This article on Owners Corporation’s Duty to Maintain and Repair Common Property has been supplied by Pierrette Khoury of Turnbull Bowles Lawyers.
An Owners Corporation has a statutory obligation to maintain and repair common property. This is particularised in section 62 of the Strata Schemes Management Act 1996 (“the Act”) which relevantly provides:
(1) An owners corporation must properly maintain and keep in a state of good and serviceable repair the common property and any personal property vested in the owners corporation.
(2) An owners corporation must renew or replace any fixtures or fittings comprised in the common property and any personal property vested in the owners corporation.
(3) This clause does not apply to a particular item of property if the owners corporation determines by special resolution that:
(a) it is inappropriate to maintain, renew, replace or repair the property, and
(b) its decision will not affect the safety of any building, structure or common property in the strata scheme or detract from the appearance of any property in the strata scheme.
It is imperative the Owners Corporation is mindful of its obligations with regard to the legislation and ensures the common property is properly maintained and repaired. Failure to do so, can affect the amenity of the building and market value of the property in general. Further, a lot owner may commence proceedings against the Owners Corporation and its managing agent seeking:
1. Orders for the Owners Corporation to carry out the repair works.
2. Damages with regard to property damage as a result of the failure to maintain and repair.
3. Compulsory appointment of managing agent, under Section 162 of the Act.
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The NSW government has recently released its Position Paper outlining the reforms it proposes to make in relation to community scheme laws in NSW.
According to the Position Paper, there are approximately 700 community schemes, 40 precinct schemes and 1,460 neighbourhood schemes in NSW.
During the extensive consultation process, the NSW government has sought feedback on reforming community schemes from peak industry bodies to owners volunteering on their own management committee.
While these reforms have not yet been enacted as legislation, they provide an indication on the proposed changes.
We have listed below some of the key changes proposed by the Position Paper:
1. Greater owner participation
During the consultation process, there were many submissions received which supported the use of alternative methods of attendance at meetings including social media, video and teleconferencing or other methods which may become available in the future including the acceptance of postal or electronic votes.
2. Electronic Storage and Distribution of Documents
It is proposed that the laws be amended to permit documents to be given to owners electronically if owners have agreed to this form of communication.
3. Secret Ballots
The current law does not provide for anonymous voting through secret ballots. It is proposed the new laws will recognise voting on a motion by secret ballot. At least 25 percent of the members of an association attending a meeting would need to support a secret ballot being held. Associations could also choose to adopt a by-law outlining the matters or class of matters that are to be subject to a secret ballot.
4. Committee Members Functions
The Position Paper proposes changes so that committee members are to carry out their functions without favour, for the benefit of owners of the scheme they represent, and to act with due care and diligence.
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