Owers-Brown v The Owners-Strata Plan No 92562; Nakkan v The Owners-Strata Plan No 92562

[2025] NSWCATCD 67

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Owers-Brown v The Owners-Strata Plan No 92562; Nakkan v The Owners-Strata Plan No 92562 [2025] NSWCATCD 67

Hearing dates:

10 November 2023; 4 and 26 June 2024; submissions, transcript and Court Book to 13 November 2024

Date of orders:

22 August 2025

Decision date:

22 August 2025

Jurisdiction:

Consumer and Commercial Division

Before:

G Sarginson, Deputy President

Decision:

(1)      By 3 months from the date of this order The Owners-Strata Plan No 92562 is to engage a suitably licensed builder or builders and/or tradespersons to perform the works set out in Schedule A of this decision.

(2)      All works are to be performed by suitably licensed persons exercising due care and skill and in accordance with any applicable legislation, including (to the extent applicable) the Home Building Act 1989 (NSW) and Design and Building Practitioners Act 2020 (NSW).

(3)       The lot owners of Lots 3 and 4 of the strata building are to give reasonable access to the owners corporation and all builders and tradespersons engaged by the owners corporation so that the works can be performed and completed.

(4)      There is no order as to costs, with each party to bear its own costs.

(5)      If a party seeks to vary the costs order the following orders apply:

(a)      Costs applicant is to file and serve costs submissions and documents by 14 days from the date of these orders.

(b)      Costs respondent is to file and serve costs submissions and documents by 28 days from the date of these orders.

(c)      Costs applicant is to file and serve costs submissions in reply by 35 days from the date of these orders.

(d)      Any party can apply to vary the procedural timetable for the filing and serving of costs submissions and documents by way of an application in writing to the Tribunal and the other parties by no later than the date of compliance with the relevant timetable obligation.

(6)      The proceedings in Case Number 2023/00401663 and Case Number 2023/00406758 are otherwise dismissed.

Catchwords:

LAND LAW – strata title – Strata Schemes Management Act 2015 (NSW) – whether timber decking is lot property or common property – duty of owners corporation to repair or replace – s 106 Strata Schemes Management Act 2015 (NSW) – whether duty breached – appropriate remedial orders

Legislation Cited:

Civil and Administrative Regulation 2022 (NSW)

Civil and Administrative Tribunal Act 2013 (NSW)

Civil and Administrative Tribunal Rules 2014 (NSW)

Conveyancing (Strata Titles) Act 1961 (NSW)

Design and Building Practitioners Act 2020 (NSW)

Home Building Act 1989 (NSW)

Interpretation Act 1987 (NSW)

Real Property Act 1900 (NSW)

Strata Schemes Development Act 2015 (NSW)

Strata Schemes (Freehold Development) Act 1973 (NSW)

Strata Schemes (Freehold Development) Regulation 1997 (NSW)

Strata Schemes Management Act 1996 (NSW)

Strata Schemes Management Act 2015 (NSW)

Strata Schemes Management Regulations 2016 (NSW)

Cases Cited:

Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336

CCS 251 Elizabeth Street Sydney Pty Ltd v Hellenic Club Ltd [2016] NSWCATCD 88

Coscuez International Pty Ltd v The Owners-Strata Plan No 46433 [2022] NSWCATAP 147

Dare v Pulham (1982) [HCA] 70; (1982) 148 CLR 658

Davenport v The Owners-Strata Plan No 536; The Owners-Strata Plan No 536 v Davenport [2018] NSWCATAP 301

Deacon v National Strategic Constructions Pty Ltd; National Strategic Constructions Pty Ltd v Deacon [2017] NSWCATAP 185

Dr N Kalokerinos Pty Ltd v Jain [2025] NSWCA 137

Fisher v Hebburn Ltd (1960) 105 CLR 188

Glenquarry Park Investments Pty Ltd v Hegyesi [2019] NSWSC 425

Gray v Sirtex Medical Ltd [2011] FCAFC 40; (2011) 193 FCR 1; (2011) 276 ALR 267

Harris v The Owners-Strata Plan No 34056 [2022] NSWCATAP 111

Hawach v A & A Building Services Pty Ltd [2024] NSWCATAP 138

Henadeck Pty Ltd v Independent Liquor and Gaming Authority; Niraula v Independent Liquor and Gaming Authority [2020] NSWCATAP 200

Hillpalm Pty Ltd v Wilson [2009] NSWSC 362

Hogan v Trustee of the Roman Catholic Church (No 2) [2006] NSWSC 74

Maple v The Owners-Strata Plan No 8950 [2021] NSWCATCD 108

Maxwell v Murphy (1957) 96 CLR 261

May v Ceedive [2006] NSWCA 396

McCrohan v Harith [2010] NSWCA 67

Melani v The Owners-Strata Plan No 22214 [2017] NSWCATCD 73

National Australia Bank v Blacker [2000] FCA 1458

Power Rental Op Co Australia, LLC v Forge Group Power Pty Ltd (in liq) (receivers and managers appointed) [2017] NSWCA 8

Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28

Proprietors of Strata Plan No 6522 v Furney [1976] 1 NSWLR 416

Re Day [2017] HCA 2; (2017) 340 ALR 368

Ridis v Strata Plan 10308 [2005] NSWCA 246; (2005) 63 NSWLR 449

Saunders v South Canberra Holdings Pty Ltd [2023] ACAT 71

Seiwa Pty Ltd v Owners Strata Plan 35042 [2006] NSWSC 1157

Shakiri v Holland [2024] NSWCATAP 28

The Owners – Strata Plan No 21563 v Rutherford [2023] NSWCATAP 326

The Owners - Strata Plan No 33368 v Gittins [2022] NSWCATAP 130

The Owners SP 35042 v Seiwa Australia Pty Ltd [2007] NSWCA 272

The Owners Strata Plan No 50276 v Thoo [2013] NSWCA 270; 17 BPR 33,789

The Owners-Strata Plan 32735 v Lesley-Swan [2012] NSWSC 383

The Owners-Strata Plan No 21563 v Rutherford [2023] NSWCATAP 326

The Owners-Strata Plan No 2661 v Selkirk [2024] NSWSC 760

The Owners-Strata Plan No 55468 v Silberstein [2025] NSWCATAP 102

The Owners-Strata Plan No 63341 v Malachite Holdings Pty Ltd [2018] NSWCATAP 256

The Owners-Strata Plan No 63731 v B & G Trading Pty Ltd (No 2) [2020] NSWCATAP 273

The Owners-Strata Plan No 68255 v Downs; Downs v The Owners-Strata Plan No 68255 [2021] NSWCATCD 34

Transport for NSW v Hunt Leather Pty Ltd [2024] NSWCA 227; (2024) NSWLR 489

Vickery v Owners-Strata Plan No 80412 (2020) 103 NSWLR 352

Walsh v The Owners-Strata Plan No 10349 [2017] NSWCATAP 230

Wells Group Pty Ltd v Betts [2025] NSWCATAP 70

White House Developments Pty Ltd v The Owners-Strata Plan No 70276 [2025] NSWCATAP 68

Texts Cited:

G.E. Dal Pont ‘Law of Costs’ 5th edition

Macquarie Dictionary 2025 edition

Category:

Principal judgment

Parties:

Case Number 2023/00401663

Kerri Owers-Brown and Lindsay Brown (Applicant)
The Owners-Strata Plan No 92562 (Respondent)

Case Number 2023/00406758

Robert Nakkan (Applicant)
The Owners-Strata Plan No 92562 (Respondent)

Representation:

Counsel:

Case Number 2023/00401663
J Jaffray (Applicant)
M Rennie (Respondent)

Solicitors:
Swaab Lawyers (Applicant)
WMD Lawyers (Respondent)

Case Number 2023/00401663
Counsel:
M Rennie (Respondent)

Solicitors:
BTC Lawyers (Applicant)
WMD Lawyers (Respondent)

File Number(s):

2023/00401663 and 2023/00406758

Publication restriction:

Nil

REASONS FOR DECISION

1. This is a dispute under the Strata Schemes Management Act 2015 (NSW) (SSM Act) between owners of adjoining Lots (Ms Owers-Brown and Mr Brown owing one Lot; Mr Nakkan owning the other Lot) that involves whether the owners corporation has complied with its duty to maintain and repair common property in respect of timber decking on balconies.

2. There are two separate Tribunal proceedings. Case Number 2023/00401663 is the application by Ms Owers-Brown and Mr Brown against the owners corporation. Case Number 2023/00401663 is Mr Nakkan’s application against the owners corporation.

3. As both proceedings involve similar issues and claims, both proceedings were listed for hearing together. The orders made apply to both sets of proceedings.

Background to the Dispute and Conduct of the Hearing

4. In this decision, the Tribunal has set out the lay evidence of the parties. The parties relied on a copious amount of lay evidence, and it is appropriate to set that evidence out so there is no doubt that the Tribunal considered it. Regrettably, that has contributed to the decision being protracted.

5. However, in closing written submissions of the parties, little reference is made to the lay witness evidence, and the focus of the submissions is upon the expert evidence.

6. The lot owners’ lay evidence is contained primarily in the affidavits of Ms Owers-Brown and Mr Nakkan. The owners corporation’s lay evidence is primarily contained in affidavits of current and former strata committee members (Mr Flood; Mr Schneller; and Mr Gehrig); former and current strata managers (Mr Hatzigeorgiou and Ms Lovie); and Mr Weir, a supervisor of the original builder of the strata building who was involved in the supervision of the installation of the timber decking by sub-contractors to the builder.

7. The proceedings were hard fought and the parties are likely to have incurred significant legal expenses. A reason for that may partly be animosity between Mr Flood; Mr Schneller and Mr Gehrig on the one hand and Ms Owers-Brown who was a strata committee member and, for a period, the Secretary of the strata committee, when the owners corporation took a position in NCAT proceedings involving a former lot owner (Mr O’Donnell) that timber decking was lot property and was the responsibility of lot owners to maintain and repair. Ms Owers-Brown now takes the position in these proceedings that timber decking is common property that the owners corporation has a duty to keep and maintain in a state of good repair.

8. Another reason may be the significant divergence between expert witnesses (in particular, Mr Wilkie and Mr Calandra) regarding the condition of the timber decking; and what is required for repair. In essence, Owers-Brown and Nakkan seek that the whole timber decking system proximate to their lots be removed and replaced, which will be of substantial cost. The owners corporation denies the property is common property and asserts that if it is, moderate repairs are appropriate.

9. There were 3 expert witnesses who gave evidence in the proceedings. Ms Owers-Brown and Mr Nakkan relied upon Mr Phil Buckley (flooring inspector of AFTA); and Mr Wilkie (building consultant). The owners corporation relied upon Mr Calandra (building consultant). After various directions (and attempts) to produce a coherent and detailed joint expert report, a final joint expert report was prepared dated 11 June 2024 that dealt with specific questions identified by the Tribunal.

10. As will be discussed later in the decision there is a significant divergence between Mr Wilkie and Mr Calandra on the nature of the defects in the timber decking and the appropriate method of rectification. Mr Wilkie assert the whole timber decking system proximate to Lots 3 and 4 needs to be removed and replaced. Mr Calandra asserts that only sections of decking boards (in the areas that are uncovered and more exposed to weather) need to be replaced. The difference in cost between the two methods of rectification is substantial. Mr Buckley agrees with Mr Wilkie on some issue and Mr Calandra on other issues, and states that remedial works involving waterproofing is outside the sphere of his expertise.

11. The hearing proceeded over 3 days (10 November 2023; 4 June 2024; and 26 June 2024). Ms Jaffray of Counsel appeared for Ms Owers-Brown, instructed by Saab Lawyers. Mr Crowley, Solicitor, appeared for Mr Nakkan. Mr Rennie of Counsel appeared for the owners corporation instructed by WMD Lawyers.

12. On the first day, Ms Owers-Brown; Mr Nakkan; and Mr Flood gave evidence and were cross examined. At the end of the first day, the Tribunal made procedural directions that included granting the owners corporation leave to amend their Points of Defence to raise s 106(3) of the SSM Act; and directed the expert witnesses to prepare a joint expert report setting out areas of agreement and disagreement.

