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Recent Court Cases
What happens when a lot owners claims defects and rental loss against the Owners Corporation, while still within the 6 year major defects period with the builder?
In this case, the lot owner filed proceedings in the Tribunal against the owners corporation seeking damages for rental loss because of water ingress.
The building was still within the 6 year major defects period, so the owners corporation cross claimed against the original builder to attend to repair defects and meet the damages claim.
In these situations, parties will normally argue who really should be liable for the damages and whether they mitigated the risk or loss under the circumstances (i.e whether the lot owner informed the owners corporation of the common property defects within their lot, whether the lot was really uninhabitable, what was the market rent, are the defects from the original builder etc).
From there, we ensured that our client was well armed with a comprehensive report about exactly what needed be done and how it needed to be done in order to bring the work up to scratch.
Thankfully, with that report in hand and some solid negotiations, we successfully resolved matters with the builder. The end result was the builder having to rectify all defects and contribute to the damages claimed against the owners corporation.
NO PAPERWORK TO PROVE YOUR POINT?
Obviously if you are going to do work on your lot in a strata situation, or do something that the by-laws might otherwise not allow, then getting approval from the owners corporation or the executive committee is a good idea.
But if you’re a long-standing resident of a complex, then you can’t always find the backup for things that have been in place for a long time. Beyond that, in this particular case the paperwork had been destroyed by water damage, and the original company records with which it had been kept had been discarded in any event.
So what happened?
Our client enclosed his carpark in 1995. At the time, he got unanimous approval from the executive committee. The enclosure helped protect his goods from theft and offer a number of other benefits.
The problem? The current committee and owners corporation couldn’t find any of those records, and didn’t like the fact that our client had an (in their view) “unauthorised structure”.
So they applied to try and force our client to take it down. Absent an approval, they argued, the structure was not authorised and should be removed.
Thankfully, the Tribunal found in our client’s favour.
First, the Tribunal was not convinced that approval for the structure was required at all.
Next, the Tribunal took the view (based on our client’s evidence) that if approval was required, he probably had it at the time.
And finally, with our client having enjoyed the structure for more than 15 years, the Tribunal could not see any compelling reason why the Owners Corporation should require it to be removed, other than the fact that it was the only enclosed carpark in the scheme.
With that, our client’s enclosed carpark will remain for some time to come.
Read the Decision Here
HOW FAR DO REPAIRS NEED TO GO?
Sometimes the issues faced by lot owners isn’t necessarily about getting the owners corporation to repair something, it’s about what type of repairs are appropriate.
This was one such situation.
Our client experienced significant water proofing and structural issues in their lot, as well as deterioration of decking, floor boards and some defective workmanship in a bedroom.
Except for the decking, there was no real issue about whether or not these things needed to be repaired. The question was more about the type and extent of repair.
More specifically – how far does the owners corporation’s obligation to maintain and repair go in situations like this? And if there is a difference of opinion, how is the Tribunal to resolve that?
Generally, as here, the Tribunal will take a practical approach.
For obvious reasons, an owners corporation will often seek to minimise the necessary work and keep costs to a minimum.
Generally, this was the approach taken by the owners corporation’s expert.
However, that approach does not necessarily always adequately address the issues, especially if there has been (as here) a long-standing failure to maintain a building.
The Tribunal is not only concerned with cost, but also effectiveness.
In each relevant case of disagreement, the Tribunal agreed with our client’s position, preferring a more effective method of rectifying the damage and requiring the owners corporation to comply with its obligations of repair.
A just outcome, and one which will see our client’s premises repaired properly so they can enjoy it going forward.
You can read the decision here.
Council Denied Our Client’s Application!
All Town Skips wanted to build a waste or resource transfer station (basically, a recycling facility) on its own land.
Of course, to do that you need to submit a development application to the Council. Our client did just that, ensuring that he had checked off the right requirements and was on pretty solid footing for an approval to come through.
Unfortunately the Council didn’t see it that way, and refused our client’s development application.
So, believing his position to be fairly solid, our client appealed Council’s decision to the NSW Land and Environment Court.
Now it’s fairly common in matters like this for the parties to engage in “conciliation” – an informal attempt to resolve the issues rather than progress through the expensive litigation process.
Fortunately as part of the conciliation All Town Skips and Council were able to come to an agreement about how our client might be able to go ahead with his plans.
A few adjustments to the development application later, an agreement was reached and ratified by the Court allowing our client to proceed with his development.
The lesson? A rocky start with your development application doesn’t necessarily mean Council can’t be persuaded along the way if you have the right strategy in place.
Case Citation: Matthew Arthur Harrison trading as All Town Skips v Central Coast Council  NSWLEC 1244
Can we recover legal costs of this Strata dispute?
One of the bigger barriers that prevent people from pursuing their rights in Strata disputes is the thought that legal costs can sometimes be significant. What happens, though, if ultimately you were forced to go through with a hearing and are successful? Can you recover your legal costs?
It almost goes without saying these days that attempting to resolve the dispute rather than running it all the way to hearing is often the better path.
Aside from the fact that a negotiated outcome can be faster and more certain, in Strata disputes making an offer of compromise can also give you a significant advantage when the time comes to talk about who should pay the legal costs of the dispute.
