This article is about the Section 155 – Notice to Rectify Breach for VIC Owners Corporations. Whose name do we put on the breach notice? Who can serve the breach notice?
Table of Contents:
- QUESTION: A tenant in our building holds loud parties outside the council hours for residential noise. As the OC Manager only has a legal relationship with the lot owner rather than the tenant, who gets the breach notice?
- QUESTION: When serving a breach notice, can the notice be served via email? I thought it must be served via post to the allocated owner’s letterbox.
- QUESTION: How do we issue a breach notice in a small self-managed scheme? Tenants in one lot keep parking on common property.
- QUESTION: Is the Owners Corporation Committee legally required to employ staff to inspect properties for breaches of guidelines?
- QUESTION: What is the breach notice process and can the Owners Corporation inspect my lot without letting me know?
Question: A tenant in our building holds loud parties outside the council hours for residential noise. As the OC Manager only has a legal relationship with the lot owner rather than the tenant, who gets the breach notice?
Answer: the OC can and should breach an occupier/tenant directly when OC rules or regulations have been breached.
You are correct in your understanding that an OC Manager only has a legal relationship/responsibility to the lot owner/s. However, the OC Act permits the owners corporation to breach a tenant directly. This must be done correctly, in writing and using the approved form.
Section 152 of the Act states that:
A lot owner or an occupier of a lot or a manager may make a complaint to the owners corporation about an alleged breach by a lot owner or an occupier of a lot or a manager of an obligation imposed on that person by this Act, the regulations, or the rules of the owners corporation.
So, a prescribed breach notice provided and forwarded by the owners corporation can be addressed directly to the offending tenant bypassing the OC Manager. The OC must keep a record of the breach notice (and all other notices) issued.
When issuing a complaint form or breach notice, the below steps found under section 155 must also be followed.
- A notice must specify the alleged breach and require (in this case) the tenant to rectify the breach within 28 days.
- The owners corporation must also give the lot owner a copy of the breach notice. The notice informs the owner of their tenant’s behaviour but will also assist the owner and their rental property manager in promptly addressing the issue with the occupiers.
In summary, the OC can and should breach an occupier/tenant directly when OC rules or regulations are breached and must also inform the lot owner by issuing them a copy of the notice for their information and record keeping.
Guy Garreffa
StrataPoint
E: [email protected]
P: (03) 8726 9962
Please note that the information contained in this article is not legal advice and should not be relied upon as such. You should obtain legal advice or instructions before you take any action or otherwise rely upon the contents of this article.
This post appears in the April 2023 edition of The VIC Strata Magazine.
Question: When serving a breach notice, can the notice be served via email? I thought it must be served via post to the allocated owner’s letterbox.
Answer: It is acceptable and legal to issue a Notice to Rectify Breach via email.
Yes, it is acceptable and legal to issue a Notice to Rectify Breach via email.
The requirements for issuance of the notice are detailed in Section 158 of the Owners Corporations Act 2006. The recent amendments to the Act in December 2021 now allow notices to be served electronically (see ‘Note’ contained in Section 158).
Callum Wilson
Bright & Duggan
E: [email protected]
P: 0427 339 980
This post appears in the November 2022 edition of The VIC Strata Magazine.
Question: How do we issue a breach notice in a small self-managed scheme? Tenants in one lot keep parking on common property.
How do we issue a breach notice if we don’t have an owners corporation? I’m 1 of 4 units and we are self-managed.
I’m having issues with tenants from the lot next door blocking the driveway. I’ve had to speak to them over 20 times but they just keep parking there or make up excuses as to why the car is parked there.
Answer: Part 10 – Dispute resolution of the Act relates to how to manage your issue.
I must correct you – you do have an owners corporation. This was created when the plan of subdivision was registered. As such you are required to adhere to the Act, Rules and Regulations, regardless of whether you are self-managed or not.
You may consider engaging a professional and impartial manager, as they would ensure good governance and transparency.
As an owners corporation you are bound by Part 8 section 139 – The Model Rules.
Further section 141 which outlines that all owners are required to adhere to the Model Rules.
