Podcast: The many sins of commission at Fair Trading

Glenview-Tamarama-Crop.jpg

Former Glenview Court - now Skye Tamarama

If there is one area of NSW Liberal politics that may be glad that the kerfuffle over the appointment of a trade envoy to New York is drawing so much media attention and political heat, it will be anyone associated with Fair Trading.

When we sat down to record this week’s podcast and discuss – among other things – the departure of Property Services Commissioner John Minns, we had no idea how chaotic things had become there.

To misquote Oscar Wilde, to lose one commissioner is unfortunate, to lose two looks like carelessness.

The departure of Commissioner Minns occurred in the same week that Building Commissioner David Chandler announced he was cutting short his extended tenure, and Minister Eleni Petinos was summarily dismissed.

Now we can report that Mr Minns’ resignation seems to be closely related to a hastily concocted plan to replace him (eventually, if and when parliament gets round to it) with a statutorily appointed independent commissioner.


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Ironically (or is it predictably?), his temporary replacement has been drawn from Small Business, the part of her portfolio that consumed most of former Minister Petinos’ energy and attention during her short tenure.

And in another irony, MS Petinos first came to prominence in a sexting scandal involving former Fair Trading minister, Matthew Kean, who has been elevated to deputy premier following the resignation of Stuart Ayres, yet another former Fair Trading Minister.

Were our colleagues in the media not consumed with what John ‘Porky’ Barilaro did or didn’t do and Stuart Ayres did or didn’t know about the New York gig, surely they’d be all over this like a cheap suit. It’s an ill wind that blows nobody any good.  

That’s just a small part of this week’s podcast.  We also discuss how the brutalist or modernist, or brutally modernist  high rise block looming over Tamarama beach has been given a reprieve following a major speed bump in its process of renewal.

We chat about the NCAT case which established that tenants can take legal action against owners corporations to force them to fix defective common property.

We have a look at the block where a majority of owners want to take one neighbour to NCAT for being a nuisance … by continually making successful complaints about their businesses to the local council.

And we ask, if the victims of flood damage can get their homes bought off them by the government, why can’t the poor benighted owners of flats in Mascot Towers be bailed out in the same way?

That’s all in this week’s Flat Chat Wrap.

TRANSCRIPT IN FULL

Jimmy  00:00

Well, the fallout from various ministries in New South Wales continues; we’ll be hearing about the Property Services Commissioner and his sudden departure.

Sue  00:13

Gosh, where will it all end?

Jimmy  00:16

And, we’ve got a couple of things from the website, plus some news about that big building at Tamarama. I’m Jimmy Thomson, I write the Flat Chat column for the Australian Financial Review.

Sue  00:29

I’m Sue Williams and I write about property for Domain.

Jimmy  00:32

And this is the Flat Chat Wrap.

[MUSIC]

Jimmy

So it seems Property Commissioner, John Minns, has quit, as well as David Chandler.

Sue  00:53

Wow! It’s a complete fallout, isn’t it really?

Jimmy  00:56

Well, you know, we heard that David Chandler hasn’t actually left, but he’s cut short his extended appointment and then, apparently the same week, John Minns, the Property Commissioner, left the office.

Sue  01:12

Why was that, do you know?

Jimmy  01:14

Well, I think it might be something to do with the fact that they didn’t even realise he was there, because you had trouble getting through to him, didn’t you?

Sue  01:23

Yes, I was doing a story and someone suggested John Minns would be the perfect person to give me a comment, so I contacted his office… They said “I’m sorry, do you mean Chris Minns (who’s the leader of the opposition)?”  I said “no, I mean John Minns, the Property Commissioner.” “Oh, I don’t know if he’s around,” and I said “what do you mean, you don’t know if he’s around? He’s the Commissioner.” “Oh, is he?” It was astonishing! In the end, the Department of Fair Trading ended up giving me a comment, whereas John Minns was just…  Where was he; the invisible man? I mean, nice man; we met him a couple of times. He’s great, but he obviously didn’t have much support from his staff really, if they didn’t really quite know his name.

Jimmy  02:08

Or his minister.

Sue  02:10

Well yes, because I guess the person in common in all this, is…

Jimmy  02:14

Eleni Petinos. John Minns (for anyone who doesn’t realise he is not Chris Minns)… He was brought in late last year, amid great fanfare; this was going to be the Property Services Commissioner, and he was going to bring in real estate agents and strata managers, and anybody who had anything to do with property, apart from the people who live in it.

Sue  02:42

The consumers.

Jimmy  02:44

The residents, the tenants, and the owners of apartment blocks, were not part of that picture. It sounded like a stuff-up from day one. I remember talking to David Chandler about him, and everybody agreed he was a very capable, experienced, decent guy. But, David said, I’m sitting looking through my office window at the Property Commissioner, who hasn’t moved, basically. When you consider what a big portfolio that potentially could have been.

Sue  03:21

Absolutely, but it obviously wasn’t very clearly defined, right from the very beginning.

Jimmy  03:25

Well, the SCA, the strata managers, objected to the fact that he would come under Fair Trading; they thought he would be an independent Commissioner. I can’t see how that would ever have worked, but they were a bit annoyed. The Real Estate Institute of New South Wales’ Tim McKibbins said initially, we’ll have nothing to do with it, because of the way it’s been set up. He changed his mind later, but there was just a lot of confusion and frustration. Eventually, I think that must have got to John Minns, and he’s quit. So, we’ve got a Building Commissioner, who’s halfway out the door and a Property Commissioner who’s already left. The Minister concerned has gone (apparently, for reasons that have nothing to do with either of these things, which I don’t believe for a minute). But you know, the government has bigger fish to fry at the moment.

