NSW lot owners are wondering about the strata duplex requirements. We cover their questions here.
Table of Contents:
- QUESTION: If I own both lots in a two-lot strata scheme, is the duplex exempt from requiring a capital works fund?
- QUESTION: What can an owner do if the other owner in a duplex refuses repairs and blocks renovation approval requests?
- QUESTION: Can an AGM in a two-lot scheme proceed if one or both owners are absent?
- QUESTION: Can individual lots on a 2-lot strata have individual building insurance if the buildings are not physically detached?
- QUESTION: I own in a 2-lot strata scheme. When the strata scheme commenced ten years ago, a capital works fund was established. Can we now cease the capital works fund, or must it continue once it has been established?
- QUESTION: A new owner purchased the other lot in our strata duplex. They refuse to contribute to maintenance or attend meetings. What can we do?
- QUESTION: Can you proceed with an AGM in a 2 lot strata plan if both lots are represented but one lot owner is in arrears?
- QUESTION: For an attached duplex in NSW, what are the requirements? Do we need an administration and sinking fund? How about strata insurance for the common property?
- QUESTION: We bought into a duplex a few years ago. We know nothing about the strata duplex requirements. It was not until we moved into our property that our neighbour in the adjoining unit informed us that there is a strata plan and a body corporate.
Question: If I own both lots in a two-lot strata scheme, is the duplex exempt from requiring a capital works fund?
I own both lots in a two-lot strata scheme. The buildings are physically detached, and there are no other buildings or parts of buildings, except for a shared concrete driveway, outside of the lots. Is a scheme like this exempt from requiring a capital works fund?
Answer: You appear to meet the exemption criteria.
Yes, as you appear to meet the exemption criteria:
- the owners corporation so determines by unanimous resolution (as you own both lots, you will have no issue)
- the buildings comprised in one of those lots are physically detached from the buildings comprised in the other lot, and
- no building or part of a building in the strata scheme is situated outside those lots.
Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440
This post appears in Strata News #759.
Question: What can an owner do if the other owner in a duplex refuses repairs and blocks renovation approval requests?
I own a townhouse in a NSW duplex. Twelve months ago, I asked the other owner for permission to paint the exterior of my home using the existing colour scheme. The duplex shares a common wall. The other owner refused, claiming cracks in their townhouse meant the foundations needed inspection.
I organised an inspection. A quote was sent to the other owner for their repairs, but they said they could not afford the work.
We have never operated as an owners corporation, even though it is a legal requirement. We have by-laws and a strata plan. Can I paint my unit as long as I use the same colours?
I am concerned that the foundation issues in their townhouse will eventually affect mine. What can I do?
Answer: You can self-manage the scheme or engage a strata manager to guide you through your responsibilities and duties for managing your scheme.
Like any other strata apartment building, a duplex, also known as two lot dwellings on strata title, is required to have an owners corporation. Any strata scheme has the obligation and responsibility to maintain and repair the common property, raise levies and deal with renovations of the property.
The owners corporation is made up of the two owners in the duplex. The owners can make decisions by passing resolutions at General Meetings. With only two owners, voting on the motions presenting the resolutions may result in defeated motions if there is disagreement between the owners, unless the unit entitlements under the strata title show that one lot has more unit entitlements than the other. In these circumstances, the lot owner may demand a poll, deciding the motion on unit entitlements. Unit entitlement is a lot owner’s proportional share of ownership of the common property and may be found on the common property title search.
Painting the exterior of your property
Painting is generally considered cosmetic work under Section 109 (1) of the Strata Schemes Management Act 2015 (SSMA). An owner of a lot may carry out cosmetic work to common property in connection with the owner’s lot without the approval of the owners corporation. The lot owner must ensure that any damage to common property (if any) in connection with the cosmetic work is repaired and must comply with any further conditions noted in the by-laws. Also, the painting should not change the appearance of the exterior. If these conditions are met, you may paint your exterior wall at your own cost.
Issues with the foundation
The foundations of the building are generally considered part of the common property. The owners corporation has a statutory obligation under Section 106(1) of the SSMA to properly maintain and keep in a state of good and serviceable repair the common property, unless there is a special by-law transferring the responsibility to the lot owners. If there is no special by-law transferring the responsibility to each lot owner, the cost of repairs to the foundation under your neighbour’s property will be shared by both owners in accordance with the lot’s unit entitlement. This is because the owners corporation has the responsibility to repair common property, and you are part of the owners corporation.
Repairs of this nature are generally paid from the capital works fund (which the owners are required to contribute to via strata levies raised in accordance with unit entitlements). If the capital works fund is insufficient, the owners corporation may raise special levies to cover the costs of the repair, which again, will be raised in accordance with unit entitlements.
Further considerations
An issue that may arise is if the unit entitlements for both lots are equal. This may result in deadlocks when passing resolutions if there is disagreement between the owners. In this case, an owner may apply to the NSW Civil and Administrative Tribunal (NCAT) for an order that the owners corporation carry out the necessary repair work to the common property if it considers the owners corporation has unreasonably refused its consent.
