Strata playing hardball on major termite damage

Property folks,

Im interested in your opinions. I have a three storey strata titled townhouse in NSW that I have owned for about ten years. The recent pest inspection showed major termite damage to the property (all three stories and the roof cavity) - not picked up in any previous inspections so this is new. The termites have been killed (as of a few days ago). The place is vacant and we are struggling to get a new tenant because we are being very upfront with any prospective tenant that there will be repairs to the damage (albeit rent will be at 50% during repairs or the lease can be broken with no penalty to the tenant). So, its imperative that we get the repairs done as quick as possible so we can rent it again.

The strata have sent us an email intimating that they will discuss with the committee a "cost sharing" arrangement to repair the damage. Im guessing this will take some time to be decided upon and also, I was under the impression that the strata should be responsible for the damage (excepting the painting and carpet replacement). We are going into this with a very cynical mindset because we have been burned before with this strata in fixing another strata related problem with one of our other properties in the complex. Before I get a strata lawyer involved to ensure we have solid advice, Im just interested in your opinion on what our rights and ways forward could be to get a quick and equitable solution to this problem.

I just feel like Im getting swindled by this strata group again.

Also, just to keep in my back pocket, can anyone recommend a good strata lawyer in NSW that may be able to assist wth issue (if it comes to that) - as much as Id like to avoid going down this track.

Any opinions would be greatly appreciated. They will help me to form a plan of attack to get this issue resolved quickly (hopefully).

Louise

 

They will be doing invasive inspection as the next stage to determine the extent, but it looks like it is mostly external (common property) walls, and Im presuming the roof cavity would also be strata..(??). Also the internal stairs from ground floor up to the first floor are also impacted, but Im not sure if that would be strata or us? The strata has building insurance and we've got contents and landlords insurance.

I guess one of the problems is, who do I turn to to get advice on how this job should be split equitably. Im just very suspicious of this particular strata company (and committee) based on previous experience, and this is going to be one very expensive job.

 

...and an update: I have just called my insurer to find that we are not covered for insect damage. (awesome...)

 

That's not unusual.

 

The strata insurance will also not cover termite damage. So it's all on the strata.

Personally I wouldn't think any off the structural repairs should be at your expense. The paint carpet and even tiling may be.

 

The common property stuff should be covered by the strata.

Who pays for it, strata or their insurer is not your concern, but it needs to be addressed in a timely manner once you have notified the strata manager and/or committee.

You will probably have to foot the bill for the internal stairs and stuff.

To determine the ownership of the roof cavity issue, try letting the strata manager know that (as a courtesy), you are getting quotes on the installation of ducted air-conditioning, and then ask is there a process in terms of Owners Corporation approval that you need to comply with?

If so, ie. "you need a by-law for use of common property/indemnification of OC for maintenance/blah-blah" then your question is answered, and you can get the strata to fix the roof cavity issues as well, since it's common property.

If not, then the bill is yours.

If the Committee dont pull their finger out, then you will need to go to Fair Trading Mediation (Resolving disputes and mediation ), which sounds scary, but isn't.

And, if that doesnt work, then it's time to have a chat to a strata lawyer for some advice, and then to Tribunal for an order for them to pull their finger out.

 

Just a couple of points here:

Responsibility for repair will depend on both the location of the problem and also the cause. If for example you had a courtyard which you are required to maintain, and through lack of maintenance or inspection on your part, termites travelled from your area to the common property causing damage - that would be your responsibility, including repairing the common property at your cost. Same story if termites entered via a pot plant or piece of furniture that you had brought into the building - you would be the cause and would be responsible.

This also means that if termites came from the common property ground and started eating the common property walls, and then travelled into your lot and began damaging your property, you would generally have an action against the body corporate/strata for your loss as a result of their negligence/failure to maintain.

Owners are generally responsible for internal fittings/finishes (i.e. skirting boards) - but if there has been a failure to meet obligations then the liability changes.

Also to the above poster's comment - rather than asking sly questions to ascertain whether the roof structure and ceiling cavity is common property - refer to the strata plans and the legislation - it's a conversation that should be transparent and will need to be understood by all to get a decision.

Lastly, keep in mind that if it is a body corporate issue and the cost of the repairs is over the committee's spending limit, that will take additional time to mobilise for a decision of the body corporate rather than just a few committee members.

Matt

 

Firstly. You own a % share of the property due to your strata interest. Stop thinking its YOU v THEM. Its you v you in reality.

Termite damage isnt insured. EVER. Read a building policy for what is insured.

The strata has responsibility to fix common property. They represent all owners. And YOU have to fund it as well as all your neighbours if the fund has insufficient cash. So until all owners pump in levies to fund the works nothing is going to occur. Those levies are NOT tax deductible unless the work is confined to rectification of damage....Ordinary levies. Perhaps Ord + Special levies need to be increased AND collected before any work starts. These may be deductible.

 

Thanks Matt, but your examples might be contestable in NSW.

