This Q&A is about change of ownership and what happens to lot ownership in NSW when the owner dies.
Question: An owner of a lot in our complex passed away 2 months ago. A family member is now residing in the deceased owner’s lot. What happens about the issue of notification and disclosure to the owners corporation?
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The owner of a lot in our strata scheme of two units passed away a couple of months ago. A family member is now residing in the deceased lot owners lot.
Neither the son that is now living there nor the other son which visits each week has given any notice to the owners corporation of any change of ownership.
What are the rules and timelines around the issue of notification and disclosure to the owners corporation?
Answer: Legislation does not comprehensively deal with a deceased’s lot in a strata scheme.
In NSW, generally-speaking, the Strata Schemes Management Act 2015 (SSMA) regulates the day-to-day functioning of a strata scheme whereas the Succession Act 2006 and Probate and Administration Act 1898 deal with the management of a deceased person’s estate. Unfortunately, these pieces of legislation do not comprehensively deal with a deceased’s lot in a strata scheme.
With respect to your specific question, there is an obligation for an owner who acquires a lot in a scheme to give notice to the owners corporation of such interest (section 22(1) of the SSMA), however, there is no time limit imposed. Importantly, a person is considered to have acquired an interest once the lot is transferred into their name.
The only real check in the SSMA is that, without a notice being given, the person cannot cast a vote at a meeting of the owners corporation. This may be all the incentive required for the son residing in the deceased owner’s lot to make arrangements to transfer the lot into his name.
Of course, each situation is different, so if you wish to discuss further, please don’t hesitate to give the team at Bannermans Lawyers a call on (02) 9929 0226.
Jabran Chaudhry
Bannermans Lawyers
T: 02 9929 0226
Suite 702, 2 Elizabeth Plaza
North Sydney NSW 2060
This post appears in Strata News #406.
This recent NCAT Case is relevant: Wang v MacDermott [2021] NSWCATAP 75.
Have a question about change of ownership or something to add to the article? Leave a comment below.
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The information contained in this article is general information only and not legal advice. The currency, accuracy and completeness of this article (and its contents) should be checked by obtaining independent legal advice before you take any action or otherwise rely upon its contents in any way.
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What happens if nothing occurs after the death of the (now deceased) lot owner and the child continues to live in the property. Probate has not been applied for (this is unlikely to occur for some time) and fees continue to accrue. The child would not be concerned about the voting power. Fees are now significant.
How can the OC enforce a judgment against the deceased lot owner? Do they need to make a probate application as a creditor?
Hi Clare
As mentioned above, the Legislation does not deal with this situation comprehensive. It would be best to seek independent legal advice.
We wish you all the best in resolving the matter.
I hear you. I do not like developers. I do not like high rise apartment buildings. I have heard of some owners only agreeing to sell up if the high rise apartment also gave them one apartment as part of the deal. Personally I cringe when there is a new development, which usually means an uptick in crime, shadows, parking issues, traffic congestion, and a lack of the community spirit because people are always coming and going. Then you can imagine the headaches for the Strata Manager.
So long as property prices continue to rise, we are going to see more long-lived residency. Who would have thought that families will now live in apartments, because they cannot afford to buy a house with a backyard.
If a descendant of a deceased estate is prevented from voting at meetings simply because they’re not an owner, it then stymies anything that must be passed ‘without dissent’, because someone must be empowered to vote for the deceased.
Correct. Someone must be empowered. Someone must have been appointed with something akin to a power of attorney (financial) that can make decisions. I would hate to imagine that the property could be empty with no rental $$ coming in for months on end, due to petty squabbles. Though totally depends on the lawyer.
I don’t know much about probate, but if something frustrates me and there’s a loophole in the law, I tend to write to my member of parliament and ask them to have a look into it.
As a non-lawyer, my understanding is that the result of a motion ‘without dissent’ only relates to those who actually vote and then vote ‘NO’.
From LVC says: “[…] Not *all* committees are like this. […]”
But many are, unfortunately, and francine may well be referring to but one owner of but one committee, which is *all* it takes to engender ‘lots’ of despots.
Even when and if probate is ever granted (I have knowledge of probate still not being granted on a deceased estate after a wait of now nearly 10 years, and will likely never be granted until all but one of the deceased’s children no longer survive.), it may be found that one (or both) of these sons mentioned have been bequeathed ‘life tenancy’ of the lot which, whilst ‘it’ does not make them an owner, ‘it’ does provide them with a valid interest in the lot. Such are the joys of living in strata.
What if there are significant delays in the granting of probate and/or the will is contested. In such circumstances, and in any event, is the executor able to vote?
Hi Frank
I would have thought the executor of the will would be able to vote, though needs to show that they’re the executor of the will and can vote on matters relating to deceased person’s assets.
.
Anyway, found this for you:
Have a read here: https://www.flat-chat.com.au/topic/deceased-estate-voting-rights-at-general-meeting/
That’s my take as well. Thank you for the link.
Hi Frank
Todd Garsden from Mahoneys has replied to this question on this post: Question: If a lot owner passed away and there are significant delays in the granting of probate is the executor of the will able to vote?
Sounds like another totalitarian strata scheme with this owner thinking they have rights to another owners personal interests and immediately on death. The SSMA need serious updating to remove this sense of power and entitlement some owners think they have over other owners life and possessions. The only thing in common owners have is common property! Unfortunately some people in schemes think they are running a prison or a boarding school and own everything other owners do in their lives! This was probably a question by a person who suddenly thinks they have jurisdiction over other peoples lives because they are on a committee and suddenly for the first time in their lives think they are important and have control over other people meddling in their affairs and lives!
Francine, see the positive in people! Not all committees are like this. I have found that Committees are only interested in a ‘deceased’ lot if the OC fees are not paid and the upkeep of property is not maintained ie, if they have a private lawn and the grass has grown to an unacceptable level etc. Committees will just have to be patient for the probate to be finalised, and then the interest for the OC fees not being paid on time will be forwarded on to new lot owner.
Albeit, some owners/investors may be interested in buying the lot!