STP-01 Strata Titles Schemes
Version 1 - 02/01/2019
1 The Nature of Strata and Survey-Strata Schemes (formerly section 1.1 of the Practice Manual)
The Strata Titles Act, 1966 was the first strata titles legislation in Western Australia. It was introduced to permit certificates of title to be issued for parts of buildings. In effect blocks of home units were subdivided by a Strata Plan, resulting in a title being issued for each lot in the building. Because of the close nature of the living environment and the mutual dependence of one lot on another, the Act set up processes and structures to cope with that environment and to promote harmonious co-existence.
In a strata or survey-strata scheme individual proprietors may own portions of the land, buildings, air and soil comprising the lot; but any part not individually owned is common property.
The main advantage of a strata scheme for a building is that it gives the security of a title for a defined lot plus an interest in the common property. This protects the equity of the owner and any mortgagee of the lot overcoming the problems suffered by the only previous alternatives, tenancies in common or company shares.
The STA provides the vehicle to put in place the lots, common property and management control necessary for an orderly use of the land. The STA standard by-laws ensure standards of behaviour, building maintenance and management are maintained.
An STA subdivision allows the occupiers to share services and facilities and to agree to mutually beneficial restrictions.
The STA provides the best option for multi storey buildings or buildings sharing a parcel of land. Also, because of the nature of the tenure the initial costs for a developer are substantially less for a STA subdivision than for a TLA subdivision and this has made it an attractive development alternative.
Land use in older urban areas is changing, resulting in land owners seeking ways to redevelop their properties. Strata titling is an accepted process in this situation for residential, commercial and industrial land and has gained acceptance in historic building renovation schemes and in rural and resort developments.
2 Basic Strata Principles (formerly section 1.2 of the Practice Manual)
2.1 Strata/Survey-Strata Schemes can only be over one Parcel of Land (formerly section 1.2.5 of the Practice Manual)
The land parcel over which the scheme fits must be a whole or complete land parcel i.e. it cannot be in separate portions. In some cases, a Deposited Plan of amalgamation of more than one parcel is the forerunner to registering a Strata/Survey-Strata Plan e.g. where party wall lots are involved on parent titles, the party wall lot(s) must be included into the new subdivisional lot with the interests (easements for party wall rights) either being brought forward, removed or modified as applicable.
2.2 Dividing Fences (sections 123 & 123B) (formerly section 1.2.9 of the Practice Manual)
Fencing in most single tier strata schemes comes under the Dividing Fences Act, 1961 in line with a normal green title situation. This means that the fencing between lots is the responsibility of adjoining lot owners. If the lot adjoins common property, then responsibility is shared between the lot owner and the strata company. However, in some strata schemes and in many survey-strata schemes the strata company may have by-laws that determine fencing responsibilities. In other cases, there may have been a decision made by the strata company to retain ownership of all of the fences in the scheme. In such cases the strata company is the “owner” of the fences and owners of land adjoining the parcel must deal with the strata company in relation to the repair or replacement of those fences.
Where a fence on a lot abuts common property the “owner” of the common property is the strata company and the responsibility for that fencing is shared between the lot owner and the strata company.
2.2.1 High Rise Schemes
In schemes that are not single tier strata or survey-strata schemes, fencing (whether internal or external) is usually the responsibility of the strata company.
2.3 Walls (formerly section 1.2.10 of the Practice Manual)
Walls on Strata Plans can have various meanings and interpretations regarding ownership. Walls on a Strata Plan are indicated by either parallel lines or by thicker lines than other lines on the plan. Walls of buildings may include doors, windows and structures where they divide lots from lots or common property. If there is a wall on the parcel that is not shown on the plan, then its position in respect of boundaries of lots and common property will determine ownership (i.e. the wall may be entirely within a lot and is therefore owned by the proprietor of that lot). The maintenance and upkeep of the wall of a building or a retaining wall that is situated on a strata lot can impact on the support for a building on an adjoining lot. This type of situation may be covered by section 11(a) (i) of the STA.
The boundaries of lots may be designated by the standard boundary definition wording contained in the STA or by an appropriate wording in respect of walls forming the boundary, e.g. “west face of wall is boundary” or “centreline of wall is boundary”. The wording on the floor plan sheet in respect of lot boundary definitions may also cover the boundaries of lots. If there is no wording on the floor plan to indicate the boundary, the wall is regarded as common property.
2.4 Party Walls (formerly section 1.2.11 of the Practice Manual)
A party wall is a dividing building wall between lots. The boundary may be the centre plane of the wall or if the wall is common property the outside surfaces of the wall. These types of walls are covered by the implied easements under section 11 of the STA.
A common wall means either a party wall, common property wall or a wall used by adjoining lots. It does not necessarily need to be associated with a building.
3 History of the Strata Titles Act (formerly section 2 of the Practice Manual)
3.1 History of the Strata Titles Act 1966 (formerly section 2.1 of the Practice Manual)
The Strata Titles Act, 1966 came into operation on 1 November 1967. It was
“An Act to facilitate the Subdivision of Land in Strata and the Disposition of Titles thereto, and for incidental and other purposes.”