Sue  04:24

So Victor Dominello is taking over the portfolio; he’s taken it back, as well as his other portfolios.

Jimmy  04:29

He’s taken back Fair Trading, yes.

Sue  04:32

And he’s a very capable minister. I mean, quite a lot happened during his reign.

Jimmy  04:37

And he’s been doing a lot of stuff; this Strata Hub business that he set up… That seems to be moving forward and it’s quite interesting, how it’s pulling in a lot of information that people should have had and should have been around but, it was never really pulled together in the one place, and now you can go on the website and find out. You had a look at it the other day, didn’t you? You were looking for something?

Sue  05:02

I wanted to try and track down somebody who had been involved in an NCAT case, and I had the strata plan number, but I didn’t really know where it was at all. I went on the Hub, and I was able to track down the exact apartment building and its address, which was fantastic.

Jimmy  05:19

Wow! See, that’s exactly what it should be for…

Sue  05:24

For journalists!

Jimmy  05:25

For journalists to track down pet owners. It’s a good idea. They had a big seminar about it, while we were away and I posted a question to them, which was actually asked and answered. And that was ‘how do strata residents know what their committees or strata managers are putting on the Hub and what information are they giving and what information is missing?’ And of course, one thing they can do is apply and go in the Hub and say ‘I’m an owner in this building, and I want to see what records there are.’  I thought that there should be a statutory thing at an AGM, that comes out with the agenda, that says ‘this is the information we’ve given to the Hub,’ and people can look at it and go ‘hang on that’s wrong, or there’s something missing there.’ And so they’ve suggested that owners corporations should maybe, create a bylaw, that says that they will do this. So they’ve left it up to the owners corporations to mandate their own reporting, which is…

Sue  06:35

That’s unlikely ever to happen.

Jimmy  06:36

It will never happen, but you know, there you go. At least they listened to the question and answered it, after a fashion.

Sue  06:44

Absolutely.

Jimmy  06:51

So John Minns has gone, David Chandler’s on the way out, but you have a story related to David Chandler, about the Tamarama building.

Sue  07:00

That’s right. You might remember a few years ago, there was (well, it’s still there), quite an iconic apartment building in Tamarama. It was called ‘Glenview’ originally, but it’s been renamed ‘Skye Tamarama.’ It was kind of a very old, crumbling 1970s brutalist building. Very ugly, but it was right there on the ridge; fabulous views over Tamarama beach and the ocean.

Jimmy  07:24

But not such a great view from the beach, up to the building.

Sue  07:31

They had a really good executive committee and strata committee, and they decided what they would do, because the building… There were problems with fire regulations; because it was so old, it just needed a complete and utter renewal, but they obviously didn’t have the money in the sinking fund, to do that kind of work. So they came up with this ingenious idea of building two penthouses on the roof. The idea is the sale of those penthouses would pay for the complete and utter refurbishment and renewal of the rest of the building. I mean, it was a genius idea and it took a very energetic person on the strata committee to see it through. It took much longer than they thought, and much more expensive than they thought. Originally, the idea was that it was going to cost $20 million… By the end, it had cost $50 million and they paid for the thing with special levies, but also, Australia’s biggest strata loan from Lannocks.

They did this work, and they finally finished the work. They put the two new penthouses on their roof; they put those up for sale and then they ran foul of David Chandler, the Building Commissioner, who said the building should be renewed to today’s regulations, which meant fire sprinklers in every level of the apartment building. They argued ‘no, it should only be renewed to a level when they started work.’ The legislation had changed in the interim. So, there was this big row and David Chandler put a stop-work order on the building and refused to issue the construction certificate. The building had to effectively, take the penthouses off the market and then argue with him about whether there should be fire sprinklers in all levels, which would be…

Jimmy  09:20

Horrendously expensive.

Sue  09:22

Yes, a huge undertaking. Eventually (just this week), the Building Commissioner has taken the order off and they just have sprinklers in the new penthouses, and down in the carpark. They don’t have them in the other levels and the penthouses have gone back on the market. They’re now $20 million each, so hopefully they’ll sell for $40 million, at least. The owners of the building (I mean, they’ve shelled out a considerable amount over the years and they’ve had the difficulty of living elsewhere), but they’ll come back to a brand new building. They think the occupation certificate will be issued in a couple of weeks, so they’ll all be allowed back in. It looks pretty amazing; it looks so much better. They’ve got a wavy roof, to reflect the ocean waves and it looks looks great. I think it’s become a bit of a template and a bit of a model, for all the other crumbling buildings around Sydney, which are thinking of maybe doing the same, and are looking for spaces in their buildings, where they can create extra apartments, or looking on their rooftops, like Skye Tamarama, to see if they can do something on the rooftop, to finance the renewal of the rest of the building.

Jimmy  10:36

Good, for them. Well, that’s a piece of good news for them at least, and actually, for everybody else who lives around there, because that building has always been a bit of an eyesore. When we come back, we’re going to talk about a curious decision from NCAT, that surprised me, about a tenant’s rights, when it comes to common property.

