Articles

Introduction

With more people living in high-rise residential buildings and experiencing higher rainfall levels, water ingress from apartment balconies has become a prevalent issue in Victoria. Additionally, Owners Corporation claimants in domestic building disputes are on the rise. This article explores the complexities involved in apartment defect claims, emphasizing the importance of expert local legal advice due to variations in building regulations across Australian jurisdictions.

Rising Incidence of Apartment Defect Claims

High-rise residential buildings and increased rainfall have led to a surge in water ingress issues from apartment balconies in Victoria. Furthermore, there has been a notable increase in Owners Corporation claimants in domestic building disputes.

Broader Australian Context

This issue is not confined to Victoria. Regions with high rainfall, such as the ACT and Queensland, are also experiencing water ingress from balconies, leaks from planter boxes, and façade damage in mid to high-rise buildings.

Legal Standing for Defective Works Claims

Determining the legal standing to bring claims for defective works is crucial. Generally, the Owners Corporation owns the Common Property and is responsible for its care, repair, and maintenance. Common Property includes areas like basement car parks, common gardens, hallways, stairwells, lobbies, and the building’s façade.

Distinguishing Common and Private Property

Distinguishing between Common and Private Property, especially with apartment balconies, can be challenging. Typically, the external face of a balcony balustrade is considered Common Property, whereas balcony floor tiles are Private Property. Components like the waterproofing membrane beneath the balcony tiles and the slab below are usually considered Common Property.

Case Law on Property Classification

In The Owners SP 35042 v Seiwa Australia Pty Ltd [2007] NSWCA 272, it was held that “the waterproofing membrane laid under the tiles on a balcony formed part of the Common Property.”

Similarly, in The Owners Units Plan No 1917 v Koundouris [2016] ACTSC 96, the judge declared, “the waterproofing is better treated as a part of the slab because it is a functional rather than decorative treatment to the slab and is practically integrated with it. It is distinct from a finish such as tiling or painting.”

Utilizing Plans and Expert Opinions

Plans of Subdivision and expert opinions are essential for determining property classifications. Defects may affect both Common and Private Property, complicating the legal standing of claimants. For instance, defective roof plumbing might lead to mould and condensation in internal areas.

Standing of Plaintiffs in Legal Proceedings

The standing of plaintiffs depends on whether defects affect Common or Private Property. Typically, the Owners Corporation is the claimant for defects in Common Property, while affected lot owners might join as co-plaintiffs. The executive committee must notify all lot owners and obtain expert reports to determine defect causes and rectification methods.

Notification and Voting for Legal Proceedings

A letter of intention to take legal action must be sent to members. In Victoria, a special resolution with 75% approval is required, while the ACT requires a simple majority. This ensures that lot owners are well-informed and have ample time to decide on joining the legal action.

State-Specific Legal Requirements

Different states have specific rules for authorizing legal action. For instance, the ACT’s Unit Titles (Management) Act 2011 allows action on both Common Property and “defined parts” of buildings with “Class A units.” The term “defined parts” includes load-bearing structures and parts of balconies.

Informing Lot Owners

Regular updates and follow-ups are essential to keep all lot owners informed, particularly about the limitation period for starting legal actions, which is 10 years in Victoria and 6 years in the ACT. Lot owners seeking to join after this period may be barred from participating.

Conclusion

Understanding the nuances of apartment defect claims and the differences in building regulations across Australian jurisdictions is crucial. Limitation periods, domestic warranties, and case law determinations can vary, making expert local legal advice critical. By seeking guidance from experienced lawyers, lot owners can navigate these complexities effectively.

Author: Justin Cotton, Director, Lovegrove & Cotton – Construction and Planning Lawyers

About Justin Cotton

Justin Cotton is a leading Australian construction lawyer and widely respected in the building fraternity. He is Chair and a member of the HIA Industrial Relations and Legal Services Committee and the Regional Executive Committee for the HIA Victorian Chapter. Lovegrove & Cotton can help practitioners, corporations and property owners resolve any type of building dispute.

For three decades, Lovegrove & Cotton have represented Strata Communities and owners corporations with the resolution of building defects claims across Melbourne, Canberra, Sydney, and Queensland. For assistance with resolving multi unit apartment building disputes, visit our Strata Community landing page on our website. If you require help resolving a leaky building claim visit our Leaky Building claim landing page on our website and email enquiries to enquiries@lclawyers.com.au, or call (03) 9600 4077

Disclaimer

This article is written for general information only and is not to be construed as legal advice. If you require legal assistance, please contact Lovegrove & Cotton Lawyers, and our experienced lawyers will assist you based on the facts and circumstances of your case.