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My point is that the OC might not have any liability at all.
That’s a common situation in VIC where lot owners are typically responsible for much of the waterproofing of their lot. And they can sometimes accidentally cause the flooding of their lot.
Much of the resulting damage can be covered by strata insurance which covers more than just common property. But the OC itself might not be liable.
In my stratas in VIC, the above situation has happened many times.
I think we’d have to know more details about the water damages and how they occurred.
They are not always due to a fault of the OC. Especially in VIC.
I’m assuming it was not due to a fault of the OC. In which case an affected lot owner can claim on any insurance policy available to them. If they use the OC’s strata building insurance, they’d have to pay any excess.
To know the circumstances of how an OC could agree to a settlement without the OP’s involvement, I’d be asking that question to the Strata Manager, the insurance broker or the insurer itself.
The usual thing to do would be to claim on your own insurance.
You could try making a formal damages claim against the OC. To be successful you’d have to establish that the OC itself was in some way responsible for the theft or at least partly responsible. That’s not an easy thing to do when the area of the theft is a common one that has to accessible to all occupiers. Security in those areas is always going to be limited. I have seen a couple of successful cases however where the OC was aware that security had been compromised but failed to remedy the situation in a reasonable way/time-frame.
I’d agree that the strata must maintain the CCTV. But that doesn’t mean it is guaranteed to be functioning 100% of the time. Unsupervised CCTV systems are common in stratas and are designed to run automatically with minimal supervision and maintenance requirements. If the OC had known for some time that its CCTV was faulty but failed to get it repaired, it might be different. The OC is claiming however that it was a “glitch”.
You are correct that a Tier 1 OC in VIC must have a manager. But that’s a Strata Manager not a Building Manager. Building Managers are not part of the strata legislation.
I think more details are needed.
It seems to me to be a plumbing leak investigation done by the OC which turned out to be caused by a lot owner? In those cases, an OC often tries to recover its costs.
I’m guessing that the OP themselves reported the leak to the OC or called the OC’s emergency after hours service? Sometimes OCs or Strata Managers have a policy that if a reported issue turns out not to be a common property matter they will recover the costs from the requesting lot. IME, it’s SMs that drive this policy more than the OC itself or the committee although it can be approved at each AGM.
It really should be that they recover the costs from the responsible lot. I’d agree that the committee should be contacted, especially if it was another lot that was found to be the eventual cause of the leak.
As for the insurance, some policies do cover exploratory costs. With a fair few conditions attached. You could check directly with the OC’s broker or the insurer. It’s the party who eventually has to pay for the exploratory costs – OC or lot owner – that makes a claim.
On the issue of “secret committee meetings”, I had a look at the situation around the nation, to see how widespread it is. Here is what I found (I think I have it right, or close to it):
Q: Does a strata committee/council need to give a committee/council meeting notice to all lot owners as per NSW?
ACT: No.
NT: No.
QLD: Yes/No. No if using the Small Schemes Module for 6 lots or less.
SA: No.
VIC: No.
TAS: No.
WA: No.
It really does seem that NSW and QLD (for 7 lots or more) are the odd states out. If this is strata “secrecy” then it’s a widespread national issue and it has been for a long time. I can’t quite see the national crisis.
IMO the intention of the legislature, as used by most of the nation, is to allow a committee to get on with its job without too much red tape formality. Some of the various legislatures also read that way – at least to me. There are several checks and balances that already limit a committee’s authority. And an OC/BC can further limit them if it wants to.
Requiring the formality as per NSW would mean, in one of my OCs in VIC, on a busy week, the issuing of 4 or 5 notices of committee meetings because, on a busy week a new issue comes up nearly each day. How would the committee be able to deal with that requirement? And how long would it take to get the committee decisions made? Even the practicality of where to hold formal in-person committee meetings can be troublesome if an unknown number of owners is allowed to attend. OCs don’t all have common areas big enough etc. Zoom is around now but not everyone in an OC might use it.
Maybe there needs to be a 2-tiered approach? Minor decisions of the committee can be made without informing/inviting all owners but major decisions must have the formality. So a committee could actually get on with doing its job reasonably efficiently for most matters. But how to set the tier? It can already be set if an OC/BC wished to set it – except that the decision would become a GM decision.
I do agree that committee decisions should be transparent. Some of the other states do require that committee decisions (minutes) are sent to all owners. But up to 5 times a week? I don’t know about that.
I would say that if a lot owner wants to see the minutes of any committee decision, it should be made available to them ASAP without question and without having to make them go through the process of inspecting the OC’s records. A minor change to various state legislatures should be able to do that.