[MUSIC]

Jimmy

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Jimmy

So, I’ve signed up to this terrific service, that actually monitors decisions from various legal bodies, including NCAT and VCAT, and it throws up some curious cases. The most recent one was an appeals panel case with a tenant, who had suffered water damage in her apartment and had claimed; first of all, she wanted rent reduction, and then she wanted her notice to quit from a landlord to be rescinded, because she said it was retaliatory…

Sue  12:11

Because she’d complained to the landlord…

Jimmy  12:15

And she wanted compensation for stress and distress and stuff like that. In the initial result, they said ‘yep, you can have rent reduction.’ They didn’t rule in favour of the retaliatory dismissal, eviction notice and they didn’t offer her any compensation. They said that because a tenant in a building is a ‘interested party,’ she could have raised the issue of the defects with the owners corporation, because that was part of her claim, that the landlord had not pursued the defects and therefore, she was entitled to compensation.

Sue  13:01

I would have thought that’s quite reasonable, because you don’t think that a tenant can approach the owners corporation?

Jimmy  13:06

Yes well, it turns out that they can. That was one of the bases on which they said you’re not getting compensation, because you could have handled this yourself. So, this goes to the appeal panel and in the interim, the whole question of the eviction notice has resolved itself. I’m guessing, maybe she’s found somewhere else to live. But, the question of compensation came up and she had a letter from her (I think it was her physiotherapist), saying that she’d been very stressed and very upset and depressed and suffered from lack of sleep and the appeals panel said no, this physio is not qualified in those areas, to be able to say whether she was depressed, or what had caused it. So, that was knocked out.

But, they ruled that even though legally, she could have taken the owners corporation to NCAT herself, to get the defects fixed, this was not a reasonable impost on her; this was really the landlord’s responsibility. They made this strange ruling, which is, that should not have been used as an excuse, or a reason for not giving her compensation, but since they’re not going to give her compensation anyway, it didn’t really matter. I think the interesting thing (from tenant’s point of view), is; I mean, can you imagine a scenario where a tenant might take their owners corporation to NCAT over defects?

Sue  14:44

Absolutely. They know the apartment much better than often the owner does and there’s often so many absentee owners, or maybe overseas owners. We know someone who lived in the same rental property for over 20 years and he’d never spoken to his owner; his owner had nothing to do with the building, whatsoever. So, yeah, I can imagine if there were electrical faults…

Jimmy  15:11

Plumbing, that kind of stuff… Well, this was a case of flooding and mould.

Sue  15:15

Walls cracking….

Jimmy  15:16

Yep. So I suppose the thing to do for tenants, is to say ‘there’s a problem in the building,’ and say to the landlord, or the agent ‘can you do something about this?’ And then, rather than going ‘okay, now I’m going to take the landlord to NCAT to make them do the things, like take the owners corporation to NCAT; I’m going to take them to NCAT.’ Cut out the middleman.

Sue  15:42

And I mean, it’s hard, because why should a tenant, who’s paying rent for a property, end up having to spend their spare time doing all this? It is stressful, and it can be expensive, and it can be hard. It’s not fair, really. But then if they do win, then hopefully NCAT will give them some kind of compensation, for the time and energy and money they’ve spent.

Jimmy  16:07

Okay, so the message is to tenants, if you are in a situation where there’s something wrong with the common property, and it’s affecting your apartment, and your landlord, or the agent is either unavailable or uninterested, rather than going through the rigmarole of taking your landlord to the tribunal, the appeals panel has made it clear that that is something that tenants can do… They don’t need to do, and they shouldn’t have their overall claim diminished if they don’t do it, but it’s an option open.

Sue  16:44

And it will keep the landlord (hopefully) onside too, wouldn’t it really? Spur them to action.

Jimmy  16:51

It could be that you go to the agent and ask them to do something; they don’t do anything, you take it on yourself and then suddenly, find that the landlord saying ‘hang on, I didn’t want to annoy the strata committee.’

Sue  17:05

So then they need a new agent, don’t they?

Jimmy  17:07

They do. When we come back, we’re going to look at an interesting story that’s come up on this week’s forum. That’s after this.

[MUSIC]

Jimmy

A very curious case has come up on the forum. It’s a longtime correspondent of ours (a flat-chatter), who has just seen the agenda of the next AGM of his building. On it, there’s a thing asking owners to approve paying for legal action against him, because of complaints that he has made about other tenants in the building, saying that he is a nuisance under Section 153 of the Act, that you can’t be a nuisance and you can’t interfere with other people’s peaceful enjoyment of their property.

Sue  17:56

So was he complaining about residential tenants, or was he complaining about commercial tenants?

Jimmy  18:01

Well, this is the thing; he’s been complaining ‘frequently,’ he says, about commercial tenants and the noise and nuisance from their operation. He’s been complaining to the local council, and every time, his complaint has been upheld. Apparently, this block is 70% owned by the same family and it may be the commercial operators. They’ve said, alright, you’re becoming a nuisance, so we’re going to take legal action under Section 153 to stop you. And that doesn’t seem right to me.

Sue  18:37

That’s incredible!

Jimmy  18:37

Shouldn’t they be taking action against the tenants, or the occupants of the commercial properties? Maybe they are the occupants of the commercial properties.

Sue  18:46

Especially if the complaints have been upheld against them.

Jimmy  18:48

Exactly. It’s not just a constant barrage of emails and complaints and, you know, phone calls and bailing people up in the corridors, and things like that. That physical confrontation could could stray into the nuisance area (maybe), but just validly complaining about the way businesses are operated, if they are in breach of council regulations, or the EPA; how could that possibly be construed as a nuisance?