13. On the second day of the hearing, the experts witnesses had not prepared a comprehensive joint expert report, although a form of joint expert report dated 3 June 2024 (signed by Mr Calandra, with Mr Buckley agreeing in an email; but not signed or agreed to by Mr Wilkie) had been prepared. The Tribunal directed the experts to confer and prepare a comprehensive joint expert report at a conference room at the Tribunal whilst the Tribunal was dealing with other lay witnesses.

14. The hearing proceeded on 4 June 2024 with Mr Hatzigeorgiou; Mr Schneller; and Mr Weir giving evidence and being cross examined (the other lay witnesses not being required for cross examination).

15. After the lay witnesses were cross examined, there was still no complete agreement between all of the experts in respect of a joint expert report. A form of a document was emailed to the Tribunal on 4 June 2024, but it was not a comprehensive and complete joint expert report that would allow the Tribunal to clearly understand the issues that the experts agreed upon and disagreed upon.

16. The Tribunal determined it appropriate to direct the experts to prepare a comprehensive joint expert report that addressed specific questions; contained a detailed scope of works; and clearly set out the areas of agreement and disagreement between the experts. The hearing was further adjourned so that report could be prepared. Due to the amount of time spent on cross examination of lay witnesses and interlocutory applications and arguments, the hearing would not have been able to conclude on 4 June 2024 in any event.

17. The final day of the hearing was 26 June 2024. The experts had prepared a Joint Expert Report dated 11 June 2024. That document exceeds 110 pages. The Joint Scott Schedule component of the report is in A3 page format 11 pages in length, with small font.

18. The experts (Mr Buckley; Mr Wilkie and Mr Calandra) were cross examined whilst giving concurrent expert evidence on 26 June 2024.

19. The evidence concluded on 26 June 2024, and there was a timetable for the filing and serving of written submissions. The parties also filed a transcript of all the hearing dates; and filed a Court Book (2 volumes).

20. The written submissions in chief of Ms Owers-Brown (prepared by Ms Jaffray of Counsel) are dated 9 August 2024. They are 29 pages in length, with an attached annexure being a scope of works in respect of the proposed work order sought by Ms Owers-Brown (referred to as “remedial works” but the works are “not necessarily limited to” the works set out in the annexure). There is also a schedule of documents identified.

21. The written submissions in chief of Mr Nakkan (prepared by Mr Crowley) filed on 9 August 2024 are 19 pages in length.

22. The written submissions in chief of the owners corporation (prepared by Mr Rennie of Counsel) dated 9 September 2024 are 41 pages in length.

23. The written reply submissions of Ms Owers-Brown (prepared by Ms Jaffray of Counsel) dated 30 September 2024 are 14 pages in length.

24. The written reply submission of Mr Nakkan (prepared by Mr Crowley Solicitor) filed on 25 October 2024 are 7 pages in length.

25. The transcript of evidence was filed on 1 November 2024 and the Court Book (which contained a compendium of the documents admitted into evidence at the hearing) was filed on 13 November 2024.

Factual Background

26. Ms Owers-Brown and Mr Brown are the owners of Lot 3 (referred to throughout the evidence of the parties as “Unit 103”). Mr Nakkan is the owner of Lot 4 (referred to throughout the evidence of the parties as “Unit 104”).

27. The strata building comprises of 8 levels. Lots 3 and 4 are located on level 1 of the strata building. The strata building is located in a southern Sydney suburb in close proximity to a beach.

28. The strata scheme comprises of 27 Lots, and common property.

29. The strata plan was registered on 23 December 2015.

30. Ms Owers-Brown and Mr Brown purchased their lot in about December 2016. They reside in the lot. Between late 2017 and mid-February 2023, Ms Owers-Brown was a member of the strata committee. Ms Owers-Brown is also, by occupation, a licensed strata manager.

31. In July 2021, Mr Nakkan and his wife (who is not a party to the proceedings) purchased Lot 4. Mr Nakkan and his wife moved into the strata building soon after purchase, and reside in their lot.

32. On 3 March 2023, Mr Nakkan commenced proceedings in the Tribunal.

33. On 3 April 2023, Ms Owers-Brown and Mr Brown commenced proceedings in the Tribunal.

THE CLAIMS

Owers-Brown

34. The orders sought are set out in the application filed on 3 April 2023, which has not been subsequently amended.

35. The following orders are sought:

1. The owners corporation “rectify the common property timber deck in Lot 3” under s 232 of the SSM Act, by reason of its breach of s 106(1) of the SSM Act.

2. The owners corporation “engage suitably qualified and licensed contractors to carry out the rectification works necessary to repair the common property timber deck in Lot 3 in accordance with the National Construction Code, applicable Australian Standards, the Design and Building Practitioners Act 2020 (NSW) and any other applicable legislation”.

3. The owners corporation pay damages to the lot owner under s 106(5) of the SSM Act.

4. An order invalidating the resolution (Motion 3) made by the owners corporation at a general meeting on 30 March 2023 in respect of maintenance of decks, pursuant to s 24(1) of the SSM Act and /or s 150 of the SSM Act.

5. The owners corporation pay the respondent’s costs of the proceedings.

6. “Any other order the Tribunal sees fit.”

Nakkan

36. Points of Claim were filed with the application. The following orders are sought:

1. The owners corporation “carry out the remedial work necessary to repair the damage to the common property of unit 104 being the timber decking on the terrace”.

2. The owners corporation “contract with suitably qualified contractors for the carrying out of all work necessary to rectify damage to the common property of unit 104, being the timber decking”.

3. The owners corporation pay damages under s 106(5) of the SSM Act.

Points of Defence

37. As no Points of Claim were filed in the Owers-Brown proceedings, no Points Of Defence have been filed in those proceedings.

38. However, the owners corporation filed Points of Defence in the Nakkan proceedings. The Points of Defence provide a narrative of why the owners corporation opposes the orders sought. It is clear the same position is adopted in the Owers-Brown proceedings.

39. The Points of Defence assert that since 2016 “the lot owners had always been informed, and believed, that the lot owners owned each of the timber decks for each unit or lot”. Instructions were “provided to lot owners for the care of the timber decking to their respective properties.”

40. The capital works fund and capital works fund plan were prepared and provisions on the basis that lot owners were responsible for any repairs required to timber decks. Other lot owners had undertaken works to replace or repair their own decks at their own expense.

41. In 2019, proceedings were taken in the Tribunal by Mr O’Donnell in respect of repairs to timber decking in unit 101. Those proceedings raised the issue of whether the timber decks were common property or lot property. The proceedings were “resolved.” A consent order provided, in part, that the owners corporation was to enact a by law to “bring the records of the strata into line with the owners expectations” (timber deck By-law).

42. Ms Owers- Brown was a strata committee member involved in the O’Donnell proceedings, and gave instructions to Solicitors engaged to represent the owners corporation. The position of the owners corporation was that the decks were lot property rather than common property. Ms Owers-Brown was “on notice of, and had indicated broad consent to” the timber deck By-law.

43. Ms Owers-Brown “delayed” the timber deck By-law being prepared and put before a meeting of the owners corporation.

44. On or about 30 March 2023, shortly after Ms Owers-Brown ceased to be a strata committee member, the timber deck By-law was passed at the Annual General Meeting of the owners corporation.

45. Ms Owers-Brown “now seeks to prevent the registration of that By-law” by bringing proceedings in the Tribunal seeking an order under s 150 of the SSM Act.

46. Both the Owers-Brown and Nakkan applications “attempt to exploit the delay in the passage of the timber deck By-law so as to bring artificially inflated claims that are unfair to other owners.”

37. Both proceedings “seek payments for works that are well in excess of any reasonable costs of repairing or replacing the timber decks to their original condition,” and seek “capital improvements to the lot property rather than a direct like-for-like repair to the timber deck.”

38. There are “significant questions” as to whether the lot owners “neglect” has caused damage to the deck. In the Nakkan proceedings, “the damage to the deck matches a mat of grass placed on the deck for the urination use of the previous owners pets, and where large heavy pots had been placed directly onto the timber.” In the Owers-Brown proceedings “observations of persons that have visited the unit and the expert engaged provide an inspection suggest that the deck has not been maintained in accordance with the guidance provided to all lot owners, and shown deterioration only where heavy pots and furniture has been placed directly onto the timber.”

39. Although the owners corporation has not filed its own proceedings in the Tribunal, it seeks “orders” in its Points of Defence. The orders sought are as follows:

1. Both sets of proceedings be dismissed.

2. The owners corporation “is to register the timber deck By-law at its earliest convenience.”

3. Owers-Brown and Nakkan pay the owners corporation’s costs of the proceedings.

4. “Such further order as the Tribunal sees fit.”

Evidence Of The Parties

Affidavits of Ms Owers-Brown

50. Ms Owers-Brown affirmed two affidavits (13 July 2023 and 1 November 2023).

Affidavit of 13 July 2023

51. Ms Owers-Brown states that she and her husband purchased the lot in late December 2016, and moved in to the lot approximately 6 weeks later.

52. She was a strata committee member “from late 2017 until mid-February 2023”. Ms Owers-Brown was, for a period of time, the Secretary of the strata committee.

53. Her lot “features a terrace area that is approximately 137 m2 that is mostly covered by a timber deck. Some parts of the deck are uncovered.”

54. At all relevant times, Network Strata Services Pty Ltd t/as Netstrata have been the strata managing agent of the owners corporation.

55. Ms Owers-Brown asserts that in “about May 2019” she became aware that the owners of unit 101 (i.e. a lot on the first floor of the strata building) Mr and Ms O’Donnell had “raised concerns that the timber deck located on the terrace at their unit was exhibiting signs of failure”. Ms Owners-Brown contacted the builder of the strata building, Sammut Constructions Pty Ltd (Mr Mark Weir) who told her the timber decking had been installed “by a sub-contractor.”

56. Ms Owers-Brown asserts she first noticed “signs of failure” of the timber deck of her lot in “about February 2020”. The “signs of failure” are identified as:

1. Timber panels showing “signs of decay and distortion.” Timber panels were “swelling and compacting against each other” and “boards were distorting out of place and no longer sat flat.” Timber deck boards “that were uncovered” had “also begun to decay.” Boards felt “spongy underfoot with the boards lagging and lacking in firmness”. In other areas boards had become a “trip hazard” because they were not sitting flat.

2. There were “holes forming in the timber boards, which had worsened over time.” The “worst areas of decay, with visible and large holes” were “immediately adjacent to the living area where the timber was exposed to weather conditions.”

3. When it rained, “rain would pool on top of the timber boards and did not drain.”

57. According to Ms Owers-Brown “over the course of the next 18 months” she “became aware” that other lot owners were experiencing similar problems with deterioration of timber decks and drainage. This included the owners of Lot 4 (unit 104).

58. On 18 December 2019, the owners corporation received written legal advice from Grace Lawyers. A copy of that advice is annexed to the affidavit of Ms Owers-Brown (but not the letter of instruction). That advice is addressed to The Secretary of the owners corporation. The advice was given in the context of an application by Mr O’Donnell and his wife for a NSW Fair Trading mediation in respect of seeking repair to the timber deck proximate to their lot.

59. The advice states that the lawyers had been instructed by the owners corporation that the “view” of the owners corporation was that repair of the decking was not the responsibility of the owners corporation. Rather, “all owners assumed individual responsibility for repair and maintenance of the decks on their respective terraces since the plan was registered.”

60. Grace Lawyers stated that it was their view that the timber decking formed part of the flooring of the building (having been installed when the strata building was constructed) and:

“Due to the method of affixation was intended to form part of the flooring system of the terraces and as such is common property…the timber deck in our view forms part of the flooring to the terrace and as such forms part of the common property. It is also apparent from the Lifestyle Decking Manual that the timber deck is affixed to the slab/floor by being screwed to the floor underneath which means, and it is arguable, that it became a physical part of the floor at registration of the strata scheme (the relevant date).”

61. The advice also recommended that the owners corporation obtain an expert report to address the assertion by Mr O’Donnell and his wife that damage had been caused due to water penetration by reason of blocked drainage pipes.

