Who is responsible for paying for the repairs?
The answers to these questions depend on a number of factors.
Generally, Owners Corporations are responsible for keeping the common property in good repair. Under typical circumstances, roofs form part of the common property in which case the Owners Corporation would be responsible for repairing a leaking roof.
Who is responsible for the ceiling of the property?
Ceilings, however, may be shared between neighbouring owners so that damages from water leaking from an upper storey property down to a lower storey tenant may be the responsibility of the upper storey owner under the Water Act 1989 (Vic).
How can you determine which lot owner is responsible?
An examination of the plan of subdivision is required in order to determine the boundaries between common property and individual lot owner’s properties.
Special fees for repairs
Just because the Owners Corporation is generally responsible for repairs to common property does not mean that the lot owners may not end up paying for the repairs. For instance, the Owners Corporation can levy a special fee for the repairs. If the special fee is more than double the annual fee for the owner’s corporation, then it must be approved by a special resolution. In order to pass the special resolution, there must be support of at least 75% of all lot owners or lot entitlements.
What is a benefit principle?
However it doesn’t end there. If the special fee is being charged for work that will benefit some lot owners more than others, then the special fee may not be levied in accordance with lot entitlement. Instead, applying the benefit principle, the owners benefiting more from the works may be required to pay an amount exceeding what they would otherwise pay based on their lot entitlement.
This benefit principle, however, is not generally applied based on a strict mathematical formula and will depend on a number of variables, including whether the works provide benefit to the owners corporation generally (such as avoiding legal actions or further damage to common property) and whether the benefiting lot owners already pay higher fees proportionally based on a higher lot entitlement.
How can Sharrock Pitman Legal assist?
If you an owner of a lot in a property subject to an Owners Corporation, and you need legal advice regarding water damage, please email litigation@sharrockpitman.com.au or call us on 1300 205 506 or alternatively fill in the form below.
The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.
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Caroline Callegari is an Associate Principal and leads our Disputes & Litigation team. She has an advisory and advocacy practice in the following areas: Commercial Litigation, corporate and personal disputes, debt recovery and, insolvency and bankruptcy matters. Caroline can be contacted on (03) 8561 3324.