Sue  19:21

Yes, absolutely. It’s kind of interesting (and I think it’s a really important topic), because there are very, very few apartment buildings that are being built now, that aren’t mixed-use developments. Nearly every single new apartment building has retail at the bottom, or sometimes they have offices on one of the floors. The bigger apartment buildings; yes, they have a lot more retail tenancies and commercial tenancies involved, you know.

Jimmy  19:48

That’s one of the reasons people move into apartment blocks; it’s because they can have shops and cafes and takeaways nearby.

Sue  19:54

But there’s always been difficulties, I think, with mixed-use developments. We’ve known people who’ve had to complain about the operation of cafes beneath them, when the cafes were cooking food, and they didn’t actually have permission to cook food, because the fumes were coming up and they weren’t properly…. They didn’t have the exhausts.

Jimmy  20:14

They didn’t have the exhaust. Well, they couldn’t, because they were on the ground floor, right underneath apartments.

Sue  20:19

That’s right.

Jimmy  20:20

They had specifically been told that they could only use a toaster and coffee machine.

Sue  20:27

And we all know restaurants underneath apartment buildings, where they have big notices that say ‘when you’re leaving this restaurant, please be really quiet, because upstairs, there’s lots of people who may be asleep.’ You know, if we have a late licence till 11 o’clock, it would be really annoying to hear people coming out and talking and chatting right underneath your window, every night.

Jimmy  20:47

But that specific instance that you refer to, has similarities with this, because (I’m not going to name names), the person who owned the cafe, was the wife of a director of the developers. They were told they couldn’t have a deep-fat fryer and every time council came around to inspect, they would call the building manager, who would call the sales director of the developer, who would call his wife and they would wheel the deep-fat fry out and put it in the carpark, so when council came, they said ‘there is no fryer here; what are you talking about?’  I think for somebody in that position (the sales director of a major development company, who’s in that position), it’s absolutely disgraceful. Those people eventually sold out and I think they lost money on that apartment, because they’ve got this cafe underneath it that shouldn’t have been there and council wouldn’t do anything about it. This person is making valid complaints and what the strata committee should be doing is going ‘oh, you are tenants of this building and you keep breaching Environmental Protection Authority laws and council bylaws. Therefore, you are breaching our bylaws. If you’re using your property to break the law, then you’re breaching bylaws.’ They should be going after the commercial tenants, rather than the person who’s complaining about them. You know, the old ‘shoot the messenger’ thing. I suspect the problem here may be that the people who have the majority votes on the committee, or on the owners corporation, are also the people who are causing the problem.

Sue  22:35

But you don’t know that.

Jimmy  22:36

I don’t know that for a fact, but my recommendation has been, tell them to take this thing off the minutes, because it’s defamatory and it’s illegal, and tell them if they don’t do it, you’re going to apply to have a strata manager appointed, and kick the committee out and manage the building properly. That should put the cat among the pigeons!

Sue  23:00

And hopefully, lead to a proper resolution of the problem.

Jimmy  23:02

Well, it might make them back down and be a bit more reasonable, or it could result in World War III; you never know. And finally, there’s a piece of news that’s come out just today… The flood victims; the government’s going to offer to buy back their properties from them, so they can move out to somewhere safer? Why are they not doing that for the victims of Mascot Tower?

Sue  23:28

Good idea. I guess they would say the difference is, one was a natural catastrophe, that the New South Wales Government could have averted, if they’d have taken action more quickly on things like flood walls and things. The other thing is something that was caused by a private developer. Well, ‘allegedly’ caused by a private developer.

Jimmy  23:49

They could get restitution through legal.

Sue  23:52

That’s right.

Jimmy  23:53

Except, we’ve heard that the deal that’s been done with the Mascot owners…

Sue  23:58

Which is confidential.

Jimmy  24:00

They are still going to lose hundreds of thousands on their apartments and they’ve still got to find a buyer for the building. It just seems to me, okay, you can say the government should have done more at preventing the flooding… I really feel for the people; it must be awful to have your home flooded out…To have a two storey home, totally underwater. But, they’re in a floodplain; they built in a floodplain. They know that there have been floods there before; maybe not as bad as the ones that hit them this time, but they knew to some extent, what they were getting into. I’m not saying they shouldn’t be compensated, I think they should. But I don’t think that they can turn around and say, ‘oh, well, the Mascot Towers situation is purely commercial and they could get their money back through the courts,’ because we know that’s not going to happen.

Sue  24:53

And no insurance for buildings. And maybe it’s the New South Wales government’s problem, because they don’t have tight enough building restrictions; construction regulations. Maybe, rather than have a buyback of Mascot Towers apartments, maybe they should offer to take on the legal battle, on behalf of those owners, because when individual owners are trying to battle a developer, the odds are stacked against them. If suddenly, the New South Wales government comes in, with its large reserves of cash and expertise, it’s kind of a different footing, really.

Jimmy  25:30

And you know, that has a psychological effect on the developer, because if the developer can make $1.00 profit more out of hammering residents in court and paying expensive lawyers to do so, then they’ll take that option. Whereas, if they’re going ‘well, I can’t do a war of attrition against the government, because they’ve got more money than me, and eventually I will lose,’ they might think ‘well, maybe I’ll just settle.’ I think any defects claim over say, $60-70,000, the government should say ‘okay, we’ll take this on; you go and fix your building, we’ll take on the claim and when we get the money out of the developers, we’ll pay your bills for you.’ That’s fantastic! That could be a new role for David Chandler.  Well, yes. Come Christmas, he’s going to be… Well, he’s well past retirement age, let’s face it.

Sue  26:27

He’s such a golden oldie, we’ve got to keep him.

