Strata by-laws play a crucial role in fostering harmony within strata communities. These rules, governed by specific legislation, can be intricate and open to various interpretations. This guide aims to clarify the key elements of drafting strata by-laws, highlight common pitfalls, and explore situations where by-laws may fall short.
Whether you’re a landlord, tenant, or simply curious about strata living dynamics, this comprehensive overview will provide valuable insights into the process of creating and amending strata by-laws in New South Wales.
The article breaks down the complexities of by-law drafting, offering practical advice for navigating this important aspect of strata management. By understanding the do’s and don’ts, stakeholders, including strata managers and the strata committee can contribute to a more cohesive and well-regulated strata scheme.
Understanding By-Laws: Their Purpose and Creation in NSW Strata Schemes
A strata plan’s By-laws serve as the foundational rules governing life in strata schemes, from high-rise apartments to expansive complexes. They function as a community constitution, ensuring fairness and harmony among residents. Each strata scheme develops its own unique set of by-laws, crafted by the owners corporation.
These regulations encompass a diverse range of issues, including:
- Pet ownership policies
- Short-term rental restrictions (e.g., Airbnb)
- Parking regulations
- Noise level limits
- Use of common property
- Standards for resident behaviour
The power to modify or introduce new by-laws rests solely with the owners corporation. Most changes require a special resolution passed during a dedicated general meeting.
The legal basis for by-law creation is outlined in Section 136 of the Strata Schemes Management Act 2015 (SSMA 2015). This legislation empowers the owners corporation to establish by-laws for “management, control, use, or enjoyment of the lots and common property.” However, the SSMA 2015 also imposes specific constraints on the owners corporation’s authority in drafting these regulations.
Understanding the scope and limitations of by-laws is crucial for maintaining a well-functioning strata community while respecting individual rights and legal boundaries.
Essential Guidelines for Crafting Strata By-laws
Utilise Current By-laws and NSW Government Model By-laws
Begin with the existing by-laws of your scheme and the model by-laws provided by the NSW Government. These templates offer a solid legal foundation but should be tailored to meet the unique needs of your strata scheme. Customization ensures that the by-laws address specific community concerns while maintaining legal compliance.
Emphasise Clarity and Precision in Language
Avoid ambiguity in by-law drafting to prevent potential disputes. Use clear, specific language that leaves no room for misinterpretation. This approach helps residents understand their rights and obligations while facilitating smoother registration processes.
Properly Register By-laws with NSW Land Registry Services
After drafting and approval, promptly register by-laws with the NSW Land Registry Services (NSW LRS). Remember:
- Amendments must be lodged within six months of approval to be valid.
- For legal recognition, record changes on the Folio of the Register for common property.
- Ensure a consolidated set of by-laws is maintained for easy reference.
Implement Regular By-law Reviews and Updates
Keep by-laws current by conducting periodic reviews:
- While the SSMA 2015 mandated an initial review within its first year, continue this practice regularly.
- Stay informed about changes in laws and regulations that may affect your by-laws.
- Consider engaging a specialist strata lawyer during reviews to ensure ongoing compliance and relevance.
By adhering to these guidelines, owners corporations can create and maintain legally sound, effective by-laws that address their community’s specific needs. This proactive approach fosters a well-regulated and harmonious strata environment.
Key Pitfalls to Avoid When Drafting Strata By-laws
Respect Existing Legal Frameworks
Strata by-laws must align with overarching legislation, particularly the SSMA 2015 and the Strata Schemes Management Regulation 2016. By-laws that contradict these primary laws risk invalidation. Ensure your by-laws:
- Comply with relevant legal standards
- Maintain enforceability
- Minimise the risk of legal challenges
Stay Within Authorised Boundaries
Strike a balance between effective governance and avoiding overreach. By-laws should:
- Serve as governance tools, not instruments of excessive control
- Respect the limits of owners corporation authority
Remember, Section 150 of the SSMA 2015 empowers the NSW Civil and Administrative Tribunal to invalidate by-laws deemed to exceed owners corporation powers.
Maintain Equity and Flexibility
By-laws should foster harmonious living, not impose undue restrictions. Avoid:
- Overly stringent regulations
- Inequitable rules
- Overbearing restrictions
Sections 139 and 150 of the SSMA 2015 guide the Tribunal in ensuring by-laws remain:
- Fair
- Reasonable
- Within the scope of owners corporation authority
Common Types of Strata By-laws
Exclusive Use By-laws
These by-laws grant certain lot owners exclusive use of specific common property areas. They must be carefully drafted to ensure fairness and compliance with the SSMA 2015.
Common Property Rights By-law
This type of by-law confers special privileges on a lot owner regarding the use of common property. It requires a special resolution and must be registered with NSW LRS to be effective.
By-laws for Scheme Created After Strata Reforms
For strata schemes created after the 2016 strata reforms, it’s crucial to ensure by-laws align with the updated legislation and reflect modern strata living needs.
Enforcing and Changing By-laws
Notice to Comply
When a lot owner or occupier breaches a by-law, the owners corporation may issue a Notice to Comply. This formal document outlines the breach and requests compliance within a specified timeframe.
Changing By-laws
To amend existing by-laws or create new ones:
- Propose the change at a general meeting
- Pass a special resolution (75% vote in favour)
- Lodge the updated by-laws with NSW LRS within six months
Consolidating By-laws
Periodically consolidating by-laws into a single, updated document can improve clarity and ease of reference for all strata community members.
Conclusion
Well-crafted by-laws are fundamental to the success of any strata community. They must strike a delicate balance between individual rights and collective interests. The legal landscape surrounding strata regulations is dynamic, constantly evolving through legislative updates and court rulings.
Given the complexity of these regulations and the potential consequences of errors, seeking professional legal guidance is highly advisable. The intricacies of strata law require specialised knowledge to navigate effectively.
For those involved in creating, amending, or interpreting strata by-laws, consulting with a strata lawyer can provide invaluable insights and help avoid potential pitfalls. Professional guidance ensures your by-laws are not only legally compliant but also serve the best interests of your strata community.
Remember, well-designed by-laws contribute to a harmonious living environment, protect property values, and minimise conflicts within the strata scheme. Investing time and resources in getting them right is crucial for the long-term success of your strata community. Whether you’re dealing with a newly created scheme or updating existing by-laws, careful consideration and expert advice can make all the difference in creating a thriving strata environment.
