This Bill has been tabled in NSW Parliament following the 2021 statutory review of the Strata Schemes Management Act 2015 (NSW) (SSMA) and the Strata Schemes Development Act 2015 (NSW) (SSDA). Related amendments are also proposed to the Community Land Development Act 2021 and the Community Land Management Act 2021.
The initial review resulted in 139 recommendations being put forward, the full report can be found by clicking HERE.
This Bill addresses 31 of the recommended changes, some in full and others only in part. The industry has been told to expect a further Bill in 2024 which will address more recommendations from the 2021 statutory review.
It would not be a favorable position to have a by-law in place which cannot be enforced so, in light of the proposed changes, owners corporations should consider undertaking a thorough review of their by-laws. Our office can provide expert guidance on progressing such a review, please reach out to your Strata Manager for further information.
If accepted, below is an outline of the key amendments:
The Bill increases the notice period required for an AGM from 7 days to 14 days. This change is overlaid by the requirement under an amendment to the Interpretations Act 1987 (NSW) that an additional 7 working days be added for any notices issued via the postal system, pushing out notification periods to circa. 4 weeks.
An owners corporation will be required to source at least two independent quotes for all expenditure over $30,000, other than “emergency repairs”. Where this requirement cannot be met, an agenda item must be included at the next general meeting confirming the reasons an additional quote(s) was unable to be obtained. Emergency repairs are defined as repairs “that are necessary to mitigate a serious and imminent threat to the health or safety of the occupants”.
The timeframe to pay contributions levied for “emergency repairs” will be shortened from 30 days to 14 days.
Currently, where money is used from one fund to pay toward (i.e., Capital Works to Administration or vice versa) a purpose other than what that fund should be used for, the owners corporation must raise a levy to repay those funds within 3 months. The amendment allows for more discretion for the owners corporation to decide (by resolution at a general meeting) if, when, how and how much money is to be reimbursed.
Owners corporations will be prohibited from requiring an owner or occupier to pay a bond or fee for the keeping of a pet. Requiring an owner or occupier to obtain insurance for a pet will also be prohibited.
By-laws which prohibit, restrict or “impose an unreasonable burden on” a personwho keeps an assistance animal will have no effect.
The Bill sets a standard for reasonable evidence required to establish that the animal is an assistance animal.
A reduction is proposed for the threshold required for an owners corporation to remove a strata committee member. Where a special resolution was previously required, an ordinary resolution will be required. Additionally, the Bill proposed to prohibit a removed strata committee member from being reappointed for a 12-month period.
The Bill clarifies that a strata committee member may be elected at any general meeting convened for that purpose, as opposed to only at the Annual General Meeting, which is the current requirement.
NSW Fair Trading will be permitted to apply to the NSW Civil and Administrative Tribunal (NCAT) for an order appointing a strata manager, or requiring an owners corporation to appoint one.
Where a strata committee member discloses a conflict of interest (e.g., benefit from engaging a certain contractor), the Bill requires that committee member not be present for, or participate in, deliberations or decisions about that matter.
An increase in the timeframe, from 1 to 2 years, for a strata renewal committee to be in operation. This timeframe can still be extended by special resolution of the owners corporation.
For strata renewal plan applications, the Land and Environment Court will have more discretion, including:
making an order giving “effectto the strata renewal plan” notwithstanding defects and irregularities in procedural steps (provided they are “not likelyto cause substantial injustice”);
objections will be considered in light of any conflict of interest and whether the objections have been made in good faith; and
under the Bill, a costs order must be made against a dissenting lot owner in certain conflict of interest scenarios, or if the court considers this measure appropriate.
The above is not an exhaustive list of the proposed amendments. The Bill can be read in full by clicking HERE.
Our office will keep you up to date on any progress to this Bill, and any future Bills which may be presented to Parliament.