Recovering legal costs in levy recovery actions in the ACT: Good news for owners corporations

Section 31 of the Unit Titles (Management) Act 2011 (ACT) (the Act) enables an owners corporation to recover expenses from a lot owner if such expenses relate to work conducted by the owners corporation because of a wilful or negligent act or omission by an owner or occupier, or because of a breach of the rules of the units plan by an owner or occupier. This provision has been considered in the context of levy recovery proceedings.

The Federal Court’s decision in the case of The Proprietors Units Plan No 52 v Patricia Isobel Gold [1993] FCA 385 held that (the then equivalent of) section 31 of the Act creates a statutory debt, for which the owner is liable as soon as the amount of the owners corporation’s expenditure can be ascertained. The Court held that non-payment of contributions was a clear breach of the rules of the units plan, and the expenditure of costs for legal action taken to recover such contributions was both rendered necessary by the debtor’s failure to pay and considered reasonable in the circumstances. This decision overturned an earlier Supreme Court decision, which had found section 31 did not apply to levy recovery proceedings.

The Federal Court decision was then applied in Hugh Russell Ford v The Owners Units Plan No. 259 [2012] ACAT 59. This is a particularly interesting decision as ACAT (the ACT Civil and Administrative Tribunal) is primarily a non-costs jurisdiction. This means that costs are usually not awarded, subject to very particular circumstances.

However, the Tribunal found that it was empowered to award costs in levy recovery proceedings brought under the Act because of the existence of section 31. Importantly, the costs awarded in this case were reduced due to a lack of “efficient” handling of the proceeding by the owners corporation. This suggests that even though costs can be awarded by the Tribunal, the amount of costs will be subject to the discretion of the Tribunal and the reasonableness of costs incurred will be assessed.

The result of these decisions is good news for owners corporations wishing to recover unpaid contributions from its lot owners. Not only are reasonable legal costs likely to be ordered payable by the debtor, but the possibility of having to pay the debt, interest and legal costs in addition may provide further incentive for the debtor unit owner to pay the debt without the need for court or Tribunal proceedings.

For more information about recovery of unpaid contributions, please contact Allison Benson of our office.

Allison Benson
Legal Practitioner Director
Ph: (02) 4032 7990
E: allison@kerinbensonlawyers.com.au

Getting it right the first time round: Avoiding LPI requisitions for by-laws

Whether it’s to authorise a renovation, regulate pet ownership, or to give the executive committee permission to approve the installation of solar panels, any change, repeal, or addition of a by-law requires the filing of documentation with Land and Property Information (LPI). With more than 72,000 strata schemes across NSW, and a significant proportion of the NSW population who may want a by-law registered or changed, the LPI is governed by specific requirements that must be met by anyone wishing to change, add or repeal a by-law. A list of some (but not all) of these requirements is set out below:

  • Has the proper form been used and is the right person/are the right people executing it?
  • Do the details on the form relating to the new by-law match LPI’s existing file? For instance, if the new by-law is stated as being “Special By-law 3”, the last by-law in LPI’s records should be Special By-law 2, not Special By-law 1, or 3, or 4.
  • Have all attachments been properly verified? LPI has an exacting standard in respect of verification and execution of attachments.
  • Does the name of the owner of the affected lot, as set out in the by-law documentation, match the name on title for that lot, as recorded on the certificate of title (title deed)? For example, has Miss Elizabeth Smith now become Mrs Elizabeth Connor? Any discrepancies in name should be explained by way of statutory declaration, filed at the same time as the change in by-law documentation.

If LPI is not satisfied that the documentation provided is accurate or compliant with the relevant standards, it will issue a requisition notice. This notice sets out the areas that require attention and provides a timeframe within which documents should be re-lodged.

Depending on the change(s) required, the availability of the strata manager or, in the case of a self-managed strata scheme, the availability of all owners required to authorise amendments and affix the common seal of the owners corporation, it may take some time for changes to be made and the documents re-lodged. If documents are re-lodged after the expiry of LPI’s timeframe, a further fee of $107 will apply. The additional time taken also holds up registration of the by-law, which in turn prevents the owner or owners from being able to take the action the by-law is to authorise. Time may also be an issue as by-laws need to be registered within two years of being resolved upon.

Whilst at first glance filing LPI documentation and ensuring compliance with LPI processes may seem like child’s play, errors are easy to make and can be costly.

For more information about by-laws, please contact Allison Benson of our office.

Update March 2017 

Since the above was posted in 2015, there have been a number of changes regarding registering by-laws. The Strata Schemes Management Act 2015, which commenced on 30 November 2016, now requires that schemes wishing to register a change of by-law with the LPI to do so within six months after the date at which it was passed. The LPI have also updated their registration process, in particular, the approved form required to be used. The first updated occurred on 1 December 2016 required schemes to annex the change of by-law but also a consolidated set of by-laws incorporating the new change of by-law. The second change occurred in February 2017, the substantive change being that all changes to by-laws lodged using the approved form will have been passed pursuant to section 141 of the new Act. The LPI also introduced a $50 requisition fee for documents relating to dealings beginning on 1 January 2017.

Allison Benson
Legal Practitioner Director
Ph: (02) 4032 7990
E: allison@kerinbensonlawyers.com.au

When being unreasonable isn’t enough: NCAT’s discretion in the reallocation of unit entitlements

Section 183(1) of the Strata Schemes Management Act 1996 (NSW) (the Act) confers a discretion on NSW Civil and Administrative Tribunal to reallocate unit entitlements when the original allocation is found to be unreasonable. The recent case of Rita Sahade v The Owners Strata Plan No 62022 & Ors [2015] NSWCATCD 5 emphasises the discretionary nature of this power.

Background

 The case was originally brought by the applicant before the Consumer, Trader and Tenancy Tribunal in 2012. The Tribunal dismissed the application. The applicant appealed to the District Court, and its decision was then the subject of appeal to the Court of Appeal, who remitted the case back to the Tribunal in respect of the following issues:

  • Whether the original allocation of unit entitlements (UE) was unreasonable;
  • If so, whether the UE should be reallocated; and
  • If so, the appropriate allocation of UE.

Relevant Considerations

 In making its determination, the Tribunal identified several considerations relevant to the decision to alter UE:

  • Market value of the lots (noting this is a mandatory and primary consideration, though not the only consideration);
  • UE forms part of bundle of rights as part of realty and ownership of unit;
  • UE forms part of market value due to the degree of control and fees/responsibilities associated with UE;
  • Units are sold and bought on the basis of known rights (i.e. known UE);
  • UE forms basis for liabilities and payments; and
  • UE controls power of management of OC and determines quorum.

The Tribunal found that the original UE allocation was unreasonable based on market value yet decided not to exercise its discretion to alter UE on the basis that:

  • Control of the scheme would change fundamentally with an altered UE;
  • By purchasing the property with 40% of the schemes UE, it was clear to the applicant at the time of purchase that she wasn’t buying a controlling share;
  • It was likely to result in compulsory management and/or deadlock if one unit given such control – which was not the legislative intent of the Act; and
  • The unopposed evidence of original owner showed the original reason for UE allocation was to prevent one lot acting without the support of at least one other lot.

The Tribunal also reaffirmed that in such matters it is the applicant who bears the onus not only to demonstrate that there was unreasonableness in the original UE allocation, but also to persuade the Tribunal why it should order a reallocation of UE, with the Act conferring a discretion and not an obligation on the Tribunal to alter UE allocation.

For information about unit entitlements generally or responsibilities of lot owners in relation to their unit entitlements, please contact our office.

Allison Benson Angie Rennie
Legal Practitioner Director Lawyer
Ph: (02) 4032 7990 Ph: (02) 8706 7060
E: allison@kerinbensonlawyers.com.au angie@kerinbensonlawyers.com.au

Renovations in Strata & Community Title Lots: New Planning “One-Stop-Shop” Website to Fast Track Development Approvals

This is a caution that the new website https://hub.planning.nsw.gov.au/ for home owners wanting to renovate their properties launched by the Dept. Planning & Environment to fast track development approvals is not a one-stop-shop. Home owners in strata & community schemes should remember that they may need the approval of their owners corporation, building management committee or relevant association.

Why is this important to remember?

Strata Schemes

For owners of a strata property, if the work you intend to do affects the common property then, in addition to considering whether you need development approval for the work, you must have the approval of your owners corporation to conduct the work. As the owners corporation owns the common property you cannot alter the common property without its permission.

If your planned work is major renovation work, then any approval will by way of a motion passed at a general meeting for a by-law under either section 65A or 52 of the Strata Schemes Management Act 1996 (NSW) authorising the works. If a development consent is required then the owners corporation as the owner of the common property affected by the renovations will also have to consent to the development application.

If development consent is not required as your planned work is minor, such as installing new cupboards or new shelving along a common property wall, then model by-law 5 applies. This means you must request written approval from your executive committee prior to doing this work. If your scheme is not governed by the model by-laws check for an equivalent by-law.

You should also consider if there are any by-laws setting standards. Model by-law 17 provides that you must not maintain anything in a lot that is not in keeping with the appearance of the building. Installing a trellis may breach this by-law. If your strata scheme is only part of a building, you must also comply with any architectural guidelines in the strata management statement.

Community Associations

If you live in a community association you should keep in mind the architectural guidelines for your association. These guidelines will often provide for the approved shades of paint or material that must be used. For instance, installing an ochre coloured roof or a tin roof instead of a charcoal slate roof may breach your association’s architectural guidelines. You should also consider whether the work you are doing will affect any community property such as piping or cabling for services or even footpaths. These sort of mistakes are costly to remedy, can cause bad feelings in the community and are easy enough to avoid with a bit of prior research.

For further information, or for a quote on preparing any necessary by-law, please contact Kerin Benson Lawyers on 02 8706 7060.

