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Forums Disputes and litigation APPLICABILITY OF ESTOPPEL IN STRATA

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    Hi Amanda

    Can the principle of estoppel be argued by a lot owner in a dispute with the owners corporation over getting reimbursed for capital expenditure incurred (importantly and urgently as promulgated by the owners corporation) by the lot owner on something that has ended up being the responsibility of the owners corporation when the owners corporation initially wrongly believed otherwise? In effect the owners corporation is now saying to the lot owner ‘prove that you needed to incur the expenditure’.

    Amanda Farmer

    Hi Thejoysofcommunityliving,

    Which state are you in?

    I am not sure what you mean by “capital expenditure incurred” by the lot owner. Are you saying the lot owner did repair and maintenance work on the common property, which the Owners Corporation should have done, and the lot owner now wants to be reimbursed its expenditure?

    In NSW, it is well established that a lot owner who does work on the common property without the consent of the Owners Corporation – even if it turns out to be work the OC should have done – is not entitled to claim reimbursement later.

    I am simplifying a little and the circumstances of the specific situation will be relevant, but that is the starting point.

    Also check out section 126 in the SSMA (NSW):

    The limitation there is that, even though the Tribunal can ‘approve’ the work done by the lot owner, it cannot order reimbursement of the amount expended by the owner in carrying out the work. Sounds like that is what the lot owner in your situation is after.

    I understand from your post that the Owners Corporation may have originally said this issue was lot owner responsibility and it turned out to be OC responsibility. That is relevant. However, ‘estoppel’ is not the applicable principle here. Rather, it sounds more like misrepresentation: the OC misrepresented that the property was lot property; the lot owner relied on that and did the work; the lot owner has suffered a loss. There may be an action there that could be pursued outside the confines of the Tribunal.

    Much turns on the facts of this situation and a lot will depend on what is recorded if anything) in communications passing between the OC and the owner. It’s hard to provide general guidance on his one.


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