Community title schemes

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Page last updated: 14.03.2018    

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Community Titles Schemes or Community Schemes are being introduced into Western Australia. They are a new option for subdividing a single parcel of freehold land into multiple schemes that exist under the umbrella of a community scheme.

Community schemes already exist in other states including New South Wales, South Australia and Queensland. Community schemes will introduce new definitions, concepts, structures and processes via the Community Titles Bill.

Community schemes will not replace strata and survey-strata schemes. Strata and survey-strata schemes will still operate under the Strata Titles Act 1985.

Strata and survey-strata schemes cannot be combined with community schemes.

Overview

Basic concepts within a community scheme

Every community scheme will have a Community Development Statement (CDS) which will set out how the community scheme is to be subdivided and developed. The Western Australian Planning Commission (Commission) will need to approve the CDS before the community scheme can be developed and subdivided.

A community scheme may have up to 3 tiers of management. Each individual scheme within a community scheme is called a community titles scheme.

A tier 1 scheme may have its own common property which is for the whole community and which every owner of a lot in the community scheme will jointly own.

A tier 2 scheme may also have its own common property which the owners of lots in that tier 2 scheme and the owners of lots in a tier 3 scheme belonging to that tier 2 scheme will jointly own.

A tier 3 scheme may also have its own common property which is jointly owned by the owners of lots in that tier 3 scheme.

The tier 1 scheme will have a community corporation which is the overarching management body for the community scheme. Each tier 2 and tier 3 scheme in the community scheme will have its own community corporation to govern and manage relationships and common property in that community titles scheme. Each tier 2 or tier 3 scheme will have a representative to act and vote on its behalf at meetings of the community corporation of the scheme to which that tier 2 or tier 3 scheme belongs.

Figure 1: Tiers within a community scheme

The tier 1 community corporation will make by-laws for the tier 1 community scheme. Each community titles scheme which belongs to the community scheme will also have its own by-laws that apply only to that scheme.

Creating community titles schemes

A community scheme is created when a single building or a single parcel of freehold land is subdivided into tier 1 lots or tier 1 lots and common property by registration of a tier 1 plan, which also creates the tier 1 scheme. After subdivision of the freehold land by a tier 1 plan the freehold land becomes known as a tier 1 parcel.

A tier 1 lot can be subdivided again into a tier 2 scheme - comprising tier 2 lots or tier 2 lots and common property by registration of a tier 2 plan. The tier 1 lot that is subdivided by a tier 2 plan becomes known as a tier 2 parcel.

A tier 2 lot can be further subdivided into a tier 3 scheme – comprising tier 3 lots or tier 3 lots and common property by registration of a tier 3 plan. A tier 2 lot that is subdivided by a tier 3 plan becomes known as a tier 3 parcel.

The tier 1, 2 and 3 schemes that together comprise the community scheme belong to the community scheme.  The resulting development is a community of schemes with up to three tiers of ownership and management.

Benefits of community titles schemes

Community titles (land) schemes will allow for large-scale planned land developments with shared infrastructure and services.

Community titles (building) schemes will facilitate a mix of uses in one or more buildings on a parcel of land, for example, a single high-rise building that has residential, retail and commercial lots.

Creating a community scheme that contains multiple community titles schemes will enable each member scheme to have by-laws which apply only to that scheme, and maintenance costs can be more fairly shared between the different schemes.

Under the Strata Titles Act 1985, sharing of common facilities and infrastructure by neighbouring schemes requires complex easement arrangements and contracts. Mixing of uses can also be achieved under the existing Act using a Management Statement that clearly states the different by-laws that apply to each use. However, there is often tension between the owners due to the failure to fairly share expenses and define rights of use.

New terms will apply to community titles schemes

A new Act will apply to community schemes

The Community Titles Bill 2018 will be introduced to Parliament to legislate this new form of ownership and shared property ownership.

List of terminology

Community schemes will have plans, body corporates, by-laws and common property. New terms that only apply to community schemes will be introduced along with new governance standards which may differ from the equivalent terms and standards in the Strata Titles Act 1985.

The following table shows the current strata terms and what terminology will be used in the new community schemes. For example, a strata scheme has a strata company and a community titles scheme will have a community corporation.

Terminology for community schemes

Strata Titles Act

Community Titles Bill

survey-strata scheme

community titles (land) scheme

strata scheme

community titles (building) scheme

strata company

community corporation

strata plan

community titles building plan

survey-strata plan

community titles land plan

strata / survey-strata lot

lot

common property

common property

management statement

by-laws of the community titles scheme

Table 1: Equivalent Terms

Additional definitions

Community Titles Bill word or phrase

Definition

belong

In a community scheme the lots and common property belong to the scheme under which they are created.

A tier 2 parcel belongs to the tier 1 scheme above it. A tier 2 scheme belongs to the tier 1 scheme. A tier 3 scheme belongs to the tier 1 scheme and the tier 2 scheme to which its tier 3 parcel belongs.

Community titles scheme

Any individual scheme, at any tier level within a community scheme.

Community scheme

All the community titles schemes within a community scheme.

Tiers of schemes

Within a community scheme there can be up to three tiers of community titles schemes

Tier 1

The first community titles scheme to be created and provides the overarching governance for all the tier 2 and tier 3 schemes which eventually belong to it.

Tier 2

This scheme subdivides a tier 1 lot into lots and common property or just lots. A tier 2 scheme belongs to the tier 1 scheme. Experience in other states shows that usually a tier 2 scheme will be the final subdivision level.

Tier 3

The ultimate level that can be reached where a tier 2 lot is subdivided into a community titles scheme. The tier 3 scheme created belongs to the tier 2 scheme that is subdivided and to the tier 1 scheme first created.

Community corporation

Tier 1, tier 2 and tier 3 community corporations.

Special resolution

A special resolution in a community titles scheme requires 75 per cent of the relative unit entitlement of members to vote in favour. The members of the scheme may be either lot owners or community corporations for schemes which belong to that scheme. Actions requiring a special resolution are specified in the Community Titles Bill.

Registration of a community titles scheme

The creation of a tier 1, tier 2 or tier 3 scheme from the parent parcel of land or from an existing tier 1 or tier 2 lot.

Registration of an amendment of a community titles scheme

An amendment of a scheme plan which modifies a lot or common property or creates, modifies or discharges an easement or restrictive covenant that benefits or burdens a lot or the common property in a community titles scheme.

Scheme documents

The scheme plan, by-laws and schedule of unit entitlement    

Subdivision

A change to the boundaries of a lot or to the boundary of a tier parcel by registration of a scheme plan or by registration of an amendment to an existing scheme plan by way of re-subdivision of lots or lots and common property, consolidation of lots, conversion of lots to common property and adding land to or removing land from common property. Land can be subdivided by registration of a community titles scheme or by registration of an amendment of a community titles scheme.

