Sahade v The Owners - Strata Plan 62022

This case involved an appeal to the Court of Appeal of New South Wales concerning an application to reallocate unit entitlements in a strata scheme. The applicant, Mr. Sahade, sought to have the unit entitlements varied, arguing the original allocation was unreasonable. The Consumer, Trader and Tenancy Tribunal (CTTT) had dismissed this application. Mr. Sahade appealed to the District Court, which ordered a remittal to the CTTT on the basis that the Tribunal had failed to provide adequate reasons for its decision. The Court of Appeal was asked to determine whether the District Court erred in law by requiring the issue of control of strata scheme management to be considered on remittal.

The central legal issue before the Court of Appeal was the scope of the District Court's power on appeal from the CTTT, specifically in relation to the considerations that could be taken into account when redetermining an application for the variation of unit entitlements. The court had to consider whether the District Court's order, which effectively directed the CTTT to rehear the matter and potentially consider factors beyond the "respective values of lots," was legally sound. This involved examining the relevant provisions of the *Strata Schemes Management Act 1996* (NSW) and the procedural rules governing appeals from the CTTT to the District Court.

The Court of Appeal found that the District Court had erred in law by making an order that was based on a misunderstanding of its appellate jurisdiction. The District Court had incorrectly applied section 67 of the *Civil and Administrative Tribunal Act 2013* (NSW) to the appeal, which was instead governed by section 200 of the *Strata Schemes Management Act 1996* (NSW) and Part 5 of the *Crimes (Appeal and Review) Act 2001* (NSW). These provisions did not contain an equivalent