[Jimmy-T]

I think this is a very good example of how NCAT, which is supposed to help us navigate the murky waters of strata gets far too wrapped up in its sense of self-importance.

There were two clauses that it found wanting.  One relating to the cancellation of key fobs, the other relating to how costs of pursuing breaches were to be charged.

In both instances the ruling accepts that the principles were OK. Strata schemes can restrict access to common property by people who are not entitled to be there.

It also accepts that the OC can legitimately demand refund of expenses incurred in pursuing by-law breaches.

However, in the first instance, the Appeals Board agreed with the original tribunal’s finding that the clause giving the OC “the power to deactivate access devices to the lot of any owner or occupier who is found to be in breach of this by-law” was “harsh unconscionable and oppressive” because it lacked limits or preconditions.

The ruling quotes the Court of Appeals judgement on the famous Jo Cooper pets case:

37. Access is an inherent property right. A provision such as this removes that property right with no preconditions; no stipulations as to how and when the breach is required to be “found” so as to trigger deactivation and deprive access; and once triggered, in what circumstances access is to be denied and for how long.

38. These provisions have inherent qualities that may impact severely on the fundamental rights of owners and occupiers at a price that exceeds and outweighs the benefits they seek to achieve.

On the question of charging miscreant owners for the cost of pursuing the by-law breaches as a levy, the tribunals agreed that the words “as a levy” were inappropriate because strata laws stipulate how levies should be imposed and what they can be charged for. To be clear, the OC was allowed to charge the costs, but not collect them in that way.

The Appeals board then engages in a long discussion about how it could legally have cut the offending clauses from the by-law but why it chose not to do so. And this is where I take issue with this ruling and the whole NCAT system

In my humble and non-legal opinion, a by-law that says that non-residents may not have short-term lets, as per Section 137B of the Act, should not be completely revoked on the grounds that the Owners Corporation did not have a chance to vote on the by-law with two significant but basically procedural clauses removed.

The intent of the by-law is to dissuade investor owners from letting empty flats in their entirety as short-term lets. Removing those clauses would have made no difference to the by-laws’ fundamental intention.

As a result of the original tribunal finding, the two blocks involved have had no airbnb by-law in place for about five months and will continue to be unprotected until such times as they can plug the holes in this one, get it approved at a general meeting and then, possibly, subject it to the “suck it and see” processes of NCAT, should the affected investor choose to challenge it.

There has to be a better way.  There should be a system of pre-checks by a Tribunal panel of selected by-laws that address fundamental principles of strata law, although it has to be said there were at least three experienced and highly regarded strata lawyers involved in writing, supporting and challenging the by-law.

Part of the problem here was that the owners corporation took a pro-forma by-law and added their own specific clauses to it. While that makes sense due to the different specific circumstances in every strata scheme, it also presents potential problems like those evident here.

You can read the Appeals Board ruling HERE.

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[Jimmy-T]

I’m going to quote the relevant section of the Act (S.116) below because it is a little confusing. On the one hand, it appears to allow the Owners Corp to sell its property.  On the other it says OCs are not subject to Section 50 (1) (d) of the Interpretation Act 1987  which … allows OCs to sell common property.
You are going to have to consult a strata lawyers at some point on this, so hopefully they will clarify this for you. On the face of it, it looks like you can sell common property and it would only require a special resolution.
However, there is a catch. The capital gain from selling the property may be taxable for individual owners. For example, your strata manager may have to distribute the value (but not the cash) to every owner according to their unit entitlements, with the expectation that they will include this in their tax return.
However, the money gained can only be distributed to owners via a unanimous resolution (no votes against).  Otherwise it stays in funds where it can be used for repairs and maintenance or to finance a reduction in levies.
All that said, disposing of unused common property is a good way of funding repairs and upgrades – just be aware of the tax implications.

116   Powers to deal with property

(1)  An owners corporation may dispose of or otherwise deal with any lot vested in the owners corporation as a result of a subdivision effected under section 13 of the Strata Schemes Development Act 2015.