62. In June 2020, Mr O’Donnell and his wife commenced Tribunal proceedings against the owners corporation. Mr O’Donell and his wife sold their lot on 19 August 2020. There was a dispute about whether Mr O’Donnell and his wife had standing to continue with the application, but it is unnecessary to refer to that issue.

63. On 29 March 2021, McDonald SM gave a written decision, a copy of which was attached to the affidavit. The decision refers to two complaints relevant to these proceedings by Mr O’Donnell and his wife, although a number of different complaints were made and relief sought including a dispute about production of strata documents.

64. The first was water ingress into the garage of their lot. The second was stormwater “ponding” on the timber floorboards of the terrace to the lot causing damage to common property, and a “concern” that water could enter the lot.

65. McDonald SM made stated the following (at [27]-[31]):

“The timber floorboards form part of an installed floor and drainage system and are supplied, manufactured product of “Urbanline Architectural… The timber floorboards are permanently fixed over concrete joists in the support structure with the entire area of the terrace sealed with a non-applicable membrane over a shaped concrete surface that creates a drainage basin. The concrete slab underneath the timber floorboards varies in its flatness between 60mm and 100mm in depth to allow for water flow and slopes across the area that directs water to the outlet.

The applicants claim that the timber floorboards and the maintenance of the drainage system beneath the timber floorboards on the balconies and terraces of each allotment are part of the common property of the strata scheme and thus the responsibility of the owners corporation as the timber floorboards form the floor of each lot and form part of the drainage system of the building on the balconies and the terraces.

The strata committee, the owners corporation and the strata manager all apparently refute this and claim that the maintenance of the timber floorboards and of the drainage system are the responsibility of each lot owner.

The Tribunal is not required to determine this issue finally and for the purposes of this hearing. The Tribunal also notes in fairness that because of the nature of this hearing, no evidence was adduced by the respondent about the drainage system which was installed on the terraces and balconies and which could contradict the evidence of the applicants.

However, the Tribunal then simply notes at this time at a strong prima facie case exists in support of the applicant’s assertion that the timber floorboards and the drainage system on the balconies and terraces of the strata scheme should be properly characterised as common property, and therefore that the care and maintenance of them should be matters for the owners corporation.”

66. At this juncture, it is important to note that under s 37 of the SSM Act, strata committee members have a duty perform their functions, so far as is practicable, for the benefit of the owners corporation, and with due care and diligence. The benefit of the owners corporation means the benefit of all lot owners, not one or a select group.

67. According to Ms Owers-Brown, in late 2021 due to her (and the strata committee’s) concern about defects in the strata building, she “took the lead” to engage experts to identify the defects in the strata building and the method of rectification. This was done in the context of the six-year period for statutory warranties under the Home Building Act 1989 (NSW) (HB Act) nearing expiration.

68. In October 2021, the owners corporation instructed Grace Lawyers to commence legal proceedings against the builder of the strata building, and the developer. The developer was Sammut Family Pty Ltd, a related company to the builder of the strata building.

69. In November 2021, legal proceedings were commenced.

70. On 25 November 2021, Mr Poriters of RHM Consultants Pty Ltd prepared a expert report on defects in the strata building, and method of rectification. A copy of that report is attached to the affidavit. The following is set out at pp 21-22 of the report:

SYSTEMIC DEFECTS Continued

Location & Description

Balconies and terraces (Units 101, 102, 103, 104 and 801)

1. Units 101, 102, 103, 104 and 801 have balconies and terraces that feature the proprietary timber decking system described in the preceding Item SD.3 (Lifestyle Decking by Woodform Architectural).

2. Units 1010, 102, 103, and 104 are located on Level 1 and features a large balcony, areas of which are also exposed externally (i.e. to sun and rain).

3. Unit 801 is located on the top floor of the building and features a large balcony, areas of which are also exposed externally (i.e. to sun and rain).

4. The areas of the timber decks that are exposed are exhibiting deterioration despite frequent re-coating by the owners of these units.

5. The owners of these units also instructed that the timber decking boards swell, expand, buckle, warp and displace (particularly at joints between boards). This was evident to varying degrees on each of the balconies and terraces.

6. The owners of these units also instructed that as a result of the swelling/expansion of the timber decking boards, the gaps between same close, and this consequently allows undrained water to accumulate on the timber decks after rainfall.

7. The species of hardwood timber used on the decks was not determinable and requires confirmation.

8. A generic brochure for the proprietary decking system has been provided, but no project specific designs or specifications have been provided.

Cause(s)

1. Inadequate provision in timber decking board fixing system to accommodate movement of timber decking boards.

2. The gaps created between the individual timber decking boards may be inadequate to accommodate movement/expansion of the timber decking boards. The generic brochure indicates nominal 3mm gap, which may be inadequate.

3. The clearance around the perimeter of the timber deck is inadequate. The generic brochure indicates a nominal 5 mm clearance. The clearance was measured in various locations, with no clearance having been provided.

4. A review of the project specific designs and specifications will be required to determine how the movement of the timber decking boards in exposed locations was accounted for in the design of the decking system.

Breach(es)

1. Under Section 18B (b) and (c) of the Home Building Act 1989 (NSW):

(b) Failure to supply materials that are good and serviceable for the purpose for which they are used (i.e. a timber decking system suitably durable for the conditions of service).

(c) Failure to perform work that complies with the Home Building Act.

Recommended Scope of Works/Method of Repair

1. Set up work areas and protect surrounding surfaces.

2. Disassemble the timber decking system.

3. Reinstate the timber decking system ensuring adequate provisions in fixings to accommodate movement of boards, and adequate gaps/clearances around boards to accommodate expansion.

4. Re-coat timber decking boards.

5. Clean up and make good work areas.

Note: If the proprietary system is no longer available, and it is not possible to salvage and reinstate existing timber boards, consideration will need to be given to replacing the timber decks.

Location and Description

Balconies and Terraces

1. The balconies and terraces throughout the building do not have stormwater drainage overflow outlets (e.g. splitter pipes).

2. Accordingly, there is a risk that the balconies and terraces will flood with water in the event of surcharge occurring throughout the stormwater drains or blockage during heavy rainfall. This water could then overflow into the building interior.

3. This issue is considered to be systemic because it was evident on all balconies and terraces that were inspected. 8 of the 27 units were inspected, which is considered to be a sufficiently representative sample of units in the building. A review of the buildings hydraulic drawings (tender issue) also indicates that there are no overflow provisions on any of the balconies of the terraces.

Cause(s)

1. Failure to create suitable overflow to drainage outlets to service the balconies and terraces.

Breach(es)

…

2. The absence of any overflow provision to prevent the entry of stormwater internally into the habitable areas within the building has failed to comply with Australian Standard AS/NZ3500.3:2003 ‘Stormwater Drainage’ nominates for the requirement to prevent surface water overflow from entering the building.

…

Recommended Scope of Works/Method of Repair

1. Engage a hydraulic consultant/engineer to assess the set up and configuration of the existing balcony terrace stormwater systems and design a suitable overflow layout/drainage plan.

2. On the upper level balconies, core or cut through the base of the perimeter hobs:

-Set up work areas and protect surrounding surfaces.

-Establish suitable access provisions to allow the work to be carried out safely.

-Carefully core or cut through the perimeter hobs at appropriate positions.

-Insert PVC or stainless steel splitter pipes into the core holes. In short the splitter pipes project outward adequately and do not discharge onto the building.

-Seal around the splitter pipes.

-Repair any damaged surfaces around the new splitter pipes.

-Paint PVC splitter pipes.

-If the perimeter hobs were cut, appropriately finish and waterproof the hobs to match surrounding surfaces.

-Clean and make good work areas.

…

71. After receipt of the RHM Consultants report, Mr Weir and Mr Poriters conducted a joint inspection of the strata building, and prepared a joint report.

72. The date of the joint report is 22 July 2022. A copy of that report is attached to the affidavit.

73. In respect of the relevant balcony/terrace defect items referred to previously, Mr Weir commented that he did “not agree” in respect of the balconies and terraces to Units 101; 102; 103; 104 and 801. In respect of balconies and terraces generally (the lack of drainage overflow outlets) the comments were as follows:

MW advised that the finished heights of the hobs around the outer perimeters of the balconies are lower than the hobs/steps beneath the balcony doorway openings, thus providing for overflow.

GP accepts this in principle. Measurement with a rotary laser level will be required to confirm this.

74. Ms Owers-Brown asserts that between mid-December 2021 and August 2022 there were negotiations between the owners corporation and the builder and developer to resolve the strata building defects dispute.

75. After the joint report of Mr Poriters and Mr Weir, Ms Owers-Brown asserts it was made “clear” to her the majority of the strata committee did not support obtaining further expert evidence on the timber decking on the balconies/terraces and the drainage system. She then “reached out” to the owners of units 101, 102, 104, 504 and 801 to obtain a further expert report.

76. According to Ms Owers-Brown, these Lot owners jointly engaged an expert report from Mr Buckley of the Australasian Timber Flooring Association (AFTA).

77. Mr Buckley provided a report dated 1 August 2022. A copy of the report is attached to the affidavit.

78. The circumstances of the engagement of Mr Buckley are set out in a letter that Ms Owers-Brown sent to lot owners “as Secretary of the Strata Committee” referring to a general meeting of the owners corporation being called on 22 August 2022 in respect of “the overall management of the current building defect claim”. The letter relevantly states as follows:

“In addition to the agenda, I wanted to write and share with you some additional reports, that I believe are vital in forming a complete understanding of the issues surrounding one significant aspect of the defect reports, that has not been resolved, and that is the timber deck system used in Breeze.

Despite the timber decks being listed in the initial RHM Consultants defect report, the Strata Committee received a recommendation from RTM Consultants and Grace Lawyers that a further expert report be sought to better analyse the performance of the timber deck system. So, six owners (including myself) sought out and paid for an inspection by a qualified expert who has experience in giving expert evidence in the NSW Civil and Administrative Tribunal (NCAT) proceedings, and that report is attached.”

79. The report of Mr Buckley dated 1 August 2022 relevantly states:

80. He inspected the strata building on 27 July 2022. The purpose of the inspection was to “assess the owners’ concerns regarding the wear and tear of the external decking to the terraces for each apartment unit.”

81. The decking is a proprietary system manufactured by Woodform Architectural Pty Ltd. That manufacturer no longer produces timber decking.

82. The boards have been installed to treated pine battens (estimated to be 35-45mm in thickness). The battens have been mechanically fixed to the concrete with packers of various thickness elevating the battens off the concrete slab.

83. There appears to have been no coating applied to the cut ends, sides or undersides of the boards “although this was not confirmed.” The surface of the boards has been coated as part of the regular maintenance of each unit owner at different intervals “with the majority of unit owners stating that the applications of decking finish were applied at 6-12 month intervals, as per the maintenance guide provided at handover”.

84. The decking was installed as part of the original strata building.

85. Owners had “implied” that they had taken responsibility for maintenance.

86. Owners had complained of difficulty in accessing the drainage system below the decking.

87. Owners had “expressed that areas not exposed to the elements performed well when maintained effectively.”

88. Unit 103 (the Lot of Ms Owners-Brown and Mr Brown) had a south eastern aspect with approximately 40% of the deck undercover. The set down depth of the decking was approximately 65-85mm. The “areas with more weather protection are in good condition, with the owner expressing they were pleased with the aesthetics and performance of the deck in covered locations.” The exposed areas of the deck had “considerable damage and distortion observable to the decking boards.” Gaps between boards had closed, the boards showed signs of decay and fungal growth. The “structural breakdown of the boards had also developed in multiple areas of the exposed decking area.”

89. Unit 104 (Mr and Ms Nakkan’s Lot) had a south western aspect with approximately 50% of the total deck area undercover. “As per all other units, the areas undercover performed well and were aesthetically pleasing.” However, “as per all other decks, compromised or missing perimeter expansion, gaps between boards, decay and fungal growth and structural breakdown of boards” was observed in the exposed area of the deck.

