Protecting your Investment
One of the main benefits of owning a unit in a condominium, or strata property, is that maintenance and repairs are shared among the owners. Typically, residents can lock their doors, leave, and trust that the strata council is making sure the building is properly maintained. But what happens when some owners refuse to invest in the necessary repairs? The result can be serious consequences—financially, legally, and for the long-term value of the property.
Different Interests, Different Opinions
It’s common for disagreements to arise over how to spend money on repairs in a strata. For example, owners who rent out their units may be more focused on short-term profits and less concerned about funding long-term repairs. Others, such as those on fixed incomes, may fear the cost of special assessments. There are also cases where a building is made up of both residential and commercial owners, each with different views on the property’s maintenance needs. These differing views can make it difficult for a strata council to get enough support (special assessments require 75% support from owners who attend a meeting) for needed repairs, leaving the property in a state of neglect.
The Legal Risks of Delaying Repairs
While skipping repairs may seem like a way to save money, this can be a dangerous decision. Strata councils have the legal responsibility to keep the property in good condition, even when some owners don’t want to spend money. If the council fails to meet this duty, or if it cannot raise the funds needed through a special assessment, the courts can step in to make sure the repairs are done.
Under the law, owners or groups of owners can take the strata council to court, asking for orders to:
- Declare that certain repairs are necessary.
- Require the strata council to make those repairs.
- Impose a special assessment to fund the repairs, even if the majority of owners disagree.
In situations where the strata council cannot get enough votes to pass a special resolution, the court can order repairs to proceed without the vote. This was confirmed in Santos v. The Owners Strata Plan LMS 1509, where the court ruled that it could force repairs to happen, even if most owners didn’t approve.
Court Orders and the Scope of Repairs
There is a misconception that the court will only order urgently needed repairs that address immediate health and safety risks. However, this is not the case. In The Owners Strata Plan VIS 114 v. Doe, the court ruled that it could intervene even for repairs that are not directly related to health and safety, as long as they prevent further damage or protect the value of the property. “Damage” in this context is understood broadly—it includes not only physical harm to the property, but also potential loss in value.
If the court sees the repairs as necessary, it will allow the strata council to raise funds through a special assessment, up to a specified amount. The court won’t get involved in the specifics of how the repairs are carried out; that will be left to the strata council. However, the court can order that the repairs must happen, and it can set a timeline for the work.
What Happens If the Strata Council Fails to Act?
If it becomes clear that the strata council is unwilling or unable to carry out the repairs, the court has the authority to step in and replace the council with an administrator. This can disrupt the management of the strata and create even more complications.
The Special Resolution Dilemma
Another challenge is that a strata council generally cannot start a legal action without a special resolution passed by the owners. This can create a situation where owners who oppose repairs also block the council from seeking a court order to force the repairs. Fortunately, the Strata Property Act allows the court to make any additional orders necessary to allow the council to carry out its duties, even without the required 3/4 majority vote.
The Hidden Costs of Deferred Strata Property Maintenance
Though it might seem like saving money by deferring repairs is a good strategy, the long-term costs of neglecting maintenance can be far higher. If repairs are neglected too long, the building envelope may be put at risk, necessitating more expensive emergency repairs, or more extensive repairs than would have been required if they had been undertaken sooner. Delaying necessary repairs can also lead to costly legal battles, court-ordered special assessments, and reduced property values. Insurance premiums may rise, and the reputation of the strata can suffer, making it harder to sell units in the future.
Conclusion
For strata councils, property managers, and individual owners, the risks of deferring maintenance are significant. Legal action, court-ordered assessments, and damage to the property’s value are all real threats when repairs are delayed. It’s more cost-effective and safer, both legally and financially, to invest in timely maintenance and repairs rather than face the consequences of neglect.
If your strata council is struggling to get necessary maintenance done because of opposition from owners, or if you are an owner frustrated by the lack of action on important repairs, call us at Ambleside Law for a consultation. Understanding your options and getting legal advice early on can help prevent more costly legal problems down the road and protect the value of your property.