Renovations By-Laws – How Much Detail is Needed?

Determining the level of detail to include in a renovations by-law can be a daunting experience. The following must be included:

Adequately describe the works and the common property area 

For the motion and by-law to be valid it must provide specific details of the works to be undertaken and specify the area of common property. This may be achieved by the inclusion of detailed scope of works, quotes, specifications and plans.

The level of detail required was considered in the case of Stolfa v Hempton (2010) NSWCA 218 (“Stolfa”) where the Court of Appeal upheld the validity of the by-law stating at para [30], that in order for the by-law to be valid it must:

“… call for a special resolution that “specifically authorises the taking of the action proposed”. It would be a question of fact or mixed fact and law in each case whether any special resolution or special resolutions is or are adequate in its or their specificity of authorisation and in its or their particularity as to the action proposed. There is obviously a clear policy in requiring direct and specific attention to the proposed action, at the same time, in overly pedantic attention to detail might frustrate otherwise clear authorisation. Common sense and reasonableness have their parts to play in the operation of a provision intended to regulate how people go about dealing with the common property in their units in everyday life”.

This is compared to the case of SP50246 v Kumar (Strata and Community Schemes) [2013] NSWCTTT 585 (19 November 2013) (“Kumar”), which involved a by-law granting an owner the exclusive use of a common property area and authorisation to carry out certain works to develop the exclusive use area.

When considering the equivalent sections of the Strata Schemes Management Act 1996, the Tribunal found that the by-law was invalid as it failed to adequately specify the works to be undertaken as required by Stolfa, stating at para [59], that:

“…I am not satisfied that the provisions of by-law 21 are sufficiently specific to comply with the requirements of section 65A of the Act as interpreted by the Court of Appeal in Stolfa v Hempton (supra). I am accordingly not satisfied that it constitutes a validly enacted exclusive use by-law

Clearly identify who will be responsible for proper maintenance of, and keeping in a state of good and serviceable repair the specified common property area

In respect of the specified common property area the by-law must clearly identify whether the owners corporation or the owner(s) will be responsible for the ongoing proper maintenance and keeping in a state of good and serviceable repair.

This requirement to confer an obligation to repair and maintain the common property was considered by the Tribunal in the case of the Owners SP62515 v Gormick Constructions P/L (Strata & Community Schemes) [2006] NSWCTTT 36 (16 January 2006) (“Gormick”), which involved a by-law authorising an owner to install and maintain telecommunications equipment on the common property roof.

The by-law included a clause requiring the owner to “make good and repair any damage by reasons of the installation of removal”. The Tribunal determined that this was inadequate to confer a clear obligation on the owner to repair and maintain the specified area of common property.

Conclusion

To ensure that the above and other relevant obligations are met please ensure to engage suitable experienced service providers.