79. The owners of Unit 101 provided photographs of works conducted by a plumber showing boards removed. A photograph showed “what appears to be a drain in the concrete sub-floor of this unit” (in the centre of the photo, which is silted up) whilst the following photograph shows a close up view of the same batten system with a pre-set gap beneath the battens, established bey what appears to be nylon packers.

80. Mr Buckley’s conclusion is set out at pp 18-22 of the report.

81. He asserts “moisture is affecting boards in areas exposed to the elements that are not sufficiently repelling water and not drying quickly enough to prevent decay in the hardwood timber decking.” The decking system sits low to the ground, and most decks have less than the 75 mm of clearance from the lower surface of the deck to the concrete slab (75 mm is the figure recommended by AFTA in its publication “Residential Timber Decks-Industry Recommendations (February 2014)”. There is no “cross flow or mechanical ventilation in place around any of the deck areas.” There are no removable panels or sections to allow for cleaning or maintenance under the decks. Plant debris had built up below the decking, trapping moisture and reducing water flow to drainage points. The durability of the timber used (Spotted Gum) is less than that recommended for a “close to ground installations.”

82. According to Mr Buckley, a “combination” of construction and drainage issues has caused there to be a build-up of moisture in the timber decking, causing lateral expansion of the decking boards, fungal growth, and decay over time. There was also an absence of expansion gap at board edges. This had contributed to the moisture below the decks and created water pooling at board edges, accelerating moisture penetration and degradation to untreated board areas.

83. Mr Buckley stated (at p 21):

“When considering the above information and the condition of the decking on site-both in areas exposed to the elements and areas undercover, it is apparent that design and installation shortcomings have created a deck system that is not equipped to deal with long term exposure to the natural elements. It is also apparent that in areas exposed to minimal wet weather (areas under cover) that the decking system is performing well.

The deterioration of the decking over time is considered irreversible and is also considered to be largely unavoidable. That is, whilst the surface coating may have been insufficient in some areas in the past, all areas of the deck observed during the inspection were sufficiently coated for normally expected conditions. However, as no access points or removable decking system were installed, there was no way to proven to remove the accumulation of debris beneath the decking, nor was the rear, sides, and cut ends of the timber surface treated in a manner designed to withstand the build-up of moisture over time without developing fungal growth and decay. Furthermore, the design and installation of the decking does not allow for good cross flow ventilation (nor was mechanical ventilation observed to have been fitted)., which is critical when considering decking built close to the ground.”

95. Mr Buckey (at pp 22-23) referred to “remedial options”. He believed it was “apparent” that undercover areas have “performed well and are not in need of remedial measures” but exposed areas “are not functioning to a suitable standard.”

96. He stated, “remedial measures would be considered necessary to exposed areas only, providing that the decks can be made up of separate installations and possibly systems or products.” Exposed areas of the deck are “damaged beyond repair in most cases” and would eventually need to be removed and replaced. Due to the “restrictions on site to set down depth” it would be “prudent” to “replace all areas with materials unaffected by moisture, such as aluminium, PVC composite materials, or stone/ceramic materials (but noting that some of these materials can become hot underneath).”

97. Mr Buckley also states that any newly installed decking system must have adequate access points to allow regular maintenance of the cavity between the deck and concrete slab.

98. In August 2022, the owners corporation called an Extraordinary General Meeting (EGM).

99. The EGM was held on 22 August 2022.

100. The agenda for the EGM included Motions in respect of the following:

1. A Deed be prepared by Grace Lawyers to resolve the NCAT strata building defect proceedings against the builder and developer of the strata building, with an agreed scope of works for repairs to be performed (Motions 4 and 5).

2. A special By-law be passed (Motion 7) to “absolve” the owners corporation from certain repair responsibilities and “provide definition of the maintenance responsibilities of the fixtures and fittings within a lot and any appliances that only service a single lot within the strata scheme”. Relevantly, that proposed special By-law stated that lot owners, rather than the owners corporation, would be responsible for:

3.5. Balcony/Courtyard Areas

a. All tiles, pavers and decking.

…

3. The owners corporation engage a suitably qualified lawyer to draft a By-law “transferring repair and maintenance of decking under s 143 (of the SSM Act)” and “appoint a member of the strata committee as a point of contact to provide the owners corporation with instructions as required”. When the proposed By-law was drafted, it would be put to a general meeting of the owners corporation (Motion 8).

101. The proposed Deed with the builder and developer did not include repairs to the timber decks. According to Ms Owers-Brown, the builder and developer had adopted the position that issues with timber decking were “fair wear and tear.” Prior to the meeting, in her capacity as Secretary of the owners corporation, Ms Owers-Brown sent lot owners an emailed letter on 17 August 2022, that included a copy of the report of Mr Buckley.

102. At paragraphs [44]-[50] of her affidavit dated 13 July 2023, Ms Owers-Brown gives her account of what was discussed at the EGM on 17 August 2022. Two Solicitors from Grace Lawyers attended the meeting.

103. According to Ms Owers-Brown Solicitors from Grace Lawyers orally asserted at the meeting the timber decking was common property, and had been “orally told” by Mr Poriters it may cost $300,000-$400,000 to rectify the defective timber decking. Ms Graves, of WMD Lawyers, attended the meeting on behalf of the builder and developer. According to Ms Owers-Brown, Ms Graves told the meeting the decking was lot property rather than common property and the builder and developer were not responsible or liable to repair.

104. Ms Owers-Brown asserts that Motion 5 to settle the legal proceedings against the builder and developer passed by simple majority (approximately 60% of unit entitlements in favour) and Motion 7 was “either defeated or withdrawn from voting”.

105. The Minutes of the EGM on 22 August 2022 state that Motion 7 was “defeated by special resolution” as more than 25% of unit entitlements voted against it. Motion 8 was “marked as a motion of no consequence as owners who would be affected by such an undertaking advised they would not sign consent”.

106. Ms Owers-Brown states that in the period September-October 2022 she and “other Level 1 owners” obtained “quotations from strata remedial builders to understand what was involved to rectify the timber decks in accordance with the requirements of the Design and Building Practitioners Act 2020 (NSW)” (DABP Act).

107. The affidavit contains the following documents:

1. “Budget Clarification” of Structural Building Pty Ltd dated 30 September 2022. That document is a “budget costing only” and does not include a detailed scope of works or costings in respect of a design in accordance with the DABP Act. The costings are $947,749 for replacement of decking of Units 101, 102, 103 and 104 (including new paving); plus HWI Insurance of $85,870. There is a separate amount for Unit 801 ($313,500).

2. Tender Submission of Builtbeta dated 25 October 2022. That document contains a scope of works, with a price of $874,465 (inclusive of GST) for works to Units 101, 102, 103, and 104.

3. Tender Submission of Builtbeta dated 25 October 2022. That document is in respect of “option 2”, which is identified as the removal of existing decking and the supply and installation of “new engineered timber decking” to units 101, 102, 103 and 104. The cost is identified as $332,735 (inclusive of GST).

4. Tender Submission of Builtbeta dated 25 October 2022. That document is in respect of “option 3-engineered decking” to Units 101, 102, 103 and 104. The cost is identified as $992,996 (inclusive of GST).

108. On 8 September 2022, Swaab Lawyers (who were engaged by the Lot owners on Level 1 of the strata building) wrote to the Solicitors for the owners corporation asserting that the timber decking required repair and that either the owners corporation should conduct repairs pursuant to its duty under s 106(1) of the SSM Act within 3 months; or the owners corporation should pursue the builder and developer for repairs to be conducted, in circumstances where the Deed had yet to be executed.

109. On 8 October 2022, Ms Owers-Brown wrote to lot owners. In summary, that letter asserted that the timber decking on Level 1 required repair; it was common property; the owners corporation would incur significant costs if it conducted the repairs; the signing of the Deed should be “paused” while the owners corporation attempts to have rectification of the timber decking included in the Deed. The letter also states that “Richard and David” of the strata committee had engaged WMD Lawyers to “represent them (sic) in the dispute with those of us who have the defective timber decks.” WMD Lawyers had acted for the builder and developer, and it was asserted that there was a conflict of interest.

110. In November 2022, Ms Owers-Brown (and her husband) and Mr Nakkan (and his wife) applied to NSW Fair Trading for mediation of the strata dispute. That mediation occurred on 17 February 2023, but it was unsuccessful.

111. On about 1 February 2023, the agenda for the strata scheme 2023 Annual General Meeting was sent out. The meeting was scheduled for 15 February 2023.

112. The agenda for the AGM contained the following relevant Motions:

1. Motion 20-Absolution of Maintenance Lot Fixtures and Fittings. It is asserted in the agenda that the proposed By-law was drafted using as a “guide” a November 2011 Land and Property Information (now Land and Registry Services) guild to “the maintenance responsibilities affecting lot property within a scheme in an attempt to clarify…grey areas surrounding maintenance”.

2. Motion 21-Absoultion of Maintenance of Decks. It is asserted that in a “Fair Trading settlement agreement” (sic) dated 9 January 2020, a lawyer would be engaged by the owners corporation to draft a By-law regarding “maintenance of the timber terrace”. No By-law had been “formalised” and “this is the opportunity to ensure compliance with that agreement set out.”

113. At paragraph [62] of the affidavit, Ms Owers-Brown states she attended the meeting. Motion 20 was defeated. Motion 21 “was passed…despite four (4) Lot owners voting against it”.

114. The Minutes of the AGM state in respect of Motion 21:

RESOLVED That the Owners Corporation decide by Special Resolution* pursuant to sections 136 and 141 of the Strata Schemes Management Act 2015 to pass “Special By-law-conferring the responsibility of the decks in the terms set out as attached to the notice of this meeting (see annexures) and to lodge notification of the by-law as a consolidated set of all existing by-laws for registration at NSW Land and Registry Services.

Vote: 16 Resolve, 0 Abstain, 4 Defeat

115. On 27 February 2023, Ms Owers-Brown emailed the strata manager stating that as the proposed common property rights By-law did not have the consent of all Lot owners, the owners corporation should not register it.

116. On 28 February 2023, the strata manager Ms Lovie responded by email stating that “I confirm we are not registering this By-law at this time”.

117. On 16 March 2023, the strata manager circulated to Lot owners a notice of an EGM that was to proceed by “pre-meeting vote only” on 30 March 2023.

118. Motion 3 was a Special Resolution Motion “Absolution of Maintenance of Decks” which, according to the meeting agenda, was “prepared by WMD Law”. The Motion was:

“That the Owners Corporation decide by Special Resolution* pursuant to sections 136 and 141 of the Strata Schemes Management Act 2015-Absolution of Maintenance of Decks in the terms set out attachment to the notice, and to lodge notification of the by-law and a consolidated set of all existing by-laws for registration at NSW Land Registry Services.”

119. The “explanation of agenda items” stated:

“As a result of the Fair Trading (sic) settlement agreement dated 9 January 2020 File No 00312273 it was confirmed in point 5 that a lawyer would be engaged and a by-law put forward for the owners corporation’s consideration. This seeks to confirm no ambiguity in relation to the responsibility being that of the lot owner.

While I confirm this motion was passed at the recent annual general meeting, we note that there were concerns raised over consent being applicable. Accordingly, the lawyer who drafted the motion and By-law confirms:

Under the Strata Schemes Management Act, a by-law is only required to have consent if it involves rights over common property of the scheme.”

120. According to Ms Owers-Brown (at paragraph [67]) the Minutes of the ‘meeting’ on 30 March 2023 state Motion 3 was passed by a vote with 92% in favour. However, a copy of the Minutes of the meeting do not appear to be attached to her affidavit.

121. Ms Owers-Brown states that “from about 28 April 2023” she was “aware” that the strata committee had placed registration of the By-law “Absolution of Maintenance of Decks” on “hold” pending determination of these NCAT proceedings.

Affidavit of Ms Owers-Brown dated 1 November 2023

122. The affidavit of Ms Owers-Brown dated 1 November 2023 is primarily an affidavit in reply, but it does include “updated estimate of costs for replacement of the timber deck” of Lot 3.

123. The “estimate” is a quotation of #1 Decks Decking and Pergola Specialists dated 24 October 2023. The quote is to supply and install Dekorator composite decking with hidden clips. The total cost (inclusive of GST) is $45,343.12.