Jimmy  26:29

Yes, we do. That’d be a great thing for him. Get that policy changed, when the government finally gets kicked out (which looks increasingly possible), and maybe, Labor will pick up that and say ‘we’ll run with this.’

Sue  26:43

It would be good if anybody did.

Jimmy  26:45

Okay. Thanks, Sue, for coming in and contributing again this week, and thank you all for listening. We’ll talk to you again soon.

[MUSIC]

Jimmy

Thanks for listening to the Flat Chat Wrap podcast. You’ll find links to the stories and other references on our website, flatchat.com.au. And if you haven’t already done so, you can subscribe to this podcast completely free on Apple podcasts, Google podcasts, Spotify, Stitcher, or your favourite podcatcher. Just search for Flat Chat Wrap with a ‘w,’ click on subscribe, and you’ll get this podcast every week, without even trying. Thanks again. Talk to you again next week.

Jimmy  00:00

Well, the fallout from various ministries in New South Wales continues; we’ll be hearing about the Property Services Commissioner and his sudden departure.

Sue  00:13

Gosh, where will it all end?

Jimmy  00:16

And, we’ve got a couple of things from the website, plus some news about that big building at Tamarama. I’m Jimmy Thomson, I write the Flat Chat column for the Australian Financial Review.

Sue  00:29

I’m Sue Williams and I write about property for Domain.

Jimmy  00:32

And this is the Flat Chat Wrap. So it seems Property Commissioner, John Minns, has quit, as well as David Chandler.

Sue  00:53

Wow! It’s a complete fallout, isn’t it really?

Jimmy  00:56

Well, you know, we heard that David Chandler hasn’t actually left, but he’s cut short his extended appointment and then, apparently the same week, John Minns, the Property Commissioner, left the office.

Sue  01:12

Why was that, do you know?

Jimmy  01:14

Well, I think it might be something to do with the fact that they didn’t even realise he was there, because you had trouble getting through to him, didn’t you?

Sue  01:23

Yes, I was doing a story and someone suggested John Minns would be the perfect person to give me a comment, so I contacted his office… They said “I’m sorry, do you mean Chris Minns (who’s the leader of the opposition)?”  I said “no, I mean John Minns, the Property Commissioner.” “Oh, I don’t know if he’s around,” and I said “what do you mean, you don’t know if he’s around? He’s the Commissioner.” “Oh, is he?” It was astonishing! In the end, the Department of Fair Trading ended up giving me a comment, whereas John Minns was just…  Where was he; the invisible man? I mean, nice man; we met him a couple of times. He’s great, but he obviously didn’t have much support from his staff really, if they didn’t really quite know his name.

Jimmy  02:08

Or his minister.

Sue  02:10

Well yes, because I guess the person in common in all this, is…

Jimmy  02:14

Eleni Petinos. John Minns (for anyone who doesn’t realise he is not Chris Minns)… He was brought in late last year, amid great fanfare; this was going to be the Property Services Commissioner, and he was going to bring in real estate agents and strata managers, and anybody who had anything to do with property, apart from the people who live in it.

Sue  02:42

The consumers.

Jimmy  02:44

The residents, the tenants, and the owners of apartment blocks, were not part of that picture. It sounded like a stuff-up from day one. I remember talking to David Chandler about him, and everybody agreed he was a very capable, experienced, decent guy. But, David said, I’m sitting looking through my office window at the Property Commissioner, who hasn’t moved, basically. When you consider what a big portfolio that potentially could have been.

Sue  03:21

Absolutely, but it obviously wasn’t very clearly defined, right from the very beginning.

Jimmy  03:25

Well, the SCA, the strata managers, objected to the fact that he would come under Fair Trading; they thought he would be an independent Commissioner. I can’t see how that would ever have worked, but they were a bit annoyed. The Real Estate Institute of New South Wales’ Tim McGibbons said initially, we’ll have nothing to do with it, because of the way it’s been set up. He changed his mind later, but there was just a lot of confusion and frustration. Eventually, I think that must have got to John Minns, and he’s quit. So, we’ve got a Building Commissioner, who’s halfway out the door and a Property Commissioner who’s already left. The Minister concerned has gone (apparently, for reasons that have nothing to do with either of these things, which I don’t believe for a minute). But you know, the government has bigger fish to fry at the moment.

Sue  04:24

So Victor Dominello is taking over the portfolio; he’s taken it back, as well as his other portfolios.

Jimmy  04:29

He’s taken back Fair Trading, yes.

Sue  04:32

And he’s a very capable minister. I mean, quite a lot happened during his reign.

Jimmy  04:37

And he’s been doing a lot of stuff; this Strata Hub business that he set up… That seems to be moving forward and it’s quite interesting, how it’s pulling in a lot of information that people should have had and should have been around but, it was never really pulled together in the one place, and now you can go on the website and find out. You had a look at it the other day, didn’t you? You were looking for something?

Sue  05:02

I wanted to try and track down somebody who had been involved in an NCAT case, and I had the strata plan number, but I didn’t really know where it was at all. I went on the Hub, and I was able to track down the exact apartment building and its address, which was fantastic.

Jimmy  05:19

Wow! See, that’s exactly what it should be for…

Sue  05:24

For journalists!

