Section 108 of the Strata Schemes Management Act 2015 requires the adoption of a special by-law before an individual lot owner can carry out works affecting common property.
The purpose of a by-law under section 108 is mainly to:
- identify the works involving common property and regulate the way in which such works shall be carried out; and
- make the individual lot owner responsible for maintenance and repairs of any portion of common property affected by the works.
Some strata schemes may want to consider a blanket by-law as a more cost-effective alternative to specific special by-laws in order to cover some common types of works, such as bathroom renovations.
Below is an explanation of the main differences between specific and generic/blanket by-laws using bathroom renovations as an example.
Specific by-laws
A specific by-law will only cover the bathroom renovations to be carried out in a specific lot by that lot owner. It will identify the lot number, the detailed scope of works conducted by the lot owner and any special conditions that may apply to the works.
The by-law will identify exactly the works being carried and the areas of the common property affected by the works; further, a specific by-law can be adapted to the circumstances of the individual lot owner.
However, specific by-laws are more expensive and time consuming since each lot owner will have to obtain a special by-law drafted (preferably by a strata lawyer) and each by-law will have to be passed at a general meeting of the owners corporation and registered.
Generic/blanket by-laws
A generic bathroom renovations by-law will cover potential bathroom renovations which may be carried out by all lot owners within the strata scheme.
A blanket by-law will have to be generic enough in order to potentially apply to all lots; however, it will also have to be worded in a way that clearly identifies the works that could be carried out to the bathrooms within the strata scheme.
A generic by-law will be cheaper and less time consuming since the owners corporation will only need to pass it once and that by-law will cover all the listed types of bathroom works in all lots for example removal of tiling and waterproofing and installation of new tiling and waterproofing.
However, a blanket by-law carries the risk that it may not be specific enough to identify the exact scope of works and the portion of common property affected by the bathroom renovations. This may result in disputes between the lot owners and the owners corporation. For instance, a lot owner may remove a wall to extend the bathroom however the removal of a wall has not be listed as a type of work authorised by the by-law. If records of what work has been conducted and when are not kept it can become extremely difficult after a number of years to establish who is responsible for the work. For instance, what work was conducted in that particular lot? A new lot owner may not be aware that the bathroom was renovated, the extent of the renovations and as such what they are responsible for. They may claim for instance that the waterproofing is original and as a result is the owners corporation’s responsibility. Unfortunately, while we recommend a blanket by-law requires lot owner to provide documentation about their works, this documentation may not be insisted upon, or even read, or kept by the owners corporation, whereas in the case of a specific by-law the by-law itself states the work to be conducted.
Conclusion
While we do not usually recommend the adoption of blanket by-laws, these by-laws could be a viable option in strata schemes whose lots have similar layouts and the owners are happy to undertake basic bathroom renovations although this could not completely exclude the risk of disputes if the lot owners go beyond the agreed scope of works without the approval of the Owners Corporation.
Please note that sections 109 and 110 provide for approving cosmetic work (the Act provides approval) and for approving minor renovations (the owners corporation or, if the power is deleted to the strata committee, the strata committee, may approve the work by passing an ordinary resolution) that do not require a by-law. Bathroom renovations generally affect the waterproofing and when they do they are neither cosmetic works or minor renovations.