Strata Dispute – Appeal in the Supreme Court of Western Australia

MPH recently acted for the respondent company in a single judge appeal in the Supreme Court of Western Australia against a decision of the State Administrative Tribunal with respect to a strata dispute. The applicant in the appeal was the strata company.

A central issue in the appeal was whether a relevant by-law conferred exclusive use rights to the occupiers of the residential lots with respect to the special common property on and above the first floor of the building and therefore whether such a by-law was an exclusive use by-law for the purposes of section 43 of the Strata Titles Act 1985 (WA).  In essence, the proper legal construction of s 43(1) of the Strata Titles Act and the relevant by-law in question was the primary focus of the appeal.

The strata company argued that the by-law in question was not an exclusive by-law because, among other things, it did not positively confer rights or privileges and identify the specified lots in the scheme to which exclusive use or special privilege is expressly granted. The strata company asserted that these were essential requirements in order for a by-law to be an exclusive use by-law for the purposes of section 43 of the Strata Titles Act.

The respondent argued that objectively the effect and substance of the by-law was that it did grant special privileges to the owners of the residential lots, which privilege was the exclusive use and enjoyment to special common property on and above the first floor. This was the case even if the by-law was drafted in negative language to confer such rights by a process of exclusion. The Court ultimately agreed with the respondent’s position and rejected the strata company’s arguments.

As the construction points raised in the appeal had not been the subject of previous authority, this decision will likely be used as precedent in other strata disputes of a similar nature.

Michael Sims SC appeared as counsel, instructed by Daniel Murdzoski (Senior Associate), with additional assistance from Greg O’Shannessy (Director).

The published reasons for the decision can be found here.