Update on strata decisions in WA

Update on strata decisions in WA

Recent decisions of the State Administrative Tribunal (Tribunal) have reinforced the significant extent of the amendments to the Strata Titles Act 1985 (WA) (Act) which took effect on 1 May 2020 (Amendments). An article by Sean Macfarlane, Partner in our Perth office.

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What is required to authorise an alteration of the common property?

In Singh and UnitingCare West [2022] WASAT 18 (Singh), the Tribunal noted that prior to the Amendments, a strata company did not have the express statutory power to alter or improve common property and according to several Tribunal decisions, a resolution without dissent was required to approve such works.

Issue in dispute

The dispute in Singh was whether a strata company could:

• authorise the improvement of common property by installing bike rails and a bollard onto a common property car bay with only an ordinary resolution; and
• authorise an owner of a lot to purchase and install the bike rails and bollard on behalf of the strata company.

The Tribunal noted in Singh that the Amendments gave a strata company the express power to alter or improve common property under section 91(2) of the Act.

Key findings

The key findings of the Tribunal in Singh were:

• The installation of the bike rails and bollard are an improvement of the common property.
• An ordinary resolution is sufficient to authorise an improvement or alteration of common property under section 91(2) of the Act where the expenditure for those works is less than $500 per lot.
• As an owner was paying for the purchase and installation of the bike rails and bollard the strata company did not need to approve a budget for the works.
• A strata company can authorise an owner on behalf of the strata company to purchase and install the items to improve the common property.
• The bike rails and bollard are sustainability infrastructure [72]:

“because their installation is consistent with the promotion by State and local government agencies of cycling as a mode of transport because of the recognition of the adverse environmental effects of motor vehicles”.

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How can a strata company deal with an owner who keeps bringing applications in the Tribunal?

A problem in strata is dealing with an owner who brings applications in the Tribunal against the strata company each time they disagree with the strata company.

In Singh and The Owners of Piccadilly Square (Strata Scheme 10762) [2022 WASAT 21 (Piccadilly), Mr Singh (yes, the same owner in the Singh case referred to above) applied to the Tribunal for orders against the strata company.

Mr Singh alleged that the strata company had breached the by-laws and the Act in allowing another owner to invite visitors onto the common property in a way that blocked access to Mr Singh’s lot.

The strata company’s response was that:

• Mr Singh did not have grounds to apply for the breach of by-laws against the strata company.
• Mr Singh has applied for relief under the wrong sections of the Act
• The application should be dismissed.

Finding

The Tribunal ordered that the proceeding be dismissed pursuant to section 47(2) of the State Administrative Tribunal Act 2004 as it was misconceived or lacking in substance based on finding that:

• sections of the Act are not scheme by-laws and therefore the Tribunal cannot make orders under section 47 of the Act (the provision for enforcement of by-laws) for the enforcement of sections of the Act; and
• the by-laws cited by Mr Singh did not impose a duty on the strata company.

Costs order against the owner

Prior to the Amendments, there were only two limited circumstances in a dispute under the Act where a person could be ordered by the Tribunal to pay costs. The Amendments removed that restriction.

In what could be seen as an attempt to discourage Mr Singh from bringing further applications, the strata company in Piccadilly obtained an order from the Tribunal that Mr Singh pay costs to the strata company.

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Can the Tribunal order a person pay damages in a strata dispute?

In The Owners of 244 Flinders St. Mt. Yokine Strata Plan 2724 and Perera [2022] WASAT 64, the Tribunal dealt with an application made by the strata company against its former strata manager.

The strata company alleged that Mr Perera was the strata manager of the strata company and that he had misplaced strata company funds.

Finding

The Tribunal, exercising its powers under the Act to deal with a dispute between a strata manager and a strata company found that:

• Mr Perera was the strata manager of the strata company at the time the money was misplaced;
• Mr Perera contravened his statutory duties as a strata manager; and
• the strata company suffered a financial loss of $21,599.77 as a result of Mr Perera misplacing the strata company’s funds.

Order for damages

The Tribunal ordered Mr Perera pay $21,599.77 as damages to the strata company to compensate it for the losses suffered as a result of Mr Perera contravening his statutory duties.

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Follow up

If you are a strata manager and want to know more about the above cases or want to discuss issues your strata company clients are dealing with, please contact the WA branch of Bugden Allen Graham Lawyers by phone on (08) 9254 6304 or via email to wa@bagl.com.au