Jimmy  05:25

For journalists to track down pet owners. It’s a good idea. They had a big seminar about it, while we were away and I posted a question to them, which was actually asked and answered. And that was ‘how do strata residents know what their committees or strata managers are putting on the Hub and what information are they giving and what information is missing?’ And of course, one thing they can do is apply and go in the Hub and say ‘I’m an owner in this building, and I want to see what records there are.’  I thought that there should be a statutory thing at an AGM, that comes out with the agenda, that says ‘this is the information we’ve given to the Hub,’ and people can look at it and go ‘hang on that’s wrong, or there’s something missing there.’ And so they’ve suggested that owners corporations should maybe, create a bylaw, that says that they will do this. So they’ve left it up to the owners corporations to mandate their own reporting, which is…

Sue  06:35

That’s unlikely ever to happen.

Jimmy  06:36

It will never happen, but you know, there you go. At least they listened to the question and answered it, after a fashion.

Sue  06:44

Absolutely.

Jimmy  06:51

So John Minns has gone, David Chandler’s on the way out, but you have a story related to David Chandler, about the Tamarama building.

Sue  07:00

That’s right. You might remember a few years ago, there was (well, it’s still there), quite an iconic apartment building in Tamarama. It was called ‘Glenview’ originally, but it’s been renamed ‘Skye Tamarama.’ It was kind of a very old, crumbling 1970s brutalist building. Very ugly, but it was right there on the ridge; fabulous views over Tamarama beach and the ocean.

Jimmy  07:24

But not such a great view from the beach, up to the building.

Sue  07:31

They had a really good executive committee and strata committee, and they decided what they would do, because the building… There were problems with fire regulations; because it was so old, it just needed a complete and utter renewal, but they obviously didn’t have the money in the sinking fund, to do that kind of work. So they came up with this ingenious idea of building two penthouses on the roof. The idea is the sale of those penthouses would pay for the complete and utter refurbishment and renewal of the rest of the building. I mean, it was a genius idea and it took a very energetic person on the strata committee to see it through. It took much longer than they thought, and much more expensive than they thought. Originally, the idea was that it was going to cost $20 million… By the end, it had cost $50 million and they payed for the thing with special levies, but also, Australia’s biggest strata loan from Lannocks. They did this work, and they finally finished the work. They put the two new penthouses on their roof; they put those up for sale and then they ran foul of David Chandler, the Building Commissioner, who said the building should be renewed to today’s regulations, which meant fire sprinklers in every level of the apartment building. They argued ‘no, it should only be renewed to a level when they started work.’ The legislation had changed in the interim. So, there was this big row and David Chandler put a stop-work order on the building and refused to issue the construction certificate. The building had to effectively, take the penthouses off the market and then argue with him about whether there should be fire sprinklers in all levels, which would be…

Jimmy  09:20

Horrendously expensive.

Sue  09:22

Yes, a huge undertaking. Eventually (just this week), the Building Commissioner has taken the order off and they just have sprinklers in the new penthouses, and down in the carpark. They don’t have them in the other levels and the penthouses have gone back on the market. They’re now $20 million each, so hopefully they’ll sell for $40 million, at least. The owners of the building (I mean, they’ve shelled out a considerable amount over the years and they’ve had the difficulty of living elsewhere), but they’ll come back to a brand new building. They think the occupation certificate will be issued in a couple of weeks, so they’ll all be allowed back in. It looks pretty amazing; it looks so much better. They’ve got a wavy roof, to reflect the ocean waves and it looks looks great. I think it’s become a bit of a template and a bit of a model, for all the other crumbling buildings around Sydney, which are thinking of maybe doing the same, and are looking for spaces in their buildings, where they can create extra apartments, or looking on their rooftops, like Skye Tamarama, to see if they can do something on the rooftop, to finance the renewal of the rest of the building.

Jimmy  10:36

Good, for them. Well, that’s a piece of good news for them at least, and actually, for everybody else who lives around there, because that building has always been a bit of an eyesore. When we come back, we’re going to talk about a curious decision from NCAT, that surprised me, about a tenant’s rights, when it comes to common property. Here at Flat Chat, we’re always telling people that one of the benefits of apartment living is that you can just lock up and leave, when you want to take a holiday. Well, if you’re looking for some inspiration on where to go, to make the most of your freedom, take a look at mildrover.com,  our website for seasoned travellers. It has news, reviews and special travel deals, in which you can literally, save thousands of dollars. That’s mildrover.com, the website that takes you somewhere fantastic, even if you don’t leave home…. So, I’ve signed up to this terrific service, that actually monitors decisions from various legal bodies, including NCAT and VCAT, and it throws up some curious cases. The most recent one was an appeals panel case with a tenant, who had suffered water damage in her apartment and had claimed; first of all, she wanted rent reduction, and then she wanted her notice to quit from a landlord to be rescinded, because she said it was retaliatory…

Sue  12:11

Because she’d complained to the landlord…

Jimmy  12:15

And she wanted compensation for stress and distress and stuff like that. In the initial result, they said ‘yep, you can have rent reduction.’ They didn’t rule in favour of the retaliatory dismissal, eviction notice and they didn’t offer her any compensation. They said that because a tenant in a building is a ‘interested party,’ she could have raised the issue of the defects with the owners corporation, because that was part of her claim, that the landlord had not pursued the defects and therefore, she was entitled to compensation.

Sue  13:01

I would have thought that’s quite reasonable, because you don’t think that a tenant can approach the owners corporation?

