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Maintaining and repairing common property

15 January 2018

Find out the responsibilities of strata managers and owners corporations with repairing and maintaining common property.

Shane Foley, co-director of BIV Reports Limited, and Christine Nesbit, Principal of Albury Wodonga Real Estate, recently held a webinar with REINSW to discuss key issues around common property repair and maintenance. 

Watch the webinar in full here.

What does the legislation say?

Shane explained that one of the most important sections in the Strata Schemes Management Act 2015 (SSMA) is Section 106, which relates to the duty on the owners corporation to repair and maintain common property. 

He said: “If you're new to the industry, you need to be aware that owners corporations cannot refuse to fix an item if it's a safety item.

“There is a duty to repair and maintain the property and you’re in breach of the Act until that property is repaired.”

He added that the new legislation has seen the addition of subsection 5, where a lot owner may recover expenses and damages from the owners corporation because they've failed to repair and maintain common property. This gives the lot owner a direct course of action against the owners corporation. 

Funding of maintenance and repair

Section 80 of the SSMA 2015 explains that owners are required to prepare a 10-year capital works fund plan to ensure they have necessary funds to repair and maintain a property. 

Shane added that section 102 refers to the limits on spending by large strata schemes, which is $30,000, and how if you spend over a certain process needs to be followed. The other instrument that dictates how much you can spend is the Management Agency Agreement.

Christine added: “We contact the owners corporation to keep them informed about repairs and it’s a good way to build a connection because it’s important you have trust and transparency.” 

Who’s responsible for repairs and maintenance?

Section 107 explains how the by-laws of strata may adopt a Common Property Memorandum which specifies who's responsible for maintenance and repairs. 

Christine says that you should always refer to the base documents when a repair or maintenance issue comes in.

She added: “If you operate a strata management business, repair and maintenance is a huge part of your management. Read what the surveyor's report says on the plan, read the Common Property Memorandum, read what by-laws have been put in place, go through your documents, and know your strata schemes, and what you're responsible for.”

Exclusive use by-laws

Section 108 describes how the owners corporation can provide an exclusive use by-law, and how in these situations the repairs and maintenance moves from the owners corporation to the beneficiary. 

Christine explains that if they don't fix it, you can on their behalf and raise a special levy for the collection of those funds. 

Shane added that Section 108, Subsection 4, says that if the by-law doesn't specify a maintenance responsibility, it defaults to the owners corporation to comply with Section 106. He also explains that Section 144 requires any exclusive by-law to provide for the maintenance of the property.

Owners corporation responsibility

Section 120 specifies that the owners corporation may carry out work on behalf of others when necessary and Section 122 delegates power to the owners corporation to enter a property to carry out work. This could include getting window locks installed, dealing with tenants, or asbestos inspections. 

Best practice for a strata manager

Christine explains how she inspects her buildings around four times a and says it’s best to be ‘proactive and be on the front foot’.

She added: “Know your laws because when you're talking to your owners corporation this puts you in control. They can't dispute it and it doesn't muddy the waters.

“Make sure you keep file notes of everything, and have a good work order system. Make sure you inspect the works once completed and ensure your tradies are reputable and they have legal liability and insurances before you send them out on site.”

Shane said that the Strata Schemes Development Act says, ‘common property, in relation to a strata scheme, or proposed strata scheme, means any part of a parcel that is not comprised in a lot, including any common infrastructure that is not part of the lot in the strata scheme’, which means anything outside the lot boundaries is deemed to be common property.

Shane added: “It is important as a strata manager that you consider the standard definition of common property. Consider the Strata Plan, and if it's pre '74 get a special consideration. Find out if your scheme has a Common Property Memorandum site because it will tell you who's responsible for what items. Also, is there an exclusive use by-law over that item?”