Kerin Benson Lawyers

Author: Allison Benson

Office: Sydney & Newcastle

Email: allison@kerinbensonlawyers.com.au

Date: 13 March 2015

Don’t drown in the legislative reform: Ensure your pool is compliant

The changes introduced by the Swimming Pools (Amendment) Act 2012 have again been postponed, with owners corporations now having until 29 April 2016 to ensure their swimming pools are the subject of a certificate of compliance if any owner wishes to sell or lease their unit. The changes were supposed to have been implemented at the end of April this year.

Owners corporations can choose either to wait for their local council to inspect their pool on request or to ask a private certifier to do so. With wait times for council inspectors reported to be up to several months, and many pools failing initial inspections, an owners corporation may prefer to engage a private certifier to inspect their pool and issue a certificate of compliance. Councils can charge up to $150 for inspection of pools (including spot-checks resulting from complaints relating to a swimming pool’s compliance), so the issue of cost may not be a strong deterrent in electing to use a private certifier rather than Council.

Even if owners are not planning to lease or sell their units in complexes with pools, the owners corporation is required to register the pool on the Swimming Pool Register. This requires a self-assessment in relation to the pool’s compliance with the relevant safety considerations set out by Australian standards and the legislation. Pools should have been registered from 2013 on the Swimming Pool Register however some may not have been registered.

The Swimming Pool Register can be accessed at www.swimmingpoolregister.nsw.gov.au.

For more information on swimming pool compliance, please contact our Newcastle or Sydney offices.

 

Allison Benson Sydney Office
Legal Practitioner Director
Ph: (02) 4032 7990 Ph: (02) 8706 7060
E: allison@kerinbensonlawyers.com.au E: enquiries@kerinbensonlawyers.com.au

Case Note: Can a lot owner claim for damages in equity & negligence arising from a breach of Section 24 Unit Titles Management Act after Thoo & Brookfield-Multiplex?

Section 24 of the Unit Titles (Management) Act 2011 (ACT) establishes the strict liability of an owners corporation to maintain and repair its common property. The ability of a lot owner to sue for damages has been limited in the light of the decision of the NSW Court of Appeal in The Owners Strata Plan 50276 v Thoo [2013] NSWCA 270 (Thoo). Whilst the case is a NSW case, the application of the legal principles involved is likely to be a guide to ACT courts and tribunals who are faced with cases with similar circumstances.

Thoo reiterated the principle that an owners corporation holds the common property on trust for lot owners. It is also authority that a lot owner is not entitled to damages for breach of an owners corporation’s statutory duty under section 62 (the NSW equivalent to ACT’s section 24) to maintain and repair common property. The High Court approved this decision by refusing special leave to appeal in Thoo v Owners – Strata Plan No 50276 & Ors [2014] HCASL 79.

The Thoo Effect – Other Available Claims for Lot Owners

However, Thoo left the possibility open that a lot owner may make a claim in negligence against an owners corporation for its failure to maintain and repair its common property. This ability to claim in negligence was considered in the recent Supreme Court of NSW decision of McDonough v The Owners – Strata Plan No. 57504 [2014] NSWSC 1708 (the recent case), as was the ability of a lot owner to make a claim for equitable compensation for a breach of trust. Once again, the similarity between the relevant legislative provisions in ACT and NSW, and the fact that the decision was made in the Supreme Court of NSW and not a court or tribunal of lower jurisdiction, make it likely that the ACT judiciary will be guided by the decision in the recent case.

The claim in the recent case arose out of a levy recovery action commenced by an owners corporation in the Local Court of NSW. The lot owner cross claimed for damages for loss caused by an alleged breach of section 62 arising out of the owners corporation’s failure to repair common property adjacent to the lot and the matter was transferred to the District Court of NSW. As Thoo prevented the lot owner from continuing their claim for damages for breach of statutory duty, the lot owner in the recent case sought to amend their cross claim.

Essentially, the proposed amended damages claim was that the lot owner’s loss was due to:

  1. the owners corporation’s negligence in failing to maintain and repair the common property; and / or
  2. a breach of trust by the owners corporation in that either:
  • section 62 was a term of the trust requiring the owners corporation to maintain and repair the common property and that this trust term was breached; or
  • the owners corporation breached its fiduciary duty as a trustee by preferring its own interests over those of lot owners or that it had a conflict of interest in pursuing the builder for damages to try to avoid the need for a special levy.

A Question of Law

A question of whether the District Court of NSW had jurisdiction to hear the matter was raised and the issue was referred to the Supreme Court of NSW. Interestingly, in respect of the claim for negligence the owners corporation sought to rely on the recent decision in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 [2014] HCA 36 (Brookfield Multiplex) as authority that the lot owner could not claim for economic loss as they were not vulnerable in the relevant sense.

His Honour Justice Brereton in determining whether the District Court had the jurisdiction to determine the proposed amendments to the claim in the recent case held that:

1. in respect of the negligence claim:

  • the lot owner’s claim for damages in negligence was not doomed to failure, that if the District Court did not have jurisdiction (which it did) the proposed amendments would have been allowed by the Supreme Court;
  • a lot owner who bought a lot from a previous owner (and not the body corporate) may not be in a position to adequately protect itself by contract from the acts or omissions of the owners corporation and therefore they may be vulnerable; and
  • the lot owner’s claim was not just based on economic loss but was also based on loss caused by physical damage to the lot;

2. in respect of the claim in equity for breach of trust it was held to be untenable because:

  • the owners corporation was a bare trustee, had no relevant active duties to perform, and “[t]he statutory obligation to maintain common property under s 62 is not a term of the trust, and no breach of trust is involved in breaching that duty”; and
  • the failure to maintain the common property could not be a conflict of interest by the owners corporation as a trustee, as it is not an aspect of its trust obligations.

The Supreme Court ultimately held that the District Court did have jurisdiction to hear the negligence claim and the lot owner’s application to amend their cross claim will be determined in the District Court, with that court no doubt taking note of the Supreme Court’s reasoning.

As the ability to claim in negligence against an owners corporation was not ultimately decided, the possibility for a lot owner to make a claim in negligence remains open following Thoo. Given the reasoning by Justice Brereton in the recent case, it seems likely that a negligence claim can be established in certain circumstances, even if a Brookfield Multiplex argument is raised in relation to the degree of vulnerability of the lot owner making the claim.

Case Note: Can a lot owner claim for damages in equity & negligence arising from a breach of Section 62 after Thoo & Brookfield-Multiplex?

Section 62 of the Strata Schemes Management Act 1996 (NSW) establishes the strict liability of an owners corporation to maintain and repair its common property. The ability of a lot owner to sue for damages for a breach of section 62 was however limited by the decision of the NSW Court of Appeal in The Owners Strata Plan 50726 v Thoo [2013] NSWCA 270 (Thoo).

Thoo reiterated the principle that an owners corporation holds the common property on trust for lot owners. It is also authority that a lot owner is not entitled to damages for a loss of increased rent on the basis that the Owners Corporation breached its statutory duty under section 62 to maintain and repair common property. The High Court approved this decision by refusing special leave to appeal in Thoo v Owners – Strata Plan No 50276 & Ors [2014] HCASL 79.

Thoo left the possibility open that a lot owner may take a claim in negligence against an owners corporation for its failure to maintain and repair its common property. The ability to claim in negligence was considered in a recent Supreme Court decision as was the ability of a lot owner to make a claim for equitable compensation for a breach of trust.

The claim arose out of a levy recovery action commenced by an owners corporation in the Local Court. The lot owner cross claimed for damages for loss caused by an alleged breach of section 62 arising out of the owners corporation’s failure to repair common property adjacent to the lot and the matter was transferred to the District Court. As Thoo prevented the lot owner from continuing their claim for damages under the statutory duty, the lot owner sought to amend their cross claim.

Essentially, the proposed amended damages claim was that the lot owner’s loss was due to:

– the owners corporation’s negligence in failing to maintain and repair the common property; and / or

– a breach of trust by the owners corporation in that either:

  • section 62 was a term of the trust requiring the owners corporation to maintain and repair the common property and that this trust term was breached; or
  • the owners corporation breached its fiduciary duty as a trustee by preferring its own interests over those of lot owners or that it had a conflict of interest in pursuing the builder for damages to try to avoid the need for a special levy.

The question of whether the District Court had jurisdiction to hear the matter was raised and the question was referred to the Supreme Court. Interestingly, in respect of the claim for negligence the Owners Corporation sought to rely on the recent decision in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 [2014] HCA 36 (Brookfield Multiplex) as authority that the lot owner could not claim for economic loss as they were not vulnerable in the relevant sense.

His Honour Justice Brereton in determining whether the District Court had the jurisdiction to determine the proposed amendments to the claim held that:

1. in respect of the negligence claim:the lot owner’s claim for damages in negligence was not doomed to failure, that if the District Court did not have jurisdiction (which it did) the proposed amendments would have been allowed by the Supreme Court;

  • a lot owner who bought a lot from a previous owner (and not the body corporate) may not be in a position to adequately protect itself by contract from the acts or omissions of the owners corporation and therefore they may be vulnerable;
  • the lot owner’s claim was not just based on economic loss but was also based on loss caused by physical damage to the lot;

2. in respect of the claim in equity for breach of trust it was held to be untenable:

  • as the owners corporation was a bare trustee, had no relevant active duties to perform, and “[t]he statutory obligation to maintain common property under s 62 is not a term of the trust, and no breach of trust is involved in breaching that duty”; and also
  • as the failure to maintain the common property could not be a conflict of interest by the owners corporation as a trustee as it is not an aspect of its trust obligations.

The Supreme Court ultimately held that held that the District Court did have jurisdiction to hear the negligence claim and the lot owner’s application to amend their cross claim will be determined in the District Court, with that Court no doubt taking note of the Supreme Court’s reasoning.

