Strata Title Scheme
A strata title scheme is a building, or a collection of buildings, where the property that each individual owns is called a lot (for example, an apartment, villa or townhouse) and all the owners share ownership of and responsibility for the common property, such as external walls, foyers and driveways. Each state has their own strata scheme law and in NSW the strata title scheme is governed by the Strata Schemes Management Act and Strata Schemes Management Regulation
On 30 November 2016, New South Wales embraced major changes to strata laws which affect the owners, tenants, landlords, strata committees and strata managing agents in various ways.
Some key changes include:
- strengthening the accountability of strata managers
- allowing owners to adopt modern technology to conduct meetings, vote, communicate and administer their scheme
- the need for owners to review by-laws by 30 November 2017, which can be customised to suit their lifestyle – like whether to allow owners to keep a pet by giving notice to the owners’ corporation
- a process for the collective sale and renewal of a strata scheme
- a simpler, clearer process for dealing with disputes
- broadening tenant participation in meetings
- a new option to manage unauthorised parking through a commercial arrangement between a local council and a strata scheme
- a clearer and simpler three-tier renovations process, which waives approval for cosmetic renovations within the strata lot (for example, installing handrails for safety).
Community Title Scheme
In NSW, the community title scheme is governed by Community Land Management Act and Community Land Management Regulation. A community title scheme allows for various levels of management and stages of development and it may consist of a sole Neighbourhood scheme or it may be further subdivided into Neighbourhood schemes, Precinct schemes and/or Strata schemes.
As is the case with a strata title scheme, common areas within a Community, Neighbourhood or Precinct scheme are owned and managed by a body corporate comprising all lot owners within the scheme. The body corporate is known as the Association. The Associations for Neighbourhood and Precinct schemes, and the Owners Corporations for Strata schemes, within a staged community title scheme are members of the Community Association.
The common areas within a community title scheme are known as the Association property and are comprised in lot 1 of the scheme. Unit entitlement is based on site values and it determines the lot owner’s voting rights and contributions to maintenance levies.
Association property in a community title scheme may include a gymnasium, swimming pool and spa, tennis court, marina, sporting facilities, golf course and clubhouse, bowling green, recreation club, parklands and gardens, roadways, communal amenities like showers and toilets, security gates and perimeter walls.
The NSW community title scheme has been deliberately left very broad allowing total flexibility to be built into the scheme based on the individual requirements and theme of the Community or Neighbourhood. The equivalent of by-laws in a strata title scheme is known as Community Management Statement in a community title scheme.
The community title scheme law reform is underway with a community schemes law reform position paper released, outlining 58 reforms. The draft Community Schemes Bills are expected to be finalised by the end of 2019.
These proposed reforms include:
- allow land to be added to a community or precinct scheme, providing it has been disclosed in the development contract
- allow a schedule of contributions to be included in a development contract which will itemise expenses and identify who is responsible for payment
- allow additional association property to be created by a community or precinct plan of subdivision, providing it has been disclosed in the development contract
- require meetings to be called to authorise certain matters identified in a development contract as “development concerns”
- only require a neighbourhood development contract for staged development of a neighbourhood scheme
- allow land to be added as association property or as a lot in the scheme by special resolution
- allow associations to lease additional property
- allow subsidiary neighbourhood schemes to be wound up and the property to be vested in the parent community scheme
- enable a community plan of subdivision to subdivide or create association property by special resolution
- allow a neighbourhood scheme or strata scheme within a community scheme to approve the subdivision of property by special resolution
- enable associations to take the benefit of a statutory easement, and
- allow subsidiary schemes to lodge a revised schedule of unit entitlements when development of the relevant scheme is complete.
Should you require further assistance in reviewing your set of by-laws or community management statement, please contact Quinn Lawyers by clicking here to submit an online enquiry form or call us on 1300 QUINNS (1300 784 667) or on +61 2 9223 9166 to arrange an appointment.