› Flat Chat Strata Forum › Airbnb and holiday lets › Can Strata By-laws be changed to block AirBnB in NSW? › Current Page
Worryingly, the Victorian decision referred to NSW law and pointed out that NCAT can overturn anti short-stay by-laws. Several lawyers have said that is unlikely but, as Millie pointed out (above) they have already done so and have publicised this on their own website.
They might not do this in every case but it would certainly be worth multi- apartment owners (about one-third of Airbnb hosts in Sydney) having a spin of the NCAT chocolate wheel.
I realise that this is a very specific case – a former hotel converted to strata units, – but here again is the relevant NCAT case study.
The order making power which an Adjudicator has under sections 157 and 159 of the Strata Schemes Management Act 1996 provides a means of redress where the original by-laws are changed in a way that may lead to an injustice.
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. The Adjudicator also considered section 157 under which a special by-law can be repealed if it is considered that it should not have been made having regard to the interest of all lot owners in the use and enjoyment of their lots.
As the owners corporation did not provide any explanation or evidence in support of their statement, the Adjudicator was not convinced that the adoption of the special by-law was necessary for the good management of the property. Orders were made declaring the special by-law invalid.