Tier parcel

The parcel of land defined as the community titles scheme for that tier. This means that the tier 1 parcel is the land encompassed entirely by the community scheme. Tier 2 parcels and tier 3 parcels refer to the land encompassed by each subdivision at those levels.

Tribunal

The State Administrative Tribunal.

Table 2: Additional Definitions

A community scheme will have multiple community titles schemes

A community scheme will have one or more community titles schemes which belong to the community scheme. A community titles scheme can be a community titles (building) scheme or a community titles (land) scheme with each scheme having its own scheme plan, by-laws, body corporate (called a community corporation) and potentially, common property.

Each community titles scheme is created on registration

Each scheme in the community scheme comes into existence when all the scheme documents are registered by the Registrar of Titles at Landgate.

The community corporation of each community titles scheme will be responsible for managing their own common property and holding their own meetings

The community corporation will manage and control common property and enforce by-laws of that community title scheme.

There can be up to three levels in a community scheme

  • A tier 1 lot can be subdivided by a tier 2 community titles scheme
  • A tier 2 lot can be subdivided by a tier 3 community titles scheme
  • A tier 3 scheme cannot be further subdivided.

A community titles (land) scheme cannot belong to a community titles (building) scheme

A community scheme can contain community titles (building) schemes and community titles (land) schemes. There are some limits on this though.

A community titles (land) scheme, where lots are defined with lateral boundaries (like a survey-strata lot), can have schemes belonging to it that include a community titles (building) scheme or a community titles (land) scheme.

However, a community titles (building) scheme, where each lot is defined as a cubic space, can only have schemes belonging to it that are community titles (building) schemes.

How a community scheme will be managed

Management structure

Figure 2 Three Tier Community Scheme

The community corporation is made up of lot owners for that scheme and the schemes belonging to it

The tier 1 community corporation is comprised of:

  • the owners of the tier 1 lots, and
  • where a lot has been subdivided by a tier 2 scheme, the tier 2 community corporation

The tier 2 community corporation is made up of lot owners for that scheme and the schemes belonging to it

The tier 2 community corporation is comprised of:

  • the owners of any tier 2 lots, and
  • where a lot has been subdivided by a tier 3 scheme, the tier 3 community corporation

A tier 3 community corporation is made up of lot owners for that scheme

The tier 3 community corporation is comprised of the owners of the lots within that community titles scheme.

Voting in community schemes

The value of the vote is based on the unit entitlement of the lot or the tier parcel if the lot has been subdivided by a scheme. (See the section: Unit entitlement in a community scheme)

There will be only two types of resolutions in community schemes: ordinary and special resolution.

An ordinary resolution is passed if the value of the votes by members present at the meeting in favour are more than the value of the votes against.

A special resolution is passed if the value of the votes in favour total more than 75% of total value of the unit entitlement of member lots and tier parcels in the scheme. Where there are only two or three members of a community titles scheme then a 2/3rd or more of the total value of the unit entitlement of member lots and tier parcels in the scheme is required.

Special resolutions will be required for specific actions within a community titles scheme such as amending the by-laws.

Seal of the community corporation

Community corporations will not need to have a common seal.  A document can be executed by the community corporation if the common seal is applied or it is signed by someone authorised by an ordinary resolution of the community corporation.

By-laws

Every community titles scheme must have by-laws

By-laws are required to be registered as part of the scheme documents for each community titles scheme within a community scheme.

The by-laws for each community titles scheme should be consistent with the by-laws for the scheme that it belongs to. If there is any inconsistency, the by-laws of the scheme it belongs to prevail.

All by-laws of community title schemes must be consistent with the Community Development Statement (CDS). If they are not, the CDS prevails.

Any disputes about consistency of by-laws may be resolved by the Tribunal.

By-laws will be binding

The by-laws for a community titles scheme will be binding on the members of that community titles scheme.

This means it is binding on every owner, lessee, occupier, and mortgagee in possession of a lot in that scheme.

Specific guidelines will be provided for by-laws, including:

  • the form which by-laws are to be in
  • the matters which must be and cannot be included within the by-laws
  • the optional matters which may be included within the by-laws
  • the name of the community corporation for that community titles scheme
  • the address for service of the community corporation
  • the control and management of the common property within that community titles scheme
  • the control and management of utility services
  • any by-laws required by a public authority or local government
  • any restrictions on use of a lot as required by a public authority or local government
  • the management, control, use or enjoyment of a lot or common property in the scheme
  • the governing of functions or procedures of the community corporation
  • managing the relationship between the community corporation and community corporations related to it and their members
  • the prohibition or regulation of the conduct of a person on the tier parcel
  • the requirement for members of the community corporation to take safety or security measures
  • the making of rules about providing services or amenities to owners or occupiers of lots, including the payment of fees and charges for those services or amenities
  • prohibiting or regulating alteration of lots or common property
  • providing for a different method of allocating contributions between members of the community corporation (which could be different from allocating those contributions in line with unit entitlement)
  • exclusive use by-laws

By-laws must include

  • the name of the community corporation for that community titles scheme
  • the address for service of the community corporation
  • the control and management of the common property within that community titles scheme
  • the control and management of utility services
  • any by-laws required by a public authority or local government
  • any restrictions on use of a lot as required by a public authority or local government

By-laws may deal with certain matters

  • the management, control, use or enjoyment of a lot or common property in the scheme
  • the governing of functions or procedures of the community corporation
  • managing the relationship between the community corporation and community corporations related to it and their members
  • the prohibition or regulation of the conduct of a person on the tier parcel
  • the requirement for members of the community corporation to take safety or security measures
  • the making of rules about providing services or amenities to owners or occupiers of lots, including the payment of fees and charges for those services or amenities
  • prohibiting or regulating alteration of lots or common property
  • providing for a different method of allocating contributions between members of the community corporation (which could be different from allocating those contributions in line with unit entitlement)
  • exclusive use by-laws

By-laws may be invalid

By-laws are invalid where they:

  • are made without power
  • are inconsistent with any legislation
  • inconsistent with the community development statement
  • are tier 2 by-laws that are inconsistent with tier 1 by-laws
  • are tier 3 by-laws that are inconsistent with by laws of a scheme to which it belongs
  • deny or limit a member of a community corporation’s right to vote on a proposed resolution (except the prevention of a member from voting on an ordinary resolution if the member has outstanding contributions to the community corporation)
  • prohibit or restrict the devolution or other dealing with a lot
  • discharge or modify an easement or restrictive covenant
  • are unfairly prejudicial or unfairly discriminate against 1 or more owners of the lots or they are oppressive or unreasonable
  • affect the keeping of an assistance animal by a person with a disability who is an owner or occupier of a lot, or
  • affect the use (on a lot or on common property) of an assistance animal by a person with a disability

Amending by-laws

By-laws of a community titles scheme may be made, amended or repealed by special resolution, but an amendment has no effect until the by-laws containing the amendment are registered at Landgate. Also, the Registrar of Titles cannot accept lodgement of amended by-laws if more than three months has passed since the resolution was made.

