I’m prompted to write this blog by a call from a strata manager who was concerned about one of their lot owners. That lot owner, who was relatively young, owned a lot that suffered from water ingress. They had previously contacted the builder and had the builder come out to do work to the lot and who had agreed to pay for the damage caused by the water ingress. Then the water ingress happened again. They contacted the builder and this time the builder said that they required the lot owner to sign a deed in return for them returning to do the work and payment for damage caused to their lot property.
The strata manager became aware of this, was rightly concerned and contacted me. As it turns out the building was less than two years old and the builder was putting pressure on the lot owner to sign the deed. Both the strata manager and I spoke to the lot owner and encouraged them to obtain legal advice before they signed the deed and to understand the proposed repair. The lot owner wanted the money for the property damage and the water ingress to be fixed but did not want to pay for legal advice. Although I strongly recommended the lot owner obtain advice and even referred them to a free legal clinic (they exist google them) I suspect they will not do so.
My concern for the lot owner and the owners corporation is that the lot owner will bow to the builder’s pressure and sign the deed and that in the deed will be a waiver of the lot owner’s rights. Given that it related to a building defect this could be a significant right being signed away.
My suggestion to anyone in this situation is to obtain legal advice.
Legal advice should be seen as enabling an informed decision: it should ensure you know what rights you have, what you are signing highlight the risks and suggest alternatives.
If the person wishing you to sign the deed is pressing you to do so that should raise concerns; while the deed terms may be benign, it may not be and obtaining legal advice (and again there are free legal clinics out there) could very well protect both your current and future rights. At the very least it should ensure you know what you are agreeing to. In this case it would include knowing:
- What your rights are
- What rights you are being asked to give up; and
- What is offered in exchange for you giving up your rights in terms of money, the scope of the repairs to be undertaken and the timeframe in which to do them.
I recently assisted the Law Society of NSW, to prepare two podcasts for their Lawfully Explained series (available on Listnr https://www.listnr.com/podcasts/lawfully-explained). This initiative is aimed at providing information about basic rights to the public and the website includes information about different areas of the law and also information about lawyers such as why and when lawyers are needed, costs and how to choose one. https://lawfullyexplained.com.au/
I encourage you all to look at the website and the podcasts.
Thanks for this article. Could I ask if the water ingress was due to a leak in the common property and if it was, would it not be the responsibility of the strata manager/OC to take it up with the builder and seek legal advice if necessary?
Hi Robert and good question. The lot owner was less than forthcoming and I did raise this with the strata manager and the lot owner advising that if it was through the common property only the OC could approve any waiver of rights. The strata manager tells me that the lot owner has bowed to the pressure and signed the deed sight unseen by anyone but themselves and the builder. You can lead a horse to water…
Rob Thorburn BE NER (Civil)
Building Matters Assist
0414 946 032 http://www.bmassist.net.auhttp://www.bmassist.net.au