Major Changes to Strata Laws in NSW to Begin at the End of 2016

In a follow up to TimeBase's previous article, the NSW Government has proclaimed the commencement of the Strata Schemes Management Act 2015 (No. 50 of 2015) for 30 November 2016, bringing into effect one of the largest modernisation efforts in strata law in the last decade.

Background to the Laws

The main objectives of the bills are to improve strata living by minimising regulatory burdens imposed on occupants and by improving the democratic processes within strata schemes. The new democratic process will see a better process of collective sale and renewal of strata schemes as well as redevelopment of aged strata schemes.

Some key changes include:

• strengthening the accountability of strata managers;
• allowing owners to adopt modern technology to conduct meetings, vote, communicate and administer their scheme;
• the need for owners to review by-laws (strata community rules) within 12 months, which can be customised to suit their lifestyle - such as whether to allow owners to keep a pet by giving notice to the owners corporation;
• a process for the collective sale and renewal of a strata scheme;
• a simpler, clearer process for dealing with disputes;
• broadening tenant participation in meetings;
• a new option to manage unauthorised parking through a commercial arrangement between a local council and a strata scheme; and
• a clearer and simpler three-tier renovations process, which waives approval for cosmetic renovations within the strata lot (for example, installing handrails for safety).

There are also measures to reduce red tape, such as simplifying financial statements for owners.

Strata By-Law Reforms Included

Reforms will introduce a model by-law dealing with smoking that intrudes into the common property or another person's lot. The reforms will also amend the model by-laws to make it easier to keep pets as opposed to automatically prohibiting pet ownership in a scheme. Model by-laws are suggested by-laws that an owners corporation can choose to adopt, or use to amend their current enforceable by-laws if they wish. Model by-laws do not remove a scheme's ability to make its own rules about smoking and pets. The model by-laws are not the by-laws of a scheme unless they are formally adopted. 

Reforms will allow schemes to take more action against the misuse of parking spaces and excess noise, as well as introduce increased fines for non-compliance. The changes will introduce measures to help address overcrowding in strata schemes.

Amendments in the commenced Act include:

• Streamlined approval for owner renovations;
• Better parking control;
• Helping owners corporations address noise and short-term letting;
• Measures to prevent overcrowding;
• Model by-laws about pets;
• Strengthening the ban on nuisance or hazardous smoke; and
• Increase in penalties for every offence in the by-laws.

Final Commencements Due for 2017

The Act has been commenced by Regulation 492 of 2016, with the outstanding building defect bond scheme to start on 1 July 2017.

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Strata Schemes Management Act 2015 (No. 50 of 2015) and Commencement proclamation, as reproduced on TimeBase LawOne

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