Strata Lot Owners: Legalising Your Exclusive Use of Common (outside) areas

Watch more legal educational videos on jimwilson.tv.

Often we see town houses and the like, which are part of a small, ground-level strata.

As such, they are part of a registered strata which has common areas adjacent to the Lots.

It is not uncommon for the Lot owners to agree between themselves that certain common areas adjacent to their individual Lots (usually yards and surrounds) can be for the exclusive of the particular Lot owner concerned. This is often done by mutual ‘allocation at no cost’, rather than one or other parties paying for the exclusive use area. In some instances money can be paid from Lot owner/s to the other/s in consideration for the right.

Lot owners often believe that once a verbal or written agreement is entered into between the Lot owners, that this somehow enshrines the right of exclusive use pertaining to each Lot. Many owners then proceed to build balconies, carports and structures for water access over common property (often with council approval). They believe that this agreement will, of itself, make for a more saleable and valuable property, as the agreement gives exclusive use of the extra area concerned.

This belief is not correct. If one of the properties is sold, an incoming neighbour may object to the exclusive use agreement and obtain a court-order for rectification and/or removal of the structure at your expense. Alternatively, the relationship with your current neighbour may deteriorate and they could take similar action.

The only way for the right to exclusive use of the extra area can be enshrined and be of certain value to the Lot owner or any subsequent purchaser, is for the right to exclusive use to be registered on the Certificate of Title for the Lot/s concerned.

This registration process is straight forward and not costly in the overall scheme of things, particularly when you consider the financial and emotional consequences of a dispute, which could takes months or years to resolve and involve tens of thousands of dollars in legal expenses, construction costs and forgone property value. It involves having a surveyor accurately map out the new exclusive use area/s on the Strata Plan; having your solicitor amend the Strata By-Laws by agreement between the Lot owners concerned; and then lodging the relevant documentation with the Land and Property Information Centre, for the purposes of registration of the exclusive use area on the Certificate of Title of each Lot owner concerned.

This way, the right to exclusive use is defined as to area and right to occupy, and is listed on the Certificate of Title of the Lot owner/s concerned: it makes for certainty of the area of the Lot being on sold.

Our view is that this puts Lot owners in a much better position to realise upon the extra wealth they have in their particular Strata lot, when they agree exclusive use of adjacent areas. (END)[/fusion_text]