As a two lot scheme, you can self-manage the scheme and there are tools or ideas available on the NSW Fair Trading website, or if easier, engage a strata manager who is experienced in this field to guide you through your responsibilities and duties for managing your scheme.
Anna Hahm Grace Lawyers E: Anna.hahm@gracelawyers.com.au
This post appears in Strata News #757.
Question: Can an AGM in a two-lot scheme proceed if one or both owners are absent?
In a two-lot scheme, can an AGM proceed if neither owner nor their representative attends? Can the meeting go ahead if only one owner is present?
The NSW Fair Trading website states that, for two-lot schemes, both parties must be present.
Answer: For schemes with only two lots, both owners (or their proxies) must be present to form a quorum.
In a two-lot strata scheme, the quorum rules are strict and are set out in Schedule 1 of the Strata Schemes Management Act 2015 (NSW). Clause 17(2) of Schedule 1 states that a quorum for a meeting is achieved if “persons entitled to vote representing not less than one-quarter of the aggregate unit entitlements” are present. However, for schemes with only two lots, this effectively means both owners (or their proxies) must be present to form a quorum, unless the scheme has adopted other quorum arrangements under clause 17(2)(b).
If neither owner (or their appointed proxies) attends, there is no quorum and the meeting cannot proceed. The law does not allow an AGM to be held in their absence, as there is no one present to vote on motions. The only options in this scenario are:
- Adjournment: The meeting must be adjourned and reconvened at a later time. At the reconvened meeting, those present (even if just one lot owner or their proxy) will form a quorum under clause 17(4) of Schedule 1.
- Pre-meeting voting or written resolutions: The owners could consider using pre-meeting electronic voting or passing resolutions in writing (by unanimous agreement), but this still requires active participation from both owners.
The NSW Fair Trading guidance for two-lot schemes reflects these requirements by stating that both parties must be present (or represented) for the meeting to be valid.
Key point: An AGM cannot validly proceed with no attendance at all. The meeting must either be adjourned or rescheduled, or the owners must use alternative resolution methods that comply with the Act.
Tim Sara Strata Choice E: tsara@stratachoice.com.au P: 1300 322 213
This post appears in the September 2025 edition of The NSW Strata Magazine.
Question: Can individual lots on a 2-lot strata have individual building insurance if the buildings are not physically detached?
Answer: The owners corporation must insure the building as a whole.
Based on the Strata Schemes Management Act 2015, owners in a two-lot strata scheme generally require the owners corporation to insure the building. However, there is an exemption under certain conditions:
- This section does not apply to an owners corporation for a strata scheme comprising 2 lots if—
- the owners corporation so determines by unanimous resolution, and
- the buildings comprised in one of those lots are physically detached from the buildings comprised in the other lot, and
- no building or part of a building in the strata scheme is situated outside those lots.
Given the information provided that the two-lot scheme’s buildings are not physically detached, the exemption does not apply. Therefore, individual lots in this scenario cannot have separate building insurance policies; the owners corporation must insure the building as a whole.
Tyrone Shandiman Strata Insurance Solutions E: tshandiman@iaa.net.au P: 1300 554 165
This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisenent Australia AFSL No 240549, ABN 15 003 886 687.
This post appears in the September 2024 edition of The NSW Strata Magazine.
Question: I own in a 2-lot strata scheme. When the strata scheme commenced ten years ago, a capital works fund was established. Can we now cease the capital works fund, or must it continue once it has been established?
Answer: As you are a 2-lot scheme, an exemption may apply.
As you are a 2-lot scheme, the following exemption may apply. However, it does require a unanimous resolution, and the scheme needs to satisfy paragraphs (b) & (c):
74 Capital works fund
….- Exemption An owners corporation for a strata scheme comprising 2 lots need not establish a capital works fund if—
- the owners corporation so determines by unanimous resolution, and
- the buildings comprised in one of those lots are physically detached from the buildings comprised in the other lot, and
- no building or part of a building in the strata scheme is situated outside those lots.
Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440
This post appears in Strata News #690.
Question: A new owner purchased the other lot in our strata duplex. They refuse to contribute to maintenance or attend meetings. What can we do?
We are a two-lot strata duplex, with one unit above another. Our voting rights are 50:50. A new owner purchased the downstairs lot 18 months ago. They refuse to contribute to any building maintenance, common property maintenance, or strata record keeping. We can’t them to attend an AGM to carry out the basic requirements of the strata.
We own 50% of the property and have 50% of the voting rights, yet we can’t even get the common property garden tended to unless we do it all ourselves or pay out of our own pockets to do it. What can we do?
Answer: Apply to NCAT to have a compulsory strata managing agent appointed.
