What happens if the Owners Corporation will not fix common property and my lot is affected?

Section 106 of the Strata Schemes Management Act provides a statutory obligation on the Owners Corporation to maintain common property.

If it is common property, the Owners Corporation must undertake the necessary repairs based on its obligations under s.106 of the Act.  If, on the other hand, the damage is to lot property, the Owners Corporations obligation arises in circumstances where the damage is caused by the failure to maintain the common property.

Where there is a claim under s.106(5) for damage to the lot property as a consequence of the failure of the Owners Corporation to comply with the requirements under s.106, the Owners Corporations fulfillment of its strict obligation requires it to repair or replace common property (and any lot property) so that it substantially was similar in appearance, characteristics and quality compared to what was there before.  It is inevitable that replacement in fulfilment of duty will bring an element of improvement and does not attract a discount.

If damage has occurred to Lot property then the Lot Owner may bring a claim for damages that are reasonably foreseeable.

The Court has concluded that reasonably foreseeable, in the sense of not being far-fetched or fanciful is the test to apply as it is very easy to satisfy.

Whilst the above indicates that the Owners Corporation would be responsible for damages to any lot owner that suffers loss as a result of the failure by them to repair replace and maintain common property, s.106(6) requires the owner to claim any damages within 2 years of the alleged breach.

There is no provision in either the Strata Schemes Management Act, 2015 or the Civil and Administrative Tribunal Act 2013 to extend the time for any damages claim beyond the 2 years of the alleged breach.

However, we note that damages can be ongoing and as such, care needs to be applied if the Owners Corporation seeks to claim that the claim for damages is out of time.  Loss of rent can be ongoing by its nature as the loss is weekly (as most Residential Tenancy Agreements require weekly rental periods).

Another exception is where the lot owner seeks a work order as opposed to damages.  In a matter determined on 26 July 2024, in Dart v The Owners – Strata Plan No. 71847 [2024] NSWCATAP 145 the Tribunal found if there is no time limit on an Owners Corporation’s obligation to repair damage out of work it has arranged to be undertaken in order to acquit its obligations under s.106(1), it does not make sense to impose a time limit on claims for repairs caused by a failure to abide by those obligations in the first place.

It was held that an owner’s corporation’s obligation to properly maintain the common property and keep it in a state of good and serviceable repair is ongoing, as is the obligation to repair damage caused by its failure to acquit that obligation.