Question: I purchased a unit off the plan. On settlement, levies increase by 50%. Is a levy increase of this nature legal?
I signed the contract to purchase a unit off the plan in May 2023 and was told the levy prices. On Dec 23, I received a redisclosure document stating the levies had increased. On settlement, the strata fees increased again to 50% more than the levy quoted when I signed the contract. No notice was given. Is a levy increase of this nature legal?
Answer: If the seller has breached an implied warranty, you may be able to seek damages.
It would depend on the specific circumstances of the matter. Generally speaking:
The seller can vary the disclosure statement (which states the amount of annual contributions reasonably expected to be payable). However, this can only be done by a further statement and is only applicable if settlement has not occurred. This is because the only remedy for an inaccurate disclosure statement is terminating the contract.
However, as settlement has occurred, you may be able to rely on the implied warranties in Section 223 of the Body Corporate and Community Management Act 1997, particularly the warranty by the seller that, as at the completion of the contract, to the seller’s knowledge, there are no circumstances (other than circumstances disclosed in the contract) in relation to the affairs of the body corporate likely to materially prejudice the buyer.
If the seller has breached an implied warranty, you may be able to seek damages. We encourage you to seek specific legal advice.
Katya Prideaux
Mahoneys
E: kprideaux@mahoneys.com.au
P: 07 3007 3753
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