Landgate will not check the by-laws

The Community Titles Bill will state that:

  • the contents of the by-laws have not been checked by the Registrar at the time of registration
  • Registration of the by-laws does not mean they are valid or can be enforced
  • The enforceability of by-laws is not guaranteed by the State.

A Lessee must comply with the by-laws

The Community Titles Bill will specify that each lease of a lot within a community titles scheme is deemed to contain an agreement that the lessee will comply with the by-laws for the scheme. The owner or mortgagee in possession of a lot within a community titles scheme must also take reasonable steps to ensure that every occupier of that lot complies with the by-laws.

Enforcement of by-laws

The breach of any by-law may result in the Tribunal ordering the person who breached the by-law to pay a penalty to the community corporation.

A community corporation can enforce by-laws by serving notice of the breach on any person or member community corporation bound by the by-laws. The notice must specify what by-law has been breached and request compliance. If the person or member community corporation breaches the by-law again after the notice has been served, the community corporation can apply to the Tribunal for a penalty to be imposed on the person who breached the by-law. The Tribunal can order the person or the member community corporation to stop breaching the by-law.

An owner or occupier can also apply to the Tribunal to enforce by-laws. If the Tribunal finds that the breach of the by-law is serious or that the by-law has been breached by that person on 3 occasions, the Tribunal can order the person who breached the by-law to pay a penalty to the community corporation.

The nature of the community corporation

Each community corporation:

  • is a body corporate
  • has perpetual succession, and may have a common seal
  • can sue and be sued
  • has all the powers of a natural person, subject to the Community Titles Bill
  • is comprised of:
    • for a tier 1 community corporation:
      • the owners of tier 1 lots
      • the tier 2 community corporations
    • for a tier 2 community corporation:
      • the owners of each tier 2 lot in that tier 2 scheme and
      • the tier 3 community corporation for each tier 3 parcel in the tier 2 scheme that was subdivided to create tier 3 schemes
    • for a tier 3 community corporation:
      • the owners of each tier 3 lot within that tier 3 scheme

Powers and duties for community corporations

A summary of the powers and duties which will apply to community corporations are:

  • the powers and duties listed in the Community Titles Bill
  • power to terminate service contracts
  • duty to keep a scheme contacts register of scheme members and related community corporations
  • a duty to keep information about the community titles scheme
  • duty to supply information and certificates
  • power to recover records, keys and property of the community corporation
  • sufficient power to enter any part of the parcel (lots and common property) in certain circumstances
  • power to represent owners in proceedings
  • authority to make, vary or discharge a contract
  • power to enter into service contracts
  • power to operate a business (for the benefit of owners)
  • power to hold intellectual property and trademarks
  • power to enter into contracts with local government to enforce local laws
  • power to participate as a member of other community corporations

Powers and duties in respect of common property

A community corporation will have the power to:

  • control, manage and maintain common property within the relevant scheme for the benefit of the owners
  • act to give effect to exclusive use by-laws (as reasonably required)
  • by special resolution, enter into a contract for the creation of a common property infrastructure easement
  • improve or alter the common property by special resolution
  • allow common property to be used for a lawful purpose
  • install sustainability or utility infrastructure on common property by ordinary resolution. (Sustainability infrastructure is infrastructure that improves the environmental sustainability of the units or reduces the environmental impact by the lot owners).
  • transfer common property out of the scheme by special resolution.

Owners, mortgagees in possession, lessees and occupiers of lots within a community titles scheme will have a duty not to:

  • damage the common property
  • use or enjoy the lot or common property in a way that interferes with another’s use or enjoyment of another lot or the common property
  • obstruct the lawful use of common property.

Enforcement of by-laws

Community corporations have the duty to enforce the by-laws on any person or member scheme the by-laws are binding on.

Powers relating to enforcement of statutory duties

Strata managers, original subdivision owners and council members will owe certain statutory duties to a community corporation. A community corporation will have the power to enforce these statutory duties.

The Community Corporation Meetings

Community schemes will have representative voting

Community schemes may have hundreds of lots. Running a meeting with several hundred lot owners present would be difficult and expensive.  As a result, community titles schemes will use the representative voting model, where each member community corporation will send one representative to vote at a meeting of the community corporation they belong to.

Who may vote?

The following are entitled to vote at a meeting of a community corporation:

  • the owners of lots in the community titles scheme
  • a representative from any member community corporation

Voting power of each community corporation

The value of the vote cast by the person representing a community corporation which is a member of a scheme is the unit entitlement of the tier parcel for that community corporation.

The owners in a scheme will instruct their representative how to vote

Each representative of a member community corporation will be directed how to vote on an issue before they attend the meeting of a “parent” community corporation. Before the representative attends a general meeting on behalf of the member community corporation they represent, the member community corporation will hold their own general meeting and vote. If the member community corporation passes an ordinary resolution the representative must vote in line with this resolution. If the representative doesn’t vote as they were instructed by the member community corporation they are representing, the vote they make will be invalid.

Unfinancial lot owners and member community corporations may not be able to vote

By-laws may prohibit a lot owner from casting a vote if they have not paid their contributions (or other amounts owing to the community corporation).  Such an owner is known as an ‘unfinancial’ owner.

A member community corporation, which owes contributions to a community corporation it belongs to can also be barred from voting based on being unfinancial via a by-law of the community titles scheme.

An original owner can’t vote on a motion relating to building defects

An original subdivision owner (usually the developer) and people who are associates of an original subdivision owner, cannot cast a vote at meetings where the motion relates to building defects .  

Meetings of member community corporations will be sequenced

Each community corporation must give its member community corporations sufficient notice of a general meeting. The notice must include detail of each of the agenda items and motions listed for that general meeting to ensure each member community corporation has enough time to call its own general meeting and vote on the issues, before voting in the parent community corporation general meeting.

In a three-tiered scheme the tier 1 community corporation must give sufficient notice to any tier 2 community corporation about the intended general meeting. The tier 2 community corporations must give sufficient notice to any member tier 3 community corporations.

A motion cannot be passed unless the member community corporations were given sufficient notice and time to hold a vote on the issue and direct their representative.

Meetings can be held using modern technology

By-laws can specify the use of modern technology to hold and vote in meetings. Voting may be conducted via electronic means, including email, skype and other forms of teleconferencing.  Minutes and notices can also be distributed electronically. The community corporation will then need to consider record keeping methods. Lot owners and member schemes will not be required to use electronic means if they choose not to.

Council members

Number of council members and process for representation

For community schemes and the schemes belonging to the scheme:

  • there will be no maximum limit on the number of council members in a community corporation
  • the by-laws may set out the number of community council members and the process for representation by owners and member community corporations.

