Was my by-law unreasonably refused?

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If you own and live in, or work in a strata scheme, then you should be aware that if you want to do certain work to your lot or to the adjacent common property a by-law will be required.

Generally speaking, the type of work requiring a by-law will be work:

(a) work involving structural changes,

(b) work that changes the external appearance of a lot

(c) work involving waterproofing (for instance replacing tiles); and

(d) work for which development consent or another approval is required.

In a recent case a lot owner had conducted structural work, waterproofing work and other work so that the lot could be used for a significantly different purpose than it had previously been used for. The scheme was an industrial scheme. The new lot owner had converted an industrial lot into a prayer hall by extending an existing bathroom, removing another ground floor bathroom, extending a mezzanine to create two offices, a kitchen and a new bathroom, installing air conditioning, a security alarm and a CCTV system.  The lot owner did not obtain Council consent for the new use or for the works. The remaining lots in the scheme continued to be used as light industrial lots meaning trucks and forklifts etc. needed to utilise the common property.

The owners corporation sought orders in NCAT seeking that the unauthorised works be removed. Despite an appeal to the NCAT Appeal Panel by the lot owner, orders were made that the works be removed and the common property be reinstated. In the meantime, the lot owner put a by-law to the owners corporation retrospectively seeking approval for their work. At a general meeting the owners corporation considered the by-law motion and it did not pass. The lot owner made an application to NCAT seeking an order that their proposed by-law be made and that the owners corporation had unreasonably refused it.

In considering whether or not the owners corporation had unreasonably refused to pass the by-law, the Tribunal noted that “a lot owner … must demonstrate the unreasonableness of the refusal, not the reasonableness of the proposed change” and that the onus is upon the lot owner to demonstrate that the decision of the owners corporation was unreasonable, rather than the owners corporation having to prove it acted reasonably.

In this instance, when taking into consideration the interests of all lot owners in the scheme, not just the interests of the lot owner making the application, the Tribunal noted that the interests of the other lot owners was in continuing to use theirs lots for light industry including warehouses.

In making the decision that the owners corporation’s refusal to pass the by-law had not been unreasonable  the Tribunal noted that the change in use had not been authorised by Council, there had been no notice to the owners corporation of the works or the change in use, there were safety concerns regarding the large number of persons accessing the lot in question through the common property, concerns regarding a lack of  parking and the effect of large numbers of cars parking in the surrounding areas on trucks needing to access other lots in the scheme and as at the date of the meeting refusing the by-law, concerns regarding the works themselves which had not been addressed.

While this is an extreme example it stands as a warning to lot owners. If you are uncertain whether or not your work requires a by-law, check with your strata manager or your strata committee. If you go ahead and do the work and it needed to be authorised by way of a by-law, you could be ordered to remove the works at your cost.

 

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