This Act was designed to overcome the problem of share or company titles where a proprietor’s interest was not defined by a title to a specific part of the parcel. The 1966 Act allowed for a strata lot to be created with boundaries defined by the Act as the centre plane of the walls, floors and ceilings. On registration of the Strata Plan, a certificate of title was issued for each lot which included common property.
The 1966 Act proved deficient in several areas:
Unit entitlements were allocated by the property developer or surveyor and were not necessarily based on the relative values of the lots.
- A lot could not include land outside of the building.
- Lot boundaries as defined by the Act were unsatisfactory.
- There were no easy dispute resolution provisions.
- Standard by-laws were deficient.
- It was not possible to re-subdivide land in a strata scheme.
- Exclusive use by-laws could not be registered.
In the early 1980s, a Law Reform Commission of Western Australia Report recommended substantial changes to the existing Act.
The 1966 Act was repealed and replaced by the Strata Titles Act, 1985 and it is the current Act. The main changes were:
- Boundaries of lots on all Strata Plans became the inner surfaces of the walls, floors and ceilings.
- Lot boundaries could be defined by a variety of wordings on new Strata Plans.
- Unit entitlement was determined by a licensed valuer on the basis of relative values of the lots.
- It was possible to include part of the land outside of a building as part of the lot.
- It was possible to re-subdivide lots and common property.
- It was possible to consolidate lots.
- Exclusive use by-laws must be registered.
- Lots could be created without buildings on them (Vacant Lots).
- A Strata Titles Referee was appointed for dispute resolution.
- The standard by-laws were revised.
- A 12-month period from the appointment date (1 July 1985) was given to register any unregistered Strata Plans lodged under the 1966 Act. This was later changed, and an extension was given to 30 June 1987.
Notice was sent to the owners of the affected Strata Plans that if not registered by 30 June 1987 the Strata Plan would become Null & Void. In effect those strata plans are now treated as cancelled Strata Plans.
In 1992 a Consultative Committee consisting of industry representatives was formed by the then Department of Land Information to recommend legislative changes. This Committee formulated changes over the next 5 years that were designed to improve the Act to meet modern community expectations.
A notable change considered beneficial to all strata lot owners was the compulsory requirement for common insurance by the strata company. This compulsory insurance coverage was for building replacement and public liability and was designed to protect all lot owners.
This consultative process resulted in the Strata Titles Amendment Act 1995 being passed by Parliament in 1995 and proclaimed on 14 April 1996. The main changes were:
- The introduction of Survey-Strata Plans.
- Management statements.
- New plan and document forms.
- Compulsory disclosure of information on the sale of strata properties.
- Standard by-laws for all strata companies.
- New types of resolutions.
- Stronger powers for the Referee.
- Standard Schedule 1 and 2 by-laws common to all schemes.
- The ability to register within a 12-month period, 1966 STA by-law resolutions that created exclusive use and other rights or privileges that could not have been previously registered.
As a result of these changes the issue of compulsory common insurance became a focus of intense community debate. This caused considerable political pressure that resulted in a “Task Force” being appointed by the Government. The job of this group was to develop legislative methods of overcoming community concerns at the changes.
This resulted in legislation being passed in December 1996 and being proclaimed on 20 January 1997.
The main changes introduced were:
- Automatic changes to single tier strata schemes of 5 lots or less so the boundaries were changed automatically to the external surfaces of the buildings unless an owner in the scheme objected prior to 20 July 1997.
- The option to merge common property land with lots by resolution and without local government or WAPC consent in schemes registered before 1 January 1998.
- The ability to convert existing Strata Plans registered before 1 January 1998 by unanimous resolution to Survey-Strata Plans without local government or WAPC consent.
- The option of individual insurance.
- The choice of opting out of insurance cover.
These changes have given lot owners simple and cheap solutions to having common property included as part of their lots. This combined with the individual insurance changes has provided more flexibility to strata lot owners to select what they consider best for their scheme.
Since these changes the Strata Titles Consultative Committee has been disbanded and a group known as the Community Titles Advisory Committee (CTAC) has been appointed.
3.2 The Community Titles Advisory Committee (formerly section 2.2 of the Practice Manual)
The role of the Community Titles Advisory Committee is to continue to improve the legislation to meet industry and community needs.
The committee has representatives from:
- The Department of Planning
- The State Administrative Tribunal (the Department of Justice)
- Western Australian Municipal Association
- Water Corporation
- Real Estate Institute of Western Australia
- Spatial Science Institute
- Law Society of Western Australia
- Australian Institute of Conveyancers WA Division Inc
- Urban Development Institute of Australia (Western Australian Division Inc)
- Strata Titles Institute of Western Australia
- Representatives of owners of lot(s) in single tier and multi-tier strata schemes
- Chairperson appointed by the Hon Minister for Lands
- A reference group involving numerous organisations was identified to assist the Committee.
The Committee is currently considering the following issues:
- Upgrading the STA.
- Conciliation service.
- Termination of schemes.
- Staged developments.
- Multi-tiered schemes and Management Statements.
- The ability to strata part of a building.
- Leasehold strata.
- Separation of title and subdivision issues from management and resolution of dispute issues.