› Flat Chat Strata Forum › By-laws and outlaws › Is this renovation bond excessive? › Current Page
NSW by-laws requiring renovation bonds are invalid. [s136(2) and s139(1)]
Part 5 of SSMA 2015 provides for the management of the finances and the keeping of accounts and records of the strata scheme, which the owners corporation is responsible for, pursuant to section 9 (3) (a) and (b).
Section 73 (2) and (3) detail what funds can be paid into the Administration Fund and section 83 provides for the levying of contributions on lot owners.
There is no authority under any provision of the SSMA 2015, to allow an owners corporation, to require a lot owner to pay money to the owners corporation, on the chance that there may, or may not, be a debt due to the owners corporation in the future.
Legally, requiring payment of money when there is no debt due, is unjust enrichment on the part of the owners corporation at the expense of a lot owner.
If a liquidated debt is owed to the owners corporation, then it can be recovered by litigation in the normal commercial manner.[ s120 of SSMA 2015]