124. The remainder of the affidavit is a reply to the affidavits of Mr Alan Richard Flood (known as Richard); Mr Andrew Schneller; Mr David Gehrig; Mr George Hatzigeorgiou; and the expert report of Mr Emilio Calandra obtained by the owners corporation.

125. Mr Flood is the owner of Lot 12 and has been, at all relevant times, a member of the strata committee.

Reply to Mr Flood’s Affidavit

126. Ms Owers-Brown asserts:

127. She was a strata committee member between 4 September 2017 and 15 February 2023. In the period from 15 February 2022 until 15 February 2023 she was the Secretary of the strata committee.

128. She obtained her license as a strata manager on 27 November 2018 and first commenced work as a strata manager on 19 March 2019.

129. Ms Owers-Brown did not have a “short fuse” with contractors.

130. In respect of the O’Donnell proceedings in the Tribunal, Ms Owers-Brown denies it was her firm view that decking was lot property. Rather, her belief was that it was unclear and that the owners corporation should obtain legal advice.

131. Ms Owers-Brown denies that she was, in effect, the strata manager of the property. At the relevant time, Mr Hatzigeorgiou of Netstrata was the strata manager. Ms Owers-Brown relayed instructions from the strata committee to Grace Lawyers.

132. At no time did two other strata committee members assert that the legal advice from Grace Lawyers about responsibility for the decking was wrong.

133. Ms Owers-Brown denied that she was of the view that the timber decks were lot property during the period of the O’Donnell litigation. Rather, she asserts that the issue was subject to legal advice, and she was not the one who circulated a “newsletter” to lot owners that they were responsible for the maintenance and repair of timber decking. She agrees she sent an email to Grace Lawyers on behalf of the strata committee instructing them to draft a By-law making Lot owners responsible for repair and maintenance, but “it was still open to Lot owners who did not agree that the timber decks were Lot property to refuse to pass the By-laws.”

134. Ms Owers-Brown denies that there was any conflict of interest in her position on the strata committee and a Lot owner on level 1 of the strata building experiencing damaged timber decking in respect of the strata committee’s negotiations with the builder and developer to rectify building defects.

135. Ms Owers-Brown was concerned that the damage to timber decking on level 1 was not considered to be a building defect in the claim against the builder and developer. It was on that basis, as well as the recommendation of Grace Lawyers, that she and other owners on level 1 obtained the expert report of Mr Buckley.

136. Mr Flood was “not supportive” of the report of Mr Buckley being circulated to all lot owners.

137. Ms Owers-Brown denies that she, in her capacity on the strata committee, deliberately delayed the preparation of the By-law that would make lot owners responsible for the repair and maintenance of timber decking. She further denies that she is attempting to benefit from the owners corporation replacing the timber decking. Rather, she asserts that it is the owners corporation’s responsibility to ensure that common property is a good state of repair.

Mr Schneller’s Affidavit

138. In reply to the affidavit of Mr Schneller, Ms Owers-Brown asserts:

139. Mr Schneller is the Lot owner of unit 801.

140. Mr Schneller’s description of “minor” damage to the timber decking of unit 801 is inconsistent with what he told Ms Owers-Brown in May 2022 by email.

141. Ms Owers-Brown disagrees with Mr Schneller’s opinion that he only saw “minor deterioration” of the timber decking on level 1 of the strata building. Ms Owers-Brown relies on photographs of the timber decking of Lot 3 taken by her husband which, she asserts, clearly shows the damage is beyond “minor”.

142. In September 2022, Ms Owers-Brown informed Mr Schneller that the remedial builders she had asked to quote for repairing the timber decking system on level 1 of the strata building would not provide a quotation in respect of Mr Schneller’s lot because Mr Schneller’s “plan of repair” would “not result in a warrantable system”.

Mr Gehrig’s Affidavit

143. In reply to the affidavit of Mr Gehrig, Ms Owers-Brown asserts:

144. Mr Gehrig never raised with her, orally or in writing, any concerns about how the strata committee dealt with the O’Donnell proceedings, or any other issue during her time as a strata committee member.

Mr Hatzigeorgiou’s Affidavit

145. In reply to the affidavit of Mr Hatzigeorgiou (the former strata manager), Ms Owners-Brown asserts:

146. Ms Owers-Brown was the strata committee member assigned to manage communications with Grace Lawyers.

147. Ms Owers-Brown denies that she regularly instructed Mr Hatzigeorgiou to “remove” from owners corporation meeting agendas a proposed By-law that lot owners were responsible for the repair and maintenance of timber decking. Rather, no draft By-law had ever been provided by Grace Lawyers.

148. She did not keep Mr Hatzigeorgiou “in the dark” about the progress of the O’Donnell litigation.

Mr Calandra’s Expert Report

149. In reply to the owners corporation’s expert report of Mr Calandra, Ms Owers-Brown asserts:

150. She and her husband did not oppose Mr Calandra lifting timber boards to conduct his inspection of the timber decking of Lot 3. Rather, they sought that if any boards were lifted, they were repaired and, if possible, the lifting of boards was to be performed at the perimeter of the deck to limit damage.

Affidavit of Mr Nakkan dated 5 July 2023

151. Mr Nakkan purchased Lot 4 (unit 104) with his wife on 5 July 2021.

151. The timber decking of the terrace of Lot 4 is approximately 65 sqm. Approximately 30 sqm is uncovered.

152. Mr Nakkan’s affidavit attaches copies of the report of Mr Buckley and the report of RHM Consultants. The detail of those reports have been set out previously.

153. In respect of the EGM on 22 August 2022, Mr Nakkan states that he opposed the resolution to enter into the Deed with the builder and developer, because the scope of works in the Deed did not include repairs to the level 1 timber decking.

154. According to Mr Nakkan, there are drainage problems on the concrete slab underneath the timber decking of Lot 4. There are a significant amount of trees in close proximity, and plantar boxes that discharge foliage. The south-west aspect of the Lot means that rain does not readily dry quickly, particularly in winter. Mud and debris falls onto the concrete slab below the decking after rain, and although Mr Nakkan regularly cleans dirt and debris from the surface of the decking, there is no practical way for him to remove the mud and debris that collects on the concrete slab below the decking.

155. Mr Nakkan refers to Mr Buckley’s comments about drainage and the inability to access underneath the decking, which he asserts is “exactly the experience which I have had with the timber decking.” Mr Nakkan refers to the contents of the RHM Consultants report in a similar fashion.

156. In respect of unit 801 (Mr Schneller’s Lot, which is located on the top floor), Mr Nakkan asserts that a notice of strata committee meeting to be held on 11 November 2022 noted there were “unapproved building works” being performed, which include the removal of timber decking. The notice included a “renovation application form” which “contained a proposal to lay porcelain pavers in place of timber decking.”

157. Mr Nakkan refers to “proposed repairs by unit 102” A notice of strata committee meeting to be held on 28 April 2023 contained a “renovation application form” with a “proposal to replace the damaged timber decking with a mineral based composite decking”. According to Mr Nakkan, no approval has yet been granted by the owners corporation for such work to be performed by the Lot owner.

158. Mr Nakkan annexes to has affidavit a quotation he obtained from G & G Carpentry to replace the timber decking with a composite decking system. The quotation is dated 30 November 2022. The quote is for removal of existing decking boards and replacement with “Modern Deck product.” The proposed cost is $28,500.

Respondent-Lay Evidence

Affidavit of Alan (Richard) Flood dated 28 September 2023

160. Mr Flood is the owner of Lot 12 (unit 304). He purchased off the plan and moved into the building in January 2016.

161. Mr Flood has been a strata committee member since 13 February 2017.

162. Mr Flood states that Ms Owers-Brown is a licensed strata manager who works with Bright & Duggan.

163. Prior to Mr Nakkan and his wife purchasing Lot 4, the lot was owned firstly by Mr and Ms Waterford, and then Mr and Ms Whittingham. According to Mr Flood, Mr and Ms Whittingham regularly placed an artificial grass mat on the timber decking of Lot 4 for their dog to use.

164. Mr Flood states that as of April 2020, the timber decking of Lot 4 appeared to him to be in a state of good repair. Mr and Ms Whittingham re-stained the deck about that time and they told him in the process of doing that the drain would be “checked.”

165. Mr Flood asserts that he formed the view that the damage to the timber deck of Lot 4 was not due to any failure of common property and the drainage system, but was caused by the artificial grass mat and damage by the Whittingham’s dog. He acknowledges he is “not an expert.”

166. In December 2016, the strata committee produced a newsletter to lot owners. Mr Flood was not on the strata committee at that time, but received the newsletter. The newsletter relevantly stated:

“…Residents are informed that the decks are part of their lot and therefore will need to be maintained by apartment owners. A regularly (perhaps yearly) re-staining will need to be carried out to maintain appearance and quality. For the info, the stain required is-’Cedar Cyprus’ manufactured by “Dulux Intergrain Natural Stain.” Prewash with “Intergrain Reviva.”

167. Mr Flood asserts that Ms Owers-Brown was a strata committee member in the period from late 2017 to February 2023. She has a “short fuse” with contractors, and sought to use contractors from her “contacts” as a licensed strata manager at Bright & Duggan.

168. At paragraphs [18]-[24] Mr Flood refers to the O’Donnell litigation in NCAT. He asserts that Ms Owers Brown took it upon herself to instruct Grace Lawyers and was “actively involved” in defending the proceedings on behalf of the owners corporation.

169. Mr Flood then refers to the mediation agreement entered between the owners corporation and Mr O’Donnell and Ms Lent (Mr O’Donnell’s wife) on 8 January 2020. Part of the agreement was the owners corporation was to draft a By-law “pertaining to the ongoing maintenance and repair of the timber terrace.”

170. According to Mr Flood, on 29 January 2020 Ms Owers-Brown sent an email to Lot owners that relevantly stated as follows:

“One of the agreed outcomes of the mediation was the formation of a By-Law that regulates the repair, renewal and maintenance of the timber terraces, moving forward. That By-law will formalise that each respective lot owner will be responsible for the repair, renewal and maintenance of their terrace; a position that all owners have been upholding (in practical terms) since taking occupation of the buildings. This is also the position communicated by the original strata committee.”

171. A copy of the email of 29 January 2020 is annexed to Mr Flood’s affidavit.

172. According to Mr Flood, Ms Owers-Brown delayed the preparation of a By-law and arranging of a By-law being put before a general meeting of the owners corporation by repeatedly asserting the issue would be dealt with “later.”

173. Mr Flood states that on or about 9 June 2020, a plumber Mr Simon of CS Plumbing inspected the drainage system proximate to the timber decking on level 1 of the building, and found there were no faults. Mr Simon provided a quotation for replacement of timber decking boards.

174. Mr Flood states that on 20 July 2021, in the O’Donnell proceedings, Ms Owers-Brown provided a statement for the owners corporation. A copy of that statement is attached to Mr Flood’s affidavit. The statement asserts the timber decking on level 1 of the strata building is lot property rather than common property.

175. Mr Flood states that the O’Donnell proceedings were ultimately settled by consent, with the owners corporation paying $2,780.91 to settle the proceedings.

176. At paragraphs [48]-[50] of the affidavit, Mr Flood refers to the negotiations with the builder and developer to settle the common property defects proceedings. According to Mr Flood, Ms Owers-Brown in her affidavit had only produced the “first draft” of the joint expert report between Mr Poriters and Mr Weir. However, the “final draft” dated 16 August 2022 “withdrew” all claims by the owners corporation in respect of timber decks on the balconies, because they are “lot property”.

177. Accordingly, the final agreed resolution with the builder and developer did not include any works in respect of the timber decks on balconies.

178. At paragraphs [51]-[69] of the affidavit, Mr Flood asserts that the strata committee had agreed not to disclose the legal advice from Grace Lawyers to other lot owners, and Ms Owers-Brown should not have sent a copy of that advice on 17 August 2022, particularly when she was writing as Secretary of the strata committee. He asserts that Ms Owers-Brown was obtaining expert evidence and engaging lawyers in respect of seeking repairs to the balconies and terraces on level 1 and “acting to bring her own claim contrary to the position that she and the strata committee had taken in relation to the resolution of the O’Donnell proceedings”.