Having owned, lived in, served on committees and chaired in NSW in multiple stratas over some decades and having owned, lived in, served on committees and chaired in VIC in multiple stratas over some decades, I’m probably better placed than most to compare the two.
For me, the VIC system is by far the best. But it’s for sure not without its issues.
The main difference in VIC, compared to NSW, is the simplification of what is common and lot property and what are common and lot services.
In VIC apartments, the lot usually owns all the airspace of their lot including all of its surfaces (eg paint, tiles, wallpaper and surface treatments including waterproofing membranes). This is mostly due to definitions in the Subdivision (Registrar’s Requirements) Regulations 2021 (an update of the 2011 version). The lot also owns all the services (water, drainage, electricity etc) from the point where the service branches to exclusively service the lot, regardless of the service location. Those concepts are not unique to VIC. In VIC apartments, lots usually also have the legislated (s.132 of the OC Act) right to “to decorate or attach fixtures or chattels” to the lot’s interior side of common property walls, floors and ceilings.
Lots cannot damage or alter common property or common services without OC permission. And no, attaching fixtures or chattels is not considered to be damaging common property. OC common property inside an apartment lot will include structural walls, slabs, beams, columns and ducts. In other words, the integrity of the building. That again is not unique to VIC.
What it means is, for most lot interior works, as long as they do not affect common property, lots do not need OC permission. The lot must still meet all rules, laws and standards including council and building code requirements. Certain works trigger a legislated (s.133 OC Act) requirement to inform the OC of the works.
In comparison, the definition of what is common and lot property and what are common and lot services in NSW is much more complex. Lot owners in NSW need more OC permissions. Lot owners in NSW may need maintenance by-laws to be created. VIC doesn’t need the by-laws (rules in VIC) or similar for maintenance to be created as long as common property if not affected. The lot will always be responsible for lot property and lot services.
The situation in VIC is not perfect but it does, IMO make owning, living in, serving on the committee and chairing VIC apartments a much more enjoyable strata experience.
For me, the minuses of the VIC system, include the increased responsibility that lot owners have to maintain their lots and their services. That can lead to more lot v lot maintenance disputes if the OC itself is not affected.
The maintenance of outdoor balconies, terraces and courts of VIC apartments can also be a bit of a shock to lot owners. While VIC apartment owners are usually happy with the idea that they are responsible for the waterproofing of their bathrooms and laundries, they can be surprised when they discover that their responsibility extends to the waterproofing around the airspace areas of their outdoors balconies, terraces and courts.
The OC is still responsible for its common property and its common services. And lots can’t always just do as they like. There are definite limits.
The plaintiff in this case was seeking damages from the wrong body.
That’s right.
And in the case of a spontaneous burst water pipe, the body responsible is likely the pipe manufacturer or the pipe installer. The owner might be liable if they could have reasonably foreseen the event.
Regardless, the affected lot has to establish the liability. That can be hard to do that with spontaneous plumbing failure events. They can be pretty unpredictable.
The main point of the linked case was to show that ownership alone is not enough to establish liability. The OC owned the pipes. The OC’s pipes caused a flow. The OC was not liable because the OC could not have reasonably foreseen or prevented the incident. That’s the requirement for liability. Not just ownership.
I would be interested to see a Tribunal ruling (if one exists) that the affected neighbour had no claim against the upstairs owner unless they could prove negligence.
Here’s one: http://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/vic/VCAT/2015/1912.html
There are others as well but I think that one is a fair example. It’s a spontaneous plumbing leak event. In this case a sewage containment leak. And the “upstairs owner” is the Owners Corporation but it could have been a lot owner.
The affected lot owner claimed $9,494.00 in damages from the OC. But lost. They could not establish the OC’s negligence or failure to maintain its common property …
I have a huge problem with the idea (often repeated here) that a failure to contain water in one person’s apartment is not their responsibility if it accidentally floods another unit –
… or the OC’s requirement to contain the flow eg under Water Act.
Two of the case findings:
- The OC did not breach its duty under s47 of the OCA to repair and maintain the sewer stacks; and
- The OC did not cause the flow of sewerage from the sewer stack into the apartment of Mr O’Connor under s16 of the Water Act 1989.
There’s no mention of a trespass claim. I believe trespass requires intent.
To be fair, you didn’t have the benefit of reading the case findings
I read it. VCAT published it, as is their prerogative.
Any chance of a citation or link, please?
