Strata Titles Act legislation will help owners overcome problem

17/10/96

Legislation to improve the Strata Titles Act would give owners options to overcome their insurance and ownership concerns, Lands Minister Graham Kierath said.

The changes provide a number of options to allow strata title owners to choose the one they want for their situation.

"After minor changes to the Strata Titles Act in April many owners examined their title and discovered they owned the building and land they occupied in common with the other owners in the strata scheme," Mr Kierath said.

"They also raised concerns about compulsory joint insurance of common property.

"I gave an undertaking their concerns would be fixed.

"I want to thank the taskforce formed to overcome the concerns and in particular the Strata Titles Action Group's representatives for their work in finding these solutions."

Mr Kierath said proposed legislation would give strata owners in non-multi storey strata schemes the choice of taking out individual or joint insurance policies.

The strata company would continue to be responsible for insuring common property.

The changes also included an easy mechanism for minimising common property.

Common property insurance would be waived if all the owners agreed by resolution but they would not be exempt from being sued if there was an injury on common property.

"The Insurance Council of Australia tells me a single insurance policy could be made available to cover a strata owner's liability for his or her lot and their interest in the common property," Mr Kierath said.

"I wanted to give strata owners different options so they could choose the one that suits them best," Mr Kierath said.

"Some options will involve a cost and others will involve no cost at all. Strata owners can choose the option they wish to use depending on the costs involved."

The options are limited to all existing schemes and those which are registered before January 1, 1998 to allow sufficient time for new schemes being developed and approved to become registered and take advantage of the conversion procedures.

Option one is an automatic one where small strata schemes of two to five lots will have the whole building, as shown on the plan, included within the strata lots.

This automatic change will be effective six months after the amendments come into force in January next year, unless an owner objects in writing to DOLA during that time.

Objections to the change will only be accepted after the six month period in exceptional circumstances.

The second option is for the strata owners to agree by resolution to have all the building structure, including the roof, floor and walls shown on the strata plan to be included within the individual strata lots.

A third option is for the strata owners to agree to amend the strata plan to show additional buildings or extensions or to bring land such as backyards into the individual lots.

This will require a surveyor's and valuer's certificate which will ensure every strata owner's interests are properly and fairly protected.

A final option is for agreement to convert to a survey title plan which will require a surveyor's and valuer's certificate and could include easements to cover for example a shared driveway.

"There will be no fees payable to DOLA for the conversion to any other Government Department and no stamp duty charges," Mr Kierath said.

"Conversion to costs to conventional property would normally run in excess of $3000 but we have organised that strata owners will only need a surveyor's and a valuer's certificate, a cost of about $600.

"Although it was not possible to sort out the more complex problems of conversion to 'green' title I have asked DOLA to draft a second Bill to make conversion easier and have it introduced into Parliament as soon as possible, hopefully this year."

DOLA will have easy-to-understand brochures available by the end of the year that will allow strata owners time to consider which option they prefer and will use before the six-months deadline for objections.

In the longer term there are plans for a user-friendly manual on strata titles to deal generally with strata titles ownership and management issues.

Strata owners can continue to gain information about the changes and their options from the DOLA Helpline on 273 7644.

Media contact: Steve Manchee 481 2133 or 018 097 260