179. Mr Flood asserts that Ms Owers-Brown “controlled” the agenda of strata committee meetings and owners corporation meetings and “did not allow” the strata manager to attend meetings. According to Mr Flood, it was Ms Owers-Brown rather than the strata manager, who prepared meeting agendas.

180. At paragraphs [77]-[79] of the affidavit, Mr Flood sets out work that other Lot owners have performed in respect of timber decking. He states that on 1 July 2023, the owner of Lot 1 sought permission to remove timber decking and replace it with tiles. That was approved by the strata committee and work is “underway.” Lot 2 made a “similar request” which has been approved and is in the “planning stages”. Lot 2 is “planning to replace the timber with a synthetic board” and unit 801 has “replaced the timber decking with ceramic tiles”. According to Mr Flood, the timber decking of Lot 1 was “repaired” by the lot owner prior to the lot being sold; Lot 2 had “flattened and sanded the deck with an industrial sander”. Lot 3 had placed “heavy concrete pots and tables” on the deck and ceased undertaking maintenance. Lot 4 had a “previous owner who had a dog and had a grass mat directly onto the timber decking”.

181. At paragraph [81] Mr Flood is again critical of Ms Owers-Brown. Among other things, he asserts that she seeks a “capital improvement” of the timber deck rather than a repair; if the owners corporation was held liable it would be “unfair” to the lot owners who had either maintained their timber deck or had replaced the timber decking; and lot owners would be faced with significant expenses (including a likely special levy) if the works sought by Ms Owers-Brown were performed.

182. At paragraphs [82]-[89] Mr Flood comments about Mr Nakkan’s evidence and his claim. Mr Flood asserts that the quotation obtained by Mr Nakkan for repairs is not “like for like.” He makes the same assertions that he made against Ms Owers-Brown that the works sought are a capital improvement; they are unfair to other lot owners who have changed their decking; and will be unreasonably expensive to other lot owners.

183. Mr Flood asserts that between 10 and 13 August 2023 he saw Mr Nakkan and another person performing “maintenance” of the terrace deck, which involved moving heavy pots and other items. Mr Flood asserts this is the first maintenance on the deck he has seen Mr Nakkan perform. He further asserts that it after the work was complete it “rained for two days” and he took photographs which, according to Mr Flood, show no ponding of water. Those photographs are annexed to the affidavit.

Affidavit of Mr David Gehrig dated 20 September 2023

184. Mr Gehrig is owner of Lot 15 (unit 403). He purchased his lot in November 2016. He has been a strata committee member since November 2022.

185. At paragraphs [4]-[7], Mr Gehrig sets out the composition of the strata committee. Relevantly, in the period between February 2020 and November 2022 the strata committee was comprised of 3 persons (Mr Flood as Chairperson; Ms Owers-Brown as Secretary and Ms Pettett as Treasurer).

186. When Mr Gehrig purchased his lot in November 2016, he was told (by an undisclosed person) the “timber deck is your responsibility”.

187. Mr Gehrig asserts that he has maintained the timber decking of his terrace and has had “no issue” with damage or deterioration.

188. Mr Gehrig refers to the “newsletter” that was sent by the strata committee in 2016 that timber decks were the responsibility of the lot owner.

189. Mr Gehrig attaches two documents from the NSW Fair Trading website: “What can affect the safety of a deck or balcony?” and “Lot owner responsibilities for maintenance, repair or replacement.”

190. Mr Gehrig asserts that the terraces and balconies are lot property because they are “not shown as common property but as lot property via the vinculum” on the registered strata plan. According to Mr Gehrig, he understands that it is his responsibility to maintain and repair lot property.

191. Mr Gehrig asserts that Ms Owers-Brown had no authority to circulate the legal advice from Grace Lawyers, which was addressed to the owners corporation and the strata committee had resolved to keep confidential.

192. Mr Gehrig states that he raised at the AGM’s in 2020 and 2021 that there was no Motion containing a By-law for lot owners to maintain the decking on the terraces of their lots. According to Mr Gehrig, Ms Owers-Brown told him it was “not ready” and would be on the agenda at the next meeting. He asserts the By-law was not prepared and put to a meeting until after Ms Owers-Brown decided “not to continue” on the strata committee and was replaced by Mr Schneller.

193. Mr Gehrig asserts that since the commencement of these proceedings and appointment to the strata committee, two lot owners on level 1 of the strata building had “withdrawn instructions” from the law firm representing Ms Owers-Brown and had obtain permission of the owners corporation to alter the decking. Mr Nakkan had changed Solicitors.

Affidavit of Mr George Hatzigeorgiou dated 22 September 2022

194. Mr Hatzigeorgiou was the strata manager of the building employed by Netstrata between November 2019 and May 2022.

195. At paragraphs [7]-[18] of the affidavit, Mr Hatzigeorgiou gives a history of the appointment of the strata committee from the first AGM on 1 March 2016. Netstrata could, pursuant to its managing agency agreement, “fill the positions” of Chairperson, Treasurer and Secretary. Mr Hatzigeorgiou “did not object” to Ms Owers-Brown taking the position of Secretary.

196. On 27 August 2019, the strata committee resolved to obtain legal advice in respect of Mr O’Donnell’s “concerns” about the timber decking on terraces, that led to his NCAT litigation in 2020.

197. Grace Lawyers prepared the advice to the owners corporation on 18 December 2019.

198. In February 2020, there was a mediation with Mr O’Donnell and his wife Ms Lent at NSW Fair Trading. The mediation agreement included drafting a By-law to “clarify” the responsibility of repair to timber decking. The agreement stated:

“The owners corporation will liaise with a strata lawyer in relation to the drafting of a by law pertaining to the ongoing maintenance and repair of timber terrace.”

199. After the mediation, Ms Owers-Brown emailed Mr Hatzigeorgiou to obtain a fee agreement from Grace Lawyers to draft the proposed By-law. He sent a request to Grace Lawyers soon thereafter.

200. On 10 March 2020, Ms Owers-Brown emailed Mr Hatzigeorgiou that a motion be added to the AGM that owners “generally discuss” maintenance of the timber terraces; the results of the O’Donnell mediation; and “approve a by-law being drafted that formalises that all owners will be responsible for the maintenance of their own timber terraces”.

201. Such a Motion was included in the agenda for the AGM. The AGM was held on 3 April 2020. The Minutes of the meeting in respect of that Motion (Motion 14) state:

RESOVED that the owners corporation approve to have a by-law drafted regarding the ongoing maintenance to the timber decking which will be presented to the owners corporation at a future general meeting.

Vote: 16 in favour, 3 against.

Notes: By agreement of the owners present at the meeting, it was approved not to allow any owner to view the legal advice from Grace Lawyers regarding the responsibility of maintenance to the timber decking.

202. Mr Hatzigeorgiou asserts that he was later instructed by Ms Owers-Brown to “delete” discussion of the proposed By-law from strata committee and owners corporation meetings because it would be dealt with later.

203. Ultimately, the proposed By-law was not put to a vote at a meeting of owners corporation until March 2023. That proposed By-law was drafted by WMD lawyers.

204. Mr Hatzigeorgiou asserts that, based on what Mr Flood had told him, he is of the view that Mr Nakkan only received the Grace Lawyers advice because Ms Owers-Brown gave it to him, despite the position of the strata committee and the Motion at the AGM on 3 April 2020 that the advice not be distributed to lot owners.

205. At paragraph [43] of the affidavit, Mr Hatzigeorgiou asserts that Ms Owers-Brown had a “conflict of interest” in respect of “pursuing a personal claim” that the timber decking was common property and required repair or replacement.

206. At paragraphs [44]-[55] Mr Hatzigeorgiou refers to the O’Donnell litigation. He states that in May 2020, he arranged from Craig Simmons Plumbing to report whether there were any drainage issues. The contractor provide a “brief report” that relevantly stated as follows:

“Attended unit 101 to look at the balcony drainage, found no issue with drain was 100 mm and clear. Found drain to ben centre of balcony best placed to drain water.”

207. Mr Hatzigeorgiou assets that Ms Owers-Brown “kept him in the dark” about the O’Donnell NCAT litigation.

Affidavit of Ms Tracey Lovie dated 25 September 2023

208. Ms Lovie is the current strata manager of the building employed by Netstrata.

209. Her affidavit is brief. She asserts that the owners corporation does not have sufficient funds in the capital works fund to pay for extensive repairs or replacement of the timber decking on level 1 of the building, and a special levy will need to be raised. According to Ms Lovie, there had been no provision in previous capital works fund plans for repair or maintenance of timber decking of the terraces and balconies. The only reference was in December 2021 to repair of an area of timber decking “on the ground floor…near the water feature” with a repair amount of $1,573.

Affidavit of Mr Andrew Schneller dated 25 September 2023

210. Mr Schneller is the owner of Lot 27 (unit 801). He purchased the lot in 2014 and has resided in the lot since January 2016. His lot is the “penthouse lot” and the only lot located on the top floor (level 8).

211. Mr Schneller became a strata committee member at the AGM in February 2023, replacing Ms Owers-Brown who had resigned.

212. In “approximately 2017” Mr Schneller received a newsletter from the strata committee stating that lot owners were responsible for the maintenance of timber decking on terraces. According to Mr Schneller, he conducted regular maintenance. The timber deck only had “minor deterioration” in areas exposed to the weather, and no deterioration to the area under cover.

213. In July 2022, Mr Schneller was “invited” by Ms Owers-Brown to inspect the timber decking on level 1 of the building and “discuss options”. He was asked to contribute (and did contribute) to the cost of obtaining the expert report of Mr Buckley.

214. In early August 2022, he met with the level 1 lot owners. There was a discussion of the issues regarding the timber decking and the upcoming general meeting of the owners corporation on 22 August 2022.

215. Mr Schneller asserts that he formed the view at the meeting that if the owners corporation settled with the builder and developer without including repair of the timber decking on level 1, Ms Owers-Brown would take legal action against the owners corporation.

216. After that meeting, and before the AGM on 22 August 2022, Ms Owers-Brown sent her emailed letter to all lot owners attaching the advice of Grace Lawyers about whether the timber decking was lot property or common property; and the report of Mr Buckley.

217. Mr Schneller attended the AGM on 22 August 2022. He asserts that after the meeting, he did not “meet again” with Ms Owers-Brown or other level 1 lot owners.

218. At paragraphs [21]-[29] of his affidavit, Mr Schneller refers to his decision to replace timber decking with tiles. He obtained various quotations. The cost of the work was “just under $22,000”. The work occurred in September 2022. When the timber decking was removed, there was no debris under the deck. He replaced the timber decking with tiles as they would be more practical to maintain and have an indefinite life span. The strata committee approved the work Mr Schneller took photographs whilst the work was performed, which are annexed to his affidavit.

219. Mr Schneller assert that, in his opinion, the quotations obtained by Ms Owers-Brown to replace timber decking and drainage system of level 1 are excessive.

Does Replacing Some Decking Boards With PVC Boards or Milled Timber Boards That Will Be Aesthetically Unpleasing Affect Compliance with the Duty Under ss 106(1) and (2) of the SSM Act?

535. The Tribunal does not accept that a mixture of different types of boards being potentially aesthetically unpleasing is a sufficient reason, in whole or part, to accept the position of Owers-Brown and Nakkan that the whole decking system needs to be removed and replaced. The decking boards are common property, and the critical issue is what is reasonably necessary to repair them, not whether they are aesthetically pleasing to the owners of Lots 3 and 4.

Will the Owners Corporation Not Be Able to Get a Builder to ‘Warrant’ Repair Works?

536. Mr Wilkie asserts that the scope of works proposed by Mr Calandra will be unworkable because no builder will ‘warrant’ the works. However, that is based on the premise that battens will need to be removed and the waterproofing membrane will be significantly affected. Having not accepted there is sufficient evidence to conclude that any battens need to be replaced, the Tribunal does not accept that it will not be possible for the owners corporation to engage a remedial builder. Any building works that fall within the HB Act will be the subject of statutory warranties under that Act.

