How do we overturn an unjust By-Law from the Dark Ages?

[Edited due to subsequent information received]

Like KiwiPaul, I’m not sure what the law was when this by-law was agreed upon but I would say it would certainly be worth a phone call to an  experienced strata lawyer to see if this land grab holds up.

The fact that the beneficiaries won’t pay any additional levies makes the whole thing even more suspect.  You could apply for a revision of Unit Entitlements on those grounds alone.

Any individual or group of individuals can challenge the status quo at the CTTT.  I would get together with like-minded people, tell the free parkers that everything is about to change, whether they like it or not, and they can sit down and negotiate a reasonable compromise now or risk losing their car parking entirely when the by-law is bounced out  by the CTTT. 

That is comforting thank you. So, the CTTT can simply throw out a By-Law such as this? That would be good, but controversial. I was also wondering about the bit in the By-Law which says “The proprietors for the time being of each lot…”, wondering if that implies when a lot is sold or let, the By-Law is no longer valid. I didn’t mention currently half the ten units with spaces are let and half owned. Also some sub-letting of these spaces occurs for cash which is probably against the ‘rules’.

The phrase ‘for the time being’ means ‘at any time’. This is a standard phrase which means parking space was allocated to whoever is the proprietor of the unit at any particular instant. So, at the moment the unit changes hands the new unit owner gets the parking space. It is a way to say the allocation is to a person but the person is defined as whoever it is that owns that unit at any moment. Put another way it is a way to make the allocation run with the unit even though the Act may have required an allocation to a person. 

We did exact this in order to have every unit allocated a covered parking space in our development and have the arrangement stick with the unit as it changes hands. 

On the matter of having the bylaw require an unopposed resolution to be rescinded, that sounds unlikely to be valid. A bylaw would only have effect (IE be valid) to the extent that it is not inconsistent with the Act. If the Act says an bylaw can be rescinded by a special resolution (that is what it is in the ACT, not sure for NSW) then what the Act says goes.

Certainly in the ACT our tribunal can overturn a bylaw. If a resolution to overturn it is unsuccessful the motion can be given effect on the grounds that the opposition was unreasonable. I would expect NSW to have a similar provision. 

Scotty is right about “like for like”, but I think everyone is forgetting:

52   How does an owners corporation make, amend or repeal by-laws conferring certain rights or privileges?

(1)  An owners corporation may make, amend or repeal a by-law to which this Division applies, but only:

(a)  with the written consent of the owner or owners of the lot or lots concerned and, in the case of a strata leasehold scheme, the lessor of the scheme, and

(b)  in accordance with a special resolution.

The By-Law quoted gave exclusive use, so in theory you need a special resolution plus written consent from all 10 beneficial owners to repeal it. Legally, that doesn’t mean “unanimous” but statistically it probably does. What owner wants to give up something he got for free, and there’s 10 of them, which also means the special resolution wouldn’t pass. So, going to the CTTT to have the 2nd paragraph of the By-Law struck out (as contrary to the Act) wouldn’t get you anywhere.

However, the By-Law sounds unfair if the 10 beneficiaries paid the OC nothing for the exclusive use right and also if their unit entitlements weren’t increased to cover maintenance costs.

I would:

1) Check the Strata Plan to see if these parking spaces were designated visitor spaces on the DA. If they were, go to the CTTT to have the By-Law invalidated on those grounds.

2) Go to the Mitchell Library and look up the 1973 Act as printed at the time. See whether the 2-year registration period applied. I’m not sure whether it did. If it did, apply to the CTTT to have the By-Law invalidated on those grounds.

3) If the 10 beneficiaries paid nothing for the exclusive use right, apply to the CTTT to have the By-Law invalidated on the grounds of unfairness (or fraud on a majority?).

4) Depending on whether your scheme’s unit entitlements reflect the larger floor space of lots with garages vs lots without garages, apply to the CTTT for a re-allocation of unit entitlements now that some lots have “grown” a parking space.

That’s s.58(7) of the 1973 Act you need to check, not the current Act.

That’s where the Mitchell Library comes in, the 1973 Strata Titles Act is not on the internet.

However, as your inspection report of 1994 mentions the problem, it would be reasonable to conclude that the 2-year registration deadline did apply even in those days.

I don’t think the concept of Special By-Laws arose before the 1996 changes.

Before then you simply repealed, amended or added By-Laws.

There was a previous discussion of Special By-Laws here:

http://www.flatchat.com.au/forum/by-laws-and-outlaws/what-is-a-special-by-law/

and my head still hurts!

I think the conclusion was that, since 1996, Schedule 1 or Model By-Laws would be called “By-Laws” and amended or added By-Laws specific to your Plan would be called “Special By-Laws”.

Of course this gave rise to the the ridiculous situation where you would repeal By-Law X and replace it by Special By-Law X.

And Plans who had registered their By-Laws before 1996, well, they were all just called By-Laws, not Special By-Laws, even though they were “special”.

Another fine mess you’ve got us into Ollie.

The “official print-out of the By-Law, made in 1975” that you refer to should be an LPI dealing form titled “Notification of Change of By-Laws” and the words “resolution duly passed” are pre-printed on it. However, immediately before that there is a dotted space where you are supposed to insert the type of resolution, ordinary, special or unanimous. One wonders why this wasn’t also pre-printed on that standard form if the 1973 Act required a certain type of resolution? I also have a faded recollection that the requirement in those days was “unanimous”.

Anyway, I digress.

You should probably inspect the minutes of the GM which passed the By-Law, to see whether the beneficiaries were required to pay for their exclusive use right. That would only be in the minutes, not on the LPI dealing. But your SM has probably archived them and will want you to pay for retrieval.

Thank you. You’re a genius to locate that.

The 1973 Act makes interesting reading, if you’re not out fighting bushfires, or watching all-day sport on TV.

58 (3) An amendment of, addition to or repeal of the by-laws has no force or effect until the Registrar-General has, pursuant to a notification in the prescribed form lodged in his office by the body corporate, recorded the notification on the folio of the Register comprising the common property.

No mention of a 2 year time limit for registration. 

58 (7) Without limiting the generality of any other provision of this section, a body corporate may, with the consent in writing of the proprietor of a lot, pursuant to a unanimous resolution make a by-law in respect of that lot conferring on that proprietor the exclusive use and enjoyment of, or special privileges in respect of, the common property or any part thereof upon such terms and conditions (including the proper maintaining and keeping in a state of good and serviceable repair of the common property or that part of the common property, as the case may be, and the payment of money by that proprietor to the body corporate) as may be specified in the by-law.

No need to dig out the Minutes from archive to check for payments for the granting of the exclusive use rights or the ongoing continuance thereof. If there were any, they should have been written into the By-Law. But you might like to check whether the Motion was unanimous, seeing as the word was omitted from the registration.

The clause above also explains the 2nd paragraph in your By-law, the one about conditions for repeal.

But wait, there’s more …

58 (9) (b) … is, unless excused by the by-law, responsible for the performance of the duty of the body corporate under section 68 (1) (b) (i) in respect of the common property, or the part of the common property, to which the by-law relates.

The current Act says an exclusive use By-Law must define whether the OC or the exclusive use owner is responsible for maintenance of the common property involved.

The Act under which your By-Law was made assigned responsibilty for maintenance of the common property involved by default to the exclusive use owner unless the By-Law said otherwise.

Any real lawyers care to comment?

CCB, what you haven’t told us is:

a) Did you check the original strata plan to see if the area was just “open space” or designated as visitor and/or resident parking?

b) What maintenance worth $50K is planned for what I’m assuming is about 200 sq.m. of open space?