NSW: 5 Most Useful By-laws: 1. The Cost Recovery ByLaw

Comments

1. Manuela Epstein says

   July 11, 2023 at 6:45 pm

   We have had a number of insurance claims for water damage to common property due to lot owner’s’ negligence, The excess was substantial in each case. Our strata looked into a cost recovery by law with respect to insurance excess recovery and we were told (by another strata lawyer) that it was not enforceable. Can you explain under what circumstances you would consider such a by law applicable

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   • Nikki Jovicic says

     July 12, 2023 at 6:20 am

     Hi Manuela

     This article should assist: NSW: Cost Recovery By-Laws And Strata Schemes: Are They Valid?

     Also, this recent Q&A:

     Question: The strata manager has arranged work on a neglected lot and associated common property and divided the costs among owners. How do we ensure the owner of the neglected lot pays their proportion of the costs?

     Reply

2. Jan Dowsett says

   May 4, 2020 at 3:38 pm

   Thank you for the information so far.
   I am really interested in what you find out if you receive more information.

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3. Jan Dowsett says

   May 4, 2020 at 3:36 pm

   Thank you for your help with this.

   Reply

4. Janis Dowsett says

   April 19, 2020 at 1:58 pm

   Would this cost recovery by-law be enforceable if the damage to the roof cavity was from works undertaken by a previous owner?
   Who would be responsible for reimbursing the Strata under these circumstances?

   The work was downlights installed through the ceiling on the top floor, thus breaching the fire wall. The wiring was not compliant with standards, as advised by the electrician engaged by Strata. The remediation included replacement of 24non-compliant downlights, upgraded connections to remove naked wires and ‘boxes’ over the wiring and also the extraction fan which also breached the fire wall.
   The repairs were undertaken by the Strata Corp and reimbursement is being sought. Is the current owner responsible for this debt?

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   • Liza Admin says

     May 4, 2020 at 12:43 pm

     Hi Janis

     The following response has been provided by Emma Smythies, Bugden Allan Lawyers:

     • The owners corporation cannot recover the costs from the current owner, if the works were undertaken by the previous owner, unless there is an existing common property rights by-law which specifically provides for this.
     • Section 132 of the Strata Schemes Management Act 2015 allows the owners corporation to apply to the Tribunal for an order that an owner of occupier pay for the cost of repairing damage caused by work carried out by or for an owner or occupier. If a Tribunal order was made under section 132 when the owner that caused the damage still owned the property, the amount ordered to be paid by the Tribunal may be recovered as an unpaid contribution, and in this instance could be recovered from the current owner as an unpaid contribution. This section, however, does not enable the owner’s corporation to obtain an order against a current owner for damage caused by a previous owner.
     • If the owners corporation is unable to recover the costs from the current owner as identified above, the owners corporation will be responsible for payment of those costs.

     Reply

5. stephen says

   April 5, 2019 at 10:37 am

   I am rather dubious about some aspects of this Recovery of Costs by law. I have even gone as far as to email Mueller and ask for some case law that shows the by law is enforced in relation to some of these questionable areas. Nothing back yet.
   I am aware of one NCAT application that related to a recovery of costs by laws and the respondent OC’s brief (law firm) agreed with the applicant that the by law went too far. The applicant’s submission was a mini thesis on who has jurisdiction to award costs. That OC no longer has the costs recovery by law.

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   • Nikki Jovicic says

     April 5, 2019 at 11:47 am

     Thanks for your comments, Stephen
     We’ll be in touch with more information.

     Reply

   • John says

     December 30, 2021 at 10:56 am

     Hi Stephen

     I agree with your disquiet about some aspects of the Cost Recovery By-Law of Muellers.

     Since we are affected by it at the moment I would very much appreciate it if you could give some more information about the NCAT application you referred to and its outcome.

     Thank you in advance if you can help

     Reply