The NSW
STRATA MAGAZINE SEPTEMBER 2026
Who is responsible for repairing a pipe serving multiple lots? Page 10 | Sara Strata
Can a named proxy holder be swapped if unavailable Page 20 | The Strata Collective
Do easement sale proceeds count as taxable income for owners? Page 28 | Matthew Faulkner Accountancy PTY LTD
About Us Welcome to the latest issue of The LookUpStrata Magazine! For over a decade, LookUpStrata has been Australia’s premier resource for everything related to strata living. Our mission is to keep strata communities informed and connected, providing thousands of lot owners, strata managers, and professionals with reliable, unbiased, easy-to-understand information to help you solve your strata problems and make informed decisions. The NSW Strata Magazines, published monthly, are just one of the many ways we’re dedicated to supporting you. They’re packed with articles from industry experts and include our comprehensive printable strata directory.
Beyond these pages, we also offer: • Q&A Service: Our team of leading strata specialists answer hundreds of your questions every month, which helps shape the magazine topics we cover. • Newsletters: Our weekly newsletters deliver timely updates on legislative changes and the latest strata news straight to your inbox. • Webinars: Join our founder, Nikki Jovicic, for weekly webinars where she hosts and partners with industry experts to discuss key topics. • The LookUpStrata Directory: A free resource that showcases hundreds of trusted strata service professionals nationwide. You’ll find it at the end of every magazine and on our website.
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Advertising and Admin Enquiries: administration@lookupstrata.com.au Disclaimer: The information contained in this magazine, including the response to submitted questions, is not legal advice and should not be relied upon as legal advice. You should seek independent advice before acting on the information contained in this magazine. Strata legislation is updated regularly. The information in this magazine is based on the legislation at the time of publishing.
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Contents 4 Who pays to strip out a bathroom for spalling repairs?
20 Can an owner remove a long-serving strata committee member?
Warwick van Ede, JS Mueller & Co Lawyers
6 Should a balcony garden approval include liability clauses? Leanne Habib, Premium Strata
8
oes a bathroom renovation affect D strata insurance cover? Tyrone Shandiman, Strata Insurance Solutions
10 Who is responsible for repairing a pipe serving multiple lots? Tim Sara, Sara Strata
12 Is a draughty window frame the owners corporation’s job? Harley Fernandes, Windowline
14 Should owners pay more if insurance commissions are banned? Megan Parkins, Tender Advisory
16 Building defect reports: When and why you need one Mark Joseph, MJ Engineering Projects
Rod Smith, The Strata Collective
22 If a strata managing agent won’t generate reports, are they obliged to allow in-person inspections? Allison Benson, Benson Legal
24 Does 33% construction end a community scheme’s initial period? Matthew Lo, Kerin Strata Lawyers
26 How do I raise a motion for a safety fence? Abe Ayoubi, Senior Strata Manager (NSW)
28 Do easement sale proceeds count as taxable income for owners? Matthew Faulkner, Matthew Faulkner Accountancy PTY LTD
30 Can an accessible parking space be used for bin storage? Megan Parkins, Tender Advisory
32
The NSW LookUpStrata Directory
18 Can requesting the Delegated Functions Report directly reduce the strata managing agent’s fee? Emma Teng, Bannermans Lawyers
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Who pays to strip out a bathroom for spalling repairs?
We need to repair slab spalling under a renovated bathroom. Who pays to strip out and reinstate the bathroom?
The owners corporation covers strip-out and reinstatement costs, even with a renovation by-law in place.
We have recently discovered spalling in the slab beneath the bathroom of one of the units in our complex. The committee will repair this, but is the strip-out of the bathroom and reinstatement of fittings the committee’s responsibility or the owner’s? I understand that the committee is responsible for paying for removal of anything blocking access to common property that needs repairing, as was the case where we paid for the removal of hybrid flooring to gain access to lift magnesite and re-level.
You have correctly identified that the owners corporation is responsible for repairs and maintenance to common property, and any spalling to a concrete slab, which is a structural element of the building, is the owners corporation’s responsibility. A properly organised owners corporation will ensure that renovation works to a bathroom are carried out pursuant to a common property rights by-law. Normally, such a by-law not only authorises the carrying out of renovation works, but makes the lot owner responsible for the ongoing repair and maintenance of the renovation works and the common property comprised in them.
The bathroom has been renovated. We suspect that may be when the membrane’s integrity was compromised, leading to our current situation. Are bathrooms treated differently under the law regarding the burden of cost in making repairs to common property? It appears that a few NCAT decisions have been supportive of the view that the bathroom fittings are lot owner responsibility.
However, whether or not the bathroom is original or has been renovated, the owners corporation is responsible for the costs which will be incurred in any necessary “strip out” and reinstatement of the bathroom necessary to enable the concrete spalling to be dealt with. Even with a common property rights by-law in place, it could not possibly be said that the concrete spalling arose from the renovation works being carried out and that, therefore, responsibility has shifted to the owner. The owners corporation will need to cover the costs associated with the strip out and reinstatement. Warwick van Ede | JS Mueller & Co Lawyers warwickvanede@muellers.com.au READ MORE HERE
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Should a balcony garden approval include liability clauses? Should approval for a balcony garden installation include liability clauses to protect against future water damage? The top-floor owners wish to establish a garden on their balcony above the rooms of the apartment below. A new waterproof membrane would be installed. The owner below is concerned about the future risk of damage from water penetration. Should this be approved with liability clauses on the garden owners?