Duties owed by council members

Council members will have a statutory duty to:

  • act honestly and in good faith in the performance of their functions as a member of the council
  • exercise due care and diligence in the performance of their functions as a member of the council
  • not improperly use their position to gain, directly or indirectly, an advantage for themselves or for any other person or to cause detriment to the community corporation or a member of the community corporation
  • disclose any conflict of interest in any matter considered by the council.

Council members can be removed from the Council, by order of the Tribunal, if they breach any of these duties.

A person who is not an owner of a lot within a community titles scheme cannot be a council member.

Contributions

Reserve and administrative funds will be required

Community corporations, secondary community corporations and community strata companies will have to set up:

  • an administrative fund (to pay for items like the control and management of the community or common property and insurance of that common property)
  • a reserve fund (to pay for items which are not routine in nature, such as repair work to common property).

The amount to be put into administrative and reserve funds may be decided at a general meeting of the corporation or company by special resolution. 

The money for these funds may be raised by levying member lots and member schemes in proportion to their unit entitlement. Community corporations and member companies may decide by special resolution to set an alternative basis for levying contributions.

Unit entitlement in a community scheme

Creating unit entitlement

Unit entitlement (UE) is based on the relative value of a lot in relation to the value of all the other lots in the community titles scheme it is part of.  

The relative UE of a tier 3 parcel to the tier 2 parcel it belongs to, is based on the valuation of the tier 3 parcel in relation to the valuation of the tier 2 parcel. Similarly, the valuation of the tier 2 parcel determines the UE in relation to the value of the entire community scheme (tier 1 parcel).

Unit entitlement of a lot in a tier 2 or tier 3 scheme

The UE of a lot in a community titles scheme will determine the levies the lot owner must pay, their voting rights in meetings, and their share in the ownership of the common property.

The relative UE of a tier 2 or tier 3 scheme will dictate the vote value exercisable for that tier 2 or 3 scheme by its community corporation at the meeting of the community corporation to which it belongs.

A lot owner in a community titles scheme will pay levies to their community corporation. How much each lot owner pays will be calculated based on the relative unit entitlement of their lot. Note that levies in a community titles scheme may be based on something other than unit entitlement (for example if one lot has exclusive use of some common property) which will be stated in the by-laws. This applies to schemes at all tier levels.

Figure 3: Example of unit entitlement in a 3-tier community

The Tier 2 or Tier 3 scheme will have the same unit entitlement as the lot it was created from

In the example illustrated in Figure 3: Example of unit entitlement in a 3-tier community the diagram shows 3 tiers of management with the third tier consisting of 3 community titles schemes and 2 single owner lots divided between two tier 2 schemes determined by usage (residential or commercial).  If the owner of lot 2 subdivided that lot into a community title land scheme of 16 equal lots and common property, the UE of that parcel which defines the tier 3 scheme would still be 8,000 with each lot having a UE of 500. If instead, it was subdivided into 10 lots the UE of the community titles scheme would still be 8,000 but the individual equal lots' UE would be 800.

If the tier 3 building scheme illustrated, and identified as Scheme A, has 10 equal lots with a UE of 200 each, then any single lot has a 1/10 share of common property, they will pay 1/10 of the tier 3 community corporation expenses and their vote will be worth 1 out of the 10 possible votes.

Proportional responsibilities between tiers

That same lot owner would be required to pay his proportion of the costs of the tier 2 community titles scheme that Scheme A belongs to, which is 1/10 X 2/10 = 2/100 or 2% of the costs.  The owner would also have a 2% share in any tier 2 common property.  Any vote taken at a tier 2 community corporation general meeting would include a single representative from Scheme A and the lot owner of lot 2.  The value of Scheme A's vote in this example is 2/10 while the value of Lot 2's vote is 8/10.

Similarly, at the tier 1 level the residential tier 2 community corporation would be required to pay 10/22 of the community title scheme costs while the commercial tier 2 community corporation would pay 12/22 and each would have that same proportional ownership of common property belonging to the community scheme .  In a vote of the community titles scheme there would be two votes cast, one worth 10/22 and the other 12/22.

Common property in a community scheme

Common property will be optional

Common property, within a community titles scheme, will be optional.

Each member scheme may have its own common property

There may be three levels of common property:

  • the tier 1 common property
  • the tier 2 common property
  • the tier 3 common property

Common property is co-owned by every lot owner

Every lot owner in a community titles scheme will own a share of the common property in their scheme. Common property will be co-owned by the lot owners as tenants in common, in shares defined by the relative unit entitlements.

All owners and occupiers of land in a community titles scheme have a right to use common property, unless restricted by exclusive use by-laws.

Lot owners’ ownership of common property in the overall community scheme

A lot owner in a tier 2 or tier 3 scheme will also own a share of the common property in any community titles schemes that its scheme belongs to.

The owner of a lot in a tier 2 or tier 3 scheme will own both a share of the common property in that tier 2 or tier 3 scheme and a share of the common property of the schemes to which it belongs.

For example, an owner in a tier 3 community titles scheme which is part of a three-tier community scheme will own:

  • a share in the common property in their tier 3 community titles scheme
  • a share in the common property of the tier 2 community titles scheme to which their tier 3 scheme belongs
  • a share in common property in the tier 1 community titles scheme.

All owners and occupiers of land in the tier 3 scheme have a right to use the common property in the schemes to which they belong, unless restricted by exclusive use tier 1, tier 2 or tier 3 by-laws.

Common property ownership will be based on unit entitlement

Unit entitlement (UE) is the share a lot owner owns in a scheme in comparison to other lots in that scheme and is used to work out their share of the common property. Because a community scheme has layers, a lot owner’s share will depend on what layer they are in.

  • The owner of a tier 1 lot has a share in the tier 1 common property of the same proportion as the relative unit entitlement of their lot. They won’t own a share of common property in any tier 2 or tier 3 schemes.
  • A tier 2 lot owner has
    • A share in their own tier 2 common property based on the relative UE of their tier 2 lot
    • A share in the tier 1 common property calculated by multiplying the relative UE of their tier 2 lot and the relative UE of their tier 2 parcel in the tier 1 scheme
  • A tier 3 lot owner has -
    • A share in their own tier 3 common property based on the relative UE of their tier 3 lot
    • A share in the tier 2 common property calculated by multiplying the relative UE of the tier 3 lot and the relative UE of their tier 3 parcel in their tier 2 scheme
    • A share in the tier 1 common property calculated by multiplying the relative UE of the tier 3 lot and the relative UE of their tier 3 parcel in their tier 2 scheme and the relative UE of their tier 2 parcel in the tier 1 scheme 

Use of any common property will depend on ownership interest

Tier 1 common property may be used by all owners and occupiers in the community scheme while common property in a tier 2 scheme may only be used by lot owners in that scheme or lot owners within any tier 3 scheme which belongs to it. Common property in a tier 3 community titles scheme can only be used by lot owners in that scheme (Note that an exclusive use by-law can provide the occupiers of any specified lot within a community scheme with access to that common property).  

