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I suppose if the OC gives or sells the owner a key/remote/swipe it becomes the owner’s? Isn’t that also common law?
Austman said
Wouldn’t it depend on who actually owns the key/remote/swipe?
I’ve been a member of six OCs/BCs across 3 states/territories and have not yet encountered a by-law or registered special rule in any of my OCs/BCs about common keys/remotes/swipes.
Yes, but how do you ascertain who “owns” the said item? Common law suggests that fitting and fixtures within the airspace of the lot are owned by the owner/occupier of the lot. It gets a tad tricky when access cards are concerned because they have one part on the common property and it cannot be clearly said that the card is a “fitting or fixture” of a lot as it is generally used to access the common property.
And by-laws stipulating that access cards are owned by the owners corporation are quite common in NSW in my experience.
nicks1990 said
My partner and I have been renting out a studio which needs access with a swipe key. We moved in about 10 months ago and my partners swipe key stopped working about 1 month ago. No damage to it, not broken – just stopped swiping.
After contacting the real estate and waiting over 2 weeks for a reply, I have been told that the “swipe is no longer covered under warranty and a new one will cost $220”. Which we have to pay.
Is this fair or legal or something, because when we moved in, we were told nothing about a warranty with the swipe key and seeing as it wasn’t us who broke it.
Well, it depends on the terms of your by-law. But, from what I have observed, most by-laws tend to provide that swipe cards are property of the owners corporation. Hence, if you’re in NSW and the by-laws so specify, then an owners corporation would have a duty under section 62 of the Strata Schemes Management Act 1996 to replace the swipe cards if they become defective.
As for the tenancy aspect, it may be arguable that your landlord is under a duty to provide replacement swipe cards under sections 63(1) or 70(1) of the Residential Tenancies Act 2010 (NSW).
@JimmyT said:
“some cases”Well Jim, many tend to take issue at me citing cases here, so I didn’t this time.
@JimmyT said:
No, it isn’t arguable. Section 49, to which you refer, doesn’t even prevent owners corps from passing by-laws preventing the lease of apartments as short-term letshttps://www.ncat.nsw.gov.au/agdbasev7wr/_assets/ncat/m771022l14/annual_report_1112.pdf
Look at page 37
“A high-rise apartment building leasehold scheme located in Sydney’s Darling Harbour was managed by a large hotel group for some time, and a number of lot owners had made their apartments available for short-term holiday leases through the hotel group. This situation changed when the hotel group vacated the building and an extraordinary general meeting of the owners voted to adopt a special by-law to prevent short-term leases and serviced apartments. The special by-law prohibited the use of lots for commercial or retail purposes, including the use of lots as serviced apartments or short-term rentals.
A lot owner made an application for Adjudicator orders to repeal or invalidate the special by-law under section 157 or 159 of the Act, so that they could continue to lease their apartment to tourists and visitors.
The owners corporation’s written submission stated that the use of serviced apartments and short-term leases created security, health and safety issues as well as adversely affecting the general amenity of the building.
Section 159 of the Act allows an Adjudicator to set aside a by-law if the owners’ corporation did not have the power to make the bylaw. However, section 49 of the Act also provides that a by-law cannot prevent any dealings relating to a lot.
The Adjudicator considered that the new special by-law led to restrictions that were not compatible with section 49, and was therefore outside the by-law making power of the owners corporation pursuant to section 159 of the Act…”
Not arguable? Or, would this be considered “scratching your amateur attorney itch”?
@Bernie48 said:
They bought about 2 years ago. They wanted to change the gate entry locks that had been in place for the last 10 years. At an EGM, the OC voted 2:1 (76:24 on unit entitlement) not to change it. I am concerned that they will get their compulsorily appointed manager to do their bidding and change the gate locks. Does the compulsorily appointed strata manager have to act in the best interests of the OC are can they do the bidding of the disgruntled minority unit holder?I don’t get it. Is there any particular reason why changing the said lock would be detrimental to you or other owners?