(2)  The owners corporation may acquire or dispose of personal property or otherwise deal with personal property of the owners corporation.

(3)  Section 50 (1) (d) of the Interpretation Act 1987 does not apply to an owners corporation.

Note—

Section 50 (1) (d) of the Interpretation Act 1987 provides that a statutory corporation may, for the purpose of enabling it to exercise its functions, purchase, exchange, take on lease, hold, dispose of and otherwise deal with property.

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[Jimmy-T]

optusJo wrote:

What sort of costs does this search involve?

According to the Regulations, it’s $31 and an additional $16 for each half-hour or part of half-hour after the first hour of inspection. There will probably be additional charges for photocopying but newer smartphones have a scanning option which is handy.

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[Jimmy-T]

optusJo wrote:

What is a Strata Manager Broker?

I Googled the phrase and came across a company called Strata Management Consultants in Melbourne.  They say it doesn’t cost you anything but then they also say in their headline title block that they are “Body Corporate” experts.

Hmmm.  Don’t they know that they’re called Owners Corporations or are they just using the vernacular rather than the correct term to attract strata newbies?

Worth checking out, anyway.

 

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[Jimmy-T]

Leo B wrote:

I thought that my nickname would appear on screen with my post in reply to “wep” re hot water. My name appeared instead.

Apologies for that (now fixed).  It’s a glitch between the registration software and the Forum.

For other Flatchatter’s future reference, if your username or real name appears in the panel to the left of your posts, click on it (which will take you to your profile page), click on “edit” then select your nickname from the drop-down menu under “display name”.  If you don’t have a nickname, this would be the place to give yourself one (or change an existing one).  NB:  You can’t change your username

 

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[Jimmy-T]

haroldo wrote:

Is there any regulation when it comes to replacing old fluros with LED battens in garage common areas.

The regulations seem to specifiy the maximum amount of power to be consumed for lighting rather than the equipment that provides it.

This document (Australian Building Codes Board) specifies 6 Watts per sqm inside a garage and 25 W/sqm in the entranceway (first 20 metres).

This one based on Building Codes Australia, limits garage lighting to 3 W/sqm.

I’d just go with what your electrician says.

 

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[Jimmy-T]

One of the more arcane discussions I have witnessed over strata lighting was whether or not to install motion detectors or low-emission lighting in common areas.

The LED lights alone we were told would pay for themselves in so many years and the motion sensors alone would pay for themselves over a slightly longer period.

We were advised by a previous building manager not to have both because the savings we made using LED lights meant it would take longer for the savings on motion sensors to make financial sense.

Thankfully someone lumped the two cost/savings analyses together and worked out the overall savings of doing both made it worth it in the slightly longer long run.  We now have both motion sensors and LED lighting in our garages, bin room and bike room, saving the strata money and doing our bit for the planet.

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[Jimmy-T]

Clare B wrote:

I am so loathe to get anyone offside as am concerned about the possible further ramifications.  My requests have already created unpleasantness, which does make me wonder what is being concealed.

The “unpleasantness” may stem from the other owners having something to hide or it could just be that the fact that you are asking questions makes them think that you believe they are hiding something, which may not be true.

The problem here may simply be lack of transparency, something they should have considered when they embarked on the works you are worried about.

You are right to take the one-on-one approach initially.  If nothing else, it will give you more ammunition if and when you head to Fair Trading.

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[Jimmy-T]

kaindub wrote:

I agree that the wiring up to the lot distribution board is OC responsibility. However if the lot owner ( and I’m not suggesting this is the case here) has overloaded the circuit, that’s his responsibility.

On re-reading the original post, it says: ” Our electricity has failed in our unit and our electrician has checked the distribution board and there is nothing wrong with our fuse in that board either. He said there is no electricity going into the distribution board with our fuse in it.”

If there is no electricity going into the distribution board, and the fuse from the distribution board is intact, it’s almost impossible for that to be the lot resident’s fault.  In any case, the fix will determine who is responsible and, as we all agree, the priority is to get the supply reconnected then worry about who pays the bill thereafter.

