Not sure if this should be in the legal subsection. Apologies to moderators if so.
Situation is a block of Perth units built in late 1960s. Six are 2 bedroom units and three are single bedroom.
The strata titling was done in 1976/77. A copy of the strata plan provided at the time of purchase of one unit (by me a few years ago) is stamped "Approved by the town planning board for the purposes of the strata titles act 39 of 1966" and signed by the chairman, dated 1977.
The strata plan has seven equal lots - lots 1 to 6 are each two bedroom units and lot 7 is the three single bedroom units. So lot 7 can only be sold as a single entity, the three separate dwellings.
This strata plan has been in place now for 28 years.
A long term resident of the building advised that years ago the owner of lot 7 (the three x single bedroom units) asked to revise the lot entitlement and their request was rejected by the owners group (body corporate). I have not seen minutes of this but assume they could be found.
Lot 7 changed hands within the last year and the new owners have asked for changes to the units' strata entitlement. The matter is to be discussed soon at a meeting of the owners, as one item of agenda in a normal owners' meeting.
Being three single bedroom units, the value of Lot 7 is, arguably, of the order of twice each of the two bedroom units - although Lot 7's strata entitlement is equal on the strata plan. [Again, approved per 1966 strata titles act, though there is a new act from 1985; that is since the strata plan was registered.]
The new owners have written
The building is located near Perth city in an area that can now have 8 storey residential development. The land is probably worth several million dollars.
My concern is that, broadly, ownership entitlements will change from seven equal lots (1/7 th each) to six equal lots (1/8 th each) and one double lot (1/4).
Lot 7 will increase 11% of the total value from a ~14% share to 25% at the expense of the other 6 lots. This represents a value of several hundred thousand dollars. [11% of total value several million dollars.]
From my perspective this is a very undesirable outcome!
Trying to look at it from the perspective of the owners of Lot 7, I can see that there objectives might seem reasonable to them.
I would really like to understand the likely legal position of this scenario.
I would greatly appreciate assistance on understanding the way forward on this matter.
Also, I am away next week and expect that I can not get online to answer any questions for the week.
regards,
Situation is a block of Perth units built in late 1960s. Six are 2 bedroom units and three are single bedroom.
The strata titling was done in 1976/77. A copy of the strata plan provided at the time of purchase of one unit (by me a few years ago) is stamped "Approved by the town planning board for the purposes of the strata titles act 39 of 1966" and signed by the chairman, dated 1977.
The strata plan has seven equal lots - lots 1 to 6 are each two bedroom units and lot 7 is the three single bedroom units. So lot 7 can only be sold as a single entity, the three separate dwellings.
This strata plan has been in place now for 28 years.
A long term resident of the building advised that years ago the owner of lot 7 (the three x single bedroom units) asked to revise the lot entitlement and their request was rejected by the owners group (body corporate). I have not seen minutes of this but assume they could be found.
Lot 7 changed hands within the last year and the new owners have asked for changes to the units' strata entitlement. The matter is to be discussed soon at a meeting of the owners, as one item of agenda in a normal owners' meeting.
Being three single bedroom units, the value of Lot 7 is, arguably, of the order of twice each of the two bedroom units - although Lot 7's strata entitlement is equal on the strata plan. [Again, approved per 1966 strata titles act, though there is a new act from 1985; that is since the strata plan was registered.]
The new owners have written
- When my wife and I purchased Lot 7 last year we were advised that the unit entitlement was the same as each of the other 6 lots
- The strata title act requires that unit allocations should be allocated in proportion to the value of each of the strata properties. Our lot is worth we estimate twice as much as each other lot.
- The State Administration Tribunal has the power to amend the schedule... A motion passed by the Council of Owners to agree to the application and a determination of appropriate unit entitlements by a sworn valuer is possibly the best way of making the adjustment.
- We have arranged for sworn valuers to conduct an initial review...
- Notice of motion that at the next meeting: the Council of Owners agree to a review of unit entitlements to reflect the Strata Titles Act and that an application be made to State Administrative Tribunal for an order amending the schedule of unit entitlements.
- We are prepared to meet the costs of the valuation and application to the State Admin Tribunal
The building is located near Perth city in an area that can now have 8 storey residential development. The land is probably worth several million dollars.
My concern is that, broadly, ownership entitlements will change from seven equal lots (1/7 th each) to six equal lots (1/8 th each) and one double lot (1/4).
Lot 7 will increase 11% of the total value from a ~14% share to 25% at the expense of the other 6 lots. This represents a value of several hundred thousand dollars. [11% of total value several million dollars.]
From my perspective this is a very undesirable outcome!
- If the original entitlements were all acceptable under the then current strata title can the new owners get the variation changed under the now current 1985 strata titles act?
- Can they have changes even if the other owners do not agree? What if the matter is voted on at the owners' meeting and the motion is rejected?
- Can the other owners easily get some sort of reasonable financial compensation?
- As the owners knew their entitlement when they bought, and should have been aware (from old meeting minutes) that a proposal to change the strata entitlement had previously been rejected, do they have a case?
Trying to look at it from the perspective of the owners of Lot 7, I can see that there objectives might seem reasonable to them.
I would really like to understand the likely legal position of this scenario.
I would greatly appreciate assistance on understanding the way forward on this matter.
Also, I am away next week and expect that I can not get online to answer any questions for the week.
regards,
