NSW: Q&A Liability Clauses When Lot Owner Improves Common Property

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This Q&A from a NSW Lot Owner concerns the need for a liability clause when the neighbour above wants to install a balcony garden.

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Question: The neighbour above wants to install a garden on their balcony. A waterproof membrane would be installed. Should this be approved with liability clauses on the garden’s owners?

The top floor owners wish to establish a garden on their balcony which is above the rooms of the apartment below. A new waterproof membrane would be installed.

The concern from the owner below is the risk of damage from water penetration in the future. Should this be approved with liability clauses on the garden’s owners?

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Answer: We would recommend that the new by-law contain comprehensive conditions regarding the carrying out the work, the future maintenance obligations and appropriate indemnities.

Ordinarily the waterproof membrane on a balcony is common property and the repair and maintenance of the waterproof membrane is the responsibility of the owners corporation.

If an owner proposes to install new waterproof membrane on their balcony for a new garden, this would be an alteration to common property governed by section 108 of the Strata Schemes Management Act 2015 (SSMA).

Pursuant to s108 of the SSMA, a special resolution of the owners corporation would be required to authorise the owner to alter common property by installing a new waterproof membrane. The owners corporation would also need to make a new by-law to ensure that the owner is responsible for the ongoing maintenance of the waterproof membrane (otherwise the owners corporation will remain responsible for the ongoing maintenance).

We would recommend that the new by-law contain comprehensive conditions regarding the carrying out the work, the future maintenance obligations and appropriate indemnities. These conditions would include:

• requiring reports from qualified consultants to advise on:
  
  • the appropriate waterproofing solution for the garden (to ensure that the waterproof membrane for the new garden section preserves the waterproofing currently existing on the balcony which is not affected by the works);
  • whether the balcony can bear the weight of the proposed garden structure and contents.
• the owner is to be responsible for all future maintenance and replacement of the waterproof membrane and any damage caused to common property or other lots by leakage or other failure of the new waterproof membrane;
• the owner is to indemnify the owners corporation and other lot owners for any loss or damage caused or contributed to by the works or any future leakage or damage caused by the new waterproof membrane;
• obtaining any required development approval, insurance obligations and certification of works.

Emma Smythies
Special Counsel
Bugden Allen Lawyers
M: 0412 046 966
E: [email protected]

This post appears in Strata News #316.

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This article does not constitute legal or other advice and should not be relied upon this way. Readers should take legal or other advice before applying the information containing in this publication.

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