Jimmy  13:06

Yes well, it turns out that they can. That was one of the basis on which they said you’re not getting compensation, because you could have handled this yourself. So, this goes to the appeal panel and in the interim, the whole question of the eviction notice has resolved itself. I’m guessing, maybe she’s found somewhere else to live. But, the question of compensation came up and she had a letter from her (I think it was her physiotherapist), saying that she’d been very stressed and very upset and depressed and suffered from lack of sleep and the appeals panel said no, this physio is not qualified in those areas, to be able to say whether she was depressed, or what had caused it. So, that was knocked out. But, they ruled that even though legally, she could have taken the owners corporation to NCAT herself, to get the defects fixed, this was not a reasonable impost on her; this was really the landlord’s responsibility. They made this strange ruling, which is, that should not have been used as an excuse, or a reason for not giving her compensation, but since they’re not going to give her compensation anyway, it didn’t really matter. I think the interesting thing (from tenant’s point of view), is; I mean, can you imagine a scenario where a tenant might take their owners corporation to NCAT over defects?

Sue  14:44

Absolutely. They know the apartment much better than often the owner does and there’s often so many absentee owners, or maybe overseas owners. We know someone who lived in the same rental property for over 20 years and he’d never spoken to his owner; his owner had nothing to do with the building, whatsoever. So, yeah, I can imagine if there were electrical faults…

Jimmy  15:11

Plumbing, that kind of stuff… Well, this was a case of flooding and mould.

Sue  15:15

Walls cracking….

Jimmy  15:16

Yep. So I suppose the thing to do for tenants, is to say ‘there’s a problem in the building,’ and say to the landlord, or the agent ‘can you do something about this?’ And then, rather than going ‘okay, now I’m going to take the landlord to NCAT to make them do the things, like take the owners corporation to NCAT; I’m going to take them to NCAT.’ Cut out the middleman.

Sue  15:42

And I mean, it’s hard, because why should a tenant, who’s paying rent for a property, end up having to spend their spare time doing all this? It is stressful, and it can be expensive, and it can be hard. It’s not fair, really. But then if they do win, then hopefully NCAT will give them some kind of compensation, for the time and energy and money they’ve spent.

Jimmy  16:07

Okay, so the message is to tenants, if you are in a situation where there’s something wrong with the common property, and it’s affecting your apartment, and your landlord, or the agent is either unavailable or uninterested, rather than going through the rigmarole of taking your landlord to the tribunal, the appeals panel has made it clear that that is something that tenants can do… They don’t need to do, and they shouldn’t have their overall claim diminished if they don’t do it, but it’s an option open.

Sue  16:44

And it will keep the landlord (hopefully) onside too, wouldn’t it really? Spur them to action.

Jimmy  16:51

It could be that you go to the agent and ask them to do something; they don’t do anything, you take it on yourself and then suddenly, find that the landlord saying ‘hang on, I didn’t want to annoy the strata committee.’

Sue  17:05

So then they need a new agent, don’t they?

Jimmy  17:07

They do. When we come back, we’re going to look at an interesting story that’s come up on this week’s forum. That’s after this. A very curious case has come up on the forum. It’s a longtime correspondent of ours (a flat-chatter), who has just seen the agenda of the next AGM of his building. On it, there’s a thing asking owners to approve paying for legal action against him, because of complaints that he has made about other tenants in the building, saying that he is a nuisance under Section 153 of the Act, that you can’t be a nuisance and you can’t interfere with other people’s peaceful enjoyment of their property.

Sue  17:56

So was he complaining about residential tenants, or was he complaining about commercial tenants?

Jimmy  18:01

Well, this is the thing; he’s been complaining ‘frequently,’ he says, about commercial tenants and the noise and nuisance from their operation. He’s been complaining to the local council, and every time, his complaint has been upheld. Apparently, this block is 70% owned by the same family and it may be the commercial operators. They’ve said, alright, you’re becoming a nuisance, so we’re going to take legal action under Section 153 to stop you. And that doesn’t seem right to me.

Sue  18:37

That’s incredible!

Jimmy  18:37

Shouldn’t they be taking action against the tenants, or the occupants of the commercial properties? Maybe they are the occupants of the commercial properties.

Sue  18:46

Especially if the complaints have been upheld against them.

Jimmy  18:48

Exactly. It’s not just a constant barrage of emails and complaints and, you know, phone calls and bailing people up in the corridors, and things like that. That physical confrontation could could stray into the nuisance area (maybe), but just validly complaining about the way businesses are operated, if they are in breach of council regulations, or the EPA; how could that possibly be construed as a nuisance?

Sue  19:21

Yes, absolutely. It’s kind of interesting (and I think it’s a really important topic), because there are very, very few apartment buildings that are being built now, that aren’t mixed-use developments. Nearly every single new apartment building has retail at the bottom, or sometimes they have offices on one of the floors. The bigger apartment buildings; yes, they have a lot more retail tenancies and commercial tenancies involved, you know.

Jimmy  19:48

That’s one of the reasons people move into apartment blocks; it’s because they can have shops and cafes and takeaways nearby.

Sue  19:54

But there’s always been difficulties, I think, with mixed-use developments. We’ve known people who’ve had to complain about the operation of cafes beneath them, when the cafes were cooking food, and they didn’t actually have permission to cook food, because the fumes were coming up and they weren’t properly…. They didn’t have the exhausts.

Jimmy  20:14

They didn’t have the exhaust. Well, they couldn’t, because they were on the ground floor, right underneath apartments.

Sue  20:19

That’s right.

Jimmy  20:20

They had specifically been told that they could only use a toaster and coffee machine.

Sue  20:27

And we all know restaurants underneath apartment buildings, where they have big notices that say ‘when you’re leaving this restaurant, please be really quiet, because upstairs, there’s lots of people who may be asleep.’ You know, if we have a late licence till 11 o’clock, it would be really annoying to hear people coming out and talking and chatting right underneath your window, every night.

