Dear Members,
I am very pleased to tell you all that both the strata law reform Bills have passed through the two Houses of NSW Parliament. This means they will now go to the NSW Governor, who will assent to them to enable them to become law.
The Government will then decide the commencement date but we understand that most if not all the laws will take effect from 1 July 2016.
As the Bills passed the Legislative Council the crossbenchers moved and passed five amendments – two to the original Strata Schemes Management Bill and three to the Strata Schemes Development Bill. These are outlined below.
The first, under the Strata Schemes Management Bill sought to extend the appointment of a strata managing agent as described in the Bill on Page 22, clause 50 (4) and (5) deleting the existing words and changing as follows:
(4) The term of appointment of a strata managing agent may be extended by the strata committee for successive periods of up to 3 months after it would otherwise expire (but not for any period that would extend beyond the date of the next annual general meeting of the owners corporation) pending a decision as to the reappointment of the strata managing agent.
(5) However, if a strata committee has extended a term of appointment of a strata managing agent under this section, the strata committee must give the strata managing agent at least 1 months’ notice of a decision not to reappoint the strata managing agent or not to further extend the appointment.
The second amendment extends the notice of end of term of appointment at clause 50 (5) (b), line 38 from 7 days to 1 month.
The third, fourth and fifth amendments were to the Strata Schemes Development Bill. These were:
Page 74, clause 170 (1). Insert after line 20:
(b) a full and frank statement by the proposed purchaser or developer of their intended use of the strata parcel,
This amendment will require the purchaser or the developer to provide in the renewal plan a full and frank statement of their intended use of the strata parcel.
The final two amendments were:
Page 78, clause 179 (1) (e) (ii), line 22. Insert “(at its highest and best use)” after “site”.
Page 78, clause 179 (1) (f) (iii), line 31. Insert “(at its highest and best use)” after “site”.
The effect of these two amendments will be that the independent valuation given to the court for a building and site must be based on its highest and best use. Before the renewal plan is given to the Land and Environment Court for consideration two independent valuations are to be provided. One is for the compensation value for each individual lot and the other is for the building and its site. These amendments provide a further safeguard by requiring that the valuation that is prepared for the building and the site is assessed on the basis of its highest and best use. That gives the owners full disclosure of the value of their collectively owned property.
All were passed by the Legislative Council.
Copies of the Bills as passed by both houses can be accessed from the links below:
Strata Schemes Management Bill 2015
Strata Schemes Development Bill 2015
Next steps
SCA (NSW) has engaged a legal team to prepare and deliver training sessions on the new legislation. That training will be a comprehensive review of all of the impact on the current arrangements and include (when it is passed) the regulations which will hold all of the details on new forms and processes.
There is no need for anyone to do any training until we have the complete regulations and how the new act is going to work. We will keep you up to speed as matters arise so don’t panic as we have plenty of time.
We will be providing a general review of the legislative changes to all members ASAP so keep an eye out for it.
We are grateful to the NSW Government, Opposition and minor parties for their work in debating these Bills and for the amendments achieved thus far. We still have some work to do but look forward to further discussions with the Minister and NSW Fair Trading as we move into a new strata era.
Yours sincerely,
Greg Haywood
SCA (NSW) President