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Back tracking from JT’s comments about the Dividing Fences Act, (in which JT correctly states that the party wanting a more expensive fence pays the difference), you probably should sort out what your own scheme’s position is first before taking this any further.
If the situation is a 50/50 split on your scheme deciding on timber or colorbond then what is your scheme’s position that you would be taking to your neighbour or to NCAT?
I would think that, under the circumstances that you describe, the position would be that if a repair of the timber fence is not possible then a replacement of the same type of fence would be appropriate. There would be no need for your scheme to have a vote on replacing same for same, as nothing is being changed.
However, if some of your owners want a colorbond fence then that is a change that would trigger the issue of “improvement” and “enhancement”. Such a change would require a 75% vote by special resolution – which your scheme clearly does not have.
Therefore, by default, your scheme’s position is that a timber fence is required. That is something that you will need to accept.
Moving forward, your scheme should obtain two quotes for the timber fence replacement and then should serve a Notice to Carry Out Fencing Work on the neighbouring strata scheme, including the quotes.
The process, and an example of a Notice to Carry Out Fencing Work, is described in the fact sheet below:
https://www.swslc.org.au/wp-content/uploads/2015/03/Neighbour-fencing-disputes-Fact-Sheet-final.pdf
Your scheme would only need to apply for an Order from NCAT if you cannot resolve this issue via an Agreement to Carry Out Fencing Works – as described in the Fact Sheet.
After the Notice has been sent and you have progressed to the Agreement phase then a sensible compromise Agreement would need to be worked out.
From your scheme’s perspective, being that your scheme wants a timber fence, it would be reasonable to suggest that your scheme permits the neighbour to erect a colorbond fence on the boundary but only on the condition that the neighbouring property would pay the full cost of the difference between the cost of the timber fence and the colorbond fence plus half of the cost of what a timber fence would cost. Your scheme would only have to pay half of the cost of a timber fence but would end up with a colorbond fence.
You may get what you want afterall and for a cheaper price than you expected!