The OC is responsible for the maintenance of Common Property. If there is any argument about it, as far as if the lot owner caused it, and if it came from the lot, which is largely irrelevant, then the OC can go to Tribunal, providing expert evidence that "it's the lot's fault..." and then get a Tribunal order to rectify. Normally, the OC would fix it first (given their obligation for "timely" response for maintenance), and then try and recoup some bickies later.

You'll note that their expenses to pursue the lot owner are not recoverable (in NSW), which should provide some clarity to the considerations of the Commitee and/or the OC...

And if the termites came into the lot from from CP then the strata would generally pick up their own expenses, and the lot owner would claim the lot issues from their own insurer. Although, arguably, apparently this is a little ambiguous in NSW, since the introduction of the new SSMA in Nov 2016.

Thanks for referring to me as the "above poster", and my "sly question", sometimes a lot owner, who might not be well versed in "transparent" discussions with strata managers, (and let's face it, strata managers are just there to take instructions from Strata Committees), and their queries, might not be offered the same level of importance and transparency by said strata manger.

ie.the probability of being palmed off is might be higher than not...

Further, you last point about additional time does not seem to provide an appriopriate outcome to the matter being addressed in a timely manner. There's no reason why an EGM cannot be called, if required, to address the matter promptly.

 

The broad responsibilities of strata/owners corporations are generally the same in all states - along with the concept of maintenance, as opposed to damage caused by neglect or negligence.

In this case I think the correct outcome will be for the cause of the termite infestation/damage to be determined by an expert (probably a failed termite protection system) - and then the cost of the repairs should be apportioned 100% to either of the lot owner or strata, depending on who should have been maintaining and inspecting the termite protection system.

It makes no sense to me for the strata to pay for some repairs (external) and the lot owner to pay for some repairs (internal). If a careless driver crashed into my house - I would not agree to fix my house and the driver to fix his car - that just would not be logical. If I've suffered any loss as a result of the negligence or failure of someone else - that person is responsible to make restitution,

And Ted your suggested question to determine whether something is common property or not was sly - and also would not necessarily have resulted in the correct answer. I have plenty of schemes where there is a by-law, easement or DA reason why an air-conditioner would require approval, even within a lot - so that answer may not help the owner. The OP should ask the question directly, and ask for a written explanation of how/why the answer was determined.

Matt

 

First things first.

Get your paperwork in order.

Write a letter to the strata committee immediately, outlining the problem and request that they undertake repairs immediately. For now, take the line that it is their responsibility as termite protection is only effective if carried out for the entire property, not just one townhouse. That gets the ball rolling.

Answer any communication, even phone calls, with a written response. Keep a good paper trail to verify events and ensure you are not playing the “he said” “she said” game.
Marg

 

Hopefully this time I'm on topic, maybe this would help (for NSW Strata):-

https://www.fairtrading.nsw.gov.au/...g-and-property/Common_Property_Memorandum.pdf

and, if I happen to mention in future, an acronym such as SSMA, it means the NSW Strata Schemes Management Act 2015, and nothing else that could cause any hysterics.

And, @Matthew Savage , thanks for your comments, but I disagree with your view, as pertains to NSW strata.

 

Thanks for all of your feedback! A bit of an update. We have found out through previous pest inspection reports that inactive termite activity was recoded in our townhouse with a recommendation to do an invasive inspection. No further action was taken. The pest inspection two years after that came to the same conclusion and also recommended clearing soil away from the common wall of our property - which our PM also recommended. No action taken. The strata then did not complete a pest inspection for another three years (until just recently when all the damage had been spotted). Since this seems to be such a grey area of who is responsible for what, we have decided to engage a strata lawyer to assist us. We just don't know our rights so although it will cost us in fees, we will get clear answers and hopefully have a relatively quick repair time. (Fingers crossed).

 

Ouch. That's gonna hurt.

Someone that's not you.

You, and more likely your Committee, are probably going to learn some stuff about s106 (NSW Legislation).

And maybe your strata lawyer will have a chat with you about Clause 5...

Anyway, good luck.

 

This is going to be a perfect example why strata committee's need to action recommendations from experts, or make sure every owner votes to not follow recommendations.

Obtaining legal advice is an excellent step, you could certainly end up in a position with the other owners where a posible claim in made on the negligent parties, being your strata manager or strata committee.

 

@Lou , any update so far?

 

You need a good strata solicitor.
Strata specialists recently won s106 repairs and maintenance case for us. We also won indemnity costs a stunning result.

 

My pest guy told me that their nest could be as far as 80 metres away, that they travel about a metre underground. I had termites, luckily no damage, a credit to the hardwood used back in Federation times. He applied a foam so that they'd consume it and poison the nest including the Queen, not our Mary. My point is that i think it may be very difficult to figure out where they came from. There's certainly no way insurance would pay for it. In my case it really was neglect by me in not having a barrier system in place which i now do. And so in OP's case i agree with other replies here that OP's strata should have had something in place and made clear with that piece of legislation posted. As an aside my pest guy told me of a 10 year old block of 4 townhouses all having to be demolished due to termites from the roof, but he did say the wood used was cheap, i think treated pine.