This question about exclusive use or special privileges bylaws has been answered by Elizabeth Florence, Abode Strata.
Question: A considerable portion of common property has been annexed for the Exclusive use of 1 particular unit. Is it usual for no money or entitlements to have changed when this occurred?
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I own a strata storage unit.
Back in 2008 just after the Strata Plan was issued a considerable portion of common property was annexed, by a rule change, for the “Exclusive use” of 1 particular unit. That area was subsequently enclosed by a wall and effectively now forms part of that unit owners Lot which is leased by a business.
Going by the original Strata Entitlement information, the acquisition of that area of Common Property has not changed the lots Unit entitlement and I am unable to ascertain whether there is, or has ever been, any remuneration by way of increased portion of Levy or ex-gratia payment to the Body Corporate?
From my reading of documentation, it would seem that there has been no charge at any time for the annexure and use of this area and all owners are paying levies based on the total area of Common Property even though we have no access or use of the subject area.
My question – is there any obligation for this lot owner to pay rent, or a levy for the use of this area? I can find not mention of any consideration being discussed at the time of the rule change and it was done very early on when the developer and partners were the sole or majority owners.
Answer: It is possible to create bylaws granting individual lot owners exclusive use and enjoyment of, or special privileges in respect of, common property or any part of it.
In brief, the rights as provided by Exclusive use bylaws are not the same as ownership and therefore unless identified as otherwise within a bylaw no fee or levy is payable to the Strata company for the use of that lot.
19.5 Exclusive use or special privileges bylaws See section 42(8) of the Act
It is possible to create bylaws granting individual lot owners exclusive use and enjoyment of, or special privileges in respect of, common property or any part of it.
Such by-laws will usually require a clear sketch plan of the relevant part of the common property and may be subject to conditions, including obligations to maintain and repair the relevant part of the common property or may be made subject to a payment or a combination of conditions and payment.
A proprietor who would have the benefit of such a by-law must give written consent to the adoption of the bylaw (see section 42 (8) STA).
To pass a by-law relating to exclusive use and/or special privileges in a two-lot scheme a unanimous resolution is required and in any other scheme, a resolution without dissent is required.
Proprietors granted exclusive use are responsible for the repair and maintenance of their exclusive use area, unless the by-law states otherwise (see section 42(11)(b) STA) 19.5.1 “For the use of” statements on strata plans
Some strata plans have notations indicating certain areas are “for the use of” particular lots.
These notations do not have any effect, unless an exclusive use by-law has been lodged to support them. To lodge an exclusive use by-law, generally the document will require a suitably dimensioned sketch plan to support the proposed by-law (note: the sketch on the strata plan cannot be used). The sketch plan is usually prepared by a licensed surveyor.
Following is the typical process for seeking a Exclusive Use bylaw:
- seek advise from an industry consultant or solicitor to obtain or prepare a dimensional sketch or detailed description of the area of common property to be affected
- apply to the Strata Council seeking application
- Obtain the prior written consent of the proprietor’s concerned – Strata Company
- The Strata Council will need to give notice of a general meeting which will consider the proposed RWD (Resolution without dissent) for the making of a Schedule 1 By Law and,
- Once the resolution is passed and becomes unconditional, the By Law is to be registered at Landgate within 3 months of the date of the meeting.
NOTE only those grants of Exclusive use which are registered on the plan as an encumbrance either as a “Notification of change of By Laws” or a “Management statement” have effect. Always refer to the Strata Plan and Annexure, if the by laws are not listed on the Strata Plan Annexure then they are not effective.
This post appears in Strata News #172.
This information is not intended to be personal advice and you should not rely on it as a substitute for any form of advice.