As the ability to claim in negligence against an owners corporation was not ultimately decided, the possibility for a lot owner to do so remains open following Thoo. Given the reasoning by Justice Brereton it seems likely even should a Brookfield Multiplex argument be made.

Is bankruptcy the best option? Considerations when contemplating bankruptcy proceedings against debtor lot owners

Once judgment is obtained against a debtor lot owner, there are various enforcement options that may be canvassed by the owners corporation. If the judgment debt (which includes interest and legal costs) is $5,000 or more, one of the enforcement options open to owners corporations is issuing a bankruptcy notice with a view to commencing bankruptcy proceedings against the debtor lot owner.

If the debtor is subsequently made bankrupt and a trustee in bankruptcy is appointed, it is possible that the trustee in bankruptcy may sell the debtor’s property in order to raise funds to distribute to creditors.

As strata managers would be aware, payment of levies (and any other debt recorded on the section 109 certificate) are usually paid out of the proceeds of settlement when a lot owner sells his or her property. Otherwise, the new owner will be stuck with an obligation to pay the previous owner’s strata debts.

However, in the case of a sale of property by the trustee in bankruptcy, there is no guarantee that debts recorded on the section 109 certificate will be paid automatically from the proceeds of sale. This is because strata levies do not fall within the scope of priority payments (pursuant to section 109 of the Bankruptcy Act 1966) and are not classified as debts owed to a secured creditor. This means that a secured creditor, such as a caveator (someone who has lodged a caveat on the title of the debtor’s property) or a mortgagee (usually a bank) both take priority to owners corporations in order of payment.

Creditors may decide, by special resolution at a creditor’s meeting, that the owners corporation should be given preference in receiving payment above other creditors or classes of creditors, subject to certain statutory priorities set out in the Bankruptcy Act. However, there is no guarantee that the then-available settlement funds will be adequate to pay the whole of the debt owed to the owners corporation.

Prior to commencing bankruptcy proceedings, we recommend conducting a title search on the debtor’s property to ascertain if there are any mortgages and/or caveats registered on title. Further searches of any mortgages and caveats can then be undertaken at minimal cost, to provide the owners corporation with more information as to the pecuniary position of the debtor and to assist in the making of an informed choice when it comes to taking enforcement action.

To discuss bankruptcy proceedings or enforcement options available to owners corporations, please contact either:

Allison Benson –

Legal Practitioner Director
Ph: (02) 4032 7990
E: allison@kerinbensonlawyers.com.au

Angie Rennie – 

Lawyer
Ph: (02) 8706 7060
E: angie@kerinbensonlawyers.com.au

Building certifier liability after Brookfield: Where to now?

Background

1. On 8 October 2014, the High Court handed down its decision in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 & Anor [2014] HCA 36 which curtails the rights of apartment owners to sue builders in negligence.

2. The case involved a long-running dispute between the builder, Brookfield Multiplex, and the owners corporation with respect to building defects in the common property of a commercial building, The Mantra Chatswood Hotel, run as a serviced apartment business.

3. The High Court adopted a case-by-case approach prescribed by previous judgments including Bryan v Maloney (1995) 182 CLR 609 (Bryan v Maloney) and Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515 (Woolcock), holding that the builder did not owe the owners corporation a duty of care in these circumstances.

Reasoning

4. There were two questions that the Court answered in coming to its ruling: firstly, whether the builder owed a duty of care to the developer and, secondly, whether the builder owed a duty of care to the owners corporation independently of any duty of care owed to the developer. i A duty of care must be established in order for an action in negligence to be successful. Continue reading

Storm Clouds Ahead for Owners Corporations (NSW version)

On 8 October 2014, the High Court handed down its decision in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 & Anor [2014] HCA 36 which has serious implications for apartment owners.

The case involved a long-running dispute between the appellant builder, Brookfield, and the respondent owners corporation with respect to building defects in the common property of a commercial building, being The Mantra Chatswood Hotel, a serviced apartment business.

The Court adopted the case-by-case approach prescribed by previous judgments in this area and held that the builder did not, in these circumstances, owe the owners corporation a duty of care to exercise reasonable care in the construction of the building to avoid causing the owners corporation economic loss resulting from latent defects in the common property. Continue reading

Case note: Section 80D – Court of Appeal Win for Owners Corporations

The NSW Court of Appeal has upheld a decision of the Supreme Court in favour of owners corporations. The case of 2 Elizabeth Bay Road Pty Ltd v The Owners – Strata Plan No 73943 is the latest win in a series of cases where the developers and builders have attempted to use non-compliance with section 80D of the Strata Schemes Management Act 1996 (NSW) to have building defects proceedings struck out or dismissed.

The argument

Section 80D requires an Owners Corporation to pass, at general meeting, a resolution authorising the seeking of legal advice or the initiation of legal proceedings. Briefly, the argument being used is that if an owners corporation has commenced legal proceedings but not complied with the requirements of section 80D, those proceedings are either invalid or null and void. If successfully argued, the proceedings could be dismissed. This would mean that if the owners corporation was out of time to commence new proceedings it would be left with a strict liability to repair building defects under section 62 of the Act and no means to recover the costs from the builder/developer. Continue reading

Responding with Lightning Fast Speed to LAAN notices from Telco companies

There has been a recent spate of Land Access and Activity Notices (LAAN) being issued to owners corporations by telecommunications companies, requiring access to strata plans either to inspect the premises or to install telecommunications facilities and equipment, usually for broadband and/or optical fibre networks.

The Draconian nature of LAANs may have many owners corporations wondering what rights they have to object to the installation of equipment and facilities by telecommunications super-giants. Some rights do exist, but time is of the essence when it comes to taking action.

The Validity of the LAAN

 Certain requirements must be met by the carrier issuing the LAAN. These are set out in the Telecommunications Act 1997 (the Act) and the Telecommunications Code of Practice 1997 (the Code). The Act requires the carrier, amongst other things, to:

  • Specify the purpose of the proposed work;
  • Provide information about compensation payable due to certain loss or damage caused in relation to the proposed work; and
  • Give at least 10 business days’ notice prior to works being conducted

Owners corporations should ensure the validity of the LAAN as soon as possible. Continue reading

Implementation of Home Building Amendments Delayed to Mid-January 2015

The Minister for Fair Trading this morning announced that the Home Building Amendment Act 2014 is now expected to commence in mid-January 2015. Up until today it was expected to commence on 1 December 2014.

The Minister says consumers’ “protections and rights would remain intact under the new home building reforms” and further, consumers “continue to enjoy all the protections afforded to them by home building laws, including the statutory warranty scheme.” The media release also indicated that “For the first time, the reforms will specifically include fire safety and waterproofing as major elements of the building, which may have access to the six year warranty”.

We believe that consumers’ rights will not be protected because, for instance, in order for fire safety and waterproofing defects to have such access they need to cause or be likely to cause:

–       the inability to inhabit or use the building (or part of the building) for its intended purpose; or

–       the destruction of the building or any part of the building; or

–       a threat of collapse of the building or any part of the building.

The updated Office of Fair Trading website indicates that the majority of the amendments and the Home Building Regulation will commence in January 2015 whereas the media release indicates all of the amendments are expected to start in mid-January (presumably 2015).

Therefore, the uncertainty surrounding the provisional date of 1 December 2014 for the commencement of these amendments has now been replaced with an even more uncertain mid-January 2015 date.

We will keep you informed as developments arise.

Read media release here…

Privacy for Strata Managers – Three lessons from the Australian Information Commissioner

It is no secret that the Australian Privacy Principles (APP), found in Schedule 1 of the Privacy Act 1988 (Cth), impose restrictions on organisations and individuals, like strata managers, in relation to the collection, use and disclosure of personal information. In compliance with APP 1, most strata managers now have updated privacy policies easily accessible on their websites. The APP also govern the security and storage of personal information, as emphasised by the recent case of Pound Road Medical Centre: Own motion investigation report [2014] AICmrCN 4 (PRMC). Here are three lessons for strata managers in maintaining compliance with the APP.

Lesson One: Keep it Secret, Keep it Safe
APP 11 deals with the security of personal information, with APP 11.1 requiring information to be kept safe from misuse, interference and loss, and also from unauthorised access, modification or disclosure. In PRMC, the Commissioner found that keeping medical records locked in a garden shed did not constitute compliance with the terms of APP 11.1 (then National Privacy Principle (NPP) 4.1).

Strata managers should ensure all records, both physical and electronic, are properly secured and protected from unauthorised access and interference.

Lesson Two: Knowing When (and How) to Let Go
APP 11.2 stipulates that any personal information that is no longer needed and is not required to be retained by law must be destroyed or appropriately de-identified. In PRMC, the Commissioner found that storage of records that were 10 years old was in breach of the requirement to destroy or de-identify the personal information contained in those records.

Strata managers should ensure that any personal information retained is current and relevant. Any personal information that is no longer required (such as the names and contact details of ex-owners) should be destroyed.

Lesson Three: Comply with Your Own Procedures
Whilst the Commissioner was satisfied that PRMC had established procedures governing the storage, review and destruction of documents containing personal information, it found that PRMC had ignored its own procedures, and that this constituted a failure to take “reasonable steps” (as required in the equivalent of APP 11.2) to destroy the information or ensure it was de-identified.

Strata managers should ensure that relevant policies are in place to guarantee the regular review of documentation containing personal information and that procedures are established – and followed – in relation to the destruction or de-identification of personal information.

To discuss APP compliance in the strata context, please contact Allison Benson.

Storm Clouds Gather for Owners Corporations [ACT version]

On 8 October 2014, the High Court handed down its decision in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 & Anor [2014] HCA 36 which has serious implications for apartment owners in the ACT.

