Office Circular No 1-1998

23 June 1998

CIRCULAR MEMORANDUM NO. 1 OF 1998
Distribution: General

THE NEW STRATA TITLES ACT 1998

Date of Commencement
All but Part 9 of the Strata Titles Act 1998 came into effect on 5 June 1998. Part 9 which deals with dispute resolution procedures will come into effect on 31 July 1998. This Act replaces and updates strata titles legislation incorporated in Part XIA of the Conveyancing and Law of Property Act 1884 which has been repealed.

Content of the Act
The Strata Titles Act 1998 contains a number of major innovations. These include:
  • A dispute resolution procedure and appeal rights
  • A flexible system of unit entitlements
  • First and exclusive by-laws
  • New requirements for the body corporate
  • Creation of common property folios
  • Multiple bodies corporate
  • Resolutions
  • Mortgages to extend similarly as in final plans of subdivision
  • Strata Plans to have same effect as an Adhesion Order
  • Staged strata development schemes
  • Community development schemes.
Some details of these initiatives are:

Terminology - Individual holdings are referred to in the legislation as lots rather than flats. This brings Tasmanian legislation in to line with other States.

Resolutions - Resolutions of the body corporate may require unanimous, special or ordinary resolution. Refer to the Act for specific circumstances where each type of resolution would apply.

Mortgages (section 7) - When a mortgage(s) is registered over part of the proposed site the mortgage(s) will on registration of the plan extend to the whole of the site. If one part of the site is subject to one mortgage and another part of the site is subject to another, one will need to be discharged. This provision is the same as for final plans of subdivision.

Common Property Titles (section 8) - Folios will be created for common property in strata schemes. The reference to the title will be the plan number as the Volume reference Folio 0, eg. Volume 127942 Folio 0. These folios will be endorsed with any dealings affecting the strata plan, eg. amendments to the plan, amendments to by-laws. When searching a lot folio the common property folio must also be searched.

Unit Entitlements (sections 16 and 17) - Each lot has a general unit entitlement. Some lots may also have a special unit entitlement. For example, in multi-storey developments some lots may benefit from access to lifts while others do not. The special unit entitlement allows contributions, interest, voting rights and income to be apportioned taking these differences into account.

Staged Strata Development Schemes (sections 34 to 50) - This initiative will allow a developer who proposes to progressively develop a site to register with the Recorder of Titles a master plan of the scheme and a disclosure statement before proceeding. The plan and statement will provide details of proposed buildings and other improvements as well as construction schedules. Developers will have the security to proceed unimpeded provided that development progresses in accordance with the scheme.

Community Development Schemes (sections 51 to 67) - These schemes will allow for projects which bring together various types of developments and must include two of:
  • A strata scheme
  • A sealed plan
  • Some other division of land
  • A retirement village
  • A marina or water based development
This will allow a developer to create a neighbourhood development with various styles of land use to reflect different levels of community needs eg. A mixture of conventional housing, strata retirement village, shopping complex and community facilities.

Multiple Bodies Corporate (sections 71 and 72) - The Act allows for multiple bodies corporate to manage a development. This is most likely to occur in site developments where different bodies corporate will be established for particular parts of the site, eg. a body corporate for a shopping complex and another body corporate for residences. Each element may have its own body corporate and the whole complex would be subject to a single management structure.

New requirements for body corporate (sections 71 to 88) - The name of the body corporate will be Strata Corporation No. .... followed by the address or name of the building, eg. Strata Corporation No. 12479 15 Green Street Mount Elizabeth. The body corporate must insure the buildings divided by the plan and any improvements on the common property. Public Risk Insurance must also be obtained. The body corporate may be divided into two or more bodies corporate.

An annual general meeting must be held within 3 months of registration of the plan and at least every 15 months thereafter. The body corporate is also required to keep a roll of names and addresses of owners of the lots as well as a notice board and letter box.

By-Laws (section 90 to 97) - The Act allows first by-laws to be lodged with the plan or scheme. These by-laws take effect on registration of the plan. Exclusive use by-laws may confer exclusive rights to use of common property. Where no first by-laws are lodged the model by-laws apply. The model by-laws are set out in Schedule 1 of the Act.

Dispute Resolution (sections 105 to 142) - The Act provides a system of dispute resolution. The Recorder of Titles is appointed as referee. The procedure of resolution will be informal. The Recorder is empowered to make enforceable orders.

Appeals (section 143 to 146) - Appeals against decisions of the Recorder may be made to the Resource Management and Planning Appeal Tribunal.

Further Information
Shortly I will be issuing a booklet for the benefit of owners and other interested persons. This booklet will explain the changes to the Act. Information detailing dispute resolution and procedures for applications will also be available for interested parties.

PARKING EASEMENTS

Amendment to the Conveyancing and Law of Property Act 1884
The legislation to create parking easements has been effected by the introduction of a new Division into the Conveyancing and Law of Property Act 1884, being "Division 2 of Part VIA - Parking Easements". The new division consists of new Sections 34D to 34J.

