Who is a “dissenting owner”?
A dissenting owner is an owner of a lot which does not support a strata renewal plan prepared in accordance with Part 10 of the Strata Schemes Development Bill 2015.
What is the “compensation value”?
The “compensation value” is the value of a lot determined:
- pursuant to s55 of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) (Acquisition Act) subject to any modifications prescribed by the regulations; or
by any different valuation method prescribed by the regulations.
The regulations are yet to be published, so it is unclear whether the regulations will specifically regulate (or modify) the manner in which the “compensation value” is calculated, and in particular whether or not GST will be recoverable by a dissenting owner as part of the market value of the dissenting lot.
However, if the “compensation value” is to be determined solely pursuant to the Acquisition Act, then it is most likely that any GST paid (or payable) on the sale of the dissenting lot would form part of the market value of that lot, meaning that a dissenting lot owner would then recover GST as part of the overall value it receives.
Is a dissenting owner entitled to “compensation value” for its lot?
Yes, at a minimum.
When making an order to effect to a strata renewal plan, a court must be satisfied in relation to the compensation being received by lot owners that:
- in the event of the sale of the entire strata scheme (a “collective sale”), each lot owner must receive not less than the “compensation value”; and
- in the event of a “redevelopment”, the amount to be paid to a dissenting owner must be the greater of the “compensation value” of the dissenting owner’s lot and the amount which the dissenting owner would have been entitled to had they supported the strata renewal plan.