In 1961, New South Wales pioneered Strata titles for the first time in the world, and many other countries followed Australia’s example afterwards.
The birth of strata
Strata property management can be challenging. However, owning and selling strata real estate was even more complicated in the old days than today. Before the introduction of Strata titles by the NSW government in 1961, multi-property buildings would be owned by a company. Occupants of the units would invest shares in the company and, as a result, own part of the company that owned the building. In return, they would receive the right to occupy space equivalent to the space of their unit. This structure was considered vague. Financial institutes classified the purchase of a Strata lot as high risk and would either stay away or charge higher interest. When the Conveyancing (Strata Titles) Act 1961 came into force in July 1961, and the first strata plan was created, it became much easier to identify boundaries, making sales transactions neater while providing the security that the banks needed. Once implemented across New South Wales, other States and Territories followed suit, as well as other countries, including New Zealand and Canada. The boundaries also clarified who is supposed to maintain what part of the building; yet, each property is different, and hence so are the rules and by-laws per property.
The responsible party of maintenance in a strata property.
During an exclusive interview with Ms Lauren Seetsen from SVN | Strata in Perth, West Australia, Ms Seetsen explained that no strata property is the same, and to understand who is responsible, we need to look at the schemes by-laws, the type of property, and the type of maintenance at hand. In some cases, when maintenance is not the responsibility of the strata company, the lot owner will have to attend to it. Also, depending on the type of maintenance and the tenant and tenancy agreement, the landlord might be able to delegate this responsibility to the occupant. In this case, the landlord or property manager would refer to the clauses in the lease agreement or the retail or residential tenancy laws to determine if the owner can request that the lessee attends to the maintenance item.
“It all depends on what is considered common property, but if the by-laws, the definitions, and strata plans indicate that an item is common property, then it will be the strata’s responsibility.”
Ms Lauren Seetsen, SVN | Strata
A common confusion Ms Seetsen deals with, occurs when she liaises with multi-property owners. They often do not understand why a specific type of repair is the lot owner’s responsibility. In contrast, the same repair item at the other strata lot of a different strata scheme they own is maintained by the strata company.
Another challenging subject is the discussion around “exclusive use.”
“Whenever the strata plan identifies an area as common property, and the by-laws stipulate this is for the exclusive use of a particular lot, the respective owner may be responsible for maintaining this part of the common area.”
To understand who is responsible for the maintenance of a strata property, we always need to refer to the strata plan, understand what type of strata scheme we have at hand, and review the schemes by-laws. Once we understand boundaries and regulations, we can ascertain who needs to attend to a specific maintenance item.
Whatever the situation, strata schemes remain a complicated property structure. In some cases, the Council of Owners might need legal advice to better understand who needs to attend to specific tasks.
Property and Commercial lawyer of Stork Davies Legal Advisors and fellow contributor of the property tribune, Shannon Davies shared his view with us.
“One of the key issues to be resolved when attempting to ascertain the division of responsibility for repair and maintenance in a strata scheme is where exactly the boundaries between lots and common property lies. This can be particularly tricky with older strata plans if you don’t have an awareness of the history of the strata titles legislation, including for example in relation to single-tier strata schemes of five lots or less that existed prior to mid-1997,” Mr Shannon said.
“It’s also possible to shift some common property repair and maintenance responsibilities to a proprietor via exclusive use by-laws (in which case the validity and content of those by-laws should be examined),” Mr Shannon continued. “However, even in those circumstances, the strata company probably retains ultimate responsibility to attend to necessary repairs and maintenance in the event that the relevant proprietor fails to do so.”
“Finally,” Mr Shannon explained, even though a strata company’s repair and maintenance functions are generally limited to common property, it is worth noting that a strata company is empowered in certain situations to enter and undertake works on a proprietor’s lot, where such works are required to comply with a written law, statutory easement obligation, court or tribunal order, or for the purpose of ensuring continuing support or shelter where a structural defect exists.”
There are many resources available to strata owners when challenged with responsibility issues. Lot owners could obtain information from Landgate and Reiwa or contact their Strata Manager, who can guide them into the right situation. Tenants may contact their property manager and request assistance or more information when unsure about their rights and obligations within the strata company.
To see the full interview with Ms Lauren Seetsen, click on the link:
Written by Wouter Jellema of SVN | Perth