Approval should always be conditional on a properly drafted by-law that transfers liability and maintenance responsibility to the lot owner. If a lot owner wishes to establish a garden on a balcony, particularly where the balcony sits above another lot, the approval should be carefully documented and supported by a by-law containing appropriate liability and maintenance provisions. A balcony garden introduces additional risks not present on a standard balcony, including water penetration, membrane failure, drainage issues, excess weight loading, and root intrusion. A new waterproof membrane may reduce this risk, but doesn’t eliminate it. In most schemes, the balcony structure and waterproofing membrane form part of the common property, since the balcony often serves as both the floor of one lot and the ceiling of the lot below. Any approval should therefore be conditional on a bylaw, prepared by a strata solicitor and registered on the common property title, that transfers ongoing maintenance, repair and replacement responsibility to the lot owner and all future owners of that lot. What should the by-law cover? • Every proposal will differ, but the by-law should generally address: • Responsibility for all installation, maintenance, repair, replacement, and removal costs associated with the garden and waterproofing system. • Liability for any damage caused to common property or neighbouring lots arising from the garden, irrigation system, drainage, or waterproofing failure. • Requirements to maintain adequate drainage and prevent water overflow, ponding, or runoff. 6 www.lookupstrata.com.au
• Rights for the OC to inspect the area periodically to ensure compliance and identify potential issues early. • Requirements to remove the installation and reinstate the balcony, if necessary. • Ongoing responsibility that transfers to future owners of the lot. In addition, the by-law should contain broader approval conditions dealing with the carrying out of the works themselves. These commonly include requirements that the works be undertaken by appropriately licensed and qualified contractors, comply with all applicable Building Code of Australia requirements, Design and Building Practitioners Act 2020 obligations, local council requirements and any other statutory approvals. The by-law should also address matters such as permitted working hours, site management, protection of common property during construction and the ongoing transfer of responsibility to future owners of the lot. If your scheme is considering a balcony garden proposal, the OC should request detailed plans before approving. These should show the proposed garden layout, planter boxes, drainage arrangements, irrigation system, waterproofing specifications and any expected additional load on the balcony. Given the risk of future water penetration and structural impacts, it is prudent to obtain advice from a suitably qualified waterproofing consultant, engineer or building professional to ensure the proposed works comply with applicable building standards, waterproofing requirements and any Design and Building Practitioners Act 2020 obligations. A strata solicitor should then prepare a by-law that clearly records the approval conditions, ongoing maintenance obligations, liability for damage and responsibility for all current and future costs associated with the installation. A proactive approach at the approval stage is far easier and less costly than trying to resolve a water ingress dispute years later. Where waterproofing gardens and neighbouring lots are involved, clear documentation, expert advice and properly drafted liability provisions are essential to protect the owner below, the OC and future owners of the lot. Leanne Habib | Premium Strata info@premiumstrata.com.au READ MORE HERE
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Does a bathroom renovation affect strata insurance cover? We’re planning a bathroom renovation in our strata unit. Do we need to tell our insurer beforehand, and could it affect our cover if something goes wrong? We’re about to do a full bathroom renovation in our unit, replacing the tiles, vanity and shower. Do we need to notify our strata insurer before we start? Could the work affect our building insurance cover if something goes wrong during or after the renovation?
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A standard bathroom renovation usually falls below the value threshold that would require notifying your strata insurer. Most strata insurance policies include conditions relating to construction works, renovations or building alterations. These conditions vary between insurers and should always be checked before work commences.
For the insurers that Strata Insurance Solutions deals with, notification is generally only required once renovation or construction works exceed a specified value, typically somewhere between $250,000 and $1,000,000, depending on the insurer and policy. A standard bathroom renovation involving the replacement of tiles, a vanity and a shower would generally fall well below these thresholds and would not usually need to be notified to the insurer.
Tyrone Shandiman | Strata Insurance Solutions tshandiman@iaa.net.au READ MORE HERE
That said, not all insurers have the same policy conditions. Some insurers, particularly those offering policies directly to consumers, may have different notification requirements or exclusions that apply to renovation works. It is therefore important to check the specific terms, conditions and exclusions of your policy before starting the renovation.
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Who is responsible for repairing a pipe serving multiple lots? If pipes running through my lot service more than one lot, is it the owners corporation’s responsibility to inspect them? I have a drain pit in my backyard and understand the pipes run through my lot and service more than one lot. My next-door neighbour has contacted the strata managing agent, advising they have noticed water in their backyard. The strata managing agent has advised I may need to pay a plumber to inspect and confirm if there is an issue with the pipes. As the pipes service more than one lot, who is responsible for organising and paying the plumber?
Pipes that genuinely serve more than one lot are common property, so inspecting and repairing them is the owners corporation’s responsibility. If the pipes genuinely service more than one lot, they are common property, and both the investigation and any repair are the owners corporation’s responsibility, not yours.
The location of a pipe doesn’t decide who owns it This is what trips most people up, and even strata managers, up.