The case involved a long-running dispute between the appellant builder, Brookfield, and the respondent owners corporation with respect to building defects in the common property of a commercial building, being The Mantra Chatswood Hotel, a serviced apartment business.

The Court adopted the case-by-case approach prescribed by previous judgments in this area and held that the builder did not, in these circumstances, owe the owners corporation a duty of care to exercise reasonable care in the construction of the building to avoid causing the owners corporation economic loss resulting from latent defects in the common property.

There were two questions that the Court answered in coming to its ruling: firstly, whether the builder owed a duty of care to the developer and, secondly, whether the builder owed a duty of care to the owners corporation independently of any duty of care to the developer.

With regards to the first question, the Court held that the developer, who originally contracted with the builder, sufficiently protected itself and was not ‘vulnerable’ to the builder’s conduct in the legal sense (vulnerability being a legal requirement for a duty of care to exist).

The Court pointed out that the contract between the builder and the developer contained numerous stringent clauses holding the builder accountable for building defects. It stated that, to supplement the contractual provisions with a duty of care towards the developer would inappropriately alter the allocation of risk effected by the parties’ contract. Therefore, there was no duty of care. And, if no duty of care was owed to the developer, it would be difficult to argue that a duty of care should flow to a subsequent owners corporation as a subsequent owner.  That is, the subsequent owner should not hold greater rights than the original owner, being the developer.

In relation to the second question, the Court held that the builder did not owe a duty of care to the owners corporation independently of its obligations to the developer. As the owners corporation did not exist at the time the defective work was carried out, there could not have been any reliance by the owners corporation upon the builder. Furthermore, the Court held that the owners corporation did not suffer any loss because it acquired the common property without any outlay on its part.

Consistent with its case-by-case approach, the Court distinguished this case from the previous case of Bryan v Maloney (1995) 182 CLR 609 where a subsequent owner successfully argued that a builder of a residential house was liable for economic loss arising from building defects. The Court held that the contractual protections provided to the original owner and subsequent purchaser in Bryan v Maloney were far less than those offered in the current case and consequently, a duty of care arose in Bryan v Maloney.

However, the Court also made it clear that it was inappropriate to use the mere nature of the purchase (i.e. whether it was a commercial or residential property) as the decisive factor in determining whether a duty of care exists. Rather, the salient features of the relationship between the builder and the owners corporation, including whether the builder owed the developer a relevant duty of care, must be considered.

The main practical outcome for residential apartment owners is that it will be generally much more difficult for them to succeed when suing builders in negligence for building defects in lot or common property. In particular, owners corporations will need advisors to carefully analyse the contracts relating to the development, construction and conveyance of apartments to determine the precise level of contractual protection afforded to the relevant parties. Indeed, it is fortunate that the Court left it open that such matters must be decided on a case-by-case basis, rather than set out a blanket rule that builders do not ever owe a duty of care to owners corporations.

Finally, owners will now have to rely more heavily on state and territorial government statutory warranty regimes and act rapidly to not fall foul of limitation periods. Unfortunately, these statutory warranty regimes tend to be more limited in scope than negligence. In the ACT, the statutory warranties under the Building Act 2004 do not apply to buildings over 3 storeys and, consequently, owners of apartments in larger buildings will either need to argue that their situation falls into a category where a duty of care exists, or alternatively, find some other non-tortious cause of action to rely upon.

Authors: Christopher Kerin & James Qian

E: christopher@kerinbensonlawyers.com.au & james@kerinbensonlawyers.com.au

Storm Clouds Gather for Owners Corporations [NSW version]

On 8 October 2014, the High Court handed down its decision in Brookfield Multiplex Ltd v Owners Corporation Strata Plan 61288 & Anor [2014] HCA 36 which has serious implications for apartment owners in New South Wales.

The case involved a long-running dispute between the appellant builder, Brookfield, and the respondent owners corporation with respect to building defects in the common property of a commercial building, being The Mantra Chatswood Hotel, a serviced apartment business.

The Court adopted the case-by-case approach prescribed by previous judgments in this area and held that the builder did not, in these circumstances, owe the owners corporation a duty of care to exercise reasonable care in the construction of the building to avoid causing the owners corporation economic loss resulting from latent defects in the common property.

There were two questions that the Court answered in coming to its ruling: firstly, whether the builder owed a duty of care to the developer and, secondly, whether the builder owed a duty of care to the owners corporation independently of any duty of care to the developer.

With regards to the first question, the Court held that the developer, who originally contracted with the builder, sufficiently protected itself and was not ‘vulnerable’ to the builder’s conduct in the legal sense (vulnerability being a legal requirement for a duty of care to exist).

The Court pointed out that the contract between the builder and the developer contained numerous stringent clauses holding the builder accountable for building defects. It stated that, to supplement the contractual provisions with a duty of care towards the developer would inappropriately alter the allocation of risk effected by the parties’ contract. Therefore, there was no duty of care. And, if no duty of care was owed to the developer, it would be difficult to argue that a duty of care should flow to a subsequent owners corporation as a subsequent owner.  That is, the subsequent owner should not hold greater rights than the original owner, being the developer.

In relation to the second question, the Court held that the builder did not owe a duty of care to the owners corporation independently of its obligations to the developer. As the owners corporation did not exist at the time the defective work was carried out, there could not have been any reliance by the owners corporation upon the builder. Furthermore, the Court held that the owners corporation did not suffer any loss because it acquired the common property without any outlay on its part.

Consistent with its case-by-case approach, the Court distinguished this case from the previous case of Bryan v Maloney (1995) 182 CLR 609 where a subsequent owner successfully argued that a builder of a residential house was liable for economic loss arising from building defects. The Court held that the contractual protections provided to the original owner and subsequent purchaser in Bryan v Maloney were far less than those offered in the current case and consequently, a duty of care arose in Bryan v Maloney.

However, the Court also made it clear that it was inappropriate to use the mere nature of the purchase (i.e. whether it was a commercial or residential property) as the decisive factor in determining whether a duty of care exists. Rather, the salient features of the relationship between the builder and the owners corporation, including whether the builder owed the developer a relevant duty of care, must be considered.

The main practical outcome for residential apartment owners is that it will be generally much more difficult for them to succeed when suing builders in negligence for building defects in lot or common property. In particular, owners corporations will need advisors to carefully analyse the contracts relating to the development, construction and conveyance of apartments to determine the precise level of contractual protection afforded to the relevant parties. Indeed, it is fortunate that the Court left it open that such matters must be decided on a case-by-case basis, rather than set out a blanket rule that builders do not ever owe a duty of care to owners corporations.

Finally, owners will now have to rely more heavily on state and territorial government statutory warranty regimes and act rapidly to not fall foul of limitation periods. Unfortunately, these statutory warranty regimes tend to be more limited in scope than negligence. In particular, from 1 December 2014, it is anticipated that the vast majority of new apartment owners in New South Wales suffering lot and common property building defects will effectively only have 2 years to sue due to the latest amendments to the Home Building Act 1989.

Authors: Christopher Kerin & James Qian

E: christopher@kerinbensonlawyers.com.au & james@kerinbensonlawyers.com.au

NCAT Applications: Exclusive use by-laws, the interests of all owners, rights and reasonable expectations

Do you want to renovate your unit but your proposed exclusive use by-law has been refused by the Owners Corporation? Or, do you believe that the terms of a works by-law that has been made are unreasonable? In either case you may be able to make an application to the NSW Civil & Administrative Tribunal (NCAT) for Strata Schemes Adjudicator’s orders under section 158 of the Strata Schemes Management Act 1996 (NSW) (the Act) for the making of the proposed exclusive use by-law or the repeal or amendment of an existing exclusive use by-law.

The key consideration in the first instance is whether the owners corporation has unreasonably refused to make the exclusive use by-law and in the second whether the terms of the by-law providing for maintenance and upkeep of the affected common property are unjust. A related type of application under section 158 can be made if a lot owner has unreasonably refused to consent to the terms of a proposed exclusive by-law or has unreasonably refused to consent to the amendment or repeal of an existing exclusive use by-law.

The purpose of a section 158 application is to ensure so far as possible in a strata scheme that the interests of all lot owners, including the lot owner wishing to do works or having the benefit of an existing exclusive use, and the owners corporation are protected. Why is this important? In a recent matter, one of our clients, a long term owner in the strata scheme wanted to renovate his lot obtain exclusive use of the common property roof space directly above his lot to add an attic room to make room for a growing family. The simple majority of lot owners supported our client. However, a special resolution was required and three investor owners holding a just over 25% of the unit entitlements blocked the motion for an exclusive use by-law that would have authorised our client’s planned renovations. In this case our client had offered to pay a significant sum of money to the Owners Corporation by way of compensation for the use of the unused roof space.

As the motion failed to pass our client would have, without section 158 of the Act, been without recourse and been unable to conduct the works. As it was with our assistance they obtained orders that the proposed by-law be made. NCAT, in considering an application under section 158 must consider the interests of all owners in the use and enjoyment of their lots and the common property and also the rights and reasonable expectations of the lot owner who anticipates a benefit from the proposed by-law (or in the case of an existing by-law derives a benefit from it). In this case it was in the interests of all lot owners and the owners corporation for the by-law to be made.

A section 158 application can be an invaluable second chance to have their proposed by-law made or an existing by-law amended or repealed through an objective third party making a determination. It is a tool for ensuring fairness within divided schemes. Before making an application we strongly recommend that you seek legal advice.

Kerin Benson Lawyers

Author: Allison Benson

Office: Sydney & Newcastle

Email: allison@kerinbensonlawyers.com.au

Date: 14 October 2014

Case Note: Failure to Maintain Common Property – Was the Owners Corporation Responsible for the Unit Owner’s Losses?

