The horror of living in Communal Housing: How laws makers scrambled the laws in Victoria, Australia, Part 1.

The horror of living in Communal Housing: How laws makers scrambled the laws in Victoria, Australia, Part 1.

by tonytran2015.

Why should people with small budgets for housing have to put up with this legal mess?

A typical problems:

Owners Corp Act 2006 06-69aa019 (of Victoria, Australia, authorised version) has been made to govern the living in close proximity and promote harmony of millions of people in the state of Victoria, Australia.

People are encouraged to buy into units/apartments/flats which are mostly individual parts of any one of many Owner Corporation and share common properties with other units/apartments/flats of the same Owner Corporation. In 2017, 16% of Australian dwellings are of communal type, which are flat/apartment/unit (Ref. [4]). The percentage may be higher at present time.The Owners Corp Act 2006 is there to protect their rights and specify their duties in being parts of some Owner Corporations.

Then they discover that Section 47 subsection (1) of the Act reads:

47 Owners corporation must repair and maintain services
(1) An owners corporation must repair and maintain a service in or relating to a lot that is for the benefit of more than one lot and the common property.

Problems:
Which of the following is meant by Section 47?

1. An owners corporation must repair and maintain [a service in or relating to a lot that is for the benefit of more than one lot] and [the common property].
–>>An owners corporation must repair and maintain both the common property and any service in or relating to a lot that is for the benefit of more than one lot.(This is what most owners expect.).

or

2. An owners corporation must repair and maintain a service in or relating to a lot that is [for the benefit of more than one lot] and [the common property].–>>An owners corporation must repair and maintain a service (in or relating to a lot) that is the common property and for the benefit of more than one lot. (This is confusing for lot owners as the service must have been declared common property before being entitled to any repair and maintain at all)(“Section 47(1) however is difficult to reconcile…, see [2] ).

or

3. An owners corporation must repair and maintain a service in or relating to a lot that is for the [benefit of more than one lot and the common property].
–>>An owners corporation must repair and maintain a service in or relating to a lot that is for the benefit of more than one lot in addition to the benefit of common property (This is the worst meaning for lot owners and is what a vexatious corporation manager would say to avoid having to repair and maintain anything at all).

Possible routes for owners having disputes:

1. Lot owners may have to consult lawyers for the most acceptable meanings. This costs them money ($4000) but still provides no certainty of being correct.

2. Lot Owners may apply to Victorian Civil and Administrative Tribunal for a more certain explanation but Lot Owners may have to follow up any appeal in Court of Appeals for a 100% certainty (This costs $10,000).

Most likely explanation of the meaning:

There is an Interpretation of Legislation Act 1984 No. 10096 of Victoria, Australia. It’s section 35 states:

35 Principles of and aids to interpretation
In the interpretation of a provision of an Act or subordinate instrument—
(a) a construction that would promote the purpose or object underlying the Act or subordinate instrument (whether or not that purpose or object is expressly stated in the Act or subordinate instrument) shall be
preferred to a construction that would not promote that purpose or object; and
(b) consideration may be given to any matter or document that is relevant including but not
limited to—
(i) all indications provided by the Act or subordinate instrument as printed by authority, including punctuation;
(ii) reports of proceedings in any House of the Parliament;
(iii) explanatory memoranda or other documents laid before or otherwise presented to any House of the Parliament; and
(iv) reports of Royal Commissions, Parliamentary Committees, Law Reform Commissioners and
Commissions, Boards of Inquiry, Formal Reviews or other
similar bodies.

Applying the rules of this Act, interpretation 3 requires the Owners Corporation to maintain and repair almost nothing as there are very few services that serve common property and two more units.

Combining this interpretation with its following section 47A subsection (2), the result is an absurd conclusion that any waste pipe servicing more than one unit will neither be maintained by Owner Corporation nor individual owners.

47A Lot owners must not repair, alter or maintain common property or services

(2) A lot owner must not repair, alter or maintain—
(a) the common property of the owners corporation; or
(b) a service in or relating to a lot that is for the benefit of more than one lot or the common property.

Applying the rules of this Act, interpretation 2 requires the Owners Corporation to maintain and repair only services that had been declared common property. What would happen to shared plumbing pipes that are not in the list of common properties? Often 2 units vertically on top of each other share common waste pipes which run in the cavity walls separating these two units with two horizontally adjacent units. The pipes are not in the space of common property, they serve two units but they don’t serve any common property. Are they to be maintained and repaired by OC? This explanation leaves an ambiguity.

Applying the rules of this Act, interpretation 1 requires the Owners Corporation to maintain and repair both the common property and any service in or relating to a lot that is for the benefit of more than one lot. This explanation is harmonious with the corresponding rules in populous neighbouring jurisdictions NSW and QLD. It promotes certainty for lot owners, fitting with the aim of making lot owners only responsible from their point of connection to services, like owners of stand alone houses.

So it would be expected that explanation 1 prevails. But as always in laws, nothing is certain until it has been clearly stated by legislations, rulings by the highest Court.

Conclusions:

The problem could have been avoided just by switching a few words around in the written legislation, saving millions of dollars in legal costs but it appeared that laws makers had not done it. It appears that they had deliberately created it that way to generate otherwise avoidable legal works.

This work is NOT about legal interpretation, it is about the confusion imposed by law makers on working people.

Why should people with small budgets for housing have to put up with this legal mess?

References

1. Owners Corp Act 2006, Act number 69/2006 Version 019
06-69aa019 (of Victoria, Australia, authorised version),
https://www.legislation.vic.gov.au/in-force/acts/owners-corporations-act-2006/019.

2. https://www.tved.net.au/index.cfm?SimpleDisplay=PaperDisplay.cfm&PaperDisplay=https://www.tved.net.au/PublicPapers/August_2012,_Sound_Education_in_Law,_Disputes_Between_Lot_Owners___OCs_Regarding_Defects___Repairs.html

3. Interpretation of Legislation Act 1984, Act number 10096/1984 Version 130, https://www.legislation.vic.gov.au/in-force/acts/interpretation-legislation-act-1984/130

4. https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/2071.0~2016~Main%20Features~Apartment%20Living~20

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