The classic situation in which this question is asked is when an owner fails to repair a leak in his or her section and the leak damages a section below. This can result from leaks in balconies, kitchens or bathrooms.
Section 44(1)(c) places the obligation to maintain and repair sections squarely on the shoulders of the owners. The body corporate is only responsible for the maintenance and repair of the common property. If there is no common property between the section that is leaking and the section that is suffering consequential damage, the issue is between the owners and the body corporate has no need to get involved.
However, does the body corporate not have some responsibilities in a situation like this?
Prescribed management rule 70 gives the body corporate the discretion to step in and make repairs to sections if the owners fail in this obligation. The only condition is that the trustees must have given the owner concerned written notice to make the necessary repairs and, after a period of thirty days, the owner has not complied. The body corporate is also entitled to recover the reasonable cost of the repairs from that owner. The question is whether the body corporate should exercise this discretion or not and of course that depends on the circumstances in every case. Here are some suggestions for things trustees might consider when faced with this problem.
Is the intervention in the best interests of the community?
The trustees’ responsibility is to manage the common property for the benefit of all the owners. If the leak in this example in any way threatens the common property or the ability of owners to use the common property, the trustees would be justified in intervening.
Does the body corporate have the money to pay for it?
Body corporate money, even a healthy reserve, results from a budget approved by the owners for specific purposes. Trustees do not have an automatic mandate to use the money for other purposes. Additionally, the trustees need to consider that intervention could result in costs for collecting the repair costs from an owner unwilling to pay, or in arbitration if the owner disputes the trustees’ right to intervene. This would be a further, substantial diversion of body corporate funds from their intended purpose.
Is the body corporate willing to accept liability / guarantee the work that is forcibly done?
What would happen if the body corporate appointed a contractor to make repairs to a section and the repair failed? There is a clear danger that the owners concerned would be entitled to insist that the body corporate deal with the failure at its expense.
The trustees need to be completely objective in these considerations, ignore the status and personalities of the owners involved and concentrate solely on establishing whether intervention is in the best overall interests of the scheme and owners.
Written by Anton Kelly (Paddocks)
Article reference: Paddocks Press: Volume 8, Issue 3, Page 1