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There has never been a better time to review the efficient and effective maintenance of your common property. The body corporate committee is charged with enacting the best interests of all owners in this regard. Several cases recently in QLD and NSW where bodies corporate and their committees have faced huge damages claims, in which owners and tenants have successfully pursued the claims of negligence on the part of the body corporate and owners corporations, have certainly placed this issue in the spotlight.
An extract of the Judgement of Newton DCJ delivered on 5 March 2010 in Magog (No. 15) Pty Ltd v The Moroccan CTS 17574 (2010) QDC 070.The relevant issue was the obligation of the Body Corporate to maintain the common property. The failure to do so had financial consequences for the Plaintiff in whose favour judgement was given.
Given the number of aging strata schemes this issue must be of significant importance to Bodies Corporate. A discussion of the legal principals commences at p26 under the headings Alleged Breach of Statutory Duty of Care.His Honour said at p26: "In my view it is clear from the words of s.152 of the Act (referring to the BCCM Act) and s.109 of the Standard Module that there is an intention disclosed by the legislation for a du y of care to arise. A duty of care is owed by the Body Corporate for the benefit of lot owners and other users of the common proper y. The Defendant had a duty to maintain common property in good condition, including, to the extent that the common property is structural in nature, in a structurally sound condition.
The duty to maintain a common property in good condition required the Defendant to maintain and manage and control the common property so that water did not leak from the common property into Lot 1. This required the Defendant to ensure that there was a waterproof membrane in the common property above Lot 1 which prevented water from leaking into that lot."His Honour went on to refer to the decision in Seiwa Pty Ltd v The Owners Strata Plan 35042 92006) NSW SC 1157 which decision considered the scope of a Body Corporate's obligation under the New South Wales legislation wherein Justice Brereton J found that the duty to maintain:
- Involved an obligation to keep the thing in proper order by acts of maintenance before it falls out of condition, in a state which enables it to ser vice the purpose for which it exists;
- Required the Body Corporate not only to attend to cases where there is a malfunction, but also to take preventative measures to ensure that there not be a malfunction;
- Extended to require remediation of defects in the original construction of he common property;
- Extended to oblige the Body Corporate to do things which could not be for the benefit of the proprietors as a whole or even a majority of them.
Relevantly, Justice Newton referred to the statement of Brereton J in Seiwa that there has been a breach of the Section 62 duty (the NSW legislation) as soon as something in the common property is no longer operating effectively or at all, or has fallen into disrepair. The duty of a Body Corporate under s.62 is owed to each lot owner, and its breach gives rise to a private cause of action under which damages may be awarded to a lot owner for breach of a statutory duty.
Given the age of some buildings, the importance of maintaining the common property and the financial consequences which might arise from failing to do so should be of significant importance to bodies corporate.
In light of the two significant cases mentioned above, a review of owner complaints regarding maintenance of common property and the importance of a solid and effective maintenance program cannot be sufficiently underlined.
....with thanks to Peter George from Short Punch and Greatorix for the case studies.