If an owner in a community scheme has no share in common property of another community title scheme in the same community scheme, the owner will not have usage rights to that common property unless granted in some other way (eg by easement, exclusive use by-law, lease or licence).

Unit entitlement in a community scheme

Unit entitlement of a community title lot

In a strata or survey-strata scheme the unit entitlement determines how much an owner pays in levies (unless this is varied), what weight an owner’s vote carries in a poll vote, and their share in the common property.

In a community scheme the unit entitlement of a community lot owner will dictate the levies they must pay to the community corporation (unless this is varied), their voting rights in a poll vote of the community corporation, and their share of the community property.

Unit entitlement of a lot in a member scheme

The unit entitlement of a lot in a member scheme will determine the levies the lot owner must pay, their voting rights in meetings, and their share in the ownership of the common property in the member scheme.

A lot owner in a member scheme will also have rights in the community scheme, but their unit entitlement won’t directly translate to their rights in the community scheme.

A lot owner in a member scheme won’t vote directly in a community scheme meeting as the member scheme will hold a vote and a representative will attend the community scheme meeting. The unit entitlement of the community lot which the member scheme subdivides (sits within) will dictate how much that member scheme’s vote is worth at the community title meeting. This means the lot owner’s unit entitlement doesn’t directly impact on the community corporation vote.

A lot owner in a member scheme will own a share in any community property. Exactly how much they own is calculated based on the unit entitlement of their lot in the member scheme multiplied by the unit entitlement of the member scheme within the community scheme.

For example, a lot in a member scheme may have a unit entitlement of 10/100 (10 per cent), and the unit entitlement of the member scheme in the community scheme may be 20/100 (20 per cent). This would mean the lot owners’ share in the community property is 10 per cent of 20 per cent or 2 per cent. Because every lot owner owns the community property as a tenant in common, no lot owner can choose an area to use independently.

A lot owner in a member scheme will pay levies to the community corporation. How much they pay will be calculated based on the unit entitlement of their lot, as a portion of the levies the member scheme then pays to the community corporation. Note that levies in strata may be based on something other than unit entitlement (for example if one lot has exclusive use of some common property). This may also be the case in a community scheme. One member scheme may pay a larger portion of the community corporation levies.

In a community scheme, when a community lot is subdivided by a secondary community scheme or community strata/survey-strata scheme, the unit entitlement for that community title lot will be different to the unit entitlement in a single layer strata/survey-strata scheme.

  • The voting rights which were attached to the community lot when voting at a community scheme level, now attach to the secondary community corporation or community strata/survey-strata company (as the case may be).
  • The total of the undivided share of community property is split among the owners of the secondary community lots or community strata/survey-strata lots.
  • The levies payable to the community corporation are also split among the owners of the secondary community lots or community strata/survey-strata lots (as the case may be).

The member scheme will have the same unit entitlements as the lot it was created from

For example, if a community lot has a unit entitlement of 25/100 in the community scheme and that community lot is subdivided into a community strata scheme, the community strata scheme’s total unit entitlement in the community scheme is also 25/100.

When the community lot or secondary community lot is subdivided, the unit entitlement of the lot will be allocated to the member scheme:

  • The share of community property and levies that apply to the community lot will be allocated among the owners of the lots on the secondary community plan or community strata/survey-strata plan, in the proportions set out in the Schedule of Unit Entitlement to the plan that subdivides the community lot.
  • Voting rights in the unit entitlement of the community lot are allocated wholly to the secondary community corporation or community strata/survey-strata company.  

However, it is not necessary for the total combined unit entitlement of the lots in a member scheme to have the same whole number total as the unit entitlement of the community lot or secondary community lot that was subdivided by the member scheme. This is to avoid the undesirable result of having fractions of units. Although in practice the collective unit entitlement may be the same.  

The unit entitlement of the community lot or secondary community lot shown in the schedule to the plan does not cease to exist when the lot is subdivided by a member scheme. The member scheme will be entitled to vote at meetings of the community corporation in the proportion that the unit entitlement of the community lot bears to the total combined unit entitlement of the community lots in the community title scheme.

Revaluation of the scheme for the purposes of unit entitlement

Currently, to value lots within a strata scheme the valuer must access every lot. At initial allocation the licensed valuer will usually be in a position to access the lots. However, gaining access to all the lots in a strata scheme to establish fit out and finish of all the lots is problematic once the scheme is running. The meaning of capital value (in a residential strata scheme, community title building scheme, secondary community title building scheme or community strata scheme for the purpose of reallocation of unit entitlement) will be amended so the licensed valuer may assume a standard level of fit out and finish for those lots in the scheme if:

  • the strata scheme is for residential purposes
  • the licensed valuer has taken all reasonable steps to value all the lots in the scheme in accordance with capital value within the meaning of the Valuation of Land Act 1978
  • the valuer has been unable to inspect one or more lots for their fit out and finish

The licensed valuer may need to supply evidence of what reasonable steps they took to access the lots before the Registrar of Titles will accept this form of valuation. 

Lots in a survey-strata scheme, community title scheme, secondary community title scheme and community survey-strata scheme will still be valued on site value. 

Reforms do not propose to change the way strata lots and survey-strata lots are valued for rating and taxing purposes.

Implications to other schemes where one is amended

Amending the schedule of unit entitlements for the community title scheme or a member scheme may impact the schedule of unit entitlements for other member schemes. This requires the unit entitlements in any affected member schemes to be recalculated at the ‘level’ of the change. In order to avoid unnecessary work, the unit entitlements within the member schemes do not have to be changed, as the reallocation of entitlement at the community scheme level does not impact the individual proportions within the member schemes.

If the change to the unit entitlement affects any other schemes, a new schedule of unit entitlement will need to be lodged for those affected schemes.

Reallocation of unit entitlement by special resolution

The schedule of unit entitlement for a community scheme or member scheme may be amended, provided:

  • the community corporation or member company consents to the amended schedule by a special resolution and
  • a licensed valuer has certified that amended schedule of unit entitlement and
  • any other requirements as set out in the regulations are complied with.

The valuer's certificate for a member scheme won’t certify the proportion in the [superior] scheme

The licensed valuer’s certificate required to lodge the plan must be in the prescribed form, and must contain the same certification for a community lot, secondary community lot or community strata/survey-strata lot that is applied to a strata/survey-strata lot. However the licensed valuer is not required to certify the lot owner’s proportion of unit entitlement in the community title scheme (and any secondary community title scheme).

Amendments to a Scheme

Revaluation of the scheme for the purposes of unit entitlement

To value lots within a community titles (building) scheme the valuer must access every lot. At initial allocation, the licensed valuer will usually be able to access the lots. However, gaining access to all the lots in a community titles (building scheme) to establish fit out and finish is problematic once the scheme is running. The meaning of capital value (in a community titles (building) scheme for allocation and re-allocation of unit entitlement) will be amended so the licensed valuer may assume a standard level of fit out and finish for those lots in the scheme.

Lots in a community titles (land) scheme will still be valued on site value.

Reforms do not propose to change the way lots are valued for rating and taxing purposes . 

Reallocation of unit entitlement by special resolution

The schedule of unit entitlement for a community titles scheme may be amended, provided:

  • the community corporation for that scheme consents to the amended schedule by a special resolution and
  • a licensed valuer has certified the amended schedule of unit entitlement and
  • any other requirements as set out in the regulations are complied with.

Acquisition of additional common property

A community corporation will have the power to acquire additional common property (land) next to their tier parcel by transfer.

Only the community corporation will have the power to add connecting land (common property) to the community titles scheme parcel, by way of transfer.

A community corporation may acquire additional common property if the community development statement specifies it can do so. If the community development statement does not allow for this, the community development statement will have to be amended. Acquisition of additional common property will require the community corporation to agree to the acquisition by special resolution and the approval of the Commission.

Transfer, lease, or license of common property

Community corporations will have power to deal with the common property under their control and will be able to transfer, lease, or license common property in a community titles scheme.

Who must consent to dealings with the common property?

If the land being transferred:

  • is common property of a tier 3 community titles scheme, the consent of that community corporation and any tier 2 community corporation will be required for the transfer, in addition to the consent of the tier 1 community corporation
  • is common property of that community titles scheme, the consent of the community corporation by special resolution will be required to authorise the transfer

The Commission must approve every transfer of the common property.

Exclusive use by-laws

A community corporation for a scheme will be able to make exclusive use by-laws over the common property in the scheme it manages.

Encroachments

Where a plan, or plan of amendment for a community titles scheme, indicates an encroachment (where buildings encroach into adjoining land), that plan will indicate whether the encroachment is to be treated as part of a lot or common property.

Community Development Statement

A Community Development Statement (CDS):

  • will govern how the community scheme is going to be developed and subdivided
  • will govern how amendments to the community scheme can be done in the future.

A CDS must be approved by the Western Australian Planning Commission (the Commission).

Purpose of a Community Development Statement

A CDS will set out the detailed land use, subdivision and development controls and developer obligations for a community scheme. It will fulfil several purposes for different parties, including:

  • regulators, as the basis for ongoing decision making by the Commission and other decision-makers concerning applications for subdivision and development approval
  • developers, as the basis of investment decisions and for coordination of implementation, especially in more complex developments involving multiple developers
  • utility service providers, in designing and coordinating detailed infrastructure and service provision for the site
  • architects, designers, landscapers and builders, in designing and undertaking development and construction in a thematic approach, if required
  • body corporates in the scheme, in fulfilling their governance obligations, including internal reorganisation of a community scheme, and forecasting and managing financial commitments
  • owners and occupiers of individual lots in the community titles schemes within the community scheme, to provide clarity and certainty as to what will occur in different stages of the development.

Content and format of a Community Development Statement

A CDS may be prepared by the owner of the subject land or their authorised agent. A community scheme must have a CDS. Tier 2 and tier 3 schemes will not have a separate CDS. The CDS will be registered with the tier 1 plan of subdivision.

Contents of a Community Development Statement

A CDS will be a set of documents, plans, specifications and drawings that describes how a parcel of land is proposed to be subdivided and developed to create a community scheme.

A community scheme may be based upon land subdivision and hence provide for multiple separate developments (existing and or proposed buildings) or be based on a single development (building or buildings) and the content of a CDS will vary accordingly.

A CDS, along with any other information that may be required by the Commission, may contain the following information:

How it will be subdivided, including:

  • location of the parcel
  • proposed community scheme subdivision
  • number of proposed tiers of management and number of schemes in each tier
  • number of proposed types of scheme - land or building
  • number of proposed lots in each scheme
  • intended land use of proposed lots
  • size/area and arrangement of proposed lots in each scheme
  • location and scale of existing and proposed development
  • existing and proposed ground and floor levels
  • siting of existing and proposed buildings and development
  • open space requirements or money to be paid to local government in lieu
  • the contributions by the original owner for public infrastructure
  • staging, timing and sequence of subdivision and development
  • location and provision of infrastructure, services, facilities and amenities in each proposed stage, community scheme or member scheme
  • movement arrangements including access to transport and proposed roads, paths and car parking
  • work required to be completed
  • architectural and design themes and requirements
  • identification of any heritage features of the site and any proposals or measures to be taken in relation to their restoration or conservation
  • existing and proposed vegetation and landscaping
  • existing and proposed drainage and water features
  • sustainability features
  • land to be dedicated, ceded to, acquired or managed by a relevant authority (if applicable)
  • land to be subject to restrictive covenants, easements or easements in gross (if applicable)

A CDS may include text, maps, plans, tables, diagrams, sketches, specifications, schedules and any official registers of value and ownership, and is to be in a form prescribed or required under the Community Titles Bill.

The CDS may also reference relevant approvals, including those obtained under other Acts and provide for a schedule of amendments to the CDS. A CDS may incorporate reference interpretations set out by a relevant statute, subsidiary legislation or planning scheme, and a gazetted State Planning Policy or Australian Standard, or relevant requirements of such documents.

The development period

The development period for a community scheme is 10 years (or other period fixed by Regulation) from registration by the Registrar of Titles of the tier 1 scheme. This period may be extended by the Commission.

A Community Development Statement must be approved

The CDS is required to be prepared and approved by the Commission prior to approval of a proposed community scheme subdivision.

A Community Development Statement must be consistent with local planning scheme

The CDS must be consistent with the Local Planning Scheme when the CDS is approved.

Preparation and consideration of a Community Development Statement

Reviewing the Community Development Statement

Under the Planning and Development Act 2005, the Commission is the central planning decision-maker in the WA planning system; however local governments, Development Assessment Panels and the State Administrative Tribunal also have key roles. The role and responsibility for the consideration and approval of a CDS will primarily lie with the Commission, but the Commission will still have the power to delegate certain decisions as per the current Planning and Development Act.

The Commission is to refer the CDS to the responsible local government, other agencies and utilities within seven days of receiving the CDS. The responsible local government and other entities are to provide their advice on the CDS during the period specified by the Commission for comment.

The Commission and/or relevant local government may require the draft CDS be advertised for public comment, and if so, comments received will be taken into consideration. The Commission can charge a fee for dealing with the application.