And yes, the compulsorily appointed strata manager is supposed to, in theory, act in the interests of all lot owners. Usually they are appointed to dissolve cliques within a strata scheme (or that is one of the reasons for appointment).
@scotlandx said:
He doesn’t say anything of the sort mini – in that post he says:One of those distinctions is between “retrospective” application of a new law to past events, and the “saving”, or continued operation of old law to new events. There is fairly common tendency to conflate the two concepts .
That is precisely what you have done. Also the discussion is in relation to someone who got approval, but didn’t get a dog, and then the old by-law was replaced with one that prevented keeping of animals. Mr Russell’s view was that the consent under the old by-law no longer applied because of that. The person would have had a right accrued under the old by-law, if they had brought a dog in in reliance on the consent under the old by-law.
Did you read his second post, on the second page? And I don’t read his posts to say that “The person would have had a right accrued under the old by-law, if they had brought a dog in in reliance on the consent under the old by-law.” There’s simply nothing in his first or second post which says that. In particular he concludes with:
“In this case the words “must not keep a dog” are similarly clear. Which brings me back to the view that a clear savings provision would need to have been included, which is not the case.”
I think it’s quite clear. That is, unless if a “savings” provision was included in that case then the “old consent” doesn’t have any effect (i.e. the words “must not keep an animal” says what it means and means what it says).
I don’t think you have read White v Bettali very carefully – it says that the limitations on the kind of regulations that may be set by by-laws arise from the statute that permit them to be made. I don’t think it was ever the intention of the legislature that strata law could be used to prescribe the exact removals company that may be used by a resident.
See White v Betalli at first instance at [37] per White J:
“37 In my view, the only limitations on the power of the owner of land being subdivided by a strata scheme of subdivision after 1 July 1997 to make by-laws are:
(a) the need for the consent of mortgagees and other holders of security under ss 8(4C) and 16 of the Strata Schemes (Freehold Development) Act;
(b) the express restrictions and prohibitions in s 49 of the Strata Schemes Management Act;
(c) the need to avoid inconsistency with any Act or law; and
(d) that the provision is made for a proper purpose and fairly falls within the concept of a by-law, that is, the regulation of the rights and responsibilities of lot owners, occupiers, or the owners corporation, in respect of the lots, or the lots and common property, for the strata scheme.”
I don’t see how a by-law restricting the use to a specific removalist company infringes upon any of those four points (similar to how, an owners corporation, in theory, could make a by-law requiring lot owners to pay additional contributions above their usual levy contributions, and not in accordance with unit entitlement).
And in any case, White J went onto say at [44] that:
“44 By-laws frequently interfere with the rights of property of an owner of a lot. In Sydney Diagnostic Services Pty Ltd v Hamlena Pty Ltd (1991) 5 BPR 11,432, the Court of Appeal upheld the validity of a by-law which prohibited a proprietor or occupier of a lot from engaging in any enterprise other than the practice of medicine, but excluding the practice of pathology. It was held that the power in s 58(2) of the Strata Titles Act enabling by-laws to be made for the purpose of, inter alia, the use of lots, extended to regulating what activities could and could not be conducted on each lot. The Court (at 11,443 and 11,434) rejected the argument that subs 58(2) of the Strata Titles Act (the predecessor to s 47 of the Strata Schemes Management Act) only permitted the making of “non-discriminating by-laws” which equally affected all lots.”
And then his Honour concluded that an owners corporation, in theory, could make a by-law allowing a lot owner to use another owner’s lot without their consent.
Quite clearly, the cases show that an owners corporation has very wide powers to make by-laws. Given that the doctrine of “restraint of trade” has no application to by-laws, then, I don’t see why a by-law couldn’t be made to restricting the choice of a removalist of a lot owner to one specific removalist company.
@scotlandx said:
In relation to pets, that is not correct mini and is established law.Daniel Russell, one of the leading strata lawyers, says otherwise (on another website)
As I said, it really depends on the terms of the by-law. Namely whether the by-law has a “savings provision” or “grandfather clause”.
I don’t believe an OC can mandate the tradespeople residents can use, i.e they must use a particular one.