Please see Part 10 – Dispute resolution of the Owners Corporations Act 2006, as this relates to how to manage your issue.
Stratabase Holdings
E: [email protected]
P: 0412 247 589
This post appears in the September 2022 edition of The VIC Strata Magazine.
Question: Is the Owners Corporation Committee legally required to employ staff to inspect properties for breaches of guidelines?
The OC Committee employed two staff members (at a total of 25 work hours per week) whose salaries are being paid for by the Lot Owners through their annual levy. Their responsibilities are to drive around the estate taking pictures of gardens, letterboxes, bins etc; then issue breach notices and follow up to resolution. This results in a hike in the annual levy which is incurring the wrath of lot owners.
The Lot owners are calling for these staff positions to be abolished in order to reduce levies. Are Lot owners within their rights?
Answer: It is prudent and proper that the OC gathers evidence of the alleged breach.
Section 9 of the Owners Corporations Act 2006 (OCA) empowers an Owners Corporation (OC) to appoint or employ persons to assist the owners corporation in carrying out its functions.
It is a function of the OC to enforce its rules. Where a formal written complaint is made, or it otherwise comes to the attention of the OC that a lot owner or an occupier of a lot may have breached the OCA, Owners Corporations Regulations 2018 or the rules the OC must decide—
- to take action in respect of the alleged breach by issuing Notice of Breach; or
- to apply to VCAT for an order requiring the person to rectify the breach; or
- to take no action in respect of the alleged breach.
OCs must be very cautious when deciding to take no action, as it may render them negligent or in breach of the statutory duty of due care & diligence.
The OC must not issue Notice of Breach or apply to VCAT for an order in respect of an alleged breach unless it believes on reasonable grounds that the person has committed the alleged breach.
For those reasons, it is prudent and proper that the OC gathers evidence of the alleged breach.
The OC must also tread warily when considering whether to terminate any contract. If the staff members are employees of the OC they will benefit from the protections conferred in employment law. If the staff members are contractors the OC may fundamentally breach the contract by terminating the staff members, leaving it exposed to claims for damages for breach of contract.
Tim Graham
Bugden Allen Graham Lawyers
E: [email protected]
P: 03 9086 5832
This post appears in the August 2021 edition of The VIC Strata Magazine.
Question: What is the breach notice process and can the Owners Corporation inspect my lot without letting me know?
I built a garden without knowing it was on common property. The Owners Corporation inspected my lot without informing me or organising access. They issued me a breach without any notice. What is the breach notice process and can the Owners Corporation inspect my lot without letting me know?
Answer: Section 155 of the Owners Corporations Act stipulates the breach process
Upon settlement in an Owners Corporation (OC) you should have received a copy of the Model rules and any Registered Rules if applicable. The rules of an OC are binding on the Owners Corporation, lot owners, any lessee or sub-lessee of a lot and any occupier of a lot.
Installing a garden on common property, without written approval from the Owners Corporation is in breach of Model Rules 4.1 and 4.3.1.
Under the model rules, rule 4.1 stipulates:
- An owner or occupier of a lot must not obstruct the lawful use or enjoyment of the common property by any other person entitled to use the common property
- An owner or occupier of a lot must not, without the written approval of the owners corporation, use for the owner or occupier’s own purposes as a garden any portion of the common property.”
In conjunction with rule 4.1.2, model rule 4.3.1 would also apply in this instance:
“An owner or occupier of a lot must not damage or alter the common property without the written approval of the owners corporation.”
Without knowing the particulars of your individual property (and the route by which the inspection was undertaken), as far as entering the lot without your permission, as the garden is on common property, the Owners Corporation has the right to inspect it at any time.
Section 155 of the Owners Corporations Act stipulates the breach process:
Notice to rectify breach
- If the owners corporation decides to take action under this Part in respect of an alleged breach, it must give notice of the allegation to the person alleged to have committed the breach.
- A notice must specify the alleged breach and require the person to whom the notice is given to rectify the breach within 28 days after the date of the notice.
- A notice under this section must be in writing in the approved form.