Jimmy  20:47

But that specific instance that you refer to, has similarities with this, because (I’m not going to name names), the person who owned the cafe, was the wife of a director of the developers. They were told they couldn’t have a deep-fat fryer and every time council came around to inspect, they would call the building manager, who would call the sales director of the developer, who would call his wife and they would wheel the deep-fat fry out and put it in the carpark, so when council came, they said ‘there is no fryer here; what are you talking about?’  I think for somebody in that position (the sales director of a major development company, who’s in that position), it’s absolutely disgraceful. Those people eventually sold out and I think they lost money on that apartment, because they’ve got this cafe underneath it that shouldn’t have been there and council wouldn’t do anything about it. This person is making valid complaints and what the strata committee should be doing is going ‘oh, you are tenants of this building and you keep breaching Environmental Protection Authority laws and council bylaws. Therefore, you are breaching our bylaws. If you’re using your property to break the law, then you’re breaching bylaws.’ They should be going after the commercial tenants, rather than the person who’s complaining about them. You know, the old ‘shoot the messenger’ thing. I suspect the problem here may be that the people who have the majority votes on the committee, or on the owners corporation, are also the people who are causing the problem.

Sue  22:35

But you don’t know that.

Jimmy  22:36

I don’t know that for a fact, but my recommendation has been, tell them to take this thing off the minutes, because it’s defamatory and it’s illegal, and tell them if they don’t do it, you’re going to apply to have a strata manager appointed, and kick the committee out and manage the building properly. That should put the cat among the pigeons!

Sue  23:00

And hopefully, lead to a proper resolution of the problem.

Jimmy  23:02

Well, it might make them back down and be a bit more reasonable, or it could result in World War III; you never know. And finally, there’s a piece of news that’s come out just today… The flood victims; the government’s going to offer to buy back their properties from them, so they can move out to somewhere safer? Why are they not doing that for the victims of Mascot Tower?

Sue  23:28

Good idea. I guess they would say the difference is, one was a natural catastrophe, that the New South Wales Government could have averted, if they’d have taken action more quickly on things like flood walls and things. The other thing is something that was caused by a private developer. Well, ‘allegedly’ caused by a private developer.

Jimmy  23:49

They could get restitution through legal.

Sue  23:52

That’s right.

Jimmy  23:53

Except, we’ve heard that the deal that’s been done with the Mascot owners…

Sue  23:58

Which is confidential.

Jimmy  24:00

They are still going to lose hundreds of thousands on their apartments and they’ve still got to find a buyer for the building. It just seems to me, okay, you can say the government should have done more at preventing the flooding… I really feel for the people; it must be awful to have your home flooded out…To have a two storey home, totally underwater. But, they’re in a floodplain; they built in a floodplain. They know that there have been floods there before; maybe not as bad as the ones that hit them this time, but they knew to some extent, what they were getting into. I’m not saying they shouldn’t be compensated, I think they should. But I don’t think that they can turn around and say, ‘oh, well, the Mascot Towers situation is purely commercial and they could get their money back through the courts,’ because we know that’s not going to happen.

Sue  24:53

And no insurance for buildings. And maybe it’s the New South Wales government’s problem, because they don’t have tight enough building restrictions; construction regulations. Maybe, rather than have a buyback of Mascot Towers apartments, maybe they should offer to take on the legal battle, on behalf of those owners, because when individual owners are trying to battle a developer, the odds are stacked against them. If suddenly, the New South Wales government comes in, with its large reserves of cash and expertise, it’s kind of a different footing, really.

Jimmy  25:30

And you know, that has a psychological effect on the developer, because if the developer can make $1.00 profit more out of hammering residents in court and paying expensive lawyers to do so, then they’ll take that option. Whereas, if they’re going ‘well, I can’t do a war of attrition against the government, because they’ve got more money than me, and eventually I will lose,’ they might think ‘well, maybe I’ll just settle.’ I think any defects claim over say, $60-70,000, the government should say ‘okay, we’ll take this on; you go and fix your building, we’ll take on the claim and when we get the money out of the developers, we’ll pay your bills for you.’ That’s fantastic! That could be a new role for David Chandler.  Well, yes. Come Christmas, he’s going to be… Well, he’s well past retirement age, let’s face it.

Sue  26:27

He’s such a golden oldie, we’ve got to keep him.

Jimmy  26:29

Yes, we do. That’d be a great thing for him. Get that policy changed, when the government finally gets kicked out (which looks increasingly possible), and maybe, Labor will pick up that and say ‘we’ll run with this.’

Sue  26:43

It would be good if anybody did.

Jimmy  26:45

Okay. Thanks, Sue, for coming in and contributing again this week, and thank you all for listening. We’ll talk to you again soon. Thanks for listening to the Flat Chat Wrap podcast. You’ll find links to the stories and other references on our website, flatchat.com.au. And if you haven’t already done so, you can subscribe to this podcast completely free on Apple podcasts, Google podcasts, Spotify, Stitcher, or your favourite podcatcher. Just search for Flat Chat Wrap with a ‘w,’ click on subscribe, and you’ll get this podcast every week, without even trying. Thanks again. Talk to you again next week.

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      If there is one area of NSW Liberal politics that may be glad that the kerfuffle over the appointment of a trade envoy to New York is drawing so much
      [See the full post at: Podcast: The many sins of commission at Fair Trading]

      The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
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