Chair (and sec) planning to annex roof space

This is an all-too-common scenario – an over-privileged committee member rewarding themselves for all their hard work by annexing common property to enhance the value of their apartments, at the expense of the other residents.

There are a lot of elements in this, not least how you are going to get the chair to do the right thing.  Let’s come back to that later.

Firstly, there is a formula for this kind of thing which is A-(B+C) = D where A is the independently assessed value of the expanded property, B is the independently assessed current value of the property and C is the cost of the renovation, including plans and legals.  D is an amount the renovator must pay to the owners corp for the use of common property. This formula was set by the High Court (I think) and is the standard for these calculations.

You will also need the by-law to include a clause in which the renovator agrees that they (and any subsequent owners)  are responsible for any common property changed in the extension, and an indemnity for any damage caused to common property or lot property during the renovation.

Finally, you will expect them to agree to a redistribution of levies based on the change of the apartment size.  It doesn’t matter on what basis your unit entitlements are currently set.  If it’s equal shares, it’s almost certainly wrong.  This is an opportunity to set things straight as every other owner will find their levies reduced, so will be likely to agree.

Now, as for how you get the chair-sec to agree to this, point out that these are all standard legal clauses and you will very easily block the extension at NCAT if she doesn’t go along with the requests.  Even if she gets a majority of other owners to agree, that would be considered a “fraud on a minority” and would be tossed by any reasonable tribunal or court.

If you are unsure of how to proceed, you and your neighbours should seriously consider employing our sponsors Strata Answers to manage this for you. If you just go along with this request you are going to lose money and potentially be liable for bad workmanship, cut corners and planning mistakes in perpetuity.