For most of us our homes are our castles. Given the emotional and financial stresses associated with them it is understandable that when there is a problem such as water penetration, a unit owner wants someone else to be responsible for any financial loss caused. In a recent ACAT case we successfully defended a claim made against an owners corporation in just such a situation.

What happened?

Like many new developments, this particular building contained building defects. As part of the process of identifying the defects, investigating the cause and engaging in a collaborative repair process with the original builder, the owners corporation had arranged for several inspections of both common and lot property. During this process no one notified the owners corporation, its building manager or experts that the unit suffered from water penetration. Sometime later the unit was inundated with water and the owners corporation was notified. An inspection was promptly arranged however due to the lack of previous issues and the cause was believed to a failure to clear the drainage system of debris. Some months later, the unit again flooded as a result of which the tenant left. After testing the cause was found to be defective building.

The unit owner then sued the owners corporation for loss of rent, compensation for damage to property and cleaning costs. Under section 24 of the Unit Titles Management Act 2008 (ACT) there is a strict duty upon the owners corporation to maintain the common property. However, the unit owner’s ultimately asserted negligence. The key question was had the owners corporation acted reasonably in the circumstances and was it therefore responsible for the unit owners loss?

The decision

ACAT found that the owners corporation had acted reasonably in undertaking building defect inspections and that this was an unfortunate situation where no one was to blame for the unit owner’s losses. The unit owner’s claim was dismissed

Although this is an ACAT decision it is of interest to NSW based owners corporations. This is because the decision of the NSW Court of Appeal in The Owners Strata Plan 50726 v Thoo [2013] NSWCA 270 which concerned the ability (or inability as it was ultimately decided) of a lot owner to claim for damages, including loss of higher rent, left open the possibility of a claim against an owners corporation in negligence.

What should I do if my unit is affected by a common property issue?

  • Notify your strata manager and your building manager in writing if you believe your unit is affected by a building defect or a common property issue;
  • If you receive notifications of inspections by building experts you should make your unit available and advise the building expert of any suspected defects or areas of concern;
  • If you believe your unit is affected by common property building defect or maintenance issue, seek legal advice on your options.

Kerin Benson Lawyers

Author: Allison Benson

Email: allison@kerinbensonlawyers.com.au

Date: 14 October 2014

Attention to Detail: The Importance of Compliance when Issuing Creditor’s Statutory Demands

The recent cases of Kisimul Holdings Pty Ltd v Clear Position Pty Ltd [2014] NSWCA 262 (Kisimul) and In the Matter of EGE Foods Australia Pty Ltd [2014] NSWSC 983 (EGE Foods) serve to emphasise the importance of compliance with legislative requirements when issuing and seeking to rely upon creditor’s statutory demands to wind up a company.

The Cases

In Kisimul, the petitioning creditor had failed to comply with s459E(3) of the Corporations Act 2001 (the Act) by failing to include a statement in the affidavits verifying two statutory demands that there was no genuine dispute about the debts owed by the debtor.

The creditor in EGE Foods had both failed to annex supporting documents to the statutory demand and to the affidavit verifying the statutory demand (though ultimately this was not found to be fatal to the creditor’s case) and had failed to comply with the requirements of the form prescribed by the Supreme Court (Corporations) Rules 1999 (NSW) by stating, in the affidavit verifying the statutory demand, that the debt was due and payable and that there was no genuine dispute as to the debt. The Court also discussed the issue of service, finding that ordinary pre-paid post encompassed registered post, and confirming the well-established precedent that the onus is on the debtor company to raise a doubt relating to the service of a statutory demand.

In both cases the statutory demands were set aside and the creditors not entitled to proceed with winding up proceedings against the debtor companies.

Reasons to Set Aside Statutory Demands

In Kisimul, the debtor company made an application pursuant to s459G of the Act to set aside the statutory demands on the basis that there was a genuine dispute in relation to the debts, that the debtor company had an offset claim, and for “some other reason” (being the lack of a proper affidavit) in accordance with s459J(1)(b) of the Act. The debtor company in EGE Foods had not made an application to set aside the statutory demand but the Court invoked its discretion under s467A of the Act to dismiss the winding up application that ensued.

In both cases, the Court found that whilst the absence of a properly completed affidavit did not of itself make the statutory demand defective, it prevented the creditor from relying upon the presumption of insolvency that automatically follows from non-compliance with a valid statutory demand. The creditors were thus prevented from winding up the debtor companies on the basis of non-compliance with the statutory demand.

To learn more about creditor’s statutory demands or legislative compliance with court documents, please contact either:

Allison Benson Angie Rennie
Legal Practitioner Director Lawyer
Ph: (02) 4032 7990 Ph: (02) 8706 7060
E: allison@kerinbensonlawyers.com.au E: angie@kerinbensonlawyers.com.au

Cracking Phoenix Eggs

It has been reported that the Australian Securities and Investments Commission, Australian Tax Office and Fair Work Building and Construction have recently begun cooperating to crack down on builders liquidating their companies to avoid repaying creditors including the Tax Office, employees, and contractors.  In particular, the Tax Office is compiling evidence given to it by a number of large construction firms for the purpose of determining whether criminal charges should be laid against directors who instigate phoenixing activity.

By way of background, a company is typically an entity whose owners (the shareholders) have what is called ‘limited liability’.  This means that a given shareholder or director is not personally liable for any of the debts of the company, other than for the unpaid value of his or her investment in that company.

For example, let’s say that there existed a company that had $10 million in debts and no assets.  A director of that company holds one share and has $5 million in personal assets including a yacht and a few million dollars in spare cash under his sofa.  If the company were to be wound up, the director / shareholder would only be legally liable for any unpaid portion of the amount he invested in the company (which could be as little as $1) and not his yacht or cash.  The legal protection offered to the above shareholder and director to prevent company creditors from touching his personal assets is referred to as the corporate veil.

Not surprisingly, the corporate veil can easily be manipulated at the expense of legitimate creditors.  One instance of this is companies engaging in ‘phoenixing’ behaviour.  Phoenixing involves a company being deliberately wound up to avoid the payment of debts.  In its place, a new company is founded which performs substantially the same services with a clean slate.  That new company, in a sense, ‘rises from the ashes’ of the wound-up company.  It would be reasonable to say that the phenomenon of company phoenixing (using $2 companies in particular) is one of the most infamous abuses of the corporate veil ever devised.

There are very limited circumstances where the corporate veil can be pierced.  The two most likely scenarios are breaches of directors’ duties and insolvent trading.  However, neither scenario is particularly helpful in the context of building defects.  Firstly, it is highly unlikely that a court would accept that a director of a company which engaged in defective building work is in breach of his or her directors’ duties.  Secondly, even if a director is found to have engaged in insolvent trading, creditors still need to prove their loss and damage and then stand together with all the other creditors to recover that loss and damage.

Given that phoenixing is rife in the construction industry, it appears to be a belated response.  As we reported in March this year, there have been previous attempts by the Commonwealth Government to discourage such behaviour legislatively.

However, it may be premature to celebrate if you are a long suffering owners corporation or lot owner whose building is riddled with defects.  Even if the Tax Office gets its hands on those directors, it will be for the purpose of either putting them in jail or to reclaim unpaid tax debts and superannuation.  That is, after the Tax Office, the employees and contractors have taken their cut, there may be no meat left on the metaphorical carcass to pick, nor does the Tax Office care.  Therefore, this crackdown, as noble as it sounds, will not assist those owners corporations which suffer from building defects.

Authors: Christopher Kerin & James Qian

E: christopher@kerinbensonlawyers.com.au & james@kerinbensonlawyers.com.au

Case Note: How to count the numbers – Voting Requirements in Units Plans

Owners Corporations pass resolutions at meetings all the time, often unanimously and without controversy. The recent ACT Civil and Administrative Tribunal (ACAT) case of Green & Ors v The Owners – Units Plan No. 199 (Unit Titles) [2014] ACAT 52 highlights the importance of properly conducting and recording meetings at which motions are voted upon. It also clarifies the method by which an owners corporation may reverse the effect of a previous motion.

The Facts

 In 2011, a special resolution was passed allowing a unit owner to extend and renovate their unit. A further special resolution was passed authorising an application to the ACT Planning & Land Authority to enable the schedule of unit entitlements to be amended (this motion passed unopposed) (the 2011 resolution).

For various reasons, the process of registering the amended schedule of unit entitlements was never completed. In 2013, the Owners Corporation was in the position where the as yet unregistered schedule of unit entitlements resulting from the 2011 motion was no longer accurate, as other units had since been renovated. The Owners Corporation in February 2014 passed a special resolution effectively reversing the 2011 resolution. The issue before ACAT was whether or not this special resolution was validly passed. At the February 2014 meeting some lot owners left during the meeting and provided absentee voting papers to the secretary as they left.

ACAT Powers and Legislative Interpretation

 Pursuant to section 129(1)(b)(ii) of the Unit Titles (Management) Act 2011 (UTMA), the ACAT has the power to declare that a resolution passed at a general meeting is void for irregularity.

ACAT found that absentee meeting papers that had been provided by unit owners as they left the meeting were in breach of section 3.31 of Schedule 3 of UTMA which required the absentee voting papers to be provided prior to the meeting. Further, as the 2011 resolution was a special resolution then section 3.14(2) of Schedule 3, which superseded the requirements of the Unit Titles Act 2001, required the same type of resolution be made in February 2014 to revoke the 2011 resolution. As such a special resolution was required.  On the evidence before it, and discounting the absentee meeting notices providing during the meeting, ACAT determined the special resolution made at the February 2014 meeting was validly passed.

Green v Owners is yet another reminder to Owners Corporations that they must strictly adhere to legislative requirements to ensure the validity of its resolutions.

