Another NCAT Decision in our Clients’ favour allowing Lot Owners Significant Claim for Losses due to Owners Corporation failure to properly maintain the common property. Proper consideration required as to Facts, Matters and Expert Evidence Required. Possible Adverse effect for Owners Corporation and Existing Lot Owner.

19/01/2026

Common Failures by some Owners Corporation

Some of the most common issues that Owners Corporations fail to address, includes water ingress through defective windows, doors and roof etc and structural issues for example, dangerous retaining walls and balconies.

Adverse consequences include mould, damp, damage to personal possessions, furniture and internal fitting.

Watson & Watson has for in excess of 30 years, advised in relation to circumstances that arise in Strata Schemes, which may lead to a dispute or resolution.  Richard Watson has been personally involved in hundreds of cases in most Courts in New South Wales, including the Supreme Court of NSW and the High Court of Australia. We have seen many changes over the years as to the process, procedures and presentation of evidence including Expert evidence.  We have observed the behaviour of persons involved in disputes and resolution of disputes, which has enabled us to properly assess the appropriate circumstances, likely outcomes and to advise having regard to the facts of the matter, circumstances and our experience. 

Do Not Delay

Considering the matter at the earliest stage, will assist you to come to the right conclusion including timing, preparation and presentation of the appropriate evidence and more likely, to be an optimal outcome for you. Throughout the process this must be reviewed.  Delay in dealing with the matter can be at significant cost to you and others involved.

Lot Owners/Owners Corporations/Strata Committee Members/Strata Managers should not delay in obtaining a review of various obligations, facts and matters which need to be considered, when a dispute is likely to arise.  Do not wait for the dispute to arise.

Owners Corporation’s Failure to Maintain Common Property

Recently we have been involved in another claim by a Lot Owner of a Strata Scheme against the Owners Corporation in the New South Wales Civil and Administrative Tribunal (NCAT) successfully claiming the Lot Owner’s losses, including rectification works and losses as a consequence of not being able to rent out the property, as a result of the Owners Corporation’s failure to properly maintain the common property.  The Owners Corporation were also ordered to pay costs incurred by the Lot Owner.  As in all cases, an Order in your favour is not for the total amount to fully compensate or reimburse you for your costs.

Limitation Periods Extended for Lot Owners to Claim Losses

We refer to our article dated 30 September 2025 relating to the recent increase of the limitation period from 2 years to 6 years in which a claim can be made.  If the claim is not commenced within the limitation period, the claim will not be successful.

It is critical to understand that based on the same facts, there are different limitation periods in relation to the various aspects of the claims that are available. 

Beware of the Limitation Period in which to make a Claim

As happens from time to time, the Owners Corporation delay in adequately considering and resolving the matter.  Do not delay in filing an Application in the appropriate Court or Tribunal within the Limitation Period in which Lot Owners may make a claim for their losses.

As often happens, in recent cases in which we have been acting for the Lot Owners, the Owners Corporation claimed that the Lot Owners’ claims for damage are not payable, having regard to the limitation period having expired.

Reconsider your Claims throughout the Process

If the Owners Corporation’s initial defence is a denial of the claim on various bases as a consequence the Owners Corporation have not fully investigated the matter or otherwise; if later, the Owners Corporation ascertain that their position as set out in their Defence is likely to fail, then it would be appropriate to consider that at the earliest stage and make concessions or offers, rather than maintaining a Defence that is most likely to fail at the Hearing.  The more aspects of the case that are unresolved, the greater and more time consuming evidence will be required, which increases the costs.

Case Preparation

In cases for example, in which the Lot Owner is making a claim, the Lot Owner needs to prepare the case on the basis of what the Owners Corporation states or fails to state in its Defence.  This preparation includes:

1. Prepare and file detailed evidence (in the appropriate form) of factual matters.  We find that once that has been prepared, most often there is little factual dispute on many of those factual matters.  The difficulty is that if such evidence is not filed in the proceedings, then the Lot Owner being the Applicant, will have a significantly reduced chance of being successful on the basis that some facts have not been proven.
2. Similar consideration is required in relation to Expert evidence of the parties.

Consequences of adverse Decision against the Owners Corporation – Unexpected Consequences for Owners Corporation and existing Lot Owners

The Owners Corporation and Lot Owners should attempt to try and resolve the matter as early as possible, as a delay will be costly.  If there is an adverse outcome against the Owners Corporation, Orders will be made against the Owners Corporation.  In addition to the actual costs associated with the dispute, proceedings including satisfying the award (and costs if ordered) against the Owners Corporation, there is reputational damage to the Strata Scheme. 

Strata Inspection Report

Most often when a unit within a Strata Scheme is offered for sale, the Purchaser obtains a Purchaser’s Strata Inspection Report, which is a Report by an independent Expert who undertakes such reports having reviewed the records of the Owners Corporation on behalf of the Purchaser (the Purchaser having obtained consent from the Vendor).  The proposed Purchasers expect such a Report to be available and a refusal to provide a Report or consent, would be adverse to the proposed sale. 

The Strata Inspection Report will disclose issues at the Strata Scheme including claims particularly, successful claims which may indicate maintenance and harmony issues. All this will be reviewed by the proposed Purchaser(s) who obtains such a Report and then is likely to have some adverse effect on the sale price of the Lot.

In addition, there are issues relating to the various by-laws which must be reviewed and carefully considered.

If you are a Lot Owner or a Representative of an Owners Corporation, please contact the experienced Lawyers at Watson & Watson by contacting Richard Watson accredited commercial litigation building and construction stream of the Law Society since 1995.  Please contact Richard Watson’s Personal Assistant Shereen DaGloria to discuss your matter.

The above in our view, is not based on your particular factual matters and it is critical that one considers the factual matters and the law that applies to your circumstances. The above is not to be taken as legal advice to be relied upon, without first contacting Richard Watson as referred to above.

This is only a preliminary view and is not to be taken as legal advice without first contacting Watson & Watson Lawyers on 9221 6011.