People assume that because something sits inside their lot, including under their courtyard, behind their wall, or beneath their floor, it must be theirs. In New South Wales, that isn’t how pipes work. Under section 4 of the Strata Schemes Development Act 2015 (SSDA), a lot is defined as cubic space that “does not include any common infrastructure”. Common infrastructure captures pipes, wires, cables and ducts that are not for the exclusive benefit of one lot. The same section defines common property as any part of the parcel not comprised in a lot, “including any common infrastructure that is not part of a lot”. 10 www.lookupstrata.com.au
Read those two definitions together and the test becomes simple. The question isn’t where is the pipe?, but who does the pipe serve? A stormwater line that drains your and your neighbour’s courtyard is not for the exclusive benefit of one lot. It is common property, even though every metre of it sits under your grass. The drain pit is treated the same way if it forms part of that shared system.
What that means for the owners corporation
Under section 106(1) of the Strata Schemes Management Act 2015 (SSMA), the owners corporation is required to “properly maintain and keep in a state of good and serviceable repair the common property”. That duty is a strict one. It isn’t limited to repairs the owners corporation feels like doing, and it doesn’t switch off because the defective item is awkward to reach. Critically, it also carries the investigation with it. An owners corporation cannot sensibly discharge a duty to repair common property while declining to find out whether the common property needs repairing. This is put beyond argument by section 122(2), which authorises the owners corporation to enter any part of the parcel “for the purpose of determining whether any work is required to be carried out by the owners corporation in accordance with this Act”. Parliament gave the owners corporation the power to investigate because investigating is part of the job. There’s also a circularity worth naming. The plumber’s inspection is what will establish whether the line is shared in the first place. Asking you to fund that inspection means paying for the owners corporation’s own evidence about its own asset. The owners corporation should engage the plumber and pay for the inspection from the administrative fund.
What you should do now
Write to the strata managing agent and ask that the owners corporation instruct a plumber to inspect the pit and the line, on the basis that the pipework services more than one lot and is therefore common property under section 4 of the SSDA, and that the inspection falls within the owners corporation’s duty under section 106.
Keep it in writing. If water is already surfacing in a neighbour’s yard, note that too. An unresolved drainage failure tends to become a damage claim, and the owners corporation carries that exposure under section 106(5). If the owners corporation refuses, an owner can apply to NCAT for orders under section 232 of the SSMA, and section 106(5) allows recovery of reasonably foreseeable loss caused by a breach of the section as damages for breach of statutory duty.
The exceptions worth checking first
Three things could change the answer, and it’s worth ruling them out before you write: 1. Y our scheme’s registered by-laws: Section 106 is expressly subject to any common property memorandum adopted by the by-laws, any common property rights by-law, and any bylaw made under section 108. A registered common property rights by-law (often granted when an owner was given exclusive use of a courtyard) can shift maintenance responsibility to the owner. Ask for a copy of the consolidated registered by-laws, not the model by-laws.
Model by-laws only apply where a scheme has adopted them, and many schemes haven’t. 2. The registered strata plan: The definition of a lot allows infrastructure to be described in the plan as forming part of the lot. It’s uncommon, but it’s the one situation where the plan itself decides the question. 3. Whether the line really is shared: If the inspection shows the pit serves your lot alone, the answer reverses, and the cost is yours. And if a blockage turns out to have been caused by something you or your tenant did, the owners corporation still repairs the common property but may pursue you for the cost. None of those change the starting position. On the facts as you’ve described them, the inspection is the owners corporation’s cost. Tim Sara | Sara Strata tim@sarastrata.com.au READ MORE HERE
Is a draughty window frame the owners corporation’s job?
Is strata responsible for sealing draughty gaps between the window frame and wall? Who is responsible for sealing the external gaps between the window frame and the wall? There is a draught coming through these gaps. I believe windows are the owners corporation’s responsibility. I am over 70 years old, and it is impossible to warm my flat because of these gaps.
That duty is firm. They can’t put it off because it’s inconvenient or costly. There can be exceptions. Occasionally a strata plan or specific by-law sets things up differently, so it’s worth asking your strata managing agent to confirm how your scheme is structured. But for the vast majority of buildings, a draught coming through the join between the window and the wall falls to the owners corporation to fix.
Isn’t it a health and safety issue? It is supposed to be at least 18°C in a dwelling according to the WHO. Anything less than this is a health issue. Under section 106 of the Strata Schemes Management Act 2015 (SSMA), the owners corporation has a strict duty to repair and maintain common property.
Draughts like this are usually caused by the perimeter sealant around the frame breaking down over time. Sometimes it’s worn seals within the window itself, or gaps that have opened up around a sliding or opening sash. Which one it is changes how it gets fixed, so the first step is getting someone qualified to look and pinpoint exactly where the air is getting in.
In most NSW schemes, external wall and window draughts are the owners corporation’s responsibility to fix.
On the temperature point, there’s no specific NSW law setting a minimum indoor temperature for strata apartments. The WHO’s 18°C guidance is a recognised health benchmark, particularly for older residents.
Draughts like this are something our inspection team sees a lot at this time of year, particularly in older apartment blocks. In most NSW strata schemes, this is the owners corporation’s responsibility to fix. Your external walls and the windows, including the frames and the join where the frame meets the wall, are classed as common property rather than part of your individual lot. Under the SSMA, the owners corporation has a legal duty to keep common property properly maintained.
