Can a developer install an air conditioning unit on common property after residents have moved in?

Once the plan of subdivision is registered, all common property is managed and administrated by the owners corporation (OC). This means that decisions about the common property rooftop rest with the OC, rather than the developer. Developers cannot simply install new fixtures or equipment on common property once residents have moved in, unless they are authorised to do so by the OC or under validly registered rules.

When the plan of subdivision is first registered, the developer may also register rules for the OC. Sometimes these rules give the developer special rights, such as the ability to carry out works on common property. The registration of OC rules must be approved by special resolution pursuant to section 138(1) of the Owners Corporations Act 2006 (OCA), which is commonly passed at the first meeting of the OC. Rules may be made on registration of the relevant plan of subdivision under section 27E of the Subdivision Act 1988 (Subdivision Act).

These types of developer rights are generally intended to allow the developer to finish construction and sell apartments without being obstructed by the OC. However, the rules must still comply with the OCA. Specifically, rules must relate to the control, management, administration, use, or enjoyment of common property or lots. If a rule goes beyond these purposes, or is unfairly prejudicial to lot owners, it may be invalid. Once the OC takes over, owners have the power to review these rules and, if appropriate, amend or remove them by special resolution.

In addition to rules, the Subdivision Act provides for implied easements across all lots and common property. Relevantly, section 12(2)(d) provides that easements exist for the passage or provision of air or any substance that is necessary for the reasonable use and enjoyment of a lot, provided it is consistent with the reasonable use and enjoyment of other lots and the common property. This means that services such as air conditioning pipes, ventilation ducts, or cabling may lawfully pass through common property or other lots if they are essential for the use and enjoyment of a lot. However, the exercise of these rights must not unreasonably interfere with other lots or with common property.

Once an air conditioning unit has been installed on common property, the next issue is responsibility for maintenance and repair. Section 129 of the OCA requires each lot owner to properly maintain any part of their lot that affects other lots or common property. More importantly, it requires lot owners to maintain any service that serves their lot exclusively, even if that service passes through or is located on common property. This means that if the rooftop air conditioning unit serves only a single apartment, the relevant lot owner must repair and maintain it. The fact that the unit is physically located on common property does not change this responsibility.

Finally, if the installation of the unit causes damage to common property, the OC may have a claim against the developer and/or the contractor for property damage. The OC may require the responsible party to compensate for the cost of repairs, or the OC may authorise them to carry out rectification works to the common property.