I’ll do that. I read all VCAT published OC cases and recall a few where OC charges claims against a lot have been reduced or refused by VCAT. However, recent changes to the OC Act (from December 2021) make it easier for VCAT to approve certain OC charges claims.
I’ve had a good read and re-read of the particular issue, including the ABC report, and still can’t still why OC committees and Strata Managers are responsible for the conditions discovered only when the flammable cladding was removed. It seems it was a complete surprise to everyone.
How can an OC, an OC committee or an SM be responsible for something they couldn’t reasonably or even possibly be aware of?
This particular issue seems to me to be an extension of the whole flammable cladding issue: A systematic failure of the whole building construction industry. Not only was the cladding wrong, so was its installation.
I agree there’s plenty of room for criticising how OCs, OC committees and SMs address building maintenance issues. Australia wide. But they have to be at least aware of the issue.
So now we know. If proper process had been followed, they could and probably would have allowed the charges.
Yes, the proper process was not followed.
But in cases where the proper process was followed, there’s no guarantee that VCAT “probably would have allowed the charges”. Although VCAT “might well have”.
The OC still has to justify the charges. And there have been many cases where VCAT has reduced the OC’s claimed charges or denied them entirely.
The practice of on-passing certain Strata Manager fees to lot owners has been done in VIC stratas for decades.
Eg the fee charged to the OC by an SM for issuing a breach notice has been on-passed to the lot that received the breach notice. It gets placed against the lot’s account. So it becomes type of pseudo fine against the lot. But it’s never been allowed to be done that way, so it’s always been done as a gambit: the lot owner has to either pay the fee or challenge it. Most pay.
The practice can even get approved by the OC at each AGM. I know some of my OCs do that. To some extent that gives the SM the green light to do it. But, as several VCAT cases have established, OC approval of the practice does not make it legal.
To make it legal before charging a lot owner, an OC had to first apply to VCAT for approval. VCAT more recently has more authority to grant that approval if it sees fit to do so.
Applying to VCAT is a process within itself, so many (most I’d say) OCs try the gambit method first. If a lot owner challenges the fees at VCAT, they might win or they might lose. The lot owners has to decide if it’s worth the challenge.
In the case in this thread, the OC withdrew the fees before the case was heard at VCAT. So we’ll never know if VCAT might have allowed some or part of them. But the OC involved for sure did not follow the correct process it needed to follow when it issued the fees.
Flooding will be a trespass or a nuisance and they do not require proof of negligence.
On that point, there’s a lot of even online published legal opinion about strata water leaks, liability and negligence.
Basically to be liable, the event has to be foreseeable. It’s not an absolute liability:
Although that’s for VIC, the same principles apply nationwide.
There are also state Water Acts that can apply but again a test of reasonableness of prediction will be needed.
These are the same kinds of tests needed to establish negligence.
How could a reasonable person foresee a burst pipe or fitting? Maybe they could have. But that’s what you have to establish.
Am I liable?
Went in and found one of the fixtures in the bathroom broken and most of the unit flooded.
You almost certainly will not be legally liable.
For you to be legally liable, a claiming party has to establish your negligence. That can be hard to do with spontaneous plumbing failure situations. But it is what they have to do. Eg they’d have to establish that you should have reasonably known of the situation before it spontaneously happened. Ownership of something is, alone, not enough to establish liability.
If you are not liable it’s up to you whether you pay for the other lot’s damage or not. It might be good manners and neighbourly to do so. If you have access to insurance that covers your legal liability, your insurer would almost certainly refuse your claim because they too would doubt your liability. You could check that if you do have such insurance.
Regardless of what anyone else says on this thread, I think it’s best that you seek specialised strata legal advice.
I agree.
I’ve dealt with dozens of these water ingress issues in VIC. And, I regret to say, owners have usually get the actual eventual issue totally wrong.
So it not only needs professional investigation but it also may need profession opinion about maintenance responsibilities.
Unfortunately, I regret to say, IME professional investigation has often got the issue totally wrong as well. They can very very tricky issues to solve. The professionals can need to be top notch experts and not just a regular plumber/builder.
Still, in VIC cracks in walls marked “Exterior Face” and general waterproofing around the airspaces of their lots (inside or outside) is a legislated lot owner responsibility in most cases. In VIC, an outside balcony, terrace or courtyard is usually treated like an inside bathroom as far as surface treatments including tiles and waterproofing is concerned.
If enough lots are being affected, the OC can decide to do investigations/repairs. Deciding to repair lot property needs a Special Resolution in VIC which is not always easy to obtain. But if most lots need the works it would be more likely.