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Put your request in writing to your strata managing agent or owners corporation, describe the draught and how it’s affecting the apartment, and ask for an inspection. Having it in writing creates a record and tends to get things moving faster than a verbal mention at a meeting. Harley Fernandes | Windowline harley@windowline.com.au READ MORE HERE
Should owners pay more if insurance commissions are banned? Is it fair for owners to bear the cost of a strata manager’s lost commission income if insurance commissions are banned? Leading up to the renewal of our strata manager’s contract, we received the following notice: “As you may be aware, there has been increased scrutiny on the strata industry over the past 18 months, particularly in relation to insurance commissions and disclosure obligations. It now appears inevitable that the Government will move to ban insurance commissions for strata managers… When commissions are prohibited, this will have a significant financial impact on our business as it will remove a key source of our income. To ensure the continued sustainability of our business, we will have no choice but to adjust our management fees accordingly… our management fees will increase to offset the anticipated loss of commission income, and we will no longer receive any insurance commissions when arranging the renewal of your insurance.” We are a three-lot scheme. Is our strata manager entitled to increase their fees to cover the income they will lose when insurance commissions are banned, and is it fair for owners to bear that cost? Are other strata management companies in NSW having similar conversations with their clients? What other options do we have?
“Fairness” is complex, but the shift away from insurance commissions should ultimately lead to more transparent pricing for everyone. “Fairness” is difficult to define; however, ultimately, a strata agency is a business, and it has operational costs that must be covered to perform its duties and/or services effectively.
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Notwithstanding this, the movement away from insurance commissions in the industry centres the operational costs into the management fees. It provides for more transparent pricing between strata agencies and the owners corporations (OC) in their carriage, which will subsequently lead to “fairer” contracts and pricing overall. In addition to monitoring commissions and strata management fees, the OC should also take initiative and assess whether or not an adequate reduction to their annual premium comes into effect, following the removal of any commissions, as historically these two fees would likely have been combined into one payment. To provide further clarification, when implemented ethically, insurance commissions for strata management agencies have traditionally been a commercial arrangement between their agency and the relevant broker, effectively to offset operating costs for the OC. They are often a representation of the economy of scale relevant to the total percentage of the strata management agency’s portfolio being placed with said broker. Unfortunately, the unethical activities and manipulation of the allowances in the overarching legislation by a handful of strata management agencies in the industry have resulted in unjustifiably high commissions and/or undisclosed dual ownership of brokerage firms, which would have likely inflated the premiums for the OCs in their portfolios regardless. While the current spotlight and pending action with respect to this arrangement will mitigate the opportunity for unethical and manipulative practices of the agencies who were operating in this manner, it will also remove necessary income for the strata agencies who weren’t doing so. Megan Parkins | Tender Advisory megan@tenderadvisory.com.au READ MORE HERE
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53% of surveyed NSW Class 2 strata buildings had serious defects. Newer buildings showed lower rates, while waterproofing remained the most prevalent category. Source: 2025 Strata Defects Research Report, Building Commission NSW
Major, minor or incomplete
Where relevant, defects are assessed against the applicable legislation, contract, Building Code of Australia and Australian Standards, then described as major, minor or incomplete work. The distinction matters because it can affect warranty periods and how a claim is handled.
What sits behind the findings
A thorough report begins with a site inspection and photographic evidence so each observed defect is recorded and located. Depending on the agreed scope and available evidence, it may set out the likely cause, recommended rectification and cost estimates, giving the owners corporation a basis to budget and act. Concealed or complex defects may require diagnostic testing before a firm conclusion can be reached.
Why an engineer-prepared report matters
A visual inspection records visible symptoms. An engineer-prepared report assesses the likely cause, relates the findings to applicable requirements and can connect the investigation to a workable remedial design and comprehensive technical specification that clearly defines the required rectification works, materials, methodology and performance requirements.
If the matter is contested
The report can be prepared with the author acting as an independent expert under the applicable Expert Witness Code of Conduct. Where required, a Scott schedule can itemise each defect, its claimed cause, proposed rectification and cost. The engineering remains factual and independent. Legal strategy should be addressed by a construction lawyer.
For full article – click here
MJ Engineering Projects prepares engineer-led defect reports for owners corporations across Sydney, often starting with a building condition assessment, and supports schemes from the first inspection through to rectification.
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Can requesting the Delegated Functions Report directly reduce the strata managing agent’s fee?
Can the owners corporation request the Delegated Functions Report directly to reduce the fee? Our strata managing agent has almost tripled the administrative fee for producing the Delegated Functions Report compared to previous years. Can the owners corporation request the report directly rather than having it produced automatically by the strata managing agent, and would doing so reduce the cost?
The increase in the six-monthly reporting requirement may explain higher agent fees. With effect from 1 July 2025, one of the amendments to the Strata Schemes Management Act 2015 (NSW) (SSMA) requires strata managing agents in NSW to provide the owners corporation with records specifying the delegated functions exercised by the strata managing agent every six months, per section 55(2) of the SSMA, rather than annually as was previously required. Under section 55(1) of the SSMA, a strata managing agent must immediately record the exercise of any function delegated by the owners corporation or an officer of the owners corporation. The functions that may be delegated to a strata managing agent are those prescribed under sections 52 and 54 of the SSMA.