In this recent case our client successfully leveraged just such an offer to argue that the other party should pay our client’s legal costs.
Here, during the course of the dispute, our client made an offer for resolution which was not accepted. In the ultimate outcome our client achieved a better result than what they had offered to resolve the matter for.
The Tribunal considered that the existence of the offer and the nature of the better outcome warranted, in the circumstances, the Tribunal making a costs order in favour of our client.
That said, costs orders in Tribunal proceedings aren’t always automatic so it’s best to get some legal advice on how to position yourself.
Read the Decision Here: The Owners – Strata Plan No 79633 v Graorovska (No 2), Graorovska v The Owners – Strata Plan No 79633 (No 2)
Unfulfilled promises to repair?
What happens if you resolve your dispute on certain terms and the Owners Corporation does not do what it agreed to do?
In this Supreme Court case, the Owners Corporation had agreed to attend to building works and remediation resulting from mould, fungal spores, bacteria and similar issues. But it had not done what it promised.
Any resolution in which you have Strata lawyers acting for you is going to involve a written deed of settlement. That deed will set out the rights and obligations of the parties.
From the point that deed is signed, your rights are now governed by its terms. If, as in this case, the Owners Corporation does not do what it agreed to do then you have a right to enforce the terms of the deed in court.
The key to enforcing these provisions is ensuring that it is clear who has to do what in the deed itself.
That way, as happened in this case, if you need to enforce the provisions of the deed you will be on solid ground explaining to the Court what has not been done and inviting it to make orders in your favour.
However, in addition to simply enforcing the deed you are also entitled to seek other damages that might have resulted from the Owners Corporation’s breach of its obligations. Here, for example, our client also recovered loss of rental for a period during which the Owners Corporation had failed to attend to building works and remediation that it was supposed to have done under the deed.
The lessons in this case? Document any resolution carefully, and do not be afraid to enforce your rights if a party fails to live up to their promises.
Link to Decision: Byrne v Strata Plan  NSWSC 342
Building Repairs Underway!
Over time buildings become run down and require work. Owners Corporations have an obligation to maintain buildings in good repair, and attend to rectifying defects that might arise.
But what happens if the Owners Corporation refuses to get the work done? Are lot owners simply to stand by and do nothing while their building gets more and more run down (and repairs get more and more expensive!).
PBL Law Group acted for lot owners in just such a situation. With earlier attempts to get the Owners Corporation to cooperate having failed, we escalated the matter by issuing proceedings in the Tribunal.
With our help, the lot owners ultimately secured an excellent outcome. Consent Orders were filed requiring the Owners Corporation to perform all of the required building works, including more than $500,000 in repairs, removal of unsafe elements, and extensive rectifications of defective work throughout the building under professional supervision.
In all a great result, and a good example of how lot owners can effectively use legal avenues to bring matters to a head if they are getting no movement from the Owners Corporation.
You can read the consent orders here.
Miller and Green -v- The Owners – Strata Plan No. 18736 SC 21 / 17310 and SC 21 / 47498
The Owners – Strata Plan No. 18736 -v- Miller and Green SC 21 / 36316
How Can We Prove a 15 Year Old Works Approval?
Long term residents in Owners Corporations often have a string of additional works they have done to their individual lots.
Some of those, of course, might have required approval from the Owners Corporation to perform if they weren’t authorised by the existing by-laws.
But what happens if a new committee wants you to take down a structure you built over 15 years ago, when nobody has any paperwork dating back that far?
PBL Law Group acted for an owner in just such a situation. Mr McCullum had built an enclosed car parking space back in 1995. Come 2020, the Owners Corporation wanted him to take it down.
The OC’s position was fairly simple: the by-laws did not approve the work, the OC could not find any previous approval for the work, and Mr McCullum could not produce any approval for the work. As a result it was unauthorised and the Tribunal should order that it be removed.
So what could Mr McCullum do to try and ask the Tribunal to accept that an approval granted over 15 years ago actually existed despite the lack of paperwork to support it?
With PBL’s help, the lot owner put on evidence:
This evidence was not challenged by the Owners Corporation, although they took a different stance on the legal view expressed by the strata manager.
With that evidence in place, PBL submitted that the Tribunal should accept that, despite the lack of documents, approval was, in fact, given to Mr McCullum to secure his carpark in the way he had done. We also submitted that even if that was not the case, with the structure having been in place for 15 years without complaint or objection by the Owners Corporation, the Owners Corporation should not now be permitted to take an aggressive stance to require the structure to be removed.
Happily for Mr McCullum – who needed this enclosure to protect his personal goods from vermin and theft – the Tribunal accepted these arguments, dismissing the Owners Corporation’s case and allowing Mr McCullum to retain the enclosed carparking space he had enjoyed for over a decade.
So while in an ideal world we have documents and minutes to support everything we want to argue, sometimes with the right Strata lawyers in your corner you can still get things across the line without the paperwork.
Click Here to Read the Decision
Case citation: McCullum -v- The Owners – Strata Plan No. 47383 Proceedings: AP 2021 / 96377
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