- If the person alleged to have committed the breach is an occupier of a lot affected by the owners corporation, the owners corporation must give a copy of the notice to the lot owner.
If the person to whom notice is given does not rectify the breach within 28 days, under section 155 the Owners Corporation may decide—
- to give the person more time to comply with the notice; or
- to give the person a final notice; or
- not to proceed with the action under this Part.
Your only avenues would appear to be either removing the garden and returning the common property to its previous state, thereby complying with the breach notice, or petition the Owners Corporation to raise a special resolution to have the garden retrospectively approved (and the garden could be allowed to stay if the special resolution were passed).
A special resolution requires 75% of owners to vote in favour of the special resolution for it to pass.
In future, it is recommended that the owner contact the Owners Corporation prior to any works being carried out to confirm the responsibility of the area and for a copy of the plan of subdivision which shows areas of common and private property.
Mark Weiler and Alice Ferré
The Knight
Email
This post appears in the June 2021 edition of The VIC Strata Magazine.
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Read next:
- VIC: Upcoming OC Act changes for Committees to be aware of
- VIC: How an Owners Corporation Can Handle Incorrect Parking
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With regards to dealing with tenants parking in common property, There’s no Body Corp. The managing agent of the unit, has had no luck in having the tenants comply and stop parking there. I’ve contacted the unit’s owners a couple of times asking them to work with me in formulating a breach notice but after they contacted their estate agent, they’ve advised me there’s nothing more they can do on the matter. I feel completely let down by the other owners of the 2nd lot with this matter … it’s left with me to deal with on my own. There’s no Body Corp but I believe we’re an OC, How am I supposed to act as an OC, if the owners are not interested or willing to help me with this issue. The owners seem to believe they don’t have to do anything about it and just handball it to me. Is this correct? Can they do this, as it just does not seem fair? Do I have to seek legal advice at my cost, when I’ve emailed the owners on several occasions asking them to work together to resolve it. I’m living with this issue daily for 15 months now. Please help guide me to what steps I take next?
There is always an owners corporation associated with multi-lot developments having three or more units (there are, if I remember rightly, special rules for two-lot developments. Please note that I am not a lawyer; these comments are off the top of my head, and you should verify the details for yourself instead of relying on what I have to say.)
If the development is self-managed, it seems that you are de-facto the chair of the committee for the OC. It usually ends up being the case that a small number of people within a development end up carrying the burden, rather than it being shared amongst all owners.
So the first step I would take, were I in your shoes, would be to look at the current state of the OC committee: meetings, minutes, who’s been elected to what positions, etc., etc. If there haven’t been such meetings, then there’s the possibility that the owners (collectively) are in breach of their legal obligations, and I would strongly suggest seeking legal advice to cover yourself before working to rectify that situation.
Once the committee situation has been cleared up, you should be in a better legal position to seek the issuance of a formal breach notice, which is pretty much the only option available if the owner and tenant aren’t willing to work with you on an informal basis. Point is: if you need to go down that path, you need to protect yourself and make sure that all of the legal formalities are covered off, else you risk personal liability. You might be able to get some traction by speaking with the owners of the other units (ie: not the one that is causing the problem), depending on how they feel about the situation. Remember: all four owners, not just you, are part of the OC – even if it’s an informal setup. Three owners working together can get a lot done even in the face of an intransigent fourth owner, but the critical thing is making sure all of the formalities and documentation have been covered off; you can’t afford to just shoot from the hip on this.
When people are willing to work together cooperatively, the informal arrangement can work well. But when that breaks down, it’s unfortunately necessary to dot all the i’s, and cross all the t’s, and that may mean a lot of work to resolve what should be a simple matter. I feel for you, I really do; I’m in a similar position with my development, but fortunately I’m not the only person on the committee who’s irritated by the visitor parking being used by residents, so we’re pushing to get traction on the problem. It does help that we have a formal strata manager that can mediate the process.
Good luck. It’s unfortunately a lot harder than it should be, but it seems that your choice is to either do that work, or just accept the situation. Neither option is great, I acknowledge that.