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The increase in the frequency of the reporting requirement may have contributed to the increase in the administrative fee charged by the strata managing agent, as the strata managing agent is now required by law to prepare and provide the report twice as often. Even if the owners corporation requests the report directly, the strata managing agent remains obliged under section 55(2) of the SSMA to provide the report every six months. You could review the strata management agency agreement with your strata managing agent about the fees charged for producing the records. Following this review, the owners corporation may wish to negotiate amendments to the agreement with the strata managing agent regarding the associated costs. Such amendment must be signed by the strata managing agent in writing and approved by a resolution at a general meeting of the owners corporation. Emma Teng | Bannermans Lawyers eteng@bannermans.com.au READ MORE HERE
Can a named proxy holder be swapped if unavailable? If a proxy names a specific strata managing agent who then becomes unexpectedly unavailable, is that proxy invalid, and is there a way to fix it before the meeting starts?
That’s an annoying one. That proxy wouldn’t hold force because you’re giving it to an individual, for example, naming me specifically. If one of my team shows up instead because I’m at home sick, they wouldn’t be able to use that proxy form.
A proxy named to an individual becomes invalid if that person can’t attend, but it can be replaced with a new proxy before the meeting starts.
The strata managing agent should be on the ball and give the owner a call to say the named person can’t make it today. The owner can then decide to do nothing, which is fine, or issue a new proxy naming whoever will be attending instead. Once that’s done, the new proxy is submitted and everything proceeds as normal.
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Strata managing agents need to be prepared for the AGM. Print out attendance lists and go through the proxies. There have been situations with blackouts, printers running out of paper, all sorts of things that can happen in an office on any given day. So preparation, even for a small block, matters. Print out your documents in the morning, check the proxies folder, and make sure you’re ready to go. You don’t want to be running late at four o’clock trying to print the owners’ list. It happens to all of us. Rod Smith | The Strata Collective rsmith@thestratacollective.com.au READ MORE HERE
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If a strata managing agent won’t generate reports, are they obliged to allow in-person inspections?
Is providing a link sufficient to meet the section 182(3) inspection obligation, or can owners insist on an in-person inspection? Is providing a link alone insufficient to meet the obligation under section 182(3)? The decision in Daley v The Owners – Strata Plan 2754 [2026] NSWCATAP 38 considered this question and determined that “the answer to the issue raised will depend on a variety of circumstances including, amongst others, the nature of the storage system and software, whether links are provided to required documents, whether they can otherwise be easily viewed or located, the nature of the user interface, and its availability and accessibility to a person who is not an expert strata searcher”. If strata managing agents won’t agree to generate reports of the data entered on behalf of the owners corporation (OC), are they obliged to allow in-person inspections? Note: the QLD adjudicator in The Groves No. 4 Minyama [2024] QBCCMCmr 58 stated “An interested person may choose to inspect the records or be provided with a copy of the records, or both. Although the body corporate may prefer the person to inspect, the legislation leaves that choice up to the person seeking access to the records.” Is this the same in NSW?
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Owners can require inspection access, with a formal path to compel it if wrongfully withheld. In NSW, the requirement to keep electronic books and records is relatively new, meaning that some schemes will have a mix of paper records and electronic records. In most cases, the strata managing agent will say when the electronic records start. For older records that are not kept electronically, the OC will need to be able to provide for an in-person inspection under section 182. In Daley, the appellant (Daley) had conducted a search and, due to the records being “in a mess” and technical issues accessing the files, could not locate the documents they sought. The OC’s position was that it was up to Daley to overcome the issues to access the documents. The Appeal Panel found there was a real question about whether the documents had been made available, noting that the ordinary meaning of “available” meant they were suitable, able or capable of use. It gave the example of an OC providing a link to a large number of electronic documents that had unclear file or folder descriptions and indicated that without “some clear and reasonably specific guidance as to where and how the documents sought were to be located” that this would not satisfy section 182(3). The reason was that the documents would not have been made available, as they could not be used. It also noted that the means or method of providing access was the method of providing access to the actual documents, not to the OC’s books and records as a whole.
What was not answered in Daley (to be fair, it was not raised) is whether the OC must generate a report of the data entered on its behalf, and if they cannot or will not do so, are they obligated to provide an in person inspection. In short, there is no express requirement under the Act for the OC (or its strata managing agent) to provide a report on the data entered into its electronic records. This is supported by the decision in Rao Nallamouthou v Owners-Strata Plan No 39988 [2024] NSWCATCD 73 where the Tribunal found at paragraph [54] that section 188 is not a mechanism to require an OC to create documents or explanations, only to provide access to documents already in its possession. The appellant in Daley sought an order that the OC, without the requirement for a search, either locate and provide Daley with the documents for copying, or locate and send an electronic copy of the documents. In the original decision, the Tribunal held it had no power to make an order to supply documents on request of a lot owner. The Appeal Panel did not consider this point and will likely be determined in the remitted proceedings before the Tribunal.
