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Do I own the ground under my lot or is it common property?
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madmother
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09/02/2018 - 1:44 am
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Hi 

I bought into a 2-lot single tier built strata scheme in WA late last year.  Shortly after moving in, my neighbour suggested that we erect a fence across the garden area between our driveways and then register a bylaw stating that either side of the fence is for the exclusive use of each respective lot.  However, we can’t agree on where the fence should go.  
 
Some info:
– unit entitlement is 1:1
– the total block is 1,046 m² 
– the floor plan indicates that my lot is 92 m² and my neighbour’s lot is 102 m² (ie 10 m² larger)
– lot boundaries are the external surfaces of the buildings.
– there are no exclusive use areas specified on the plan and only the standard bylaws apply. 
– the scheme is on a corner block and the two lots have different street addresses and separate driveways.
– there is a large garden area at the junction of the two streets that we are supposed to jointly maintain.
– the two houses share a roof and only the garages (common property) have a common wall.
 
– there is a existing fence that separates the two back yards (not shown on strata plan) and my neighbour’s back yard is larger than mine
– the front yards are partially enclosed (also not shown on strata plan) and are approximately the same size.
 
 
We would like the new fence to divide the land fairly so that the lots would be close to the ‘correct’ size should we convert to survey-strata at a later stage. 
 
I have suggested that as the total block size is 1,046 m² and our unit entitlement is 1:1, that each owner should get approximately 523 m².
 
My neighbour is adamant that because her house is larger that she should get 528 m² and I should get 518 m².  Calculations: 1,046 m² – (92+102 m²) = 852 m² divided by 2 = 426 m² land. Therefore 518 m² (426 m² + 92 m²) for me and 528 m² (426 m² + 102 m²) for her.
 
So my question is…
Do I own the land beneath my foundations or is that ground common property? 
 
I do realise that the final survey-strata boundary line would be determined by mutual consent and not unit entitlement, but I wouldn’t want to give away precious square metres if I don’t really have to.
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JimmyT
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09/02/2018 - 8:21 am
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Not being familiar with WA strata law, I would guess – and it is a guess – the answer to your question is no, you don’t exclusively own the land under your house.

Thinking of digging a cellar … or opening a mine?

The real question is, however, why your unit entitlements are 1 to 1 when they probably should be 92/194 and 102/194 (47.4% and 52.6%) especially since your neighbour wants the land divided that way.

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madmother
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09/02/2018 - 9:35 am
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Thanks JimmyT.

Back in 1984 the developer probably thought that a 1:1 entitlement was a brilliant idea. My neighbour (who has owned her lot for 30 years) is clueless about strata. She probably has no idea that it is possible to change unit entitlement.

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JimmyT
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09/02/2018 - 12:41 pm
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Well, there’s your leverage over the fence.  If she wants more, she pays more.

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Lady Penelope
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09/02/2018 - 8:26 pm
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madmother – The unit entitlement of 1:1 indicates that the developer considered that:

(1) the value of the Lots was relatively equal at the time that the strata plan was registered (not the current value) , and/or

(2) 2 Lots scheme’s Lot entitlements should generally be kept equal to prevent one Lot effectively gaining greater control than the other Lot.

Just because your neighbour has a larger internal space than you do it does not follow that your neighbour should have a greater share of the common property. In fact, in my opinion the reverse is true.

You could argue that your neighbour should actually be granted less exclusive yard space than you to offset your different sized internal spaces i.e. the larger internal space is offset by a smaller external space to make the Lots more equal in value. 

Unit entitlements reflect the burden placed on each owner to provide funding for the repair and maintenance of the common property areas such as the roof, exterior walls etc. Those parts of the building that are not common property do not create burdens on other Lot owners. Each owner is generally responsible for their own internal maintenance, regardless of the respective sizes.

A larger internal space usually equates to a larger common property roof area over your neighbour’s Lot which creates an unequal maintenance burden on you should the roof ever need replacing. Depending on the WA Act, the exterior walls, even those contained within the proposed exclusive use areas could also be regarded as common property. A larger internal area usually equates to a larger external common property wall area.

For your neighbour to add a larger external space to an already larger internal space could possibly create an “unreasonable” imbalance to the 1:1 unit entitlement. This would be in favour of your neighbour and would be to your detriment.

At the very least your external spaces should be equal, but there is an argument that you could mount that your external space should be greater to compensate for the unequal internal spaces.

You may need to speak to a property valuer to work out the best formula for creating equal value within your scheme, taking into account both the internal spaces and the proposed external spaces of both Lots.

NB: Please be aware that the Tribunal is probably unlikely to change the entitlement as the Tribunal would be loathe to give your neighbour a greater voting power and greater control than you in your 2 Lot scheme. 

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madmother
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09/02/2018 - 9:00 pm
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Lady Penelope, thank you for your informative answer and for all those great suggestions.  You really know your stuff!

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