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[Jimmy-T]

Mikada wrote:

He said there is no electricity going into the distribution board with our fuse in it.

This is a bit confusing.  I’m guessing you mean there is no power coming from the common property distribution board to your power board, in which case this is almost certainly an owners corporation responsibility.

In an emergency, especially if the owners corp, strata manager or building manager has shown no urgency in investigating the problem, you can organise the repairs yourself and then charge them back to the owners corp.  They may refuse to pay because you have not followed correct procedure, but if you have given them every opportunity to fix the problem, and they have been slow to respond,  you will probably be compensated eventually.

On a very basic level, the OC is responsible for electrical wiring  up until it emerges from common property walls in your apartment (e.g into your lot’s fusebox).

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[Jimmy-T]

kaindub wrote:

I was suggesting a personal visit rather than just requests. They can’t ignore you if you turn up at their office ( with a prior appointment)

The theory is good, and that may well work. But I have heard many stories about people being refused appointments, the material not being available when they get there, passwords being “lost” etc etc.

The simple fact is that if a committee and a complicit strata manager don’t want you to see records, they can put all sorts of obstacles in the way to, at the very least delay the process in the hope that you just give up.

Otherwise, you end up going to Fair Trading and/or a tribunal and wish you’d done that in the first place.

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[Jimmy-T]

TrulEConcerned wrote:

… is such a by law “harsh” as per s. 139(1) that provides that a by-law must not be “harsh, unconscionable or oppressive” and hence ripe for a challenge?

I believe the NSW Planning thinking is that a tenant or owner has a current and ongoing relationship with the building and its residents and so can be held personally accountable when things have gone wrong (and they get back from skiing in Aspen). So it doesn’t discriminate against investors because they are not subject to community scrutiny and pressure.  But, hey, anything can be challenged and this one surely will be, one way or another.

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[Jimmy-T]

It would be a lot easier to ban fishing from common areas by the use of a rewritten by-law.  There could indeed be health and safety issues and there may also be aesthetic and ethical issues with the idea of live fish being pulled out of the water and killed and gutted, especially in front of children.

I wouldn’t pussyfoot around this. A communal swimming pool area is no place for people to be river fishing.  Within reason, the owners corp has the right and responsibility to control what happens (or doesn’t) on common property.

For instance, you could theoretically pass a by-law banning the use of barbecues on balconies because of the smoke and smell that goes into other residents homes.

Check with a strata lawyer but I don’t a ban on fishing from common property would fall foul of the “unreasonable, harsh or discriminatory” test.

By the way, I was going to say that I doubted very much if there were regulations that prohibited people from fishing from shared swimming pools but then I found this NSW Government fact sheet which under “Prohibited” says you can’t “use any methods (e.g line fishing, traps, nets, bait collection) in closed areas.”

But that seems to mean areas  of waters and rivers that are closed to anglers and other fishers for seasonal or stock protection reasons.

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[Jimmy-T]

I’m wondering if I should hand in my Strataguru badge.  I have committed the worst sin of which anyone writing about strata can ever be guilty – I assumed.

I assumed that by-laws banning short-term lets in Sydney apartment blocks applied to everyone.  But no. Resident owners and full time tenants can side-step any ban by showing that the flats are their principal place of residents.  It’s only absentee investors who will be affected by the bans.

We shouldn’t be surprised – the NSW government had to be dragged kicking and screaming to any restrictions on airbnb and their ilk.

Now we find they don’t exist for residents, apart from the limit of 180 nights in Sydney.

I’m off to write “Assume makes an ass of u and me” 1000 times as punishment.

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[Jimmy-T]

Cosmo wrote:

The Department of Fair Trading states “Chairperson does not have a deciding vote under any circumstances”.

I think this is badly worded (which is not that unusual with Fair Trading). Your vote still counts towards a simple majority.  I believe what this is referring to is an additional vote to break a deadlock, as exists in Victoria and elsewhere.

In fact Section 8(3) of Schedule 2 of the strata Act says this:

The chairperson does not have a casting vote in relation to any motion but may vote in his or her own right if otherwise entitled.

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