You may make application to the NSW Civil & Administrative Tribunal to have a compulsory strata managing agent appointed pursuant to Section 237 of the Strata Schemes Management Act 2015 NSW as it appears that your scheme is not “functioning satisfactorily”, has failed to comply with legislative requirements in terms of failure to maintain and have proper meetings and is failing to perform its duties.
As the applicant, you will bear the burden of proof and need to provide evidence in support of all the dysfunction of your scheme.
As your application would be for the appointment of a compulsory appointment, you do not need to make application for mediation through NSW Fair Trading.
Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440
This post appears in Strata News #626.
Question: Can you proceed with an AGM in a 2 lot strata plan if both lots are represented but one lot owner is in arrears?
Answer: No, because both owners are required for a quorum in your scenario and persons constituting a quorum must be financial.
Leanne Habib Premium Strata E: info@premiumstrata.com.au P: 02 9281 6440
Question: For an attached duplex in NSW, what are the requirements? Do we need an administration and sinking fund? How about strata insurance for the common property?
I live in a duplex. The building is not detached as the lots share a common wall.
I’m wondering what our requirements are. Do we need an admin and sinking fund for repairs maintenance, pest sprays etc is for two owners to share?
How about strata insurance for the common property?
Answer: As your building is attached and shares a common wall then you would be required to obtain building insurance for the common areas and also establish an administration and capital works fund.
The Strata Schemes Management Act 2015 includes special provisions for owners in a two-lot scheme and they include the below:
- Accounts & finance statements are not required to be audited
- A quorum in a two-lot scheme with two owners is always two people entitled to vote
- The strata committee is made up of an owner from each lot
- Owners can obtain their own building insurance for their lot, and be exempt from having a capital works fund if:
- The building in each lot are physically detached;
- No building or part of a building is situated outside the lots; and The owners pass a unanimous resolution for the owners corporation not to have building
- insurance for both buildings and/or not to have a sinking fund.
The above list applies to your property, but we draw your attention to the last point around the insurance and capital works fund.
As your building is attached and shares a common wall then you would be required to obtain building insurance for the common areas and also establish an administration and capital works fund.
However should yourself and the other lot owner decide that you would prefer to not have shared insurance and not establish a capital works fund, then you could hold a General Meeting and pass a unanimous resolution to remove those requirements.
Further requirements for your owners corporation would to hold an Annual General Meeting each year and also have an administration fund established to cover the day to day expenses for the common property which would include the insurance if no special resolution is passed and things like the annual pest treatments, lawn mowing etc.
You are able to find what should be included in an Annual General Meeting and also further information around Strata Schemes with two lots on the Office of Fair Trading’s website.
Jane Giacobbe Strata Reports Victoria & NSW E: info@srvic.com.au P: 0402 341 848
This post appears in the August 2020 edition of the NSW Strata Magazine.
Question: We bought into a duplex a few years ago. We know nothing about the strata duplex requirements. It was not until we moved into our property that our neighbour in the adjoining unit informed us that there is a strata plan and a body corporate.
My husband and I bought into a duplex in Campbelltown in October 2016. We were not made aware by our conveyancer that our property was under strata plan.
It was not until we moved into our property that our neighbour in the adjoining unit informed us that there is a strata plan and an owners corporation.
Before we had a chance to look into this matter further, our adjoining neighbour sold her property. We are now in a situation where there are two new owners in the strata duplex and we do not know anything about the requirements. How do we remove the previous owners from the owners corporation and how do we have the new owners registered? Please help us with this enquiry.
Answer: When a property is purchased in a strata scheme, a Section 22 notice is provided to the Strata Manager once the sale and transfer of title has taken place.
It sounds like there is a problem with the conveyancer / lawyer who acted for the purchaser.
When a property is purchased in a strata scheme, a Section 22 notice is provided to the Strata Manager once the sale and transfer of title have taken place. Every strata plan in NSW has a registered address with the NSW Land Registry Services (previously LPI, previously Department of Land). The conveyancer would normally search this information for you to send the Section 22 notice to the right place.
In this situation, I would suggest you do the following:
- Call your lawyer / conveyancer and ask who the strata manager is (if there is one).
- If there is one, ask have they (the lawyer) sent the strata manager the ‘Section 22 notice’ to advise of the transfer of ownership
- If there isn’t a strata manager, speak to your neighbour and find out if they are the owner. If they are, find out what you need to do regarding the strata matters. Normally for a duplex with no strata manager, the main item to do each year is the insurance if the properties are physically connected and run the AGM.
- If your neighbour is a tenant, find out who their agent is and explain why you need to know the details of the agent (so they don’t think you are ‘dobbing’ them in for something!)
- Speak to the real estate agent and try and get in contact with the other owner so you can organise correct insurances and possibly start setting up some processes around the annual strata meeting (the AGM). There is plenty of information on this website and the internet about what to do. The Office of Fair Trading will also be able to help and this is a free service.
Good luck, I hope this is helpful!
Rod Smith The Strata Collective E: rsmith@thestratacollective.com.au P: 02 9879 3547
This post appears in Strata News #183.
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