Case Note: Are you obliged to allow the original builder to repair building defects? Not always

In a win for Owners Corporations (and home owners) in NSW, a recent Supreme Court decision has validated the right of the Owners Corporation, in certain circumstances, to refuse an offer by the original builder to conduct remedial work where there are agreed building defects.

The case arose after the builder met with the Owners Corporation’s expert on site. Although the builder agreed to repair some items, including some bathrooms, the builder did not admit there was a systemic defect involving the construction of the bathrooms. Nor did the builder, despite requests by the Owners Corporation’s expert and lawyer, provide a detailed programme of works for the remedial repairs that was acceptable to the Owners Corporation’s expert. The Owners Corporation sought rectification orders through the NSW Office of Fair Trading and these orders were made. Unfortunately, the orders did not provide for a detailed scope of remedial work. Following the orders being made, the builder contacted the Owners Corporation directly and sought access to the property to conduct works. Despite further requests for a detailed scope of remedial works none was forthcoming until after commencing of legal proceedings although the builder argued it was ready, willing and able to conduct the remedial work under a new contract for $1.00.

At the final hearing (some six years later) the builder argued that the Owners Corporation’s claim should either be dismissed or the amount claimed be limited to the amount for which the builder could have conducted the work.

The Court found for the Owners Corporation and ordered damages be paid. While there is a legal principle that a plaintiff must mitigate its loss, there is also a principle of acting reasonably. This means a plaintiff is able to recover its estimated costs of rectifying the damage except to extent it was unreasonable to insist on reinstatement. The Court stated that in building contracts “it is also generally accepted that the owner must give the builder a reasonable opportunity to rectify any defects … except where its refusal to give the builder that opportunity is reasonable or where the builder has repudiated the contract by refusing to conduct any repairs”.

In providing this opportunity, the Owners Corporation is not mitigating its loss but mitigating the builder’s damages. What is reasonable depends on the circumstances of the case but it includes whether or not the builder has attempted to repair the defect and if owner had reasonably lost confidence in the willingness and ability of builder to do the remedial work:  The Court found the onus was on the builder to prove that the Owners Corporation acted unreasonably. In this instance the builder’s scope of works was deficient, early attempts at rectification were unsatisfactory & it was appropriate for Owners Corporation to commence proceedings. Although the Owners Corporation had rejected the builders offer to conduct the works this was reasonable as it had lost confidence in Builder by this time.

 

Author: Allison Benson

Office: Sydney & Newcastle

Email: allison@kerinbensonlawyers.com.au

Date: 31 August 2014

Case: The Owners – Strata Plan No 76674 v Di Blasio Constructions Pty Ltd [2014] NSWSC 1067

Debt Collectors v Lawyers – When is it time to call in the Legal Professionals?

When seeking to recover unpaid strata levies, it is natural for Owners Corporations to want a fast result with as little money spent as possible. For this reason, many may shy away from enlisting the assistance of lawyers, fearing excessive legal fees will result in more money being spent than saved. But this is not always the case.

Acting as Agent

Debt collectors act as agents for Owners Corporations. This means that Owners Corporations may be held responsible for the actions of their debt collectors. If improper conduct is alleged against the debt collector, the Owners Corporation may quickly find itself embroiled in legal proceedings instigated by the very debtor from whom the Owners Corporation is trying to recover levies.

If Owners Corporations use debt collectors, they should carefully monitor the actions taken by the debt collectors and should familiarise themselves with the Debt Recovery Guidelines. (For more information on the Debt Recovery Guidelines, see our article “Debt Recovery Guidelines: Are You Following Appropriate Procedure?”)

Paying Double?

If debt collectors are unsuccessful in recovering the debt, the Owners Corporation may refer the matter to lawyers for legal action. This means the Owners Corporation may have to pay the debt collector fees for recovery attempts as well as paying legal fees to the lawyers.

Quite often a letter of demand from a law firm carries more weight than a similar letter issued by debt collectors. If lawyers are approached from the outset, Owners Corporations can save money by not paying two different businesses to do the same job. Whereas many debt collection agencies charge commission on successful levy recovery, Kerin Benson Lawyers does not, so Owners Corporations may end up with more money in their pocket.

It’s Complicated

If a debtor disputes a debt, puts forward a settlement offer or wants to negotiate a payment arrangement, there are certain pitfalls that must be avoided to ensure the interests of the Owners Corporation are properly protected. Kerin Benson Lawyers provide Owners Corporations with practical, sound advice on resolving disputes and recovering unpaid levies, ensuring Owners Corporations are legally protected in the event that the debtor defaults or challenges the debt.

For cost-effective, pragmatic advice on debt recovery, please contact:

Allison Benson Angie Rennie
Legal Practitioner Director Lawyer
Ph: (02) 4032 7990 Ph: 02 8706 7060
E: allison@kerinbensonlawyers.com.au E: angie@kerinbensonlawyers.com.au

 

Units Plans & Rules: What rules apply? And how are they changed & enforced?

The Owners Corporation is responsible for managing the units plan and the enforcement of its rules. The Unit Title (Management) Act 2011 (ACT) (the Act).

What Rules Apply to My Units Plan?

The default rules for a units plan are set out in schedule 4 of the Act however the default rules can be amended, rescinded, substituted or added to.

How Are the Rules for My Units Plan Changed?

Any amendment, including a rescission or variation of, or a substitution or addition to, the default rules must, in accordance with schedule 108 of the Act, be by a special resolution of the Owners Corporation. The amended rule takes effect either on the date of its registration or on a later date as stated in the rule.

Enforcing Rules

Generally, both a unit owner and a unit occupier are bound to comply with the rules for the Units Plan. The exception is that an occupier who is not a unit owner is not bound where a rule is inconsistent with the terms of their residential tenancy agreement under the Residential Tenancies Act 1997 (ACT).

The executive committee, if they reasonably believe that the unit owner or occupier has breached a rule and it is likely that the breach will continue or be repeated, can issue a rule infringement notice. Before issuing the rule infringement notice the Owners Corporation must resolve by ordinary resolution to do so. A rule infringement notice can be technical and it is important that all requirements under the Act are complied with or it may not be valid.

If a rule infringement notice is not complied with then the Owners Corporation may apply to ACAT for an order. The maximum penalty for a breach of a rule infringement notice is 5 penalty units. Under section 133(2) of the Legislation Act 2001 (ACT) a penalty unit is:

(a)     for an offence committed by an individual—$140; or

(b)     for an offence committed by a corporation—$700.

Therefore for an individual the maximum penalty per non-compliance with a rule infringement notice is $700 and for a corporation is $3,500.

For more information regarding rules please contact Allison Benson allison@kerinbensonlawyers.com.au

Date: 8 August 2014

What By-laws Apply to My Strata Scheme?

Many lot owners, particular those in older strata schemes, do not know what by-laws apply to their scheme. While the Secretary of the Owners Corporation is required to keep a record of all the by-laws in force in the scheme this record may not always be accurate.

Why? There was a change to the law on 1 July 1997 affecting strata schemes registered before this date. Also over time there is often ad hoc additions, amendments and repeals of by-laws by the Owners Corporation. If rigorous records are not kept, confusion ensues.

This is particularly so where there are several by-laws in respect of the same subject area, for instance where there are by-laws in respect of either works and/or exclusive use areas. It is relatively common for the beneficiary of an exclusive use by-law to want to add additional space or conduct additional works (requiring a second by-law). If not properly drafted these by-laws can cause uncertainty.

For strata schemes registered after 1 July 1997, the applicable by-laws are:

  • the by-laws registered with the strata plan (including any amendments or repeals after their registration); and
  • any additional by-laws registered after the strata scheme.

For strata schemes registered before 1 July 1997:

  • the model by-laws 1 – 29 in the Strata Schemes (Freehold Development) Act 1973 (NSW) (the 1973 by-laws) no longer apply;
  • the model by-laws listed in schedule 1 of the Strata Schemes Management Act 1996 (NSW)  now apply (the 1997 by-laws); and
  • any additions to the 1997 by-laws made after 1 July 1997; and
  • any by-laws that were added to the 1973 by-laws; and
  • any amendments, additions to, or repeals of the schemes by-laws made before or after 1 July 1997.

Note that any amendments, repeals or additions to the original by-laws must be registered to be valid but that registration does not make an invalid by-law valid.

Fair Trading has indicated that as part of the strata reform process that existing schemes will be required to consolidate their by-laws. The proposed reforms are expected to be released early in 2015. This provides existing schemes with an ideal opportunity to be proactive and plan ahead by starting the process of reviewing their existing by-laws now. By obtaining advice on their by-laws (including advice on validity) now existing plans will be in a better position to consolidate their by-laws in an organised and considered manner.

 

Kerin Benson Lawyers

Author: Allison Benson

Email: allison@kerinbensonlawyers.com.au

Date: 8 August 2014

Why Balconies Leak

Ross Taylor & Associates’ famous “Why Balconies Leak” video – Everything you need to know about balcony leaks, but were too afraid to ask.

httpss://youtu.be/pkc4-9RbRuU

New Debt Collection Guidelines: Are you following the appropriate procedure?

In July 2014, Australian Security Investments Commission (ASIC) and Australian Competition and Consumer Commission (ACCC) jointly released a publication entitled “Debt Collection Guideline: for collectors and creditors” (the Guideline). The Guideline is a timely reminder to Owners Corporations that certain practices must be observed when chasing a recalcitrant debtor for non-payment of levies.

Respect thy debtor

Owners Corporations should ensure any communications with the debtor regarding unpaid levies are made in an appropriate manner and with the debtor only. Owners Corporations should:

  • Ensure contact addresses (e.g. postal address, email address) are current prior to revealing details of the debt by that medium
  • Avoid contacting the debtor at the workplace where possible
  • Not broadcast details of the debt to tenants, co-workers, family or friends of the debtor
  • Respect the debtor and avoid using discriminatory, aggressive or threatening language and/or behaviour towards the debtor

Failure to respect the privacy of the debtor can constitute a breach of the Privacy Act and end up causing more problems for the Owners Corporation. Similarly, aggressive language or unnecessarily frequent contact may be perceived as harassment or coercion.

Documentation is key

Owners Corporations should maintain accurate records in respect of their correspondence and/or attempted communication with the debtor. Records should include:

  • The date, time and location of any discussion, including the names of people present
  • The exact terms of any payment proposal or settlement discussion
  • The date(s) and method(s) by which instalment payments are made to reduce the debt

Honesty is the best policy

Misleading a debtor as to the creditor’s intentions or misrepresenting the potential consequences of non-payment of a debt can constitute misleading conduct and breach Commonwealth consumer protection laws. If a lot owner disputes the debt, Owners Corporations should obtain legal advice.

For assistance with recovering unpaid levies or for more information on debt recovery services, please contact Kerin Benson Lawyers.

Newcastle Sydney
 Ph: (02) 4032 7990  Ph: 02 8706 7060
E: enquiries@kerinbensonlawyers.com.au E: enquiries@kerinbensonlawyers.com.au
Canberra  
 Ph: (02) 6140 7061
E: enquiries@kerinbensonlawyers.com.au

 

Using Bankruptcy Proceedings in Levy Recovery: What happens if the debtor pays down the debt?

Once judgment has been granted in a levy recovery matter the Owners Corporation should seriously consider applying for the issue of a bankruptcy notice.

When is a bankruptcy notice possible?

To obtain a bankruptcy notice in levy recovery matters the judgment debt must be over $5,000 and the lot owner(s) must be individuals (not companies).

Why a bankruptcy notice?

A bankruptcy notice is the first step in being able to commence proceedings to bankrupt someone. After it is served, the debtor has 21 days within which to come to a payment arrangement with the Owners Corporation, pay the amount claimed or to apply to have it set aside. If they do not do any of these things they have committed an act of bankruptcy and the Owners Corporation can file a creditor’s petition seeking a sequestration order (this is the technical name for a bankruptcy order).

A bankruptcy notice is an extremely powerful tool in debt recovery especially when the debt relates to strata levies. The reason being is that the debtor lot owner has something valuable that they want to protect; their apartment. If a sequestration order is made and a trustee appointed to the debtor’s bankrupt estate, one of the first things the trustee will do is to consider whether there are any assets such as a unit that can be sold to pay out creditors.

What happens if the debtor pays down the judgment debt after the act of bankruptcy?

This is one of the most common questions we are asked. Quite simply, if a debt of over $5,000 is owed to the Owners Corporation when the act of bankruptcy is committed (i.e. 21 days after the bankruptcy notice is served) then as long as the debt is liquidated (such as a strata levy) it can be the basis of a creditor’s petition and the bankruptcy proceedings can be initiated.

This is helpful as due to the time between filing a claim for the debt and judgment being awarded often other levies have fallen due and payable. Provided these levies were due and payable before the act of bankruptcy they can be added to any amount outstanding under the judgment debt (including the post judgment interest). Often a debtor will pay down the amount owed under the judgment debt to under the $5,000 mark and not realise that other levies that are due and payable can also be claimed as part of the debt in a creditor’s petition.

For assistance with levy recovery action please contact Kerin Benson Lawyers on these details:

Kerin Benson Lawyers

Allison Benson

Email: allison@kerinbensonlawyers.com.au or enquiries@kerinbensonlawyers.com.au

Date: 22 July 2014

 

Kerin Benson Lawyers Guide to Obtaining a Rectification Order

This is a brief outline of what occurs during the process of obtaining a rectification order from the ACT Planning and Land Authority (ACTPLA or otherwise known as the Environment and Sustainable Development Directorate) against a building licensee (including a nominee of the builder).

The information contained in this guide is for informational purposes only and is current as at 18 July 2014. It is not legal advice. The reader should consult a suitably qualified lawyer regarding any specific legal problem or matter.

Complaint is lodged:

The first step is that a complaint is lodged. ACTPLA has prepared a standard complaints form. Kerin Benson Lawyers can complete the form, and in support, draft submissions, obtain the relevant experts’ reports and prepare witness statements to augment the complaint.

This may take a few weeks depending upon the complexity and quantity of the defects, the capacity of the various experts to provide reports and the ability to prepare witness statements in a timely manner.

ACTPLA prioritisation:

After ACTPLA receives a complaint, it prioritises it by the number and severity of defects, so it can direct resources to matters of the highest risk to the community.

Complaints with a risk to public safety are treated as priority one and ACTPLA aims to inspect them within 24 hours of receiving a complaint. Complaints about a serious breach, which are not a safety risk, are treated as priority two and are inspected within 24 to 48 hours of receiving a complaint.

All other complaints are priority three and are investigated as resources allow, taking into consideration the changing number of priority one jobs. In our experience, notwithstanding these KPIs set by ACTPLA, there is a long waiting period for complaints relating to both priority two and three defects.

30-day progress report:

ACTPLA represents that complainants will be:

  1. provided with an update in writing on the progress of the investigation within 30 working days of receipt of the complaint; and
  2. informed of the significant milestones and finalisation of the complaint.

However, specific details and actions of ACTPLA’s investigation will not be disclosed to the complainant. This apparently is a consequence of the Privacy Act 1988 to protect the private information of individuals involved and to avoid prejudice in any potential litigation.

Unfortunately, from our experience in dealing with ACTPLA, the above updates and information are not necessarily provided.

Inspection:

As part of its investigation, ACTPLA will request that the complainant grants it access to the complainant’s property to investigate the alleged defective works. ACTPLA will advise the complainant of when the inspection is to take place.

We note that, if a builder requests access to the building, the complainant should grant access on the condition that the builder is escorted at all times and their activities monitored.

Requests for further information:

Following the inspection, but occasionally before, ACTPLA may request further information from the complainant depending upon the complexity of the defect, and/or if the defect requires specialist knowledge to understand.

At Kerin Benson Lawyers, our strategy is to frontload as much of the supporting evidence for the defects as possible. This is then likely to save costs, time and effort that would otherwise have been expended in engaging in a drawn-out iterative process of ACTPLA and the builder requesting, and the complainant subsequently providing further information.

It presently takes on average 2 years for a rectification order to be issued for non-life threatening defects. However, Kerin Benson Lawyers have been able to procure such orders in 6 months, although actual experience has varied. This is because ACTPLA’s workload has been increasing exponentially in the last 3 years. In 2010/11, ACTPLA reported that it had managed 14 complex cases, including 7 litigated matters. In 2011/12, this increased to 46 complex cases, including 17 litigated matters. Furthermore, in 2012/13, ACTPLA managed 84 complex cases, of which 13 were litigated.

Disciplinary sanctions against builders are rare. In 2010/11, 313 complaints were filed against builders but no disciplinary sanctions were handed down. In 2011/12, 303 complaints resulted in 3 builders being disciplined. In 2012/13, 303 complaints resulted in no disciplinary sanctions. Therefore, over the last 3 years, 919 complaints resulted in only 3 instances where disciplinary action against builders occurred – a conversion rate of less than 0.4%.

Our anecdotal experience is consistent with the above figures. ACTPLA is becoming much slower to respond to such complaints. Nevertheless, our perseverance in emphasising to ACTPLA the importance of our client’s matter, has assisted in a faster turnaround time on average than complaints which are unassisted.

Requests for responses from the builder:

To ensure procedural fairness during the investigation, ACTPLA will approach the builder to ask for its response to the issues the complainant has raised in relation to the alleged defects.

If the builder replies, the process may be extended due to the parties having to argue their respective points. We are unable to give a definitive estimate as to how long this process takes. However, the best method to mitigate the impact of a prolonged dispute is to bring compelling evidence substantiating the defects in the first instance.

Decision and further steps:

Eventually, ACTPLA will make a decision as to whether to make, or decline, a rectification order. Ideally, if ACTPLA makes a rectification order, the builder will comply and undertake the rectification works, saving any further action by the complainant.

If the builder refuses to comply with the order, ACTPLA can impose a fine upon the builder. On 6 March 2014, the fines for non-compliance with a rectification order were increased to maximum penalties of $280,000 for an individual and $1,400,000 for a corporation (up from $28,000 and $140,000, respectively).

ACTPLA can also engage (and pay) a third-party builder to do the work required to be completed by the rectification order and then seek to recover that cost from the original builder. ACTPLA may also order (and pay) another builder to complete this work if it considers that the original builder is unsuitable for the work (eg because the original builder does not have sufficient competence).

However, the above may not occur due to funding issues which have recently plagued ACTPLA. There have been a few cases where ACTPLA has issued a rectification order on a builder but was unable to pay a third-party builder to carry out the works due to a lack of funds. This resulted in a breakdown of the process and further delays in the rectification of defects.

Appeal rights:

If you are dissatisfied with the outcome, you may appeal the decision in the ACT Civil and Administrative Tribunal (ACAT). We note that the builder may also appeal the decision if it is dissatisfied with the outcome. The appeal, called a ‘merits review’ involves ACAT stepping into the shoes of ACTPLA and making a fresh decision based on the facts.

Appeals from ACTPLA’s orders are also increasing. In 2010/11, there were 2 appeals to ACAT. In 2011/12, this figure had increased to 12. Comparatively, in 2012/13, there were 23 appeals to ACAT, 4 of which were directed to the ACT Supreme Court. Builders regularly appeal decisions that are unfavourable to them in connection with rectification orders involving large apartment complexes.

To reserve their rights, we recommend owners corporations pass a resolution at general meeting authorising the executive committee to engage in a merits review application before any decision by ACTPLA is handed down. This is because, under the ACT Civil and Administrative Tribunal Act 2008, an application to ACAT for review of ACTPLA’s decision must be made within 28 days after the day the decision is handed down (in practise, this is the date of the letter of decision). Such a timeframe will not allow the holding of a general meeting to approve the appeal within the required period following receipt of the decision.

Having indicated this, an appeal by a complainant would only be required if ACTPLA decided not to issue a rectification order or, issued a rectification order that did not address a sufficient number of defects. The appeals referred to above usually involve the building licensee as the appellant.

Kerin Benson Lawyers can draft a model resolution to be passed at a general meeting if instructions are given to do so.

Further information:

If you believe that your apartment is affected by defects and would like further information or assistance in relation to the rectification order process, please contact Christopher Kerin on (02) 8706 7060.

Meeting Notices: Why it is vital to get the timing right

When recovering strata levies or defending an application by a lot owner in respect of the validity of a meeting, it is essential that you have good processes in place and can demonstrate that you have followed these processes when sending meeting notices and levy notices.

In a relatively recent NSW case, the Supreme Court was critical of an Owners Corporation who had commenced levy recovery proceedings against a debtor lot owner. The lot owner was successful on a number of points. Although a NSW case the principles also apply in the ACT.

What happened?

The Owners Corporation sent notices for a general meeting out to lot owners by post on Tuesday 17 January. The general meeting was held on 30 January and at this meeting a special levy was raised. The lot owner fell into arrears. When the Owners Corporation took action to recover the strata levies the lot owner challenged the validity of the 30 January meeting on the basis that inadequate notice of the meeting had been provided.

The Court determined that the Owners Corporation, to prove a meeting notice was sent, must be able to satisfy the Court that:

  1. the meeting notice was correct;
  2. the notice was placed in to an envelope;
  3. the envelope was properly addressed;
  4. the correct postage was paid for the envelope; and
  5. the envelope was physically deposited in a mailbox or post office.

The Court found Clause 32 of Schedule 3 of the Strata Schemes Management Act 1996 (NSW) required at least seven clear days’ notice of a general meeting must be provided. This time frame excludes the postal service rule under the Interpretation Act 1987 (NSW) which deems service to be effected on the fourth working day after the notice was posted. What this means is that the meeting notice was deemed served on Monday 23 January (the fourth working day after the notice was posted). With seven days’ notice required the meeting could not validly have been held until 31 January. Therefore the special levy was invalid.

What do I need to do to ensure the meeting is validly held?

  • Be aware of the postal rule. The date of deemed service is the fourth working day after the notice is posted (s32 Interpretation Act 1987 (NSW) & s160 Evidence Act 2011 (ACT))
  • Make sure that the notice period for the meeting is strictly adhered to. In NSW this is 7 clear days’ notice (Schedule 2, cl 32) and in the ACT this is 14 or 21 days’ notice depending on the motion (Schedule 3, cl 3.6); and
  • Keep a record of the date the notices were sent, who sent them and that your office processes were adhered to.

Kerin Benson Lawyers

Author: Allison Benson

Email: allison@kerinbensonlawyers.com.au

Date: 15 July 2014

Debt Recovery For Overdue Strata Levies: Recovering Legal Expenses

An Owners Corporation is entitled to “recover as a debt a contribution not paid at the end of one month after it becomes due and payable, together with any interest payable and the expenses of the owners corporation incurred in recovering those amounts” under Section 80 of the Strata Schemes Management Act (1996).

The good news is that legal costs are considered expenses for the purposes of section 80 however there are restrictions imposed on the recovery of expenses to be aware of.

What are the limitations?

 In The Owners Strata Plan P 36131 v Dimitriou [2009] NSWCA 27, the Court considered the nature of “expenses” under section 80 of the Act and held that legal costs and expenses incurred in recovery of a debt, including court proceedings, may be claimed by an Owners Corporation under section 80.

However, the Court imposed several limitations on the recovery of legal costs, including those set out below:

  • Legal costs and disbursements must be proven by the claiming party to be reasonably incurred;
  • Legal costs and disbursements must be proven by the claiming party to be reasonable in amount;
  • The Owners Corporation’s conduct in commencing proceedings must be reasonable; and
  • Any claim for expenses, including legal costs, must be made in the same proceedings as the claim for the unpaid levies.

These limitations have been upheld in later cases. In particular, there has been emphasis on legal costs being reasonably incurred and reasonable in amount.

Owners Corporations should take care when making any payment arrangements with lot owners or when commencing proceedings for recovery of overdue levies to ensure their right to claim expenses is not lost, either through unreasonable conduct of the Owners Corporation or by trying to claim expenses after the levies have been fully recovered.

Whilst seemingly straightforward, the recovery of levies can become complicated very quickly.

For advice on levy recovery and further information on what amounts can be claimed from a recalcitrant lot owner, please contact either:

Newcastle Office Sydney Office
Ph: (02) 4032 7990 (02) 8706 7060
Canberra Office Email for all offices
Ph: (02) 6140 3270 enquiries@kerinbensonlawyers.com.au

 

What are the potential cost consequences of refusing to participate in Alternative Dispute Resolution processes?

 Many commercial contracts, including those between building managers, facilities managers, caretakers, strata managers and Owners Corporations, have a clause buried towards the end of the contract that sets out a process for resolving disputes.

In my experience it is all too common for parties to ignore the contractual dispute resolution processes set out in their contract and to rush to litigation whether due to heightened emotions, a misunderstanding or lack of knowledge about the process or incomplete legal advice. This can be expensive and lead to unexpected costs consequences. Continue reading

Case Review – Expert Reports and Owners Corporations

A recent Supreme Court decision involving a dispute between an Owners Corporation and a building expert engaged to inspect the property and provide a building defects report has raised the following issues:

  1. the need for an Owners Corporation to consider the scope & brief provided to their building expert;
  2. whether or not the Owners Corporation’s brief is reflected in the expert’s fee proposal;
  3. the use to which an expert report can be put; and
  4. how an Owners Corporation works with its building experts.

Continue reading

Three Key Things to Research when Considering Buying a Strata Unit: Don’t Shy Away From It

Across Australia the growth of strata title buildings is continuing. Over the Christmas break NSW residents would have looked on in horror at the structural defect concerns raised at the Opal Tower building in Olympic Park causing an evacuation of the complex. The most important thing you can do to prevent a similar situation is to do your due diligence in three key areas. Read more here. 

Canberra Times article – Owners’ legal action over defects

On 3 December 2018, the Canberra Times published an article on owners’ legal action over defects with particular focus on Elara apartments as the owners prepare for Federal Court action against the builders’ insurance fund, which could end years of legal wrangling and building disputes over the controversial Bruce development To read the full article, click here.

Strata Managers Beware: Postal service deeming provisions have changed!

Strata managers need to be aware of this key change if serving notices by post. Section 160 of the Evidence Act 1995 (NSW) has recently been amended. Instead of being deemed served four working days after the item has been posted, the item is now deemed served after seven working days after it has been posted.

This change reflects the new “priority” mail system established by Australia Post which meant regular mail now takes longer.

What does this mean? Essentially, if you are sending out any sort of notices by ordinary post you now need to allow seven working days for it to be deemed served.

Consider the following scenarios where a strata scheme still sends some or all meeting notices by ordinary post:

Strata committee meetings: 72 clear hours’ notice + 7 working days for postage of the notice
General meetings: 7 clear days’ notice + 7 working days for postage of the notice
Initial general meetings: 14 clear days’ notice + 7 working days for postage of the notice
General meetings

(where strata proposal is put to lot owners)

 

14 clear days’ notice + 7 working days for postage of the notice

Remember to allow for weekends and public holidays when setting your meeting schedules.

Flammable Cladding Action Group

The Owners Corporation Network (OCN) is calling on all residential owners facing potential financial imposts due to flammable cladding to contact the OCN on eo@ocn.org.au ASAP, to be part of a Flammable Cladding Action Group.

The OCN has seen the benefits of strata owners pooling resources to resolve shared challenges. In addition, OCN is holding a seminar:

 Simplifying Strata – Successfully Managing Building Defects & Major Projects on Saturday 6 October 2018, 9.00am – 11.30am, at the Kirribilli Club

to assist people dealing with building defects, flammable cladding or looking to carry out major projects.  Cost for non-members is just $55 (incl GST), which includes OCN membership to 30 June 2019.

The Minister for Innovation and Better Regulation, The Hon. Matt Kean will open the session, outlining recent regulatory changes which will benefit strata owners.

OCN will introduce you to Better Living in Strata (BLISS!).  OCN is run by strata owners for strata owners with the aim to deliver Better Living in Strata Schemes for the increasing number of people choosing to make strata home.

Global building specialists, Sedgwick (formerly Sergon), will explain how to successfully manage building defects identification and resolution, including combustible cladding, as well as major repairs and upgrade projects.

For more information and to book, visit www.ocn.org.au/events.

University Research Project on Building Defects

Deakin and Griffith Universities are undertaking a research project on building defects. One part of the project involves interviewing stakeholders (including committee members) about their experiences and opinions dealing with building defects.

All participant information will be re-identified to provide anonymity.

If you are interested and available, the researchers can interview you via teleconference at any time between now and mid-December 2018.

If you are a committee member who is interested in participating, please email Christopher Kerin (christopher@kerinbensonlawyers.com.au) who will forward your details onto the relevant academics.

University Research Project on Building Defects

Deakin and Griffith Universities are undertaking a research project on building defects. One part of the project involves interviewing stakeholders (including committee members) about their experiences and opinions dealing with building defects.

All participant information will be re-identified to provide anonymity.

If you are interested and available, the researchers can interview you via teleconference at any time between now and mid-December 2018.

If you are a committee member who is interested in participating, please email Christopher Kerin (christopher@kerinbensonlawyers.com.au) who will forward your details onto the relevant academics.