A Few Strata Law Quickies in NSW
Strata greenies, pets and lawyers are getting some nice new strata laws …
It looks like the environment, animals and, penalties get the benefit of some shortcut strata law reforms in NSW … and that’s fine by the planet, many pets, and all the strata lawyers.
Introduction
In a relatively short time [7 months] a few things are due to change in New South Wales strata laws after the Strata Schemes Management Amendment (Sustainability Infrastructure) Bill 2021 was finally assented to in parliament on 24 February 2021.
Those changes are now on the way to become law, so here’s my update.
Latest strata law reform history & status
In mid-2020 a draft bill was introduced to the NSW parliament [on 16 June 2020] to make a few changes to strata laws.
The draft bill covered the following things [see my more detailed review below]:
new provisions for sustainability infrastructure,
extra provisions for secret ballots,
extra provisions for tenant information,
fixing a problem with civil penalties for NCAT orders, and
clarifying proxies for multi-lot owners.
The second and third reading speeches for the bill were approved in the Legislative Assembly on 28 July 2020.
The bill then entered the upper house [Legislative Council] for debate on 4 August 2020.
Some amendments were proposed on 25 August 2020 by both the Legislative Assembly and Legislative Council. The amendments related to controls on animals in strata buildings [see also my more detailed review below].
On 16 February 2021, the amendments were negotiated and resolved with some being agreed, some changed, and, others abandoned.
The new [updated] Strata Schemes Management Amendment (Sustainability Infrastructure) Bill 2021 was passed by parliament on 16 February 2021 and assented to on 24 February 2021. You can read it here.
If you’re interested you can also check out the detailed steps and progress of the law in parliament here.
Overview of the latest NSW strata law changes
So, what’s changing in NSW strata law next?
Well, there are 6 key areas that are new or changed as follows.
1. Common property works
A new regime is introduced for common property alterations and works that involve sustainability infrastructure that allows for approval at an intermediate level between replacements under s 106 of the strata laws and changes under s 108 of the strata laws.
Interestingly, sustainability infrastructure is defined by its purposes including things like:
reducing energy or water consumption,
increasing energy or water consumption efficiency,
reducing or preventing pollution,
reducing landfill waste,
increasing recycling,
reducing greenhouse gas emissions, and/or
facilitating sustainable transport use.
Approval is by a new kind of meeting decision ‘the sustainability infrastructure resolution [a reverse majority] where less than 50% of the votes cast are against the proposal. And, the decision needs to consider [at least] a few criteria as follows:
costs, including running and maintenance,
ownership and future responsibility, and
usage rights amongst strata owners.
So, the new provisions will make approval of sustainability-focused works is easier in NSW strata buildings [following the example of a few other states].
They also mean that refused proposals for sustainability infrastructure are reviewable at NCAT.
Plus, it’s possible the new provisions are wide enough to cover strata owner proposals for sustainability infrastructure; allowing approval by decisions between those required for minor renovations under s 110 of the strata laws and for things requiring a common property rights by-law under s 142 or a licence under s 131 of the strata laws.
And, I wonder about third-party proposals for sustainability infrastructure on common property. Can an energy storage or electric car charging business seek approval to install their equipment in a strata building’s common property under the new provisions?
2. Animals
New provisions are introduced covering controls on and applications for keeping animals in strata buildings.
By-laws that ‘unreasonably’ prohibit keeping animals will have no effect and strata building decisions made under a by-law that ‘unreasonably’ prohibit keeping animals also be ineffective.
However, unreasonableness isn’t [and in my view shouldn’t be] defined.
But, there are a few provisions that clarify [or attempt to clarify] unreasonableness.
One is a [reversed] provision specifying that it’s reasonable to keep animals unless the animals unreasonably interfere with the use of lots or common property. That provision appears to incorporate Cooper’s Case principles. However, on my reading, it also appears to involve a few double negatives.
Another is a different [reversed] provision specifying that by-laws prohibiting animals aren’t harsh, unconscionable, or oppressive if they don’t unreasonably prohibit keeping the animals. That provision also appears to address the s 150 issues covered in Cooper’s Case. However, on my reading, it appears to involve some confusing circular reasoning.
Interestingly, permission for keeping an animal also occurs automatically [by deeming provisions] where a contravening ‘unreasonable’ decision has been made by the strata building or no decision has been made by the strata building within a reasonable time [whatever that is].
Plus, the Minister for Fair Trading is to undertake a review of animal keeping in strata buildings within 6 months covering, at least, a range of issues specified in the law changes.
So, it seems these changes are partly prompted by recent trends favouring animals in strata buildings and partly as a result of the NSW Court of Appeal decision in Cooper’s Case which I wrote about in The Dogs of Strata War or The By-Law is Dead: Long Live the By-Law.
But, it also looks like they’re not the final story as the wide-ranging ministerial review is very likely to come up with many new [and different] ideas.
Watch this space …
3. Penalties for NCAT order breaches
New provisions are introduced authorising penalties for breaches of NCAT orders under the strata laws.
There’s nothing particularly special about these provisions.
They’ve been introduced to fix a problem that arose because the power to seek penalties for NCAT order breaches ended up in s 77 of the Civil and Administrative Tribunal Act 2013 after the 2015 strata law changes and needed the permission of an ‘authorised official’ in the Minister’s office.
So, whilst necessary and welcome, It’s about time this problem has been fixed.
4. Tennant information
Strata buildings will not need to provide a copy of the by-laws to tenants where they’ve separately been supplied by lessors.
It makes sense not to send by-laws to tenants twice, but I’m not sure how strata buildings will know if that’s already been done.
5. Secret ballot records
Secret ballot voting records must not be disclosed during any inspection of strata records. OK!
6. Proxy tweaks
A strata owner of multiple lots can appoint one proxy using just one form.
And, a proxy remains valid if a meeting is adjourned [subject to its terms].
Francesco ...
Feb 26, 2021