This article is about a VCAT case where a lot owner was ordered to remove a hot water system installed on a neighbour’s private property and relocate it lawfully.
So what is the case?
The case is Fok v Chen (Owners Corporations) [2025] VCAT 679
What is it about?
This proceedings was a dispute as to whether a lot owner was entitled to install their hot water service in another lot owners private lot.
This case involved a dispute between Ellen and Billy Fok, owners of Unit 4 in a 1970s suburban development, and their neighbour Huizhen (Lily) Chen, owner of the adjacent Unit 3. At the heart of the matter was the placement of the Foks’ hot water system, which had been installed—without consent—within the boundaries of Ms Chen’s private car park space.
Complicating matters was the broader issue of fences and sheds erected by various lot owners over common property, a problem not uncommon in aging Owners Corporations that haven’t adapted to modern living arrangements.
While the Foks’ hot water system had been in place for years, it came under scrutiny after Ms Chen attempted to sell her unit in 2022, marketing it as having a “fully fenced backyard.” The Foks objected to this claim, and Ms Chen eventually withdrew the listing. Ms Chen decommissioned the Foks’ hot water system, prompting further legal action.
The Foks brought proceeding OC307/2023 seeking compensation and broad orders including the removal of fencing across the development. Ms Chen counterclaimed (OC146/2025), seeking removal of the hot water unit from her title.
VCAT made an order requiring Foks to remove their hot water system from Ms Chen’s private property and relocate it lawfully – either onto their own land or onto common property with the Owners Corporation’s consent.
So why did the Tribunal make the order?
The trespass was clear, evidence, including site plans and photos, showed the hot water service was well within Ms Chen’s private lot car space.
The Foks’ argument that others were also unlawfully using common property (e.g., fencing off backyard space) did not excuse their own trespass.
The Owners Corporation had moved to grant 99-year peppercorn leases to regularise existing fenced areas of common property which was an appropriate remedy.
In an interesting statement the Tribunal said: “In the absence of any legal authority being cited to me, establishing that peppercorn rental leases can only be used in an Owners Corporation environment if all lot owners ‘receive’ an equal area of common property for the private use, I must reject Edwin Fok’s argument.”
TheTribunal noted the Foks could relocate their hot water unit to the front of their unit, where an air conditioner was already installed, and obtain a similar lease from the OC.
This case underscores the importance of clear delineation between private and common property, particularly in older subdivisions. It also illustrates how Owners Corporations can use lease mechanisms to resolve long-standing encroachments without forcing widespread demolition of backyard improvements.
Importantly, the Tribunal rejected the argument that one party’s unlawful use of land does not justifies another’s.
Takeaways for Owners Corporations and Lot Owners
- Encroachments onto common or private property should be regularised through formal leases, not informal agreements or inaction.
- Lot owners must not assume that long-standing use of land creates a legal property entitlement.
- Owners Corporations can and should act proactively to address safety, legal compliance, and access issues.
- Legal action can be avoided through transparent communication and clear governance protocols.
Need advice or assistance in a VCAT case?
Contact Phillip Leaman who heads the Owners Corporations team at Tisher Liner FC Law. We have extensive experience in assisting Owners Corporations in prosecuting and defending VCAT applications and providing advice concerning the operation of the Owners Corporations Act 2006 and giving opinions on the interpretation of plans of subdivision setting out what is private lot property and what is common property.
Phillip Leaman
Tisher Liner FC Law
E: ocenquiry@tlfc.com.au
P: 03 8600 9370
This post appears in Strata News #782.
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This article has been republished with permission from the author and first appeared on the Tisher Liner FC Law website.
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