However, in another section 182 decision of Abraham v Owners Strata Plan No 61419 [2023] NSWCATCD 119 the Tribunal’s position was that the OC’s obligation was to provide access to the documents unless the Tribunal ordered otherwise under section 188. The Tribunal indicated at paragraph [8] that section 188 provided it with power to make an order that an OC supply information if it was satisfied that the applicant was entitled to the information and the information has been “wrongfully withheld“. In my view, depending on how the order is framed, the Tribunal would have the jurisdiction either under section 188 or the general order making power under section 232 to require documents to be provided. A link to section 182 of the Strata Schemes Management Act 2015 (NSW) is here. Allison Benson | Benson Legal allison@bensonlegal.com.au READ MORE HERE
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Does 33% construction end a community scheme’s initial period?
Is there a time limit on how long a developer has before the community association’s initial period ends, or can they take unlimited time? Is there a time limit on how long a developer has to sell at least one-third of a development, which would take the community association out of the initial period? Or do they have unlimited time to proceed with the development?
The initial period ends once a third of unit entitlements have been sold or subdivided, not once 33% of construction is complete. The purpose of the initial period, during which is imposed restrictions on what an owners corporation or association can do, was to protect subsequent owners from a developer (who is the initial owner of all unit entitlements of the scheme) from: making undisclosed changes during the early stages of a scheme when the developer has control (second reading speech to the Community Land Development Act 2021 and Community Land Management Act 2021 [the 2021 Acts]). Stating it generally, the initial period in respect of strata schemes and community schemes (including subsidiary schemes like neighbourhood schemes) is the period after the registration of the scheme and until when a third of the unit entitlements have been sold by the developer to new owners. When the initial period concludes in a community scheme 24 www.lookupstrata.com.au
is complicated due to the possibility of stage developments and subsidiary schemes. As explained by the second reading speech: The current law [the 1989 Act] provides that the initial period of those schemes ends when at least one-third of the total unit entitlements are subdivided by neighbourhood or strata schemes whose own initial periods have already expired. But since not all lots are necessarily subdivided into a subsidiary scheme many community and precinct schemes may remain stuck in their initial period indefinitely, unless they apply to the NSW Civil and Administrative Tribunal for an order to end the initial period. This was addressed in the updated definition for initial period in the 2021 Acts, which, as the second reading speech explains: provides that if there is no subsidiary scheme in a community or precinct scheme, the initial period expires on the issue of an occupation certificate under the Environmental Planning and Assessment Act 1979, which is issued when development is completed on land as required by a development consent. This reform brings an effective and automatic trigger into the laws to expire the initial period for community and precinct schemes, without the delay, uncertainty and burden associated with requiring a tribunal order to resolve the situation for owners.
Thus, the initial period of a community scheme does not end when a developer has developed at least 33% of a development. Rather, pursuant to the 2021 Acts, the initial period:
I encourage the enquirer to seek legal advice. Matthew Lo | Kerin Strata Lawyers matthew@kerinstratalawyers.com.au READ MORE HERE
ends on the day that at least one third of the sum of the total unit entitlement under the scheme consists of one or both of the following— 1. former development lots in the scheme that are the subject of subsidiary schemes for which the initial period has expired, 2. development lots in the scheme that are not owned by the original owner and for which occupation certificates (within the meaning of the Environmental Planning and Assessment Act 1979) have been issued for development on the lots.
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How do I raise a motion for a safety fence?
A committee member wants a cheaper, non-compliant safety fence for our common property. How do I raise a motion for a compliant one instead? I’m an owner and strata committee member for a four-lot strata scheme. We recently voted for a risk assessment on a safety fence issue on our common property. I’d like to know how to raise a motion at a general meeting for an appropriate safety fence, when another committee member wants a cheaper option that doesn’t adequately meet our responsibilities under WHS or strata legislation.
A motion should require a compliant fence, not just a choice between two options. An owner may submit a written motion requiring a compliant fence be included on the agenda of the next general meeting under clause 4 of Schedule 1 to the Strata Schemes Management Act 2015 (NSW) (SSMA). The motion should be sent to the secretary and strata managing agent before the meeting notice is issued. You may issue an accompanying explanatory note. The motion should not simply ask owners to choose between a “cheap” and a more expensive fence. It should require the owners corporation to adopt a solution that is demonstrably suitable for the identified risk and compliant with all applicable legal, technical and approval requirements. Once a professional risk assessment identifies a safety risk on common property, the owners corporation should respond reasonably and on proper evidence. Under section 106 of the SSMA, the owners 26 www.lookupstrata.com.au
corporation is required to properly maintain common property and keep it in a state of good and serviceable repair. It must also renew or replace common-property fixtures and fittings where required. Cost remains a relevant consideration, but it should not override safety or compliance. The owners corporation is not necessarily required to approve the most expensive proposal. However, any less expensive alternative should be supported by a suitably qualified professional confirming that it adequately controls the identified risk and satisfies the applicable standards, planning requirements and building requirements.
Does the motion require a special resolution?
That depends on the nature of the work. Where the proposal involves repairing, renewing or replacing an existing commonproperty fence with a substantially equivalent compliant fence, it may fall within the owners corporation’s maintenance and repair obligations under section 106. However, if the proposal involves installing a new fence, materially changing the appearance, configuration or structure of the common property, or adding something that did not previously exist, a special resolution under section 108 may be required. The meeting notice should identify the correct resolution threshold before it is issued. Where there is uncertainty, the motion can be expressly drafted as a special resolution to avoid the work later being challenged as an unauthorised alteration to common property.