In answer I would simply refer you to the passage of Campbell JA in White v Betalli at [205] (who formed the majority in that case):
“There is nothing in the notion of a by-law that, of itself, imposes any kind of limitation on the kind of regulation that might be adopted, beyond that it is for the regulation of the particular community to which it applies. Any limitation on the type of restriction or regulation that can be a by-law must arise from the statute that enables the by-laws to be created, or from the general framework of statute law, common law and equity within which that local community is created and administered.”
The passage was also approved in another decision of the Court of Appeal.
Quite clearly, an owners corporation can “mandate the tradesperson residents can use” through by-laws.
@JimmyT said:
Q2 – Can they limit your choice to use only their nominated removal company?
No – unless there a specific issues with the building that require skills that only the nominated company possesses. They could try to enforce it but any breach notice would probably be knocked over in NCAT as being unreasonably restrictive and may actually be a restraint of trade. A better by-law would allow for a hefty deposit before the move, and an inspection of common property before and after.
Sorry Jim, but I would have to disagree with you on that one.
It is well established that the doctrine of “restraint of trade” has no application to by-laws in a strata scheme: Hamlena Pty Ltd v Sydney Endoscopy Centre Pty Ltd (1990) 5 BPR 11,436 per Young J at 11,441-11442.
And there are other ways to enforce breach of a by-law. One other way is to apply for interim orders restraining a breach of a by-law, which could be granted if a lot owner/occupier has informed the owners corporation that he/she intends to breach a by-law and the by-law is in clear terms. Here is a reported story on that: https://www.stratalive.com.au/article/news/strata-news/2013/07/bylaws-prohibiting-onsite-auctions
If one then breaches an order of an adjudicator to comply with a by-law, then one could face fines up to $5,500 for non compliance with the order (as well as being liable for the owners corporation’s legal costs in the matter). Not sure if that is a path one wants to go down.
Q3 – Can additional by-laws apply to me given I am an existing tenant?
Yes, but they can’t be retrospective. For instance, a by-law banning pets can’t be enforced on pets already in the building because that relates to an action that has already happened (bringing in a pet). However, they could bring in a by-law to take action against barking dogs because that relates to actions in the future that could be prevented.
That really depends on the terms of the by-law. But I will say that your last sentence is contradictory to the one before it. There is no reason why the very act of keeping a pet couldn’t be one that “relates to actions in the future that could be prevented”. This is because, if a pet is removed from the parcel then the act is “prevented” as it is no longer “kept” on the parcel.
In short, yes, a by-law can be made to have a retrospective effect to prohibit pets being kept on the parcel. Its practical effect is probably harsh, but that is the reality of the legislation which specifically envisages an owners corporation passing a by-law to prohibit animals being kept on the parcel. One would hope that members of the owners corporation have at least a little humanity within them to not pass such a by-law.
@Stratafied said:
Some strata plans also have by-laws that restrict rental of parking to owners or tenants of the strata plan so that may be something worth checking. I think they may have an argument that it is a car however if there are no restrictions to the contrary regarding who they can rent to.But if the development consent for the building does not prohibit such rental arrangements, then I think it is at least arguable that the by-law would offend s 49(1) of the Strata Schemes Management Act 1996, which states that “No by-law is capable of operating to prohibit or restrict the devolution of a lot or a transfer, lease, mortgage, or other dealing relating to a lot.”
I have, however, seen such by-laws and have been curious about them.
@Whale said:
KWP – actually the NSW Act doesn’t definitively state that the responsibility of any alterations to common property transfers to the O/C once a lot is sold, that’s just how it’s generally interpreted (including by me).That’s not really the case.
If works have been carried out in contravention of section 65A, that is, if there has been an addition to the common property without a special resolution specifically authorising that addition, then, prima facie, some cases have held that the owners corporation is responsible for maintaining that addition.
The conclusion is said to follow from section 5 of the Strata Schemes (Freehold Development) Act 1973 which defines “common property” to be “so much of a parcel as from time to time is not comprised in any lot”. As to the meaning of “parcel”, the same Act defines it to be:
“(a) except as provided in paragraph (b), the land from time to time comprising the lots and common property the subject of a strata scheme, and
(b) in relation to a plan lodged for registration as a strata plan, the land comprised in that plan.”
And “lot” is defined to mean “one or more cubic spaces forming part of the parcel to which a strata scheme relates, the base of each such cubic space being designated as one lot or part of one lot on the floor plan forming part of the strata plan, a strata plan of subdivision or a strata plan of consolidation to which that strata scheme relates, being in each case cubic space the base of whose vertical boundaries is as delineated on a sheet of that floor plan and which has horizontal boundaries as ascertained under subsection (2), but does not include any structural cubic space unless that structural cubic space has boundaries described as prescribed and is described in that floor plan as part of a lot. “
Thus, it follows from definitions that in a strata scheme there can only exist lot and common property.
Section 62 of the Strata Schemes Management Act 1996 says:
“(1) An owners corporation must properly maintain and keep in a state of good and serviceable repair the common property and any personal property vested in the owners corporation.
(2) An owners corporation must renew or replace any fixtures or fittings comprised in the common property and any personal property vested in the owners corporation.
(3) This clause does not apply to a particular item of property if the owners corporation determines by special resolution that:
(a) it is inappropriate to maintain, renew, replace or repair the property, and
(b) its decision will not affect the safety of any building, structure or common property in the strata scheme or detract from the appearance of any property in the strata scheme.”
Thus, subject to a special resolution being passed under s 62(3) or a by-law being made in accordance with s 65A(4) which both must satisfy certain requirements (or an exclusive use/special privilege by-law being made under s 52 which imposes the responsibility of maintaining the common property to the lot owner(s) specified in the by-law), an owners corporation is responsible for maintaining common property under s 62, even if, as the cases say, it is common property which has been added to without proper approval.
In the case that a lot owner has breached s 65A and have done certain works which have added to the common property, that owner, whilst he is still owner of the lot, could be ordered by a strata schemes adjudicator to restore the common property into its former condition.
However, if that lot owner sells his unit and the unit, with the unauthorised works, is bought by another person then that new owner technically hasn’t committed a breach of s 65A or the by-laws of the strata scheme (which generally prohibit works from taking place unless if there is the requisite approval).
@Whale said:
After adding-in all the changes to Common Property that the O/C had itself made over the years, the Register was then closed-off, and at the next General Meeting it was specially resolved to Register a Special By-Law stating in very specific terms that any changes, alterations etc not shown from time-to-time in that Register were un-consented by the O/C, and that the responsibility for maintaining and repairing those was the responsibility absolutely of the Owner/s from time-to-time of the Lot/s concerned.Without having seen the by-law, I would just add a few remarks. Do you receive written consent from those who have agreed to accept the responsibility of maintenaning that common property?
Here is an excerpt from the Minister’s second reading speech with respect to the 1987 amendments to the Strata Titles Act 1973 (the precedessor legislation to the Strata Schemes Management Act 1996):
“The proposals also include a number of measures to protect the interests of both individual proprietors and bodies corporate. The first is that for such a by-law to be valid, the body corporate must first obtain the written consent of the proprietors who will be given the exclusive use of the common property. This provides a proprietor with a safeguard against unknowingly being given responsibility for the maintenance of part of the common property. For example, a proprietor absent on vacation might otherwise return to find that he had been granted exclusive use of the roof of the building with attached responsibilities for its upkeep and maintenance.”
It seems like the said by-law in your self managed strata schemes infringes upon the intent of the legislature in this regard. I will not make any comments as to its validity other than this.
@Adalazie said:
I’d like to go to the Strata Manager’s office and get the contact details of some of the other owners – who are investors and who never turn up to meetings – so I can tell them what I think may happen and, if they agree, obtain their proxy votes to keep the Strata Manager.Just a note here, make sure the proxy form has option 3 fully filled out (and option 1 selected AND option 2 crossed out – or option 2 filled out AND option 1 crossed out). Option 3 is:
“If a vote is taken on whether
………………………………………………………………………………………………………………………………………………….
(the strata managing agent) should be appointed or remain in office or whether another managing agent
is to be appointed, I/we want the proxy to vote as follows:”The failure to adhere to the above requirements (including the crossing out of the inapplicable options or the failure to fill out option 3 or option 2 if applicable) will, more likely than not, render the proxy form invalid.
@Goose said:
What are your thoughts? Is this common practice?I know someone who paid a deposit of $8000 for two off the plan apartments. The builder ended up becoming bankrupt and this person lost their deposit and didn’t get to own the apartment they thought they would eventually own.
This event occurred about 10 years ago meaning that the $8000 would be worth more now.
So I think you are in a better position than these people …
Apologies for the late reply. But I find that this forum is not very user friendly. It actually took me 10 minutes to find this thread to see if there were any replies to it … Anyway …
I assume the op is in NSW.
If so, some Tribunal and court decisions have held that section 62 of the Strata Schemes Management Act 1996 obliges an owners corporation to maintain and repair an addition to the common property even though it was unauthorised. So the op is quite correct, following those decisions, that the owners corporation would be prima facie under a duty to maintain and repair those unauthorised additions to the common property in accordance with its statutory duty to keep the common property in a state of good and serviceable repair.
An adjudicator can order that a lot owner who has made unauthorised changes to the common property (in contravention of s 65A or the by-laws) to restore the common property to its former condition. However, if the owner does not comply with the order the only thing that can be done at NCAT level is that owner being fined (and under the present law most Tribunal decisions have held that only one penalty application per breach can be maintained due to the wording of the Strata Schemes Management Act).
If the owner still doesn’t comply after the penalty application, then it is at least arguable whether an owners corporation would be able to obtain orders for access into the owner’s lot to carry out that rectification work to the common property at cost of that recalcitrant owner. This is due to the owners corporation only being allowed to enter the lot for specific purposes under the legislation (which seems to envisage a legislative intent of preserving fundemental freehold rights of a lot owner i.e. the ability to exclude others). There is another aspect of the legislation which does not seem to have been tested by many with respect to an owners corporation gaining access to a lot to restore common property to its former condition, but that is another story. The point is, that seeking adjudicator’s orders can be very time consuming, rack up legal costs and get no where in resolution of the actual dispute…
I think this is where the “toothless tiger” of NCAT (formally CTTT) derives from. So the op is quite correct in remarking that statements such as “we can make him take it out!” can be considered to be inept.
In any case, as to Whales’ post, even if a lot owner was “on notice” of unauthorised works to the common property by its predecessor in title, they still technically haven’t committed a breached of s 65A. That breach was by the previous owner, and it is arguable whether an application for adjudicator’s orders could be made against that the previous owner for restoration of common property.
And, I am not aware of any “simple online resources” to explain this … it is quite technical and the owners corporation would be advised to promptly seek legal advice in relation to the matter.
@Whale said:
In that way the interests of your O/C, and those of any new Owners are suitably protected by virtue of the fact that a monetary adjustment can be made at Settlement to account for the costs of the new Owner either restoring the Common Property to its pre-renovation state or for seeking and obtaining the O/C’s retrospective (and perhaps conditional) Consent to those.I don’t think it will be as straightforward as that.
In any case, I think it’s arguable whether the “new owner” would be obliged to restore the common property to its former condition when works had been done to the common property by the precedessor in title which were not authorised in accordance with the by-laws.
I could quote cases, but it seems these tend to be too overwhelming for most here, so I will simply say that by-laws generally prohibit damage being done to the common property by an owner of occupier. In this case, assuming this to be so, any “damage” to the common property would’ve been done by the (soon to be) precedessor in title and that person (or those persons) would’ve committed a breach of the by-law. Then, the new owner would not have committed a breach of any by-law and thus may not actually be liable to make good the damage done by the precedessor in title.
I will also say that there is at least one owners corporation (probably in recongising that the above principles are probably true) sought orders in the Supreme Court restraining the sale going ahead until breaches to the by-law were made good. This (expensive) option may be worth pursuing …