Owners of Strata Plan 36131 v Dimitriou

The Owners of Strata Plan 36131 (the Owners Corporation) sought to recover unpaid strata contributions and legal costs from Ms Dimitriou. The dispute concerned whether the Owners Corporation was entitled to recover legal costs incurred in pursuing the recovery of unpaid strata contributions, and if so, the extent of those recoverable costs and whether they needed to be claimed in the original proceedings for the contributions. The matter was heard in the Court of Appeal of New South Wales.

The primary legal issues before the Court of Appeal were: (1) whether the definition of "expenses" under section 80 of the *Strata Scheme Management Act 1996* (NSW) included legal costs incurred by the Owners Corporation in recovering unpaid strata contributions; (2) if legal costs were included, what specific types of legal costs were recoverable; and (3) whether such legal costs had to be claimed in the same proceedings as the claim for the unpaid contributions.

The Court of Appeal determined that while section 80 of the *Strata Scheme Management Act 1996* (NSW) did permit the recovery of certain legal costs as "expenses," these costs were limited to those reasonably incurred in the process of recovering the unpaid contributions themselves, not costs associated with separate proceedings to recover those expenses. The Court found that the original proceedings before the primary judge were for the recovery of contributions, and the subsequent application to recover legal costs was a separate matter. The Court allowed the appeal, setting aside the orders of the primary judge and dismissing Ms Dimitriou's summons. Ms Dimitriou was ordered to pay the Owners Corporation's costs of the application and appeal.