Practical approach
The strongest motion establishes an objective compliance threshold rather than prescribing a particular product solely on price.
Owners may legitimately compare different quotations, materials and designs, but every option under consideration should first satisfy the same professionally prepared scope. If another committee member proposes a cheaper fence, ask that the proposal be referred to the risk assessor or another appropriately qualified professional for written confirmation that it provides an equivalent and adequate safety outcome. If that confirmation cannot be obtained, the cheaper proposal should not be approved merely because it reduces the immediate cost. The minutes should record the risk assessment, the professional recommendations, the alternatives considered and the reasons for the owners corporation’s final decision.
This creates a clear record that the owners corporation considered the known risk and made an evidence-based decision rather than choosing an option solely because it was cheaper. Abe Ayoubi | Senior Strata Manager (NSW) abe.strata@gmail.com READ MORE HERE
Do easement sale proceeds count as taxable income for owners? We sold an easement and put the proceeds into our capital works fund. Do owners need to declare this as income, and should it have been split between us instead? We recently sold an easement over land that our block of 38 units originally sold back in 2003. That land has since been built on twice, with the most recent units completed in 2022, from memory. The proceeds from the easement, around $37,000, were added to our capital works fund to help with expenses. Our strata managing agent has just sent a note to all owners saying that these funds must be declared as income on our tax returns, despite no one receiving any individual funds from the sale. How should we handle this? Should the proceeds have been divided between owners? Should there have been an EGM to ask owners to agree to using the funds for expenses of the strata scheme? The strata committee made the decision. At the time, we paid lawyers to negotiate the sale, and no mention was made of how the proceeds should be divided. We are far from confident in our strata managing agent and are reluctant to test their knowledge further on this.
Easement sale proceeds are declared in each owner’s own tax return, split by unit entitlement. It’s what I would consider an unusual rule, but ‘income from common property’ must be declared in the owners’ tax return, not the strata tax return. Unusual or surprising in that I don’t know what the reasoning was behind making this a tax rule. This is Taxation Ruling TR 2015/3, which of course applies across Australia like all taxes do, as opposed to strata legislation, which is all state and territory-based. 28 www.lookupstrata.com.au
The sale proceeds are declarable as income in the portion of your unit entitlements. In your case, these are split by the same ratio as levies. With 38 units, $37,000 would be split at roughly $1,000 if all unit entitlements were equal. The common property sale proceeds are most likely a capital gain for which CGT discounts may be available for investor owners. If your unit in that plan is your ‘principal place of residence’, you should be exempt from tax, but confirm this with your tax agent. There is a more common type of income from common property, being rental income (roof space to a telco, an accessway for nearby construction, lease of a common storage cage or car space), which all owners, including resident owners, would declare and pay tax on. TR 2015/3 explains that a distribution of the proceeds to owners is of no consequence to it being taxable or not. A benefit exists to all owners (eg., reduced levies) even if it remained in the plan’s bank account. Tax deductions may be available for a portion of strata levies, but that’s another question for your tax agent, who would consider your individual circumstances. The strata managing agent is doing the right thing in advising owners, who subsequently include it in the paperwork they give to their tax agent. Matthew Faulkner | Matthew Faulkner Accountancy PTY LTD matt@mattfaulkner.accountants READ MORE HERE
Can an accessible parking space be used for bin storage?
Our strata committee wants to use an accessible parking space to store bins during garbage room repairs. Is this illegal? Our strata committee has proposed to use a designated accessible parking space to store 12 waste bins while work is being carried out in the garbage room where the bins are normally stored. Our development approval requires that we have one designated accessible parking space available for visitors. Is using this space for storage legal? I would have thought that an accessible parking space could only be used for accessibility parking?
Using an accessible parking space for bin storage would likely breach the development consent and require council approval. In the first instance, I would strongly recommend that this matter be referred to either a town planner, lawyer and/or potentially the development department of the relevant council office. Ultimately, the answer would be contained within the provisions of the original development consent or section 88B instrument (under the Conveyancing Act 1919 (NSW)) for the site.
