NSW: Q&A Improvements to common property. Is a by-law required?

This article is about requirements for common property improvements.

Table of Contents:

• QUESTION: Can you clarify the “like for like” concerning external paint colour choices?
• QUESTION: If strata resolves to make an addition to common property, is there any need to create a specific by-law concerning each of the proposed additions before actioning?

Question: Can you clarify the “like for like” concerning external paint colour choices?

Can you clarify “like for like” concerning external paint colour choices? We want to repaint the outside of our building. We only have three of the five lot owners who agree with the project. We have already unsuccessfully conducted a GM.

Considering “like for like”, could we paint the dark brown doors white to match other aspects of the building, such as the balustrades and screen doors? Part of the downstairs footpath is yellow and the other section is red. Could we paint the whole path red?

Answer: It is widely accepted that changes to the existing colour scheme would be deemed as an alteration to the common property, for the purpose of improving or enhancing it.

When dealing with changes to common property, we rely upon section 108 of the Strata Schemes Management Act (NSW) 2015 (‘the Act’):

1. Procedure for authorising changes to common property An owners corporation or an owner of a lot in a strata scheme may add to the common property, alter the common property or erect a new structure on common property for the purpose of improving or enhancing the common property.
2. Any such action may be taken by the owners corporation or owner only if a special resolution has first been passed by the owners corporation that specifically authorises the taking of the particular action proposed.

To dissect this, we must first consider if we are going to:

1. add to common property
2. alter the common property; or
3. erect a new structure on common property.

Then we must consider if we are doing so for “the purpose of improving or enhancing common property”.

It is widely accepted that changes to the existing colour scheme would be deemed as an alteration to the common property, for the purpose of improving or enhancing it.

Therefore, in accordance with section 108, a special resolution in a general meeting (wherein no more than 25% of votes cast are against the resolution) is necessary to approve those works.

Some may argue that repainting the common property is considered maintenance, which an owners corporation is obligated to do under section 106 of the Act. If we were to repaint in the same colour scheme, it would be unlikely to be considered an “improvement or enhancement”.

However, section 108 allows us to clarify “maintenance” versus an “improvement or enhancement” and how to approach it.

Furthermore, approaching this with a special resolution avoids any potential argument of an invalid decision being made (as the threshold for votes in favour is higher than an ordinary resolution).

Tim Sara
Strata Choice
E: tsara@stratachoice.com.au
P: 1300 322 213

This post appears in the June 2024 edition of The NSW Strata Magazine.

Question: If strata resolves to make an addition to common property, is there any need to create a specific by-law concerning each of the proposed additions before actioning?

If our NSW strata resolves at a general meeting by special resolution of the owners corporation to make an addition to common property, is there any need to create a specific by-law concerning each proposed addition before actioning?

The subject additions would not be maintenance but improvements, as the common property would not have existed. Examples could be EV charging infrastructure, solar batteries, fibre optic data networks, or a common property garden pergola.

Answer: If the work is to be conducted by a lot owner and the lot owner is to maintain the work, a by-law is required.

A special resolution is required if you add to the common property, for example, install EV charging infrastructure. Note that as this is sustainability infrastructure, the calculation of votes for this type of special resolution differs from a normal special resolution.

At some stage, all infrastructure will require repairs, maintenance, renewal and replacement. If the work is to be conducted by a lot owner and the lot owner is to maintain the work, sections 108(3) and (4) require a by-law to be passed. No by-law is required if the owners corporation does the work and is responsible for maintaining it.

Allison Benson
Kerin Benson Lawyers
E: allison@kerinbensonlawyers.com.au
P: 02 4032 7990

This post appears in the April 2024 edition of The NSW Strata Magazine.

Disclaimer: This is general information and should not be considered to be legal advice. If you are affected you should obtain legal advice specific to your individual situation.

Have a question about repairs v improvements in NSW apartments or something to add to the article? Leave a comment below.

Read next:

• NSW: Repairs v Improvements to the Common Property: When Is a Repair a Repair?
• NSW: Replacing Items of Common Property Just Got Much Harder

Visit Maintenance and Common Property OR NSW Strata Legislation

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