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@dan said:
This information seems to contradict the response I received from Jimmy which stated shower screens are not common property and we should put a motion forward at the next meeting to invoice the lot owner.
They might not be common property but that doesn’t mean they’re not covered by the OC’s strata building policy.
And if they are covered by the OC’s strata building policy (I think they will be, as a lot fixture) then it’s allowed for the lot owner to make an insurance claim. I don’t think the OC could even stop that.
Who pays any excess is another question. That seems to vary around Australia. Sometimes it’s written in the Act, sometimes it’s an OC/BC decision.
And if the insurance claim is refused, it’s then the lot owners cost.
@dan said:
Following on from my email above the strata manager has responded with – “This is not a misuse of funds as the shower screen is covered under the strata insurance policy and we are in the process of making a claim to the insurance company”.To note that compulsory strata building insurance usually covers much more than just common property. Most policies I’ve seen also cover lot fixtures, lot fittings and lot improvements as well.
If that’s the case, a lot owner is within their rights to make a strata insurance claim if it’s a claim on their insured lot property fixture, fitting or improvement.
I think there’s a mix of issues about noise and safety.
While the OP states noise is a complaint issue in some circumstances, it seems not to be the main issue for scooter use on the driveway?
If the existing by-law was:
7 Children playing on common property in building
An owner or occupier of a lot must not permit any child of whom the owner or occupier has control to play on common property within the building or, unless accompanied by an adult exercising effective control, to be or to remain on common property comprising a laundry, car parking area or other area of possible danger or hazard to children.Or
8 Children playing on common property
(1) Any child for whom an owner or occupier of a lot is responsible may play on any area of the common property that is designated by the owners corporation for that purpose but may only use an area designated for swimming while under adult supervision.(2) An owner or occupier of a lot must not permit any child for whom the owner or occupier is responsible, unless accompanied by an adult exercising effective control, to be or remain on common property that is a laundry, car parking area or other area of possible danger or hazard to children.
Would either of those (the old and the new model by-laws for NSW) actually allow for a child to play on a scooter on a common property driveway?
@JimmyT said:
No, but they can say “we’re not going to help you to claim on OC insurance …” and that would be enough of a discouragement for most owners.
Indeed.
Just by pass them if you think you have a legitimate claim.
@butterflyness2006 said:Strata have said no it’s our responsibility.
I’d just like to note, and it’s been confirmed to me directly by the strata insurance companies, that you actually don’t need to ask “strata” before making a lot property “fixture or fitting” claim on an OC/BC compulsory building insurance policy.
As a lot owner you can make such a claim directly. The insurance companies have told me that you have that right but they will of course assess your claim. Who pays the excess is another question.
It makes some sense because a lot contents insurer can refuse to cover a lot property fixture or fitting because they know the fixture is already covered by an OC/BC compulsory building insurance policy.
So if you eg accidentally damage a kitchen or bathroom fixture, an OC/BC committee or manager can’t really say “we’re not going let you claim it on the OC/BC’s compulsory building insurance”.
@scotlandx said:
Austman – you are in Victoria. I also own a property in Victoria, and my experience has been that the law is very different there.The NSW legislation provides that a lot owner can be awarded damages for loss as a result of the OC’s failure to maintain the common property. You do not have to prove negligence, because the OC’s obligation is a strict liability one.
It’s the same in Victoria – that an OC has a absolute duty to repair and maintain common property.
I think the OC would responsible for a lot’s losses if it failed to repair or maintain the common property (if the pipe was actually common property) in a timely manner.
As 106 (5) states, it’s got to be “reasonably foreseeable”. How a pipe that can spontaneously burst or leak at any time could be considered “reasonably foreseeable” is the problem.
The case you cited was a long term (well over a year) major roof leak. Not quite the same thing as a spontaneous burst or leaking pipe. And it was claimed in the case that repairs were not done in a timely manner. The delay caused the foreseeable loss.
None of my insurers around Australia consider a spontaneous burst or leaking pipe event to be a legal liability on the pipe owner. Failing to repair it in a timely manner could be another matter.
Generally you have to establish negligence to be successful in a claim against an OC/BC in your circumstances.
As Bunyip1 states, NSW has had some changes in this area. Delays in getting a common property defect repaired can result in a successful claim against the OC by a lot owner for damages. Other states are not as clear.
Compulsory strata building insurance will cover a lot’s fixtures and fittings, it usually does not cover a lot’s contents of which a floating floor is considered to be.
I’ve personally been in your situation a few times including in the ACT. I think you’d need to establish that the OC wasn”t doing enough or had waited too long to get the repair done.
Your choice is to claim on your contents insurance or have a legal fight with the OC. Of course, as your lot contents were affected you could try a direct claim against the builder yourself – floating floors are not common property and the builder was probably the cause of the defect.
@scotlandx said:
If the neighbour’s pipes leaked and destroyed the cupboard, then the neighbour is responsible.Actually they usually aren’t.
In my many dealings with these types of matters and strata insurance claims, the neighbour has to be found legally liable for the leak for any claim against them to be successful. And that usually requires establishing negligence on their part.
With many plumbing issues, negligence is actually difficult or impossible to establish. Pipes spontaneously leak or burst. If someone eg damaged the pipes, they might the liable party but as we know in strata schemes, one lot’s pipes are often in another lot’s airspace (eg in garages), so it’s not always the owner of the pipes who might damage them.
But I agree, it’s best to let the insurance companies work it out.
It seems to me this would be a building insurance claim and that would be on the OC/BC’s compulsory building insurance (that covers fixtures, fittings and lot improvements) regardless of if they or the pipes are common property or not.