Community Development Statement Conditions

The Commission may approve a CDS with conditions that include amendment, insertion or deletion of proposed content including:

  • changes to or substitution of plans and designs
  • specific requirements, standards, additional detail or clarity to be inserted into the CDS
  • for the developer, to set out or follow a set sequence in which various stages of the proposed subdivision or development will be implemented
  • for the developer to specify when land will be ceded or dedicated, and infrastructure, landscaping, shared facilities and services will be constructed or completed as part of the sequencing of the development.

When can the Commission reject a Community Development Statement?

The Commission may refuse a draft CDS if:

  • the proposed community scheme does not comply with an applicable Local Planning Scheme or State planning policies
  • the Commission considers that conventional or other land tenure arrangements would be preferable or necessary to secure orderly and proper planning and development outcomes or the public interest
  • the proposed community scheme is inconsistent with orderly and proper planning
  • the relevant local government and/or other entities do not support that CDS regarding relevant planning considerations
  • it does not comply with required content or form or other circumstances that may be prescribed.

The State Administrative Tribunal will have the power to review decisions

If the Commission exercises a discretionary power in decision-making concerning a proposed CDS, a right of review by the State Administrative Tribunal will be available.

The approval of a CDS by the Commission will lapse after four years if it is not registered with a tier 1 scheme plan at Landgate within that period.

The status and effect of the Community Development Statement

The status and effect of a Community Development Statement will change depending on what stage it is in

Effect of a CDS during the approval period

One of the key differences between a CDS and other statutory planning instruments (such as a local structure plan) is how the CDS can bind planning decision-makers, owners and developers. The approval period for a CDS is the period after a CDS is approved and before registration of the tier 1 scheme plan to create the community scheme. During the approval period, a planning decision-maker:

  • must give due regard to the approved CDS when assessing a development application
  • must approve a subdivision application if that application is consistent with the approved CDS

CDS is binding during the development period

The development period begins on registration of the tier 1 scheme plan along with registration of the CDS and runs for 10 years. During the development period, the registered CDS:

  • binds developers: developers cannot obtain development or subdivision approval if inconsistent with the CDS
  • binds owners: owners cannot object to development or subdivision where it is consistent with the CDS
  • binds planning decision-makers: the decision-maker must approve a subdivision or development application that is consistent with the CDS

Effect of a CDS after the development period

Once the development period has expired, a planning decision-maker must give due regard to the CDS when assessing:

  • a development application or
  • a subdivision application.

Amendment of a CDS

A CDS can be amended:

  • before the CDS is registered with the tier 1 scheme plan, by application of the developer to the Commission
  • After the CDS is registered with the tier 1 scheme plan, the community corporation for the tier 1 scheme must approve the proposal to amend the CDS by special resolution before an application can be made to the Commission.

The Commission may approve the application to amend the CDS, provided the amended CDS is consistent with the local planning scheme.

After the Community Development Statement is registered, it is binding

The Registrar of Titles is to give notice of registration of a CDS with a tier 1 scheme plan to the Commission and relevant local government.

Exemption of additional planning documentation

The Commission, in consultation with the relevant local government, may waive the need for a statutory planning instrument such as a Local Structure Plan, Local Development Plan or Activity Centre Plan, in accordance with the Local Planning Scheme that is in operation, where a CDS has been prepared and approved by the Commission for the land.

Amending a Community Development Statement

A Community Development Statement may be amended

The development period for a community scheme may be for a considerable length of time. Some flexibility is necessary to allow for changes to the planning, design and development of a community scheme in response to changed planning or other relevant factors. Amendments are subject to approval of the Commission.

What amendments can be made to a Community Development Statement?

Amendment of a CDS must be consistent with the Local Planning Scheme in operation. It cannot amend or be contrary to the Local Planning Scheme.

How an amendment is made to a Community Development Statement 

Before any amendment can be lodged with the Commission the consent of the tier 1 community corporation must be obtained. This requires endorsement from the tier 1 community corporation by special resolution to the proposed amendment to a registered CDS.

Amendments to the Community Development Statement are effective when it is registered

A change to the registered CDS will not be given effect until the tier 1 community corporation has lodged the amended CDS (or by order of the Tribunal) in the prescribed form and the Registrar has registered the amended CDS.

Planning Applications

Under the current  Strata Titles Act 1985 the proposal to strata title may come before or follow development on a site. In other words, the proposal may relate to an existing building, to an existing building and its site, or to vacant land. Approval to subdivide does carry an obligation upon the applicant to implement the proposal.

Subdivision and development applications

In Western Australia, subdivision and development have separate meanings. Although related they are not interchangeable. Subdivision and development of a community scheme may be by a single owner and developer, or by multiple owners or developers.

The subdivision and development may be in accordance with:

  • a single (or coexisting) subdivision, and/ or
  • a development application and approval, or
  • multiple (not necessarily concurrent) subdivision and/ or development applications and approvals.

While subdivision of a site often comes before development, subdivision and development applications regarding a parcel of land may occur in any order.  

While the Commission is the decision-maker for all applications to subdivide land (though the Commission has delegated its function in certain cases), development applications may be decided by various decision-makers. In addition to the Commission, local government, Development Assessment Panels and the Metropolitan Redevelopment Authority constituted by the Metropolitan Redevelopment Authority Act 2011, have roles in relation to exercising development control.

Decision-making in relation to applications for subdivision and development approval is, in practice, largely discretionary. An applicant may make an application for approval at any time and the decision-maker is generally unrestricted when determining an application for approval, by either the content of a Local Planning Scheme or Local Structure Plan or the advice received on referral of an application.

These aspects lead to coordination and implementation problems, which are made more complex by the nature of a community scheme, where there may be shared ownership of the site, both during subdivision and development phases, and upon completion of the entire scheme.

Subdivision and development applications in relation to community schemes

The process set out in the Planning and Development Act 2005 (PDA) will apply to subdivision applications for a community scheme. The application to the Commission, referral for advice and consideration of a proposed plan for subdivision for community titles (building) schemes and community titles (land) schemes, will apply to community titles subdivision applications.

Two step subdivision approval

There is a two-step planning approval process for subdivision of a community titles scheme.

Step one: approval of a plan of subdivision (s. 135 PDA). Note that planning conditions may be imposed at this step.

Step two: endorsement of the scheme plan (s. 145 PDA).

Any conditions imposed at subdivision approval (step 1) and at development approval (if any) will need to be complied with before the Commission will endorse the scheme plan (step 2).

A scheme plan cannot be registered without the Commission’s endorsement of the scheme plan.

Development Applications

Application for development approval in community schemes will be made to the local government under the relevant local planning scheme.

Building Approvals

Generally, building work cannot be undertaken without a building permit. A building permit will not be issued unless the applicant has obtained each authority required under the legislation. 

Building approvals will be required for community title schemes.

Plan requirements

Community schemes will have two different kinds of plans.

  1. Community titles (land) scheme plans will be like survey-strata plans. The plan will have survey dimension boundaries and any portion of the parcel which is not a lot will be common property.
  2. Community titles (building) scheme plans will be like strata plans. The plan will have cubic space to define the lots and any portion of the parcel which is not a lot will be common property.