Definitions
Section 34D introduces a number of new definitions to apply to parking easements. The definition of what constitutes a vehicle is drawn as wide as possible to cover all likely possibilities which can be reasonably foreseen at the present time. Specifically "vehicle" has been defined to mean:

(a) a vehicle for use on a road; or
(b) a vehicle for use on a track; or
(c) a vehicle for use on water; or
(d) a vehicle designed to be wholly or partially air-borne.

Recognition of parking easements
In Section 34E provision is made for the law to recognise the right to park a vehicle as an easement right. Note that the easement may include the associated vehicular and pedestrian access to and from the easement as well as the actual right to park. In a multi-storeyed building this could include the lifts and the vehicle ramps. As you will see given the standard-form easements added to Schedule 8 of the Act, these may be more easily described in a plan and then by reference to that plan.

Subsection (2) provides that a parking easement may be on the horizontal plane such as an open flat area or the parking easement may be created by reference to both the horizontal and vertical plane, which would be required if, for example, the parking easement was in a building. It will make it easier to set aside parking facilities in a strata titles development.

Subsection (3) has been included to overcome the common law rule which would prevent an easement being granted which creates a right of exclusive occupancy applying to parking easements.

Parking easements will be created by the existing procedures used to create easements
Section 34F subsections (1) and (2) set out the various ways in which a parking easement may be created. They adopt the existing statutory procedures used to create easements, specifically:

(a) by deed (if it is general law land);
(b) as provided by Section 105 of the Land Titles Act 1980;
(c) by a "schedule of easements";
(d) by a strata titles plan;
(e) in any other way approved by the Recorder.

A parking easement may be like a conventional easement and run with title. They may be leased.

It is intended that by adopting these practices it will enable parking easements to be created by following normal procedures which when appropriate, will enable the parking easements to be created in conjunction with conventional sealed plans, strata title plans, or leases.

As the Act introduces a new form of land use, (ie. a parking easement), subsection 34f(3) links the approval procedure to the existing land use approval provisions of the Land Use Planning and Approvals Act 1993.

Parking easements in gross
An innovative provision is made in subsection 34G(1) which will enable a parking easement to be created as an easement in gross.

The nexus between dominant and servient tenements where there is a dominant tenement
Subsection 34G(1) of the Act also makes provision for parking easements to be created in the conventional way where there is both a dominant and servient tenement.

The current common law rules are too restrictive on the requirements for the nexus or physical connection required between the dominant tenement and the servient tenement and as a result they are unsuitable for the requirements of a parking easement.

Under the new subsection 34G(2) the test to be applied to determine whether a physical connection exists between the dominant tenement and the servient tenement will now be based on modern planning requirements.

The simple test will be that if the planning authority considers their connection is appropriate having regard to the land use purposes under the Land Use Planning and Approvals Act 1993 then they will be deemed to have a sufficient physical nexus for the law.

The common law rule relating to the unity of seisin will not apply to parking easements
Subsection 34G(3) is similar to the existing provisions in the Land Titles Act 1980 and provides that the easement will not be destroyed by the unity of seisin of the dominant and servient tenements.

Maintenance of parking easements and other commercial arrangements
Section 34H is designed to make it clear that parking easements can be made to accommodate normal commercial arrangements for the maintenance of easements where appropriate.

Subsection (3) is included to overcome the common law prohibitions against positive covenants applying to parking easements.

Parking easements to "run with title"
Section 34I provides that like other easements, all the rights and obligations attaching to a parking easement "run with title".

Subsection (3) clarifies the rights of people associated with land where the parking easement is created over leasehold estate.

Variation and termination of parking easements
Section 34J is included to enable people to enter into agreements to vary parking easements. The Act provides that where a variation would change the use of land normal planning approval procedures must be followed.

Subsection 34K(1) provides that a parking easement may be terminated by agreement, and unless there are contractual impediments which do not allow it, an owner of the dominant tenement may surrender that person's easement rights. Subsection (2) is included to ensure that the land use requirements to provide easement facilities cannot be avoided.

Provision is made in Section 34L to provide that documents creating, varying, recording the expiry or termination of a parking easement are capable of being registered either in the Torrens title register kept under the Land Titles Act 1980 or in the Deeds Register. The provision adopts the current procedures relating to registration.

Removal of obsolete and other parking easements from titles
Section 6 of the Act introduces amendments to Section 84C(1) of the principal Act to allow a person to apply to the Recorder of Titles or the Supreme Court to cancel or modify a parking easement when they become obsolete or require removal in other circumstances.

Subsection (1A) introduces additional grounds for the removal of parking easements which are unique to the needs of a parking easement. Subsection (7A) is required to protect the rights of people against the loss of previously incurred costs when a parking easement is modified or extinguished under the Section.

Short form easements
Additional standard forms of easements are inserted into to Schedule 8 of the principal Act by Section 7 of the Act. The purpose of the schedule is to simplify conveyancing and plan preparation. These include:
  • bus parking easement
  • customer parking easement
  • disabled parking easement
  • employee parking easement
  • occupier parking easement
  • general parking easement
  • service parking easement
  • vehicular access way
  • pedestrian access way
  • combined access way
The use of the standard form easements is not compulsory. The parties may if they wish, adopt other definitions to suit the needs of the parties.

MICHAEL DIXON
Recorder of Titles
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