Strata Headache? Massive Change to Damages Claims in Strata

Strata owners across NSW now have six (6) years to claim damages when their owners corporation fails to repair and maintain common property.

This massive legislative change to section 106(6) of the Strata Schemes Management Act 2015 (NSW) (SSMA) significantly strengthens the rights of lot owners.

Owners previously only had two (2) years to bring a damages claim under the SSMA.

Understanding Section 106 Obligations

Under section 106 of the SSMA, an owners corporation has a strict legal duty to properly maintain and repair the common property.

When the owners corporation fails to do so, lot owners can:

• Apply to the NSW Civil and Administrative Tribunal (NCAT) to obtain orders to compel the repairs, and
• Claim damages for reasonably foreseeable losses, such as lost rent or temporary accommodation costs.

What Has Changed?

Previously owners only had two (2) years from when they first became aware of the loss to commence a claim for damages. This short limitation period caused a multitude of disputes over whether certain claims were within or outside the statutory time limit. Owners who missed the deadline were often forced to pursue alternative legal action in the Local Court, relying on causes of action like negligence or nuisance. However, this increased time, complexity and cost.

The recent amendment of the SSMA now extends the time limit to six (6) years, allowing owners more flexibility to consider their legal options and pursue NCAT proceedings without facing premature time bars.

Implications for Owners Corporations

The longer limitation period increases the exposure risk for owners corporations. If they delay repairs, they may face substantial damages claims, especially in cases involving extended loss of rent or prolonged displacement.

As a result, this change encourages owners corporations to respond promptly to repair requests and maintain detailed maintenance records as means to attempt to avoid potentially costly legal disputes.

Strata Problems Don’t Fix Themselves— Luckily, We Do.

At Madison Marcus, our Real Estate & Property Divisions provides start-to-finish support, strata law included, so you have one expert team for every stage of your property needs. We focus on solving matters quickly and cost-effectively, letting our results speak for themselves. From Sydney to Parramatta and across regional NSW, we deliver tailored legal advice and practical solutions to protect your investment and your peace of mind.

Our Strata Law & Community Living division team has deep experience acting for both lot owners and owners corporations in disputes involving all aspects of the SSMA. We understand the technical, legal, and practical complexities involved in strata claims across NSW. If you need advice or representation in a repair dispute, or if you want to proactively manage your strata obligations, we are here to help.

External References & Resources:

• NSW Legislation – Strata Schemes Management Act 2015 (Section 106): Direct source of the legislation, including the amended s106(6).
• NSW Civil and Administrative Tribunal (NCAT) – Strata and Community Schemes: Guidelines on how to file disputes and what the Tribunal can order.
• NSW Fair Trading – Strata Living Guide: Official government information on the rights and duties of owners corporations.
• Strata Community Association (NSW): Industry body providing updates and resources for strata owners and managers.