The Reliability of the Expert Evidence

537. The parties legal submissions make numerous criticisms of the ‘credibility’ of the other parties experts.

538. Principles regarding expert evidence in the Tribunal were discussed in detail in Shakiri v Holland [2024] NSWCATAP 28 at [88]-[98]. It is unnecessary to repeat those principles. Fundamentally, the role of expert evidence is to assist the Tribunal to make factual findings.

539. To the extent that the Tribunal has not accepted certain expert evidence, that is not a personal criticism of the expert. I do not accept any of the experts are merely an advocate for their client and are not genuinely expressing opinions that fall within their field of expertise. However, the role of the Tribunal, when making factual findings, is to assess the totality of the evidence in the context of the applicable legal principles and the burden of proof.

540. The submissions of Owers-Brown and the owners corporation also refer to a “danger” of accepting the evidence of the other parties’ expert on certain issues. That submission is unhelpful If it is implied that there is a “danger” there will be an appeal, that is not a matter that has any influence whatsoever on the decision of the Tribunal. The Tribunal makes its findings on the basis of its best endeavours to assess the evidence and apply legal principles to the found facts. If a party wishes to appeal the decision under s 80 of the NCAT Act, that is a matter for the party.

The Scopes of Works Proposed by the Parties

541. Before referring to the appropriate remedial orders (scope of works) for the owners corporation to repair the timber decking that has fallen into a state of disrepair, it is appropriate to refer to an immediate difficult with the orders sought by Owers Brown and Nakkan, even if the Tribunal had accepted the evidence of Mr Wilkie that the whole decking system needs to be removed and replaced.

542. Mr Wilkie’s own evidence is that, because such works would involve external waterproofing works, prior to any work being performed a design would have to be engaged. In Glenquarry Parker J made clear that any remedial orders under ss 232 by reason of breach of s 106(1) or (2) of the SSM Act must be clear, unambiguous, and certain. Ordering an owners corporation to get an expert report or investigation and then do unspecified work that is based on that report, is not appropriate.

543. If the Tribunal were satisfied that the entire decking system needed to be removed and replaced, based on the principles in Glenquarry and the opinion expressed by Mr Wilkie, the extent of its order would have been the owners corporation engage a suitably qualified designer under the DABP Act to provide a report and design to the owners corporation for the removal and replacement of the decking system. It would not have ordered, as Owers-Brown and Nakkan seek, to replace the decking system based upon the design, irrespective of Mr Wilkie proving a scope of works. As discussed previously, the missing piece of Mr Wilkie’s report is a design from a qualified designer under the DABP Act.

544. Ultimately, this issue does not arise because the scope of works the Tribunal regards as reasonably necessary is based primarily upon the ‘Option 1’ scope of works set out in the Joint Report dated 3 June 2024 signed by Mr Calandra and agreed to by email by Mr Buckley, although taking into account the additional areas identified in the document of Mr Buckley “Markup of the plans showing the location of boards previously identified as requiring patching with reclaimed boards” (p 39 final Joint Expert Report; p 1810 of Court Book). The work order of the Tribunal incorporates (a) that PVC decking boards are appropriately used; and (b) as best it can, the issues that will arise if rotten battens are discovered.

545. The proposed scope of works set out in the closing submissions of Counsel for the owners corporation is also not helpful, lacking detail. The Tribunal must craft the appropriate orders as best it can from the expert evidence.

546. The Tribunal regards 3 months as an appropriate period to perform the works.

547. It should be noted that if the parties agree to vary the orders to perform repairs by consent, that can be done under Regulation 9(1)(a) of the Civil and Administrative Regulation 2022 (NSW). Otherwise, the Tribunal must do its best to formulate final orders; and if there are further disputes they may be dealt with by way of fresh Tribunal proceedings (if appropriate). The Tribunal has previously referred to the provision of s 80 of the NCAT Act regarding an internal appeal.

The Difference Between ‘Defective’ Works in Breach of s 18B of the Home Building Act 1989 (NSW) And the Duty of the Owners Corporation Under ss 106(1) and (2) of the SSM Act.

548. All of the experts refer to inadequacies in the design of the decking system, that has contributed to the deterioration of the decking boards.

549. However, there are different legal tests for breach of statutory warranties under s 18B of the HB Act which the builder and developer owed to the owners corporation, compared to the duty that the owners corporation has to lot owners under s 106 of the SSM Act. It is unnecessary to repeat the legal principles previously set out in respect of s 106(1) and (2) of the SSM Act. For a discussion of the legal principles for breach of statutory warranties, see Deacon v National Strategic Constructions Pty Ltd; National Strategic Constructions Pty Ltd v Deacon [2017] NSWCATAP 185 at [46]. However, it is important not to conflate the test for breach of statutory warranties with the test for failing to keep and maintain common property in a state of good repair.

What Are the Appropriate Orders for Compliance With Section 106(1) or (2) of the NCAT Act?

550. The remedial powers of the Tribunal are contained in ss 232 and 241 of the SSM Act. The Tribunal is satisfied the owners corporation is in breach of its duty under s 106(1) of the SSM Act, and has set out a scope of works in Schedule A of this decision. The fixture does not require replacement under s 106(2), but it requires repair under s 106(1).

Is Any of the Damage to the Decking Boards Caused By the Actions of Lot Owners?

551. The Tribunal rejects the submission that the owners of Lots 3 and 4, or the predecessor owners, caused any damage to the decking boards. As discussed previously, the decking boards are common property. It is the responsibility of the owners corporation to keep and maintain the decking boards in a state of good repair. The evidence does not establish any damage caused by Lot owners, either by what they have placed on the decking boards; or any other matter.

The Claim By Owers-Brown and Nakkan for Legal Costs Incurred as Damages Under s 106(5) of the SSM Act

552. There are a number of flaws in the claim by Owers-Brown and Nakkan that the owners corporation should pay legal costs and disbursements incurred by them as damages under s 106(5) of the SSM Act which are “reasonably foreseeable” loss caused by the owners corporation’s breach of ss 106(1) and/or (2) of the SSM Act.

553. First, neither Owers-Brown or Nakkan have provided any evidence of the costs and disbursements incurred which they claim as damages. On this issue, Owers-Brown submits that she should be awarded the costs and disbursements incurred by her up to the date she commenced proceedings. However, the Tribunal cannot simply make a declaration that the owners corporation pay some unspecified amount to Owers-Brown and Nakkan. It is incumbent upon any party seeking damages to provide sufficient evidence to establish loss (McCrohan v Harith [2010] NSWCA 67 at [118]-[126] and the authorities discussed therein). No evidence has been provided to quantify what are the alleged damages, which is a sufficient reason to dismiss the claim for damages.

554. Further, there is a fundamental issue that the Owers-Brown and Nakkan submissions fail to address. There is a distinction between “costs of, and incidental” to legal proceedings (which are bound by the provisions of s 60 of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act)) as modified (if applicable) by r 38 of the Civil and Administrative Tribunal Rules 2014 (NSW) (NCAT Rules) and damages recoverable under s 106(5) of the SSM Act. The distinction between costs and damages is well established (see, for example, G.E. Dal Pont ‘Law of Costs’ 5^th edition pp 185-188 at paras [7.21]-[7.23]).

555. The distinction was discussed in the Appeal Panel decision of The Owners – Strata Plan No 21563 v Rutherford [2023] NSWCATAP 326 (Rutherford). Rutherford involve whether costs of a pre-litigation mediation could be recovered under s 106(5) of the SSM Act. Although the decision partly involved consideration of Reg 60 of the Strata Schemes Management Regulations 2016 (NSW), the reference to the principles regarding the distinction between “damages” and “costs” remains apposite.

556. The Appeal Panel (with discussion of applicable legal authorities at [53]-[94]) stated (at [52] and [95]-[97]):

The general principle applied in the courts is that a successful plaintiff cannot recover, as damages, expenses which are properly characterised as costs of and incidental to the proceedings.

…

“Consistently with the principle outlined by the High Court in Anderson v Bowles, the limitations upon the award of costs in the Tribunal should not be circumvented by characterising ”costs of, and incidental to, proceedings” (which may involve obtaining legal advice and obtaining expert evidence) as an element of damages for breach of duty under s 106 of the SSMA. As discussed previously, there is a critical distinction between ”costs of and incidental to the proceedings;” and expenses incurred that do not constitute ”costs of and incidental to the proceedings.”

If the particular expenses are not ”costs of, and incidental to the proceedings” then they may be recoverable as damages by reason of breach of the duty under s 106 of the SSMA, subject to the other limitations on the award of damages for breach of duty under s 106 of the SSMA, including whether the type of loss is a ”reasonably foreseeable loss suffered by the owner as a result of contravention of this section by the owners corporation” (s 106(5) of the SSMA); and whether the proceedings have been brought within the limitation period in s 106(6) of the SSMA. A further limitation occurs by reason of reg 60.

The distinction between whether the relevant expenses incurred are ”costs of and incidental” to the Tribunal proceedings, or are not, will involve assessment of the particular facts and circumstances of the dispute. However, it is a distinction that must be made. A successful party to litigation in the Tribunal cannot simply avoid the provisions of s 60 of the NCAT Act (which are subject to rule 38 of the Civil and Administrative Tribunal Rules 2014 (NSW)) by characterising what are, in fact, costs of and incidental to the Tribunal proceedings, as damages arising under s 106(5) of the SSMA.”

557. The principles were also referred to in Gray v Sirtex Medical Ltd [2011] FCAFC 40; (2011) 193 FCR 1; (2011) 276 ALR 267 at [15]-[16] (Gray):

”A distinction has long been drawn between damages and legal costs, such that a successful plaintiff cannot recover its costs of the proceedings from the defendant as damages, even though the defendant’s wrongful act caused the plaintiff to incur those costs: Cockburn v Edwards (1881) 18 Ch D 449 per Jessel MR at 459, per Brett LJ at 462 and per Cotton LJ at 463; Ross v Caunters [1980] 1 Ch 297 at 324E–G: Hobartville Stud Pty Ltd v Union Insurance Co Ltd (1991) 25 NSWLR 358 at 365F–366B; Seavision Investments SA v Evennett & Clarkson Puckle Ltd (The “Tiburon”) [1992] 2 Lloyd’s Rep 26 at 34; Queanbeyan Leagues Club Ltd v Poldune Pty Ltd [2000] NSWSC 1100 at [45] and [46]; McGregor on Damages, 18th ed (Sweet & Maxwell, London, 2009) at [17-003]. A plaintiff’s ability to recover its costs of the proceedings from a defendant depends instead upon the exercise of a judicial discretion; and the amount (if any) that the plaintiff recovers is not assessed in the same way as damages, but “taxed” according to the applicable rules of court. As Jessel MR put it in Cockburn at 459.8:

… it is not according to law to give to a party by way of damages the costs as between solicitor and client of the litigation in which the damages are recovered. The law gives a successful litigant his costs as between party and party, and he cannot be said to sustain damage by not getting them as between solicitor and client.

Neither may a successful plaintiff or defendant recover the difference between the legal costs awarded in its favour, or withheld, as the case may be, in one civil proceeding and the legal costs it actually incurred in that proceeding, as damages in a subsequent civil action against the same opponent: Anderson v Bowles (1951) 84 CLR 310 at 323.4–8 and 324.2; Quartz Hill Consolidated Gold Mining Co v Eyre (1883) 11 QBD 674 at 690.4–5; Barnett v Corporation of Eccles [1900] 2 QB 423 at 427.8, 428.5; Ritchie v British Insulated Callender’s Cables (Aust) Pty Ltd (1960) 77 WN(NSW) 299 at 300.4–10 (RHC); Berry v British Transport Commission [1962] 1 QB 306 at 317.1, 319.2–4, 320.9–321.4, 322.1, 329.6, 329.7–330.1, 336.4, 336.7–9; Lonrho Plc v Fayed (No 5) [1993] 1 WLR 1489 at 1497G–H, 1505G–H, 1510D–F; Penn v Bristol & West Building Society [1997] 1 WLR 1356 at 1364H; Avenhouse v Hornsby Shire Council (1998) 44 NSWLR l at 36G–37C; Queanbeyan Leagues Club at [45] and [46]; Grainger v Williams [2009] WASCA 60 at [104] and [203]. Whether and to what extent a party is entitled to recover its costs from the opponent is regarded as having been finally determined in the first proceeding. Otherwise, most successful plaintiffs could bring a second action against the defendant to recover the costs they failed to obtain upon taxation as damages flowing from the original wrong: Berry at 323.5–6 and 328.2.”

