Pullicin and the jurisdictional maze of s106 (5) claims

s106 damages strata

In The Owners—Strata Plan No 74835 v Pullicin and The Owners—Strata Plan No 80412 v Vickery [2020] NSWCATAP 5 the Appeal Panel, constituted by the President, Deputy President and a Principal Member, settled the vexed question of whether the Tribunal had jurisdiction to consider a lot owner’s claim for s106 (5) SSMA damages.

Section 106 (5) damages can be claimed by a lot owner when it suffered loss as a result of an Owners Corporation failing to keep the common property in repair in accordance with its strict obligation under  section  106 (1) of the SSMA

NCAT had held prior that:

  • In Shum—it had jurisdiction under s106 (5)
  • In Shih—it did not, but may have under the general dispute clause s232.

In Pullicin the Appeal Panel determined that the Tribunal did not have power under either section.

This leaves lot owners to claim these types of damages in a court of competent jurisdictions.

The decision poses difficulties for lot owners seeking orders against an OC because the relief sought is usually two-fold, and now may have to be taken in different jurisdictions.

An order that the Owners Corporation repair and maintain the common property (a work order) can be made by NCAT but cannot usually be made by the Courts.  The Supreme Court theoretically has the power to grant an injunction in similar terms but has historically been reluctant to do so.

A claim for consequential damages can now only be made by a court.

Monetary jurisdiction limits apply so that lot owners may find themselves suing for s106(5) damages in a court that does not have jurisdiction to order relief under s106 (1).

A lot owner seeking a work order in NCAT and damages in a separate court will be faced with increased costs and differing timetables.

Do you need legal advice regarding claiming damages against the owners’ cooperation (s106)?  

Clare Peacock is an experienced construction lawyer working on Sydney’s Northern Beaches. Clare provides practical, cost-effective building approval advice to property owners, builders and strata managers. Services include residential building disputesbody corporate issues and strata building problems.

Call 02 9452 9298  Send an Email  Online Enquiry

Tags: , , ,