This article discusses NCAT timeframe for strata building defect disputes in NSW, outlining how long defect claims typically take and what legal costs owners corporations can expect depending on defect severity and jurisdiction.
Question: What is the average length of time and legal costs to bring a defects claim involving a strata of 5 units to court?
Answer: You can have minor defects in a 500-unit scheme, or you can have significant, major structural defects in a five-unit scheme that could cost millions to fix.
We’re going to give the most lawyerly answer we can: it depends. We know this is a very frustrating answer, but it does.
If you bring a claim in NCAT, NCAT has a procedural direction to wrap up matters within 12 months. As Duncan said, just, quick and cheap. NCAT will always push for a shorter period. However, if you need to go to the Supreme Court because the matter exceeds NCAT’s jurisdictional limit of $500,000, the Supreme Court generally takes longer, depending on the builder and developer and their mood towards the proceedings.
If you have a builder and developer who’s compliant and willing to speed things along, the Supreme Court can be a quick avenue. If not, they can drag their heels. Unfortunately, that’s just one of the drawbacks of the Supreme Court.
A major consideration for the requisite court is:
- the type of defects – major versus minor,
- the extent to which these defects are having an influence, and
- the cost associated with rectification.
In terms of the size of the strata scheme, in this case, five units, unfortunately, the size doesn’t always assist. You can have small strata schemes dragged through proceedings because, unfortunately, the builder is not coming to the table, or the defects are large. Whereas you can have quite large strata schemes that resolve quite quickly.
In terms of legal costs, that also depends. Unfortunately, the cost will be determined by the length of time. It’s not about the number of units; it’s about the extent of the defects.
In a 5 lot scheme, if there are relatively minor defects where the rectification costs are less than $100,000, you probably want to get together yourselves and say, “look it’s going to cost us $20 grand each to fix. Let’s just do it ourselves.” But if the cost is higher, it’s definitely worth a letter to the builder and developer, particularly if you’re still within time. It’s certainly worth getting an expert involved.
It’s really about the nature of the defect rather than the size of the strata building. You can have minor defects in a 500-unit scheme, or you can have major structural defects in a five-unit scheme that could cost millions to fix.
Jack De Gioia Bannermans Lawyers E: enquiries@bannermans.com.au P: 02 9929 0226
This post appears in Strata News #775.
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