Shum Appeal clarifies scope and operation of NCAT’s jurisdiction to award damages to lot owners—section 106

Strata Owners Corporation obligations.

Shum v The Owners Strata Plan No. 30621 [2017] NSWCATCD 68

In Shum v The Owners Strata Plan No. 30621 [2017] NSWCATCD 68, a lot owner was awarded in excess of $55,000 damages for breach of the Owners Corporation duty to repair and maintain common property.

The 30 August 2017 decision was one of the first to decide applications under the then relatively new section 106 (5) of the SSMA 2015.

The Owners Corporation appealed the decision challenging the jurisdictional finding and whether an award of damages could operate retrospectively.

In The Owners Strata Plan No. 30621 v Shum [2018] NSWCATAP 15 the Appeal Panel determined that:

  • a lot owner is entitled to recover reasonably foreseeable loss against an Owners Corporation in consequence of a breach of s106,
  • NCAT‟s jurisdiction to award damages to a lot owner in these circumstances is under section 232,
  • there is no monetary limit on the award of damages that can be made,
  • the s106 obligation is ongoing and may give rise to multiple causes of action, and
  • the SSMA 2015 is not retrospective and as a result NCAT has no power to make orders under either s62 of the old SSMA or for damage suffered prior to 30 November

The finding as to retrospectivity resulted in a reduction in Mr Shum‟s damages from $55,943.24 to $28,034.11.

This decision is welcome clarification for lot owners and Owners Corporations alike but looks set to open this particular set of floodgates for an already busy Consumer & Commercial Division.

Download the latest Northern Beaches Construction Lawyers Newsletter (PDF) »


Northern Beaches Construction Lawyers

Clare Peacock is an experienced construction lawyer working on Sydney’s Northern Beaches.

Clare provides practical, cost-effective assistance regarding strata scheme disputes and defective building works.

Call 02 9452 9298  Send an Email  Online Enquiry