NSW: Why do you Need to Consider the Registered By-Laws when Preparing a New By-Law

This article is about registering by-laws has been provided by Bannermans Lawyers.

By-laws can provide guidelines regarding behaviour and to assist the smooth running of a scheme. It is important to consider the registered by-laws of the scheme when it comes to preparation of new by-laws. Why? This is to ensure that the new by-law does not conflict with the existing by-laws for the scheme.

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The main types of by-laws that a strata scheme may adopt include:

By-laws to regulate the management, administration, control use or enjoyment of the lots or the common property of a scheme (commonly called “section 136 by-laws”); and

By-laws that grant lot owners special privileges or exclusive use rights over parts of the common property which also allow lot owners to take action which adds to, alters or erects a new structure on common property (also known as “common property rights by-law” under Strata Schemes Management Act 2015 (SSMA 2015)).

Section 136 by-laws

Section 10 of the Strata Schemes Development Act 2015 states that a plan intended to be registered as a strata plan must indicate the by-laws intended to be adopted. That means, a scheme usually have had some by-laws in place since day 1 of the strata plan being registered. As such, it is important to review those existing by-laws before preparing any new by-laws for the scheme as in some instances, the scheme may simply need amendment of the existing by-laws rather than additional by-laws being prepared.

Common property rights by-laws

When preparing a common property rights by-laws for major renovation works, it is important to consider the existing by-laws for the scheme to ascertain if there are any application procedures and document requirements currently in place, and to avoid any inconsistencies which could lead to a dispute.

It is also important to review the current by-laws as there may be by-laws which already grant rights of exclusive use or special privilege areas over certain areas of common property to lot owners.

The purpose of a common property by-law is to authorise particular works and to ensure the lot owner (and if stated, the subsequent owner) is responsible for the ongoing maintenance and repair of the works.

Consolidation and change of by-laws

It is clear in section 141 of the SSMA 2015 that a change to the by-laws of a strata scheme has no effect until:

the owners corporation has lodged a notification with the Registrar-General in the manner approved by the Registrar-General, and

the Registrar-General has made an appropriate recording of the notification in the folio of the Register for the common property.

In short, notification of any change of by-law must be lodged with the Registrar General not more than 6 months after the passing of the special resolution to make the by-law.

Generally speaking, the owners corporation will attend to the consolidation and registration of by-laws in accordance with section 141(1) of the SSMA 2015:

“an owners corporation may, in accordance with a special resolution of the owners corporation, change the by-laws of the strata scheme”.

Yet, there is no express requirement that indicates the owners corporation is responsible to attend to the consolidation and registration of the by-laws following a general meeting. In most cases, the owners corporation would attend to this process and request a reimbursement from the owner for the associated costs. Ultimately, if a common property rights by-law has been specially resolved at a general meeting, the benefited owner should clarify the consolidation and registration arrangement with the owners corporation to avoid any delay in effecting the by-law and any approval granted with it.

Bannermans Lawyers
E: [email protected]
P: 02 9929 0226

This post appears in Strata News #579.

The information contained in this article is general information only and not legal advice. The currency, accuracy and completeness of this article (and its contents) should be checked by obtaining independent legal advice before you take any action or otherwise rely upon its contents in any way.

This article has been republished with permission from the author and first appeared on the Bannermans Lawyers website.

Have a question about by-laws or something to add to the article? Leave a comment below.

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