In a strata scheme building, the owners corporation is the legal owner of the common property. When lot owners propose to carry out works that require statutory approval (such as development consent/complying development certificate), it is highly likely that they will also require consent from the owners corporation if those works impact on common property.

In a recent case of the Owners Strata Plan 70989 v Afghan Community Support Association of NSW Inc, the respondent Afghan Community Support Association of NSW Inc (‘ACNC’) carried out multiple structural works on common property including alterations of roof frame structures, metal roof sheeting, excavation of a ground floor slab, construction of additional floor structures, extension of a mezzanine level and changed the use of the lot from a warehouse to a mortuary. ACNC submitted that Council approval had been granted to convert the existing warehouse into a mortuary and no objections were received by the Council before the construction certificate was issued. Additionally, the ACNC claimed that they had requested to convene a general meeting with the strata manager to discuss the proposed use of the property, however their request was not answered.

The Tribunal was of the opinion that the unauthorised works carried out by ACNC had caused damage to common property or another lot. As a result, it made an order, pursuant to the provisions under Strata Schemes Management Act 2015 (‘the Act’), that ACNC had to remove the unauthorised works and restore the common property to its previous state and repair any damage to the common property. The reasoning behind such order was derived from the requirements set out in sections 108 and 111 of the Act where an owner of a lot in a strata scheme must not carry out work on the common property unless:

• the owner is authorised to do so under Part 6 of the Act;
• under a common property rights by-law; or
• by an approval of the owners corporation given by special resolution or in any other manner authorised by the by-laws.

This message is clearly demonstrated in Stolfa v Owners Strata Plan 4366 & Ors [2009] NSWSC 589 in which it was found in circumstances where the relevant Council had approved the works and a development application had been granted, did not relieve a lot owner from their obligation to seek approval from the owners corporation for works.  That means, Council approval does not simply replace approval from an owners corporation.

Accordingly, a lot owner who proposes to undertake works that impact on common property must take reasonable steps to seek permission from the owners corporation before carrying out any alterations to common property. This can be achieved by requesting a motion for approval of the works to be placed on the notice of a general meeting, along with a draft common property rights by-law.

What can the owners corporation do against unauthorised works?

Generally, works will be classified unauthorised if those works impact on common property and no consent has been granted by the owners corporation. Noting the owners corporation has a strict duty to repair and maintain common property, they may demand that the lot owner return the common property to its original condition. Failing compliance, the owners corporation may seek orders from the Tribunal under section 132 of the Act. If the Tribunal is satisfied that the work carried out by or for an owner or occupier on any part of the parcel of the scheme has caused damage to common property or another lot, the Tribunal may make an order requiring the owner or occupier of the lot to:

• perform work or takes other steps to repair or rectify the damage to common property; or
• pay to the owners corporation or another lot owner a specified amount for the cost of repairs of the damage and any associated costs, including insurance and legal costs.

Having said that, there is always a quicker and cheaper solution to a matter- an owners corporation may require the lot owner to submit a common property rights by-law with a full scope of works, relevant plans and structural reports to seek retrospective approval from the owners corporation for the existing works at a general meeting. If the owners corporation is satisfied with the works and the by-law, the owners corporation will specially resolve to make the by-law and once registered, the works will be deemed authorised ( i.e. the lot owner will then be able to keep their works).

However, if the lot owner refuses to make a by-law or provide their written consent to the making of a by-law, the owners corporation can, pursuant to section 149 of the Act, seek orders from the Tribunal to make an order for a common property rights by-law to be made, provided the Tribunal finds that the lot owner has unreasonably refused to make a common property rights by-law.

Key takeaways

• Having council approval does not simply replace the requirement for owners corporation consent;
• Works will still be deemed unauthorised in the absence of consent from the owners corporation; and
• A lot owner should not overlook the implication of any unauthorised works as the owners corporation has power to seek orders from Tribunal to enforce against any unauthorised works carried out by lot owners.

Should you require advice on this issue or assistance in preparing a common property rights by-law for your proposed works, please do not hesitate to get in contact with us directly at enquiries@bannermans.com.au or on 02 9929 0226.