Strata Law FAQ

Please choose from the list of FAQ’s below:

Strata Law FAQ#1 - What are strata owners obligations in
regards to strata levies?

There are two types of strata levies: periodic levies and special levies.

Periodic Levies

Prior to each Annual General Meeting, an Owners Corporation will prepare estimates of how much money it would need to credit to its administrative find and to its sinking fund.

The monies credited to the administrative fund are set aside to pay for the daily or recurrent expense of the Owners Corporation, generally to maintain the strata building. The monies credited to the sinking fund are set aside to pay for expenses of a capital nature, such as to repaint the building or to repair the common property.

Estimates (or budgets) are presented to the Owners by the Executive Committee usually with assistance of the Strata Manager at the Annual General Meeting. At that meeting, the Owners Corporation will determine the amount of levies payable by all the Owners which are usually payable each quarter. The amount payable in respect of each lot in the strata scheme is based on the “Unit Entitlement” of the individual lots. These Unit Entitlements are stated in the strata plan which should have been provided to you at the time of the purchase. They are also stated in the Certificate of Title of the common property.

An Owner of a lot is liable to pay the strata levies as and when they become due and payable. These regular levies are payable regardless of whether an Owner has been issued with a levy notice.

Outstanding levies will accrue interest at the rate of 10 per cent per annum, until paid. The Owners Corporation may recover from a defaulting owner, any outstanding levies, interest, as well as its reasonable expenses incurred in doing so, pursuant to section 80(1) of the Strata Schemes Management Act 1996 (NSW)(“the Act”). Section80(1)
Read more - Owners Corporation Seeking to Recover Legal Costs

Special Levies
In some circumstances, special levies will have to be raised. For instance, an Owners Corporation may find itself in a situation where it has to carry out major building works and there are insufficient funds to meet this expense. The Owners Corporation will then have to call an Extraordinary General Meeting (or at the Annual General Meeting), during which a special levy will be struck to raise enough funds to pay for the shortfall.

Like a periodic levy, an Owner of a lot on the strata scheme will then have to pay the Owner’s levy (based on Unit Entitlement) the special levy by its due date. The failure to pay the special levy will result in interest being charged and where applicable, section 80 expenses (including legal costs) incurred by the Owners Corporation in recovering the debt.

However, although section 78(6) of the Act States that regular periodic levies are deemed to have been duly levied even though a notice of the levies were not provided to the owner, that exemption does not apply to special levies. Notice of a special levy must be served on an Owner at the Owner’s address for service of notices or at the unit address, depending on the circumstances of each case.

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Strata Law FAQ#2 - Owners Corporation is demanding I pay outstanding levies that are not my fault. Must I pay?

Generally, a new owner is liable, with the previous owner, to pay any outstanding levies and interest on those levies. Section 78(6) of the Strata Schemes Management Act 1996 states that:

“If, at the time a person becomes owner of a lot, another person is liable in respect of the lot to pay a contribution, the owner is jointly and severally liable with another person for the payment of the contribution and interest on the contribution.”

However, that section of the Act does not say that a new owner has to pay the expenses incurred by the Owners Corporation in recovering the debt from the previous owner, which would otherwise have been recoverable (and may remain recoverable) from a defaulting owner in accordance with section 80(1) of the Act.

Strata Law FAQ#3 - Can I have a dog in my apartment?

Depending on what the by-laws to your strata schemes says, you may have to first ask for the written consent of your Owners Corporation before you can have a dog in your lot.

Many strata schemes adpot the by-laws set out in the Strata Schemes Management Act 1996 (NSW). According to By-Law 16 in that act, an owner or occupier must not keep any animal on the lot or the common property without first obtaining the written consent of the Owners Corporation.

By the same token, an Owners Corporation cannot unreasonably withhold its consent, particularly where the owner or occupier agrees to abide by certain conditions, such as having the dog on a lead when on the common property and cleaning up after the dog.

In some cases, an Owners Corporation may have modified By-Law 16 to allow the keeping of certain pets.

In any event, a by-law cannot prevent or restrict you from keeping or using a guide or hearing dog on your lot or the common property.

Please note that our provision of any telephone advice to you is only a general discussion to assist as to whether you wish to instruct us. Telephone discussions should not be construed as legal advice and are not to be relied upon. Legal advice which you can rely on can only be properly provided by us to you at or following an initial conference. We are not responsible for any action you may take or fail to take based upon the provision of our telephone advice to you. If you wish to arrange a conference, please contact us.

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