558. Paragraph [15] of Gray was cited with approval by the NSW Court of Appeal in Transport for NSW v Hunt Leather Pty Ltd [2024] NSWCA 227; (2024) NSWLR 489 (Hunt Leather) at [203]. In Hunt Leather, the NSW Court of Appeal held a litigation funder’s commission was not reasonably foreseeable damages recoverable pursuant to the tort of nuisance (paras [193]-[210]).

559. The evidence and submissions of Owers-Brown and Nakkan do not articulate how the costs and disbursements incurred prior to commencing these legal proceedings in the Tribunal do not fall within the principle of “costs of, and incidental to the proceedings” such that they would be recoverable as reasonably foreseeable damages. Rather, they adopt the position that legal costs and disbursements are reasonably foreseeable damages under s 106(5) of the SSM Act because they are a reasonably foreseeable type of loss caused by the breach of ss 106(1) and/or (2) of the SSM Act, irrespective of whether they are costs of, and incidental to, the proceedings. That is not consistent with the authorities referred to in Rutherford.

560. The Tribunal is not satisfied the legal costs and disbursements of Owers-Brown and Nakkan are reasonably foreseeable damages under s 106(5) of the SSM Act. This aspect of their proceedings is dismissed. Whether those costs and disbursements are recoverable under s 60 of the NCAT Act will be considered later in these reasons.

The Claim By Owers-Brown and Nakkan Regarding the By-law Passed on 30 March 2023 Being Unlawful, and the Claim by the Owners Corporation That It Should Be ‘Released’ From and Undertaking Not to Register the By-law

561. As is acknowledged in the submissions of Owers-Brown and Nakkan, the By-law passed on 30 March 2023 cannot be registered as it gone stale under s 141(3) of the SSM Act.

562. Section 141 of the SSM Act states as follows:

141   Changes to and consolidation of by-laws

(1)  An owners corporation may, by special resolution, change the by-laws for the strata scheme.

Note—

If the special resolution is a sustainability infrastructure resolution, fewer votes are needed to pass it. See section 5(1)(b).

(2)  The change to the by-laws has no effect until—

(a)  the owners corporation lodges a notice, in the approved form, with the Registrar-General, and

(b)  the Registrar-General makes an appropriate recording of the notice in the folio of the Register for the common property for the scheme.

(3)  The owners corporation must lodge the notice within 6 months of the day the special resolution is passed.

(4)  An owners corporation may, by special resolution, consolidate the by-laws for the scheme, whether or not a by-law is amended, repealed or added.

(5)  The written consent of the owners on whom a common property rights by-law confers rights or special privileges is not required to consolidate the by-laws for the scheme, if the consolidation does not involve the amendment, repeal or addition of a common property rights by-law.

(6)  The secretary of the owners corporation must keep a consolidated up-to-date copy of the by-laws for the scheme.

563. The owners corporation could have registered the By-law. Had it done so, the Tribunal would have had to consider the claims by Owers-Brown and Nakkan that the meeting was not validly held (s 24 of the SSM Act) and/or the By-law was harsh, unconscionable or oppressive (s 150 of the SSM Act).

564. However, in circumstances where the By-law was not registered in accordance with s 141(3) of the SSM Act, there is no By-law to invalidate under s 150 of the SSM Act, and no utility in considering whether it was passed in circumstances where there was allegedly non-compliance with the provisions of the SSM Act and its Regulations such that it should be invalidated (see the discussion of the relevant principles in Harris v The Owners-Strata Plan No 34056 [2022] NSWCATAP 111).

565. The application for orders under ss 24 and 150 of the SSM Act was withdrawn at the hearing. It was the Tribunal who raised the issue of s 141(3) of the SSM Act with Counsel for Owers-Brown (T: 10/11/23: P3 :L44-48). Ultimately, Counsel for Owers-Brown stated that Owers-Brown withdrew the s 150 application, but “reserved her rights” if a resolution was passed in the future (T:10/11/23: P 14: L 18-25). There was no reference to the s 24 application being withdrawn at the hearing, but the submissions of Owers-Brown clearly indicate the applications are not pressed. It is unnecessary to explore the position of Nakkan, because throughout the proceedings there was no material departure by Nakkan from the position of Owers-Brown.

566. In respect of the submission by the owners corporation that it should be “relieved” of its “undertaking” that the By-law would not be registered, there are a number of flaws.

563. Firstly, the owners corporation never brought its own proceedings in the Tribunal. It has only raised this issue in response to the proceedings by Owers-Brown and Nakkan.

564. Secondly, there is no evidence pointed to that this was a formal undertaking to the Tribunal. There are circumstances where the Tribunal has the power to make orders regarding undertakings (see, for example, CCS 251 Elizabeth Street Sydney Pty Ltd v Hellenic Club Ltd [2016] NSWCATCD 88 in respect of the ‘usual undertaking as to damages’ in retail lease interim orders). However, all the owners corporation refers to is an “undertaking” not to register the By-law until the proceeding have concluded to another party. It is noted that at the hearing, Counsel for Owers-Brown referred to the “undertaking” being given to Nakkan, not Owers-Brown. There is no documentary evidence referred to by the owners corporation that shows the “undertaking” or its terms.

565. As discussed previously, the Tribunal has no general power under the SSM Act to make a declaration. It’s only powers regarding declarations are those the subject of specific provisions of the SSM Act. Even if the Tribunal had the power to make an order under ss 232 and or 241 of the SSM Act to “relieve” the owners corporation from its “undertaking” to another party (which is a vexed issue, and the written submissions of the owners corporation to not refer to any legal authorities that clearly support the proposition that the Tribunal has the power to make such an order), there is no utility in making such an order.

566. In simple terms, the owners corporation chose not to register the By-law. It now cannot be registered. The owners corporation would have to call a fresh general meeting and pass a fresh By-law. It is entirely a matter of speculation as to whether it will do so, and if it did, whether that By-law would (if registered) be the subject of challenge under the SSM Act.

Section 106(3) of the SSM Act

571. The SSM Act. That submission is correct (see the discussion of the relevant principles in Davenport v The Owners-Strata Plan No 536; The Owners-Strata Plan No 536 v Davenport [2018] NSWCATAP 301 at [157]-[161]) although it does not explain why the owners corporation sought (and was granted) leave to amend the Points of Defence at the hearing to rely on s 106(3) (even as an alternative argument to its central proposition that the terrace timber decking was not common property), yet concedes in its submissions that the Resolution does not satisfy the requirements of s 106(3).

The Issue of Costs

572. The Tribunal is satisfied that it makes a costs order in this decision, and if any party seeks to vary that order, it can do so. This has been an approach taken by the Tribunal and Appeal Panel in a number of matters (e.g. Wells Group Pty Ltd v Betts [2025] NSWCATAP 70).

573. The Tribunal is not satisfied that this is a type of proceedings where r 38 of the Civil and Administrative Tribunal Rules 2014 (NSW) applies (The Owners-Strata Plan No 63341 v Malachite Holdings Pty Ltd [2018] NSWCATAP 256). Although Owers-Brown and Nakkan sought damages under s 106(5) of the SSM Act in respect of legal costs and disbursements, the amount was unquantified in any pleading or submission, and there was no evidence provided to quantify loss. The Tribunal is not satisfied the amount “claimed or in dispute” in the proceedings exceeded $30,000, irrespective of the evidence of Mr Wilkie that the cost of repairs may exceed $100,000 (although this was speculative in the sense that Mr Wilkie also stated that a design by an appropriately qualified person under the DABP Act was required before rectification works could occur).

574. Even if the Tribunal was wrong in that conclusion, and r 38 of the NCAT Rules applied, the parties have had substantial successes and failures on different issues. If the provisions of s 60(1)-(3) of the NCAT Act did not apply, and the Tribunal was considering the issue of costs under ‘common law’ costs principles, the Tribunal would be satisfied that the appropriate order would be each party bear its own costs: Hogan v Trustee of the Roman Catholic Church (No 2) [2006] NSWSC 74 at [40].

575. For any party to be awarded costs, the Tribunal must be satisfied that there are “special circumstances” under s 60(2) of the NCAT Act, taking into account the matters in s 60 (3) of the NCAT Act.

576. The principles applicable to ss 60(1)-(3) are well established (see, for example, The Owners-Strata Plan No 63731 v B & G Trading Pty Ltd (No 2) [2020] NSWCATAP 273). The Tribunal needs to be satisfied (a) there are special circumstances; and (b) those special circumstances are sufficient for the Tribunal to exercise its discretion to depart from the usual principle under s 60(1) of the NCAT Act that each party pay its own costs.

577. In this matter, the parties had arguable positions on most of the claims and defences. Some of the claims and defences of the parties were not obviously strong (or not pursued), such as the issues involving the claim for s 106(5) damages; the operation of s 106(3); and the owners corporation being relieved of its ‘undertaking’. Further, just as the owners corporation failed in its argument regarding the timber decking being lot property, Owers-Brown and Nakkan failed to obtain the order they were seeking regarding replacement of the timber decking; and also failed to adequately grapple with the issue that their own expert asserted his scope of works could not be actioned until a design was performed under the DABP Act.

578. The proceedings were lengthy and complex. However, the parties contributed to this and bear equal responsibility. The parties each sought to canvass a significant amount of lay evidence and cross examine lay witnesses, when the critical issues for determination involved (a) whether the timber decking was common property; (b) whether the duties under s 106 (1) or (2) of the SSM Act were breached; and (c) if so, what were appropriate remedial orders in respect of the condition of the common property.

579. As well, the time taken to conclude the proceedings was extended by the failure of the experts to adequately confer and prepare a Joint Expert Report until the final Joint Expert Report. Responsibility for that delay does not fall solely at the feet of one expert or one party.

580. If any party seeks to vary the Tribunal’s cost orders it may do so, in accordance with the procedural orders made.

Annexure A-Scope of Works

1. Remove and replace timber floorboards of terrace of level 1 of the strata building in the areas identified in the document “Phil Buckley Inclusions-Markup of the plans showing the approximate locations of boards previously identified as requiring patching with reclaimed boards” marked in yellow, blue and green that is set out at p 1810 of the Court Book.

2. Replacement boards to be PVC boards of similar colour to the existing boards.

3. Painter to apply a clear coat of suitable deck coating material to all old and new decking boards.

4. Battens to remain as is unless it is necessary to remove any battens because they are structurally insufficient to support replacement PVC boards.

5. If any battens are removed, the concrete slab to be adequately waterproofed to ensure that the slab is resistant to water ingress.

ORDERS

(1)    By 3 months from the date of this order The Owners-Strata Plan No 92562 is to engage a suitably licensed builder or builders and/or tradespersons to perform the works set out in Schedule A of this decision.

1. All works are to be performed by suitably licensed persons exercising due care and skill and in accordance with any applicable legislation, including (to the extent applicable) the Home Building Act 1989 (NSW) and Design and Building Practitioners Act 2020 (NSW).

2. The owners of Lots 3 and 4 of the strata building are to give reasonable access to the owners corporation and all builders and tradespersons engaged by the owners corporation so that the works can be performed and completed.

3. There is no order as to costs, with each party to bear its own costs.

4. If a party seeks to vary the costs order the following orders apply:

(a) Costs applicant is to file and serve costs submissions and documents by 14 days from the date of these orders.

(b) Costs respondent is to file and serve costs submissions and documents by 28 days from the date of these orders.

(c) Costs applicant is to file and serve costs submissions in reply by 35 days from the date of these orders.

(d) Any party can apply to vary the procedural timetable for the filing and serving of costs submissions and documents by way of an application in writing to the Tribunal and the other parties by no later than the date of compliance with the relevant timetable obligation.

1. The proceedings in Case Number 2023/00401663 and Case Number 2023/00406758 are otherwise dismissed.

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I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar