A lot owner has an apartment in a strata scheme with shared facilities with a pool, sauna and gym however the owner does not live in that strata scheme because they have rented their apartment out – can they still use the pool, sauna and gym, deemed as shared facilities?

The answer may not be that straight forward and raises many questions:

• They have rented out their apartment, but the lot owner still pays the levies so wouldn’t they be entitled to use the shared facilities?
• Even though the lot owner still pays the levies have they signed their rights over to the tenants for use of the shared facilities once they lease the property?
• Can the lot owner prohibit their tenants from using the apartment facilities thereby by doing so, the owner can have complete access to the facilities as after all they pay the levies?
• Perhaps the lot owner can still use the facilities, unless there is a specific by-law which prohibits them from using the shared facilities?

The answer is typically this:

• When an owner leases their lot, they also lease their interests in the common property to their tenant.
• This means the owner forfeits his or her right to use the common property facilities such as the pool, sauna and gym.
• In some cases a shrewd owner might change the lease to reserve to the owner the right to continue to use the common property facilities.
• It is unlikely this would be legally effective because an owner’s interest in the common property cannot be dealt with separately from, or severed from, his or her interest in their lot.
• However, an astute owner could decide not to lease out part of the lot such as storage room or one of two car spaces. In doing so, the owner could retain his or her interest in the common property and the right to use the common property facilities.

Do you need to review your by-laws?

In some cases it can be very useful to put in place a by-law that makes these rules clear to ensure that common property facilities are not overused.

NEED TO UPDATE YOUR COMMON PROPERTY FACILITIES BY-LAW?

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist

The NSW Government is looking to combat the fastest-growing cause of fires by implementing new product standards for lithium-ion batteries.

NSW Fire and Rescue recorded more than 90 incidences over the 2022-23 period with fires caused by lithium-ion battery powered products and, it continues to escalate.

In response to the growing incidences, NSW Government is taking a proactive stance to ensure products comply with safety standards and are appropriately tested, certified and marked before they enter the market.

When these changes come into effect suppliers, both corporations and individuals, who do not comply will incur heavy penalties.

The prevention of fires, saving lives and protecting property are high on the agenda for the NSW Government as the reality is that e-bikes, e-scooters and other e-devices are here to stay.

For more information visit Media and NSW Government

REDUCE YOUR RISK WITH AN E-BIKE / E-SCOOTER BY-LAW?

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

The NSW government has announced that it will introduce strata laws aimed at improving transparency in the industry.

Increasing the maximum penalties and penalty infringement notice amounts around strata managing agents’ obligations to disclose commission information are among some of the planned changes

In summary the NSW Government will implement new laws around:

• Stricter rules on matters such as commissions
• Tougher conflicts of interest disclosure requirements
• Increased penalties that can be imposed on strata agents
• The banning of agents from taking a commission when they do not play a role in finding the best deal for strata residents
• Strengthening NSW Fair Trading’s enforcement and compliance powers

The NSW government will consult with the industry ahead of introducing legislation in the coming weeks.

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

Carpet inside an apartment in a strata building is common property.  So too is paint on the walls and ceiling inside an apartment.  Surely that can’t be right!  But according to two Supreme Court Judges, it is.

Introduction

There are some truths that the strata industry has held to be self-evident for many years.  For example, in the strata industry, it has long been held that carpet inside an apartment in a strata building forms part of the lot and is not common property and that the same can be said for paint on the walls and ceiling inside an apartment.

But sometimes in strata living (as in life) not everything is as it seems.  A recent Supreme Court case makes that clear.

Carpet

In 2021, the owners corporation of a townhouse complex in Tweed Heads South sued the builder of the complex in the Supreme Court for damages arising out of construction defects.  The case was heard by the Supreme Court in May 2024 and on 7 June 2024 the Court published its judgment.

During the course of its judgment, the Supreme Court had to consider whether or not the owners corporation was entitled to recover damages from the builder for consequential damage to carpets inside the townhouses that was caused by defects in the common property that had allowed water to leak into and cause damage to those townhouses including the carpets in them. The builder argued that the carpet inside the townhouses was lot property as a result of which the owners corporation could not claim compensation for the damage to the carpet.

The Supreme Court disagreed.  The Court held that the carpet was installed inside the townhouses before the strata plan was registered and, relying on the Seiwa case, held that the lower horizontal boundary of each townhouse was the upper surface of its floor, namely the carpet.  For these reasons, the Court concluded that the carpet in each townhouse was common property meaning the owners corporation could claim damages for the cost to remove all carpet and underlay and supply and install new carpet to match existing carpet as closely as possible: see The Owners – Strata Plan No. 99960 v SPS Building Contractors Pty Ltd [2024] NSWSC 687.

Cosmetic Work

The conclusion that carpet inside a strata lot is common property will not sit comfortably with many within the strata industry.  That begs the question: did the Supreme Court get it right?

There is an indication in the Strata Schemes Management Act 2015 that it did.  Section 109 of that Act allows an owner of a lot in a strata building to carry out cosmetic work to common property in connection with the owner’s lot without the approval of the owners corporation.  Section 109 provides some examples of cosmetic work including laying carpet.  This indicates that the legislature considered that carpet in a lot forms part of the common property.

Again, this conclusion will still not sit well with many in the strata industry.  So is there any other support for it?

Paint

In 2010, the Supreme Court had to consider a claim by lot owners for damages to cover (among other things) the cost to repair water damage to ceilings and peeling paint work on ceilings in their lot.  The Court concluded that the ceilings and the paint on them were not within the cubic space of the lot and therefore formed part of the common property: see Stolfa v Owners Strata Plan 4366 & Ors [2010] NSWSC 1507.

Again, section 109 of the Act provides support for the conclusion that paint inside a strata lot forms part of the common property.  This is because section 109 says that painting a strata lot is cosmetic work to common property in connection with the lot.

Common Property Memorandum

There is further support for these conclusions in the common property memorandum.  Section 107 of the Act permits an owners corporation to make a by-law to adopt a common property memorandum.  The common property memorandum specifies whether an owner or the owners corporation is responsible for the maintenance and repair of certain common property.

The common property memorandum that has been prescribed under the strata regulations covers paintwork inside a lot including on a ceiling and internal carpeting.  Whilst the common property memorandum allocates responsibility for the maintenance and repair of that paintwork and carpeting to owners, the inclusion of those items in the memorandum lends support to the conclusion that they form part of the common property, as strange as that might seem.

Conclusion

The conclusions reached by the Supreme Court will be surprising to many and turn longstanding thinking in the strata industry about some basic concepts on its head.  Those conclusions are not entirely free from doubt and there is at least one case which goes the other way.  Nevertheless, the Supreme Court decisions should give everyone in the strata industry pause for thought.

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

Restricting or Banning Smoking in Strata

As of 1 May 2024 body corporate’s in Queensland are permitted to introduce by-laws that specifically prohibit or restrict smoking or inhaling of smoking products on common property of strata buildings.

As Queensland grapples with these changes, in NSW there are still many buildings that do not have a by-law concerning smoking, even though they are permitted to do so. This has raised questions such as:

• Is it possible to stop people smoking in a strata building without a by-law that bans smoking?
• If it is possible to stop smoking without a by-law, is it still necessary or desirable to have a by-law that bans or restricts smoking and, if so, why?

Banning Smoking without a By-Law

Somewhat surprisingly, it is possible to stop residents of a strata building smoking in their lots or on common property without a specific by-law that prohibits smoking.  Section 153 of the Strata Schemes Management Act 2015 prohibits residents from using or enjoying their lots in a manner or for a purpose that causes a nuisance or hazard to another resident. There have been several cases over the past years in which NCAT has made orders prohibiting residents in strata buildings from smoking on the basis that smoke caused by smoking constituted a nuisance to other residents in contravention of section 153.

NCAT Smoking Cases

In May 2019, a lot owner, Martin Gisks, succeeded in obtaining an order from NCAT prohibiting the resident of another lot in his building smoking on her balcony or in her bedrooms and requiring that resident to close all exterior doors and bedroom and bathroom windows when smoking inside her lot (Gisks v The Owners – Strata Plan No. 6743 [2019] NSWCATCD 44).

In October 2022, lot owners in a different building, Mr Pittman and Ms Cartwright, obtained orders from NCAT prohibiting the owners of another lot smoking or permitting any other person to smoke tobacco products on the balcony of their lot, and prohibiting them from permitting smoke from any tobacco product to be emitted from the interior of their lot into the lot of Mr Pittman and Ms Cartwright (Pittman v Newport [2022] NSWCATCD 173).

More recently, in June 2023, an owner in a strata building, Haydn Shaw, obtained an NCAT order prohibiting the owner and resident of another lot permitting the smoking of tobacco products in the courtyard of their lot (Shaw v Euen [2023] NSWCATCD 68).

In each case, NCAT concluded that the smoke caused by the smoking of cigarettes or tobacco products by residents constituted a nuisance which interfered with the amenity of other residents in contravention of section 153 of the Act.  It was on that basis that NCAT made orders prohibiting or restricting smoking in each of these cases.

Is a By-Law Banning Smoking Desirable?

These NCAT cases beg the obvious question:  does an owners corporation need to bother introducing a by-law prohibiting or restricting smoking?  The answer is “Yes” if the owners corporation wants to make it easier to ban or restrict smoking in its building.

This is because without a by-law that bans or restricts smoking:

• the owners corporation may not have standing to apply to NCAT for orders to prohibit residents smoking in a way that causes a nuisance to other residents because the owners corporation itself has not suffered from that nuisance (The Owners – Strata Plan No. 2245 v Veney [2020] NSWSC 134); and
• there is a need to prove that not only particular residents are smoking but also that the smoke from cigarettes or tobacco products has caused a nuisance to other residents by unreasonably and substantially interfering with the use and enjoyment of their lots (something which may be difficult to do).

In other words, if a by-law exists that bans smoking the owners corporation is able to enforce that by-law and to succeed it does not need to show that smoke from cigarettes constitutes a nuisance to other residents.  The owners corporation just needs to prove that particular residents are smoking in breach of the by-law.  That is much easier to do.

Conclusion

It is possible to stop residents smoking without a by-law that bans smoking.  However, it is much more difficult to do so because it requires proof that the smoking causes a nuisance to other residents.  And, there is real doubt that an owners corporation can apply to NCAT for an order to stop residents smoking in those circumstances.

Introducing a by-law prohibiting or restricting smoking overcomes those problems, gives the owners corporation the right to take steps through NCAT to prevent residents smoking and makes it easier for the owners corporation to win the case and put an end to smoking in its building.

DO YOU NEED A BY-LAW THAT PROHIBITS OR RESTRICTS SMOKING? CLICK HERE NOW!

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

As the world we live in drastically changes, people are looking for more economical and sustainable ways of living.

Many families (and others) are downsizing and moving into strata apartment living which often means they need to also review their current transport options.

The parking incident that raised many questions!

In a recent incident a lot owner was sent a notice from their owners corporation to remove a kayak from their parking lot. The kayak was stored neatly in front of their motor vehicle within the confines of their parking space.

The owners corporation said the kayak was not a vehicle so therefore it had to be removed or the owner would incur a fine. The owner argued that the kayak was a vehicle and therefore could be kept in the parking space according to the building’s by-law for parking.

• Firstly, is a kayak classified as a non-motorised vehicle?
• What if the kayak was strapped to roof racks on the motor vehicle (providing the height allowed for this), would the owner have been asked to remove the kayak?
• What if it was a non-motorised bicycle or scooter that was parked on the parking lot?
• What if it was an e-bike or an e-scooter – are they classified as motor vehicles?
• The list goes on: row boats, dinghies, skateboards, rollerblades etc all types of transport.
• Should the by-law have stipulated (among other things) motorised and non-motorised vehicles?
• What is legally deemed as a transport vehicle and what is not?

As government and local councils push communities to reduce carbon emissions – the question that must be asked is: do we need to now allow for other forms of transport vehicles with lower emissions to be parked on parking lots within strata complexes?

Do you need to review your parking by-law?

The lesson here is to ensure that your parking by-law is current and in-line with today’s ever-changing world.

Most likely your parking by-law is out of date and requires a review.

For a parking by-law review speak to our specialist strata lawyers here now.

YOUR PARKING BY-LAW NEEDS A REVIEW CLICK HERE NOW!

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

The Scenario

Mr Smith owns a residential lot in a strata building in Sydney.  The floor tiles in Mr Smith’s bathroom have cracked and are damaged beyond repair.  The building was constructed 30 years ago so matching replacement tiles cannot be found.  Is Mr Smith entitled to insist on the owners corporation re-tiling his whole bathroom so that the bathroom tiles have a uniform finish?  In this article we explore the answer to that question.

The Law

An owners corporation has a statutory duty to properly maintain and keep in good repair the common property and, where necessary to renew or replace any fixtures or fittings that form part of the common property under section 106 of the Strata Schemes Management Act 2015.

This duty requires the owners corporation to replace an item of common property when it is reasonably necessary to do so because, for example, the item has been damaged beyond repair: Glenquarry Park Investments Pty Ltd v Hegyesi [2019] NSWSC425.

So what happens when tiles on the floor or a wall of a bathroom that form part of the common property are damaged beyond repair but matching tiles cannot be found.  Can the owners corporation just replace the damaged tiles doing the best it can?  Or does the owners corporation have to re-tile the entire bathroom to ensure a uniform tiled finish?

Replacing Damaged Tiles

Where tiles are damaged beyond repair and matching tiles cannot be sourced, the duty of the owners corporation is to use replacement tiles that are substantially similar in appearance, characteristics, quality and amenity to the existing tiles.  This can require the owners corporation to replace a larger section of tiles to achieve substantial similarity: Selkirk v The Owners – Strata Plan No. 2661 [2024] NSWCATAP 17.

However, this does not necessarily mean that, where matching tiles cannot be found, the owners corporation is responsible for re-tiling the entire bathroom.  There are a number of cases which make this clear.

The Cases

1. In Stolfa v Owners Strata Plan 4366 & ors [2010] NSWSC 1507 a lot owner did work which damaged five tiles on a bathroom wall in another lot. The owner of the damaged bathroom applied for an order that the other owner compensate her for the cost to re-tile the whole bathroom because matching tiles could not be found. The Court rejected that claim and was unpersuaded that such a course was reasonable, particularly in the absence of evidence establishing that a reasonably approximate matching tile, albeit not a precise match, was unachievable. The Court allowed an amount to cover the cost of re-tiling the damaged wall only.
2. In Petropoulos v CPD Holdings Pty Ltd t/as The Bathroom Exchange (No 2) [2018] NSWCATAP 233 a builder renovated a bathroom and an ensuite bathroom for a homeowner but built the shower recesses too small. The owner wanted the builder to re-tile the whole bathroom floor after enlarging the shower recesses because matching tiles could no longer be found and the owner was concerned that a patch repair would compromise the waterproofing membrane. NCAT’s Appeal Panel rejected the owner’s request and concluded that it was reasonable for the builder to attempt to match the tiles rather than completely re-tiling each bathroom. The builder was ordered to ensure that replacement tiles were of the same colour, dimensions and type as the original tiles, or if no identical replacement tiles were available, of a colour that most closely matched the original tiles.
3. In The Owners – Strata Plan No 74602 v Brookfield Australia Investments Ltd [2015] NSWSC 1916 an owners corporation sued a builder for defects. The owners corporation alleged that there were waterproofing defects in bathrooms due to incorrectly installed water stop angles as a result of which bathrooms needed to be completely re-tiled due to the difficulties in obtaining matching tiles, even though only a small number of tiles needed to be replaced. The Court concluded that this would amount to the complete demolition and reconstruction of the bathrooms which was unreasonable and unnecessary particularly as there was no evidence of water leakage from the bathrooms.
4. In SP 62930 v Kell & Rigby Holdings Pty Ltd [2010] NSWSC 612 an owners corporation sued a builder for various defects including waterproofing defects in bathrooms. The owners corporation asked the Court to order the builder to pay damages to cover the cost of re-tiling all of the bathrooms because matching tiles could not be found and owners were entitled to a uniform tiled finish in their bathrooms. The Court concluded that it would be unreasonable for an owner to insist on replacement of a large quantity of undamaged tiles at great cost if a close match could be found and installed in a place (such as an architectural break) where the joinder of the tiles would not be immediately obvious. The Court held that the floor tiles within the showers in the affected lots should be replaced, making use of an appropriate existing architectural break, and that it was not reasonable for the owners corporation to insist upon the complete re-tiling of the entirety of the bathrooms.

Analysis

These cases demonstrate that both NCAT and the Supreme Court have rejected claims for entire bathrooms to be re-tiled when a small section of tiles are damaged or defective and perfectly matching tiles cannot be found.

However, in general, the owners corporation will still need to ensure that the work it does to replace the damaged tiles achieves an acceptable aesthetic finish.  This may require the owners corporation to re-do more than just replace the damaged tiles.  It can require the owners corporation to replace, for example, one or more walls which contain damaged tiles or an entire shower recess by making use of appropriate architectural breaks.

Ultimately, each case turns on its own facts but it will often be the case that it will be unreasonable for an owner to insist on an owners corporation replacing a large quantity of undamaged tiles at great cost if a close match can be found to achieve an acceptable aesthetic finish.

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

Adrian Mueller Explains the New Strata & Community Law Reforms?

Adrian Mueller talks ‘phase 1’ of the strata law reforms, and the amendments to the Strata Schemes Management Act 2015 (NSW) below, including:

1. Transitional Period
2. Strata Renewal Process
3. Pets and Assistance Animals
4. Committees
5. Annual General Meetings
6. Financial Management
7. Notices and Record Keeping
8. Lot 2 Schemes: Consolidation of By-laws & Complying with the Act, Managing Agents and Commissions

DO YOUR BY-LAWS NEED UPDATING IN LINE WITH THE NEW LAWS?

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

Pets, By-laws and New Legislation

In December 2023 new strata laws commenced that changed the rules regarding pet ownership, including assistance animals, in strata buildings.

What do the new pet rules mean?

• Any fees, bonds and insurances imposed by the owners corporation are now banned under the new legislation.
• It’s also now easier for lot owners and tenants with assistance animals to prove their animal’s ‘assistance’ status with less loopholes to jump through.
• Those new rules will result in some existing pets by-laws (or parts of them) being invalid and will need to be reviewed.

Pet By-laws will Need to be Reviewed!

 Therefore, it is time to get all pet by-laws reviewed to ensure they comply with the new laws.

CLICK NOW FOR A PET BY-LAW REVIEW IN LINE WITH THE NEW LAWS

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.

Short-term Rental Policies Under Review

As the NSW Government grapples with the housing crisis across the state short-term rental accommodation (STRA) comes under the spotlight.

Policies and framework for STRA in NSW will be reviewed with the hope to unlock the supply of long-term and affordable accommodation.

As such, the NSW government is looking for community feedback on the recently released discussion paper which will form part of the comprehensive review of NSW STRA.

Have Your Say…

• Complete the survey
• STRA discussion paper
• Further information

The survey completion deadline is 14 March 2024.

Review Your STRA By-laws

Do you need to review or update your current short-term rental accommodation (STRA) by-law? Speak to the STRA experts today!

Adrian Mueller I BCOM LLB FACCAL I Partner

Since 2002 Adrian has specialised almost exclusively in the area of strata law. His knowledge of, and experience in strata law is second to none. He is the youngest person to have been admitted as a Fellow of the ACSL, the peak body for strata lawyers in Australia. Profile I Linked

Contact Us

For all strata law advice including by-laws, building defects and levy collections contact our specialist NSW and Sydney strata lawyers here or call 02 9562 1266, we’re happy to assist.