In strata property management, by-laws are crucial for maintaining community harmony and fair governance. Their effectiveness hinges on their alignment with current living standards and principles of equity. The Strata Schemes Management Act 2015 (SSMA) Section 139(1) ensures this by prohibiting harsh, unconscionable, or oppressive by-laws. Those imposing blanket bans or disregarding individual circumstances may face legal challenges under strata law. By-laws excessively limiting common household activities might also conflict with modern community expectations.
The NSW Civil & Administrative Tribunal (NCAT), empowered by SSMA Section 150, plays a key role in examining and potentially nullifying such by-laws. This underscores the importance of crafting well-balanced and considerate regulations.
This article examines strata by-laws in depth, drawing on recent Tribunal rulings. These cases shed light on various aspects of strata living, including cost recovery, pet policies, and property administration, reflecting the evolving nature of strata legislation. They emphasise the necessity for by-laws that honour the rights and reasonable expectations of all community members.
For those involved in strata schemes seeking to assess the durability and applicability of their by-laws in the current environment, this discussion offers valuable insights. It highlights the ongoing development of strata law and the vital need for adaptable, fair by-laws that resonate with the changing dynamics of communal living.
Recent Developments in NSW Strata Legislation: A Guide to Reviewing Current By-laws
| Administrative Cost Recovery | The Nikitopoulos v The Owners – Strata Plan No 52311 [2023] case highlighted limitations on Owners Corporations’ authority in creating by-laws. The Tribunal ruled that by-laws for recouping legal and administrative costs were unenforceable, being harsh, unconscionable, and oppressive. This emphasises that while Owners Corporations can establish by-laws, these must be fair and equitable, not unfairly targeting specific lot owners or imposing unreasonable burdens. |
| Compliance Costs and Property Entry | In Owners – Strata Plan No. 77109 v Gokani-Robins Pty Ltd [2023], a by-law allowing the Owners Corporation to recover enforcement costs and enter properties was deemed invalid. The Tribunal found the powers granted to the Owners Corporation, particularly regarding common property entry and enforcement, to be excessive and thus harsh, unconscionable, or oppressive. |
| Pet Ownership Limits | Bruce v The Owners – Strata Plan No. 98803 [2022] NSWCATCD 83 addressed the interpretation of a pet ownership by-law. The Tribunal concluded that the by-law did not explicitly limit owners to one pet, contrary to the strata committee’s interpretation. This ruling underscores the importance of clear, unambiguous language in by-laws to prevent misinterpretation and unjust restrictions on pet owners’ rights. |
| Strata Managing Agent Appointment | Walker Corporation Pty Ltd v The Owners – Strata Plan No 61618 [2023] NSWCA 125 involved a dispute over replacing strata managing agents. The Tribunal invalidated a clause in the strata management statement (SMS) mandating a single agent for multiple schemes. This decision upholds owners corporations’ autonomy in appointing managing agents, ensuring their rights aren’t unduly constrained by complex-wide agreements. |
| Access Device Deactivation | The Owners – SP No 91684 v Liu [2022] NSWCATAP 1 addressed the limits of owners corporation powers under by-laws. A by-law allowing the deactivation of access devices for short-term letting breaches was deemed invalid, exceeding the scope of by-law framing powers under the Strata Schemes Management Act. This reinforces the boundaries of owners corporations’ authority in creating and enforcing by-laws. |
| Smoking Prohibition | Pittman v Newport [2022] highlighted the challenges of imposing a complete smoking ban through strata by-laws. The case suggested that a total ban could be legally contentious, potentially infringing on residents’ rights and contravening Section 139 of the SSMA. This underscores the need for balanced approaches to smoking regulation in strata schemes. |
| Mandatory Flooring Requirements | Gurram v Owners Corporation SP36589 [2017] NSWCAT challenged a by-law mandating carpet as the only flooring option. The Tribunal found this restriction harsh, unconscionable, and oppressive, highlighting the need for flexibility in by-laws to accommodate minor renovations permitted under the SSMA without special resolutions. |
| Discriminatory By-laws | Araya v Owners Corporation SP65717 [2021] NSWCATAD 5 addressed potential discrimination in enforcing parking by-laws for disabled residents. While the Tribunal ruled against discrimination in this case, it established that owners corporations’ actions in managing common property could potentially be subject to discrimination claims under the Anti-Discrimination Act 1977. |
| Cooking Prohibitions | Franklin v The Owners—Strata Plan No. 87497 [2022] NSWCATCD 210 invalidated a by-law completely prohibiting cooking within residential units. The Tribunal deemed this “blanket ban” unnecessary and disproportionate, emphasising the need for reasonable and proportionate by-laws in strata schemes. |
| Short-term Letting Regulations | New planning frameworks introduced in November 2021, including Section 137A of the SSMA, allow owners corporations to regulate short-term rental arrangements. By-laws can prohibit short-term rentals in non-principal residences, balancing income opportunities with residents’ concerns about noise and security. These changes also ensure adherence to fire safety standards in short-term rental properties. |
The Importance of Regular Strata By-law Reviews: Seek Expert Strata Lawyer Guidance
Strata by-laws are dynamic entities, constantly evolving in response to legislative changes, societal shifts, and legal interpretations. Tribunal cases frequently demonstrate that by-laws, once valid, may lose their enforceability over time due to these changing contexts. A static approach to by-laws can potentially lead to complex disputes and unexpected legal challenges for owners corporations or associations.
To mitigate such risks, regular by-law reviews are not just beneficial but strategically crucial. These reviews ensure that your strata scheme’s regulations remain current, enforceable, and aligned with contemporary legal standards. This proactive approach can help prevent disputes and potentially costly legal complications.
Experienced strata lawyers can provide invaluable assistance in reviewing and updating by-laws. They can offer expert guidance on:
- Assessing the enforceability of existing by-laws
- Interpreting recent legal developments and their implications
- Drafting new by-laws that comply with current legislation
- Addressing specific concerns or issues within your strata complex
Whether you have questions about particular by-laws or seek to understand recent changes to by-laws, professional legal advice can provide the necessary clarity and direction. Regular consultations with strata law experts can help ensure your strata scheme operates smoothly and remains compliant with current regulations.
Consider scheduling a by-law review with a qualified strata lawyer to safeguard your community’s interests and maintain harmonious strata living. It may be time to review your by-laws if they’re outdated or no longer serve the needs of your strata property effectively. Remember, a general meeting and special resolution are typically required to make changes to by-laws. Your strata lawyer can guide you through this process and help ensure your new or amended by-laws are still valid under NSW strata law.
