each of the first three levels and two on the upper level – called penthouses (some say sub penthouses because there are two there.

2. the original / current unit entitlements were set by the (we think) the developer.

3. the four lots on the lowest level have unit entitlements of 11; the four on the next level up have UE of 12; the four on the third level have UE of 13 and the two on the top level have UE of 14. Unit entitlements total 200

4. many of the lots in this strata plan were sold off the plan.  Some of them (5 lots) were ultimately sold to people who had “invested” in the development and or were shareholders in the development – hence the sale prices in those cases are not “arms length”.

5. the builder went into administration / liquidation just as the building was being finished.

6. We have had home owners warranty claims in the building over a number years and have exhausted that insurance.  Owners will need to contribute to significant special levies to fund the balance of the cost of defect repairs.

7. A representative of the developer told me around the time of settlement that the UE were originally intended to be 11; 12; 13 and 14; as you went higher in the building (and the values / selling prices got higher) however Council wouldn’t allow four units on the top floor (something to do with occupancy numbers) so as the two penthouses UE’s were doubled.

8. The owners of the two sub penthouses (the minority I mentioned) are complaining that the UE’s are inequitable (especially now that we face significant special levies to repair the building).

8. We have had a valuation report done however it is dated 13 August 2013 and makes no reference to values at the time the strata plan was regisitered.

9. It does conclude that the penthouse UE’s should be reduced by 33% while lower lots should increase from 7% to 24%.

10. As I commented above (at point 4) we don’t know all the values at the time the strata plan was registered (and some were not “arms length” transactions however based on what we do know about purchase prices at the time of registration of the strata plan most owners (while recognising that there is most likely some inequity) do not believe the valuation report we have received has  got it right.

I hope this assists in further helpful comments being made about this issue for our benefit and also others strata dwellers who have similar issues to tackle.

Thanks again everyone for your comments thus far.

 

 

[Aquarian]

Thanks Jimmy T,

The OC has a Building Defects lawyer and a consulting engineer.  We have signed a deed with the insurer (some matters still to be argued) and have builders on site doing some of the works. While some of the works are being undertaken it has been an unbelievable battle with the insurer to get them to agree to each point.  The OC has waited for insurer approval and funding before undertaking the works (thus far $1.3M plus $200K out of pockets yet to be settled).  There are more defects in the pipeline. We have had one bedroom in our lot uninhabitable for 5 + years with water entering every time it has rained.  The contents of the room were put into storage and the OC don’t want to pay those costs (despite having legal advice that they are liable) unless the insurer guarantees that they will be paid by the insurer.  I have not, at this stage, gone onto other “damages” but certainly will if I have to take legal action against the OC.

[Aquarian]

Gilgal1 said:

Can only agree with Jimmy T.

Our place has lots of water leakage (and other) problems and insufficient funds to fix them – caused by years of neglect. I live in fear that someone will demand a similar payment before we can fix everything.

Only a couple of days ago my spouse threatened to ‘sue the strata’ if the leak affecting our balcony isn’t fixed soon (we’ve already had our carpet replaced several years ago, after being inundated by a serious leak in another unit that affected most units on our floor). I had to point out that we’ve got engineering reports and are well on our way to repairing all the leaks, not just ours, hopefully in the new year.

Thank you Gilgal,  a lesson for me in all this is that owner’s don’t do themselves or the OC any advantage by waiting till things can be afforded or take their course.  We have worked diligently with our HOW claim and the insurer has taken their time and resisted us on many turns (ultimately agreeing).  In hindsight I think the OC should have raised the funds (Around $2M) and completed the repairs while pursuing the insurance claim to the fullest.  A hard call but the disruption to everyone and the heartache over all these years is terrrible.  Some owners have passed away waiting for the “dream” to be realised!

[Aquarian]

JimmyT said:

The OC is liable in the first instance because of its legal duty to maintain and repair common property (even though they are doing their best to effect this). They then need to claim against the insurer.  Look at it this way, if the insurer refuses to pay, the OC still has to stump up so they may as well pay now and claim later.  Better to keep relations on a cordial footing and do the right thing rather than find excuses so they don't have to dip into their funds. And don't forget, oit's the home owner who's really suffering.

 

Thanks Jimmy…it is as we have been told by our solicitor but a number (the majority) of the owner's corporation executive committee say “why is it our problem?”  The committee's decision is in defiance of the legal advice received.  I am the owner with the water damaged lot.  There are other water damaged lots as well however mine is probably the most severely effected.  If I can't get the OC to understand its responsibilities I will have to take legal action which unfortunately for all concerned will make it a much bigger matter.

[Aquarian]

Hi Jen F,

Why do you say “To complicate matters the owner is a member of the executive committee (but is not obviously being part of the decision as to whether to pay or not). “

As I understand it there is a very real prospect that all owners will at some stage be conflicted – why, given the circumstances of a strata corporation should such conflicts bar an owner (who is a member of an executive committee) or an owner at a general meeting for that matter from voting on a matter that they have a personal interest in?

 

Regards

Mark H

[Author]

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