30 www.lookupstrata.com.au
Notwithstanding this however, in my experience, any “change of use” of an area or asset dedicated for a specific purpose within the original development consent or section 88B instrument for a site, would very likely trigger a requirement for either a complying development certificate, a development modification or at minimum notification to the council which forms as the relevant authority. Further to this, noting that the area has a specific use related to accessibility, the inappropriate reallocation of this could also be defined as discrimination under the relevant legislation. Finally, as the area falls on the common property of the owners corporation, I would recommend that, again, at an absolute minimum, the owners corporation be consulted via motion at a general meeting. Megan Parkins | Tender Advisory megan@tenderadvisory.com.au READ MORE HERE
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Category Water, waste and sustainability solutions Category Category
Altogether Group Power.Water.Data
https://altogethergroup.com.au/home-business/ partnershipenquiries@altogethergroup.com.au 1300 803 803
Humenergy
People, innovation and value sharing https://www.humenergy.com.au/ Info@humenergy.com.au 1300 322 622
Fair Water Meters
Retrofit sub-metering specialists https://fairwatermeters.com.au/ info@fairwatermeters.com.au 1300 324 701
Category Category
SAFETY & SECURITY
Category Access control, CCTV and security systems Category Category
QUATRIX PTY LTD
Intercoms, Access Control, CCTV, Data, etc. https://www.quatrix.com.au/ info@quatrix.com.au 02 9554 3487
Lock, Stock & Barrel Locksmiths Pty Ltd https://www.lsblocksmiths.com.au/ info@lsblocksmiths.com.au 0411 700 072
FERST
People First https://ferst.com.au/ gary.cheeseman@ferst.com.au 0419 211 683
Category Category
CLEANERS
Category Building, window and gutter cleaning Category Category
Arrow Abseiling Pty Ltd
Window cleaning, repair and maintenance https://www.arrowabseiling.com.au/ contact@arrowabseiling.com.au 02 8957 3693
Waste Clear Pty Ltd
Towards a better tomorrow https://wasteclear.com.au/ admin@wasteclear.com.au 1300 525 352
Sydney Gutter Cleaning
SGC are a leading team in roof and gutter services https://www.sydneyguttercleaning.com.au/ info@sydneyguttercleaning.com.au 02 8310 6770
Pristine Window and Gutter Cleaning Honesty, integrity and quality!
https://pristinewindowandguttercleaning.com.au/ admin@pwgc.com.au 02 9533 4476
Category Category
FIRE SERVICE
Category Fire safety, protection and compliance services Category Category
Linkfire Pty Ltd
Your Essential Safety Partner http://www.linkfire.com.au/ sales@linkfire.com.au 1300 669 439
2020 Fire Protection
Experts in Fire Protection for Strata https://www.2020fireprotection.com.au/ service@2020fire.com.au 1300 340 210
Fire Safety Constructions Compliant Specialist since 1999
http://www.firesafetyconstruction.com.au/ info@firesafetyconstructions.com.au 02 9945 3499
Category Category
PEST INSPECTION
Category PestCategory inspection, control and prevention Category
Safe Spray Pest Control
Protecting your most valuable assets... https://safespraypestcontrol.com.au/ service@safespraygroup.com.au 1300 562 053
Category Category
FACILITY MANAGEMENT
Category Building and facilities management Category Category
LUNA
Building and Facilities Manager https://www.luna.management/ info@luna.management 1800 00 LUNA (5862)
BME Group
Re-Defining the Standards of Building & Facilities https://bmegroupbuildingmanagement.com.au/ lachlan.hunt@bmegroup.com.au 02 8283 7531
Alliance Management Services
The Dedication & Commitment Your Building Deserves https://alliancemanagementservices.com.au/ info@alliancemanagmentservices.com.au 0466 533 320
DOWNLOAD DIRECTORY HERE Category Category
LIFTS & ELEVATORS
Category Lift consulting Category and vertical transport Category
ABN Lift Consultants
A team of friendly, open minded professionals https://www.abnlift.com/ andrew@abnlift.com 0468 659 100
Innovative Lift Consulting Pty Ltd
Australia’s Vertical Transportation Consultants https://www.ilcpl.com.au/ bfulcher@ilcpl.com.au 0417 784 245
Category Category
Category Category
SOFTWARE
Category DigitalCategory tools for managing strata schemes Category
MiMOR
Connecting People - Creating Communities https://www.mimor.com.au/ info@mimor.com.au
Stratabox
Building Confidence https://stratabox.com.au/ contact@stratabox.com.au 1300 651 506
Town Square
PROJECT MANAGEMENT
Productivity and Communications Platform for SMs
PM Services Australia
Urbanise
Category Project management for strata works Category Category
Client-side Project Management Services https://www.pmservice.com.au/ info@pmservice.com.au 02 9221 1490
Projx PM
Project Managers for Strata remedial projects https://www.projx.pm/ rossl@projx.pm 0421 274 426
Category Category
DELIVERY & COLLECTION SERVICES Category Parcel, mail & locker solutions Category Category
Groundfloor
Parcel, mail, dry cleaning lockers & Parcel rooms. https://www.groundfloordelivery.com/ ask@groundfloordelivery.com 03 4050 7660
Category Category
https://townsquare.au/ hello@townsquare.au
Automate your workload to increase efficiency. https://www.urbanise.com/ marketing@urbanise.com 1300 832 852
Resvu
Customer Service Software for Strata https://resvu.io/ enquiries@resvu.com.au 08 7477 8991
StrataMax
Streamlining strata https://www.stratamax.com/ info@stratamax.com 1800 656 368
MYBOS
Building Management for Residential & FM Schemes https://mybos.com/ sales@mybos.com 02 8378 1096
Onsite.fm
RECRUITMENT SERVICES
Building Management Software
Property Recruitment Partners
Serif.AI
Category Recruitment Category for the strata sector Category
People solutions for the Strata Sector
https://propertyrecruitmentpartners.com.au/ aaron@propertyrecruitmentpartners.com.au 02 8313 5591
sharonbennie - Property Recruitment Matching top talent with incredible businesses https://www.sharonbennie.com.au/ sb@sharonbennie.com.au 0413 381 381
https://onsite.fm/ hello@onsite.fm 02 7227 8550
AI managed with your judgement https://www.serif.ai/ kelly@heyserif.com
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