A community titles (land) scheme plan or community titles (building) scheme plan must be accompanied by the following documents when lodged at Landgate:

  • certificates given by a licensed surveyor and a licensed valuer
  • a schedule of unit entitlement
  • the Commission’s approval of the plan
  • the by-laws
  • an approved community development statement in respect of a tier 1 scheme plan

A community titles scheme may be amended

Amendment of a community titles scheme that involves subdivision is:

  • Re-subdivision (alteration of boundaries of one or more lots and or common property to create one or more different lots and or different common property)
  • Conversion of a lot to common property
  • Consolidating 2 or more lots into 1 lot
  • Transferring common property into a community titles scheme
  • Transferring common property out of a community titles scheme

Each of these amendments to a community titles scheme will require the 2-step subdivision approval of the Commission and will also require various consents of owners and others before the amendment can be registered.

Considerations and decisions when a development application is lodged

The Commission will refuse an application:

  • when the land over which a proposed community building plan, secondary community building plan or community strata plan is not a whole green title lot or freehold lots are proposed within the building
  • when vacant airspace lots are proposed
  • when it comes before completion of staged construction of a building
  • when a single dwelling is proposed on a proposed community or secondary lot
  • where a leasehold strata subdivision is proposed for a secondary or other lot within the proposed community title scheme
  • when it has not approved the Community Development Statement (CDS)
  • where the intention is not to create multiple management levels or
  • that does not contain a number of community strata/survey-strata schemes which will provide for lots for separate use and disposition

The Commission may refuse an application:

  • in situations where conventional or other land tenure arrangements would be preferable or necessary to secure planning and development outcomes or the public interest

The Commission may take into account:

  • the need for public access to some or all parts of the community property, secondary community property or common property having regard to orderly and proper planning
  • the requirement for public open space or other facilities or amenities, consistent with orderly and proper planning, in addition to whatever private open space or amenities may be proposed

The Commission may require:

  • when an approval of a CDS for the subject land is current but not yet registered, as a condition of approval of a proposed development in respect to all or part of the proposed community title scheme, amendment or replacement of the approved CDS.

Conditions even where development has begun

In the case of an application being made after the start of construction or modification of a building, the Commission may grant a certificate unconditionally, or subject to conditions specified in the certificate which are capable of being complied with, without affecting the form or structure of the building.

Variation to a community scheme

Variation of a community scheme when it is damaged or destroyed

Where a community titles scheme is damaged or destroyed, a community corporation, lot owner or mortgagee in the damaged scheme can apply to the Tribunal for an order to vary the existing scheme or to substitute a new scheme in its place.

If a tier 1 or tier 2 community titles building scheme is damaged or destroyed, one or more of the schemes belonging to that scheme in that building may also have been damaged or destroyed. As a result, the Tribunal will be able to order amendments be made to the scheme plan and the schedule of unit entitlement for any damaged scheme including schemes belonging to that scheme which are also damaged, and to the community development statement.

Variation of community scheme when part of it is taken or resumed

Where part of the land in a registered community scheme is taken, the Tribunal can make an order to vary the existing scheme or substitute a new scheme in its place. The Tribunal will be able to make directions to amend the scheme plan and schedule of unit entitlement for any scheme that has been affected by the taking (including any scheme belonging to it). Where part of a lot is taken the acquiring authority must lodge a plan with the Registrar that defines the new boundaries of the scheme.

Resumption of a community scheme

The Minister for Lands may take the whole of the land in a scheme within a community scheme and declare that the scheme for that parcel is terminated on the registration of the order.

Other aspects of a community scheme

Insurance for community schemes

  • A community corporation must insure, for replacement value, its common property and community corporation assets
  • Owners of lots on a scheme plan may insure for buildings and public risk on their lot as the community corporation is not responsible
  • A community corporation must maintain public liability insurance for the common property and relevant assets for not less than the amount specified in the Regulations
  • Public liability insurance will cover damage to property, death, bodily injury and illness
  • There are to be no exceptions to the above requirements except where the Tribunal makes an order, or the community corporation has by-laws that provide for at least a comparable level of insurance and the insurance is in place.
  • In the case of a community titles (building) scheme, the community corporation  will be deemed the owner of the building and must insure the building for its replacement value
  • The community corporation for a community titles (building) scheme is responsible for insuring common property in their scheme to full replacement value and is responsible for public risk arising in relation to the common property in that scheme. Community titles (building) schemes have an insurable interest in their part of the building despite the ownership of the building by the community corporation at a higher tier
  • Relevant other insurance conditions will apply to community corporations
  • The Community Titles Bill will permit a community corporation of a community titles (building) scheme to recover (from a lot owner) an amount which fairly reflects the portion of the premium attributable to the risk associated with something within that lot owner’s control
  • The community corporation is to obtain an independent valuation from a licensed valuer in respect to the building or buildings for which the community corporation is responsible at least every five years, and may recover the cost of the valuation from lot owners in proportion to their unit entitlement

Valuations in a community scheme

The unimproved value of land within a community scheme will be determined by:

  1. For a tier 1 parcel: as if the parcel were a single parcel of land owned by the community corporation
  2. For a tier 2 parcel or a tier 1 lot: as a proportion of the value of the tier 1 parcel to which it belongs, which is the same proportion as the relative unit entitlement
  3. For a tier 3 parcel or a tier 2 lot: in proportions the same as item 2 above.

The gross rental value of land subdivided by a community scheme will have to be provided as a separate valuation of each lot.

The capital value of land in a community scheme must consider the benefits and disadvantages applying to the lot as part of the community scheme.

Objections to a valuation are dealt with under the Valuation of Land Act 1978 and the objection must be made by the owner of the lot. When the objection is regarding a tier parcel then the community corporation is regarded as the owner.

Rating and Taxing

The owner of a lot is liable for the rate or tax as if the lot were a separate parcel of land. The community corporation will not pay rates or taxes.

Roads and access ways in a community scheme, subject to the relevant approvals, may have the status of:

  • privately owned by the community corporation of the tier in which they are common property
  • dedicated (transferred) to the relevant authority (e.g. a local government)
  • a mix of privately owned and dedicated to the relevant authority.

Disclaimer

This document has been prepared for informing stakeholders and the community on the nature and scope of the proposed legislation relating to community titles. Legislation is subject to government consideration and Parliamentary processes. This information should not be relied upon as a substitute for professional legal advice, nor relied upon as a guide for future legislation relating to strata titles or community titles in WA, or in relation to current or future subdivision or development proposals, commercial transactions or dealings in strata or community titles. Every effort has been made to ensure that the information presented is accurate at the time of publication. Because this document avoids the use of legal language, information about the law may have been summarised or expressed in general statements.

This page was last updated on: 23 May 2018