Insurance companies tend to know what an OC/BC’s compulsory building insurance actually covers. And in this case it seems they have concluded that the damaged cupboard is a building fixture, fitting or lot improvement covered by the OC/BC’s compulsory building insurance.
@Lady Penelope said:
I am not an accountant. Perhaps you should seek advice from an accountant.
Our strata management firm (one of the largest in Victoria) does use accountants for this. It’s those accountants that registered the OC where I live and chair for GST last year when it appeared that the OC’s projected levy income would temporarily exceed $75,000 in a 12 month period (due to special and unpaid levies). They are adamant that this the correct GST threshold for OC/BCs.
I don’t think there’s any doubt that OC/BCs must register for and pay GST once the GST turnover threshold is exceeded. And it’s clear on the ATO’s website that the turnover includes levies:
turnover must include levies on unit owners
All my other (larger) OC/BCs are registered for GST.
What appears to have happened recently is the ATO ruling that OC/BCs are now considered “for profit” organisations. That now sets their GST threshold to $75,000 (not $150,000 as it might have been previously).
AFAIK when OC/BCs spend their income on goods and services, which is what they usually do, they receive GST credits on that expenditure. So, eventually, GST becomes an almost neutral tax for most OC/BCs.
Except that it needs administration (BAS reports etc). And funds raised for long term maintenance might not see any GST credits for many years.
When to exit (cancel the registration) the GST system, as my OC can now do if it so chooses, is another matter! On that we are seeking accountancy advice.
I don’t think those are valid any more Lady P.
One is an old 2009 document while the other is for bodies corporate in general (not specifically strata).
When I looked at this as close as I could it seems that it’s Tax Ruling TR 2015/D1 that became TR 2015/3 that specifically applies to “strata title bodies constituted under strata title legislation”:
http://law.ato.gov.au/atolaw/view.htm?locid=%27TXR/TR20153/NAT/ATO%27&PiT=99991231235958
Ruling
22. A strata title body will not be taxed as a non-profit company even if it includes non-profit clauses in its by-laws.
It’s explained in many places, but here is an example:
Tax status – a strata owners corporation will be taxed as a “for profit” company …
It seems that after that 2015 tax ruling OC/BCs are now always classed as “for profit” organisations. And that mean the $75,000 GST threshold now always applies.
@Lady Penelope said:
This PDF from the ATO may be helpful (though complicated – if you are not
A more user friendly information source from Strataman is here:I believe that some of that information is now out out date.
A more recent ruling by the ATO has deemed at all strata body corporates are in fact “for profit” organisations and so do not qualify for the $150,000 GST threshold.
So if a strata scheme raised $4,000/year in levies per lot, even a 19 lot scheme would exceed the $75,000 GST threshold limit.
@JimmyT said:
Why would a strata scheme need to register for GST? Is this normal? What are you selling?It’s the law – OC/BCs that have an income of $75,000 or more per year (12 months forward projection or 12 months past actual income) must register for and pay GST. And not only pay GST but do BAS (Business Activity Statements).
And it’s not just regular levies that are counted for the GST threshold. Special levies and even unpaid levies (which are counted as future revenue) can tip even smaller OC/BCs over that $75,000 threshold easier than one might imagine. That happened to the 12 lot building where I live and chair the OC.
The ATO also doesn’t consider OC/BCs as “not for profit” organizations which would at least extend the GST threshold to $150,000.
@Missy said:But remember that means 10% of levies go to the ATO, this will mean a dip in the strata funds, this tends to mean if the budget is done correctly (and depending on the expenses) the levies will increase by 10%.
Missy, shouldn’t stratas that pay GST also receive GST credits on their goods and services expenditure?
So the net effect for a strata that spends all its levy income on goods or services should be close to GST neutral? Eventually?
That’s the way I thought it works. But trying to get information from our Strata Manager on our recent GST registration is like trying to get blood out of a stone.
We didn’t actually end up exceeding the $75,000 threshold. We raised a special levy that took it close. But thanks to some late levy payers, our forward projections including their outstanding levies did temporarily exceed the threshold.
When to exit the GST system is now our issue. Even if GST credits mean all or most of the GST paid is eventually returned, there’s still all the administration around GST that has to be paid for (BAS etc).
IMO the lawyers and the tilers have it right and the Strata Manager has it wrong.
I’ve not seen acoustic underlay used in tiled kitchens, bathrooms, laundries, lavatories. They have typically been built that way for as long as I know. And any by-laws on acoustic requirements usually exempt them.
Kitchens are actually not considered wet areas under the BCA/NCC rules. So they don’t actually require waterproofing or floor wastes. AFAIK the choice of flooring in kitchens tends to be for practical reasons. In the building where I live all the kitchens have wood floors (so they are not much waterproof at all) but others that I own or have owned use tiles.
What type of flooring is there now?
My building has had a formal request for filming. As well as external shots from the street and of the interior of one lot (they are free to do that), they wanted to include some common areas.
The production company asked the OC to sign a “Location Release Form”. The OC committee voted to approve.
In our case the filming was done in less than a day and was not very obtrusive. At one point they did set up a rail in the street for one of the cameras. And they used a drone for some higher up external shots.
@JimmyT said:It was a very general, non-specific comment.
It’s actually legislated that lot fixtures, fittings and improvements must be covered by any compulsory strata building insurance in at least ACT, NSW, VIC. So it should apply to all strata building insurers.
For many landlords that’s adequate cover as far as lot interiors goes because in a tenanted property (unfurnished) that’s the most expensive lot interior items covered. But it’s up to the landlord..
I personally choose to take out landlord insurance in my tenanted strata properties even when they are covered by compulsory strata building insurance. But they don’t pay out until any covering strata building insurance is first claimed.