Owners Corporation Case Law Update – Smith v Owners Corporation Plan No. RP002839 (Owners Corporations) [2024] VCAT 447
What is the case about?
This case concerns a small 8 lot residential complex in East St Kilda. There are two buildings, each with a stairwell. There is a long history of storage in the common property stairwell areas. Stairwell A services Lots 1 and 2, and Stairwell B services Lots 3 to 8. More recent history has seen communal concern that public access to the stairwell access has created safety and security issues.
The two stairwells have doors with locks that prevent you accessing the stairwells without a key.
The Owners Corporation (OC) is subject to the Model Rules. The Owners Corporation respondent passed three separate resolutions over a two year period in respect to the access to the stairwell and in particular the restriction of keys to only lot owners or occupiers of lots in the stairwell.
The last two resolutions essentially provided:
“It was resolved that the Owners Corporation will only give keys accessing a stairwell door to:
a) owners or occupiers of lots that are serviced by that relevant stairwell;
b) contractors and managers of (a) the Owners Corporation or (b) relevant lot owners/occupiers of the lots in the relevant stairwells; in order to perform their services; or
c) as otherwise approved by the Owners Corporation for any reasonable and lawful reason.”
The Applicant was the owner of lot 8 and he wanted a key to Stairwells A (the stairwell that only provided access to lots 1 and 2). One of the reasons cited was to take shelter in the event of rain and to store his bikes.
The Applicant alleged that the resolutions were either:
- A resolution granting exclusive occupation of the stairwells to certain lot owners and therefore a licence or lease;
- A statutory rule that was not valid as it was not passed as a special resolution and not registered with Land Victoria;
- A resolution that resulted in a significant alteration to the use of common property.
The respondent Owners Corporation argued that none of those applied and the restriction on key issue was for safety and security of lot owners and appropriately within their statutory powers.
What did the Tribunal find?
The respondent Owners Corporation for whom Phillip Leaman and Tisher Liner FC Law acted was successful. The Tribunal dismissed the Applicant’s application. The Tribunal found that the effect of the OC committee resolutions allowed for use of the other common property stairwell with permission from the OC, and this would not be for storage of personal property in those common property areas. The two stairwells in any event have been locked for many years, which already restricted access of owners, occupiers and even visitors to the common property stairwells.
The Tribunal found “the committee’s ordinary resolutions to be a functional process that has now been put in place, that allows this small residential complex, affected by an OC, to operate more harmoniously. There will be keys to the doors for stairwells A and B and only the owners, occupiers, OC manager and contractors servicing those common property areas will have access to these keys. The effect of this is that today all owners and occupiers do not have access to all common property areas unless given permission by the OC. I find this as not a significant alteration of the common property but rather, a code of conduct via valid ordinary committee resolutions that accords with s.4 of the OC Act in respect of the OC managing and administering the common property areas being stairwells A and B.”
What does this mean for other Owners Corporations?
The case reinforces what most Owners Corporations views are which is an Owners Corporation has the power to impose restrictions on keys and security passes to prevent people (including other lot owners and occupiers) from common property in particular situations. A classic example is an apartment building that provides lot owners with an access card that only allows them access to the carpark and their relevant level and no other level.
An Owners Corporation is responsible for the safety and security of the common property.
Owners Corporations should keep up to date key registers, undertake regular key audits, cancel old passes not in use and restrict access to common property areas where it is not appropriate for other occupiers to have access.
Need advice or assistance in a VCAT case?
Contact Phillip Leaman who heads the Owners Corporations team at Tisher Liner FC Law. We have extensive experience in assisting Owners Corporations in drafting resolutions that are enforceable and prosecuting and defending VCAT applications.