Whether trying to get your co owners to sell an entire block as one to a single purchaser or, as a developer negotiating the purchase of all the lots in the block, effecting a collective sale is a delicate procedure. The object is to see everyone share in the upside of unification. Collective sales are best done by agreement, but court processes are available to protect the interest of dissenters while delivering on the will of the majority, which is a minimum of 75 % of owners.
Many strata buildings have reached their use by date and are sought after for redevelopment and urban renewal projects. The process of agreeing to get strata owners to act as one in either selling the whole block to one buyer or redeveloping the block with or without the participation of a developer is called strata renewal. It can be done by agreement or with the assistance of the courts if a minority of owners refuse to participate.
Where some owners want to participate in a redevelopment of the strata by surrendering their title and taking a new one in a redeveloped building, a redevelopment plan is required setting out all the rights and obligations of the various parties and the means by which everyone will be protected. If agreement is reached, then the redevelopment proceeds according to a redevelopment agreement signed by all parties. If there are dissenters, the strata renewal court processes are used to obtain compulsory sale orders on terms approved by the court.
A new building with un-remedied building defects is good for neither owners or the developer. These disputes tend to escalate when approached without commercial sensitivity. Owners can be emotional that they have not got what they bargained for, and builders and developers can get overly defensive and aggressive. The skill to negotiating a solution to building defects is a technical diagnosis of the problem and being able to clearly present better solutions for the parties than years in court and hundreds of thousands of dollars in legal fees.
Strata laws balance the rights of an individual to enjoy their property and the rights of the other owners as a whole to peace and quiet. Therefore, owners when they buy strata necessarily surrender some of the rights they would have as a stand-alone home owner, for example the right to renovate without your neighbour’s approval. Most renovations in strata are permitted only with a by-law that sets out what work is to be done, when, how, and on what terms. These by-laws must be written reasonably so if they are refused they can be appealed.
Repairs and Maintenance
Determining who’s responsible for what in a complex arrangement of shared floors, walls and ceiling is an art as much as a science. Delay, whether by confusion or obfuscation is costly, and distressing. Resolving these disputes requires an accurate reading of a strata plans to determine what is common property and therefore the responsibility of the owners corporation, and what is lot property, and therefore the responsibility of the lot owner. Unresolved disputes can lead to claims in court and tribunals for repair costs and damages for loss of use or value.