Question: Can the committee in our community title development charge owners $150 if they do not attend a clean up day?
My elderly mother in law lives in a house in a community title development. The strata committee recently decided that the 49 lots should have twice annual “clean up” gatherings. If a lot owner does not attend, they have to pay an additional charge of $150. Can the committee impose arbitrary penalties like this?
Answer: The community association or the association committee cannot impose a penalty against an owner who does not attend the twice annual “clean up” gatherings.
No, the community association or the association committee cannot impose a penalty against an owner who does not attend the twice annual “clean up” gatherings. Nor can the community association impose levies on owners other than in accordance with the units of entitlement i.e. impose a levy on one or some owners but not all owners.
Case law and the legislation is very clear that only the Courts or Tribunal can impose penalties.
Community schemes may be tempted to adopt by-laws that seek to recover costs or penalties such as these. However, community schemes cannot recover costs or penalties by way of a by-law.
By-laws cannot impose fees and charges unilaterally in the absence of express authority to do so under the Community Land Management Act 2021, as it would be inconsistent with the provisions of the Act relating to association property maintenance and maintenance of association funds.
A costs recovery by-law may also be ruled invalid if it is harsh, unconscionable or oppressive. The Tribunal has done so on a variety of grounds, including where a by-law displaced the normal processes of the courts, where it did not provide the debtor with procedural fairness, where the by-law reserved assessment of the amount to the scheme without independent assessment, where the by-law lacked inbuilt controls such as whether the amount was reasonable in quantum and reasonably incurred and where the by-law was framed as a debt due, rendering the relevant owner unfinancial and subject to loss of voting and other rights.
This post appears in the December 2024 edition of The NSW Strata Magazine.
Matthew Jenkins Bannermans Lawyers E: enquiries@bannermans.com.au P: 02 9929 0226