Of all the twisted skeins of flawed logic that wind through Strataland, the land grab is one of the most popular, applying ‘common sense’ to common property and coming up with something akin to fraud and theft.
“I have a piece of open ground outside my ground floor window,” goes the thought process, “no one else goes there so I am going to knock a doorway in the wall, stick up some fences, and then I’ll have a backyard for free. Whoo-hoo!”
Permission from the owners corp is obtained by suggesting the other ground-floor owners do the same, the absentee landlords and committee avoiders upstairs aren’t even aware of what’s going on, and suddenly the ground-floor owners have increased the value of their property considerably at their neighbours’ collective expense.
There are other forms of illicit property occupation, of course, such as the extension into the roof space “because no one else can use it anyway” and the ever-popular “I’m parking on the driveway because my garage is full of storage boxes.”
Right now on the Flat-Chat Forum there are examples of all of these being discussed. In one, the ground-floor owners have discovered that the upstairs Juliet balconies are technically common property.
A little knowledge being a dangerous thing, they have generously offered to allow the residents of the flats to use their balconies exclusively, without having to allow neighbours to traipse through their homes for a bit of a lean, provided the upstairs owners let the downstairs mob turn the common area outside their units into front yards.
Nice try, people, but that one isn’t going to fly. A balcony is common property because it is part of the structure and appearance of the building and its neglect could have a serious effect on other owners.
But exclusive use of the balcony is assumed and just because it’s common property doesn’t mean it’s freely available to other owners.
As for the downstairs owners effectively squatting on the common area outside their flats, as many do, putting in gardens and kids play equipment or picnic benches, the other owners need to establish clearly that, even if they are allowing this, the land still owned collectively by the whole building and that permission to have their stuff there can be withdrawn at any time.
It may seem harsh and unneighbourly, especially if there is no free access to the common areas. But if you don’t set the ground rules, you could find yourself in court someday against an angry purchaser who was told that the “yard” was theirs and theirs alone, with the evidence of permanent structures to back that up.
In another example, albeit a more legitimate form of land grab, an owner of 75 percent of the units in his block wants to know what’s to stop him turning a patch of common property into a garden for the adjoining ground-floor flat, since he has the voting power to pass the requisite by-laws to do so.
The answer – local council planning approvals aside – is nothing. However, he can’t do it for free.
Although he has the voting power to make this happen, he is still taking away the other owners’ share of common property and using it for his own benefit and they are entitled to be compensated.
Otherwise it would be, in legal terms, a fraud against the minority. There is a formula for the compensation established in a High Court ruling, which is that the owners corp receives the difference between the old value and the new value of the property, minus the cost of any renovations or paperwork required to formalise the shift of use and ownership.
The unit entitlements should also be adjusted so that the majority owner is paying a bit more, and his neighbours a bit less, to reflect his expanded domain.
Having said all that, there are examples all over the state – and, indeed, the country – where apartment residents have assumed bits of common property without paying anything for it. The strata Act even refers to it in passing as an example of something that isn’t allowed.
Even so, there have also been examples of the Tribunal ruling that it’s OK because of many years of acceptance of the situation without complaint.
So keep a watchful eye on your neighbours and, at the very least, make sure they know that a trip to Bunnings to buy some fencing, planters and a picnic bench does not constitute legal ownership of common property land.
There’s more on this – and more – on flat-chat.com.au.