The Unit Titles Act 2010 (‘2010 Act’) and the Unit Titles Regulations 2011 (‘Regulations’) came into force on 20 June 2011 replacing the Unit Titles Act 1972 (‘1972 Act’). The 2010 Act brings in big changes to the creation, management and administration of unit title developments (a ‘UTD’) which will have a big impact on everyone with interests in UTDs – principally UTD Developers, UTD Body Corporates, and owners, occupiers & prospective purchasers of units in UTDs.
The 2010 Act contains mandatory duties and rules (‘Mandatory Rules’) which override the provisions contained in all existing UTD Body Corporate Rules as from 20 June 2011. The Mandatory Rules are extensive and include such things as:
The 2010 Act also contains limited operational rules (‘Operational Rules’) which can be varied by the UTD Body Corporate Rules, but will otherwise apply to existing UTD Body Corporates.
The 2010 Act contains limited, but important, transitional provisions in respect of the Operational Rules and maintenance obligations, including the requirement for a maintenance plan. We deal with each in turn below.
It is worth pointing out a number of the more significant changes that will affect all UTD Body Corporates from now on – although these are by no means exhaustive!
This is a such a significant change that we thought it needed its own heading!
The vendor of a unit in a UTD (‘Unit Vendor’) now has significant disclosure obligations under the 2010 Act. Details of the information that a Unit Vendor has to disclose can be found in clause 33 of the Regulations and includes such things as:
NB: This list is not exhaustive!
If a Unit Vendor does not comply with the disclosure requirements, the purchaser will be able to refuse to settle or, cancel the sale contract.
Most importantly, if you own or occupy a unit in a UTD, you need to be sure that your UTD Body Corporate is aware of its obligations in respect of the Mandatory Rules, so that they can be implemented. Perhaps you could provide the UTD Body Corporate with a copy of this article and if it has any questions, we would be more than happy to discuss these with the principal representative of the UTD Body Corporate.
If you are contemplating selling your unit in a UTD, then you will need to make sure that you are in a position to provide the requisite disclosure statement to any purchaser. It is worth noting that some of the disclosure requirements arise directly out of implementation of the Mandatory Rules.
Moving forward and by 1 October 2012, all UTD Body Corporates must review its existing rules in light of the Mandatory Rules and Operational Rules, and establish a Maintenance Plan. These things should be done in consultation with all of the owners of units in the UTD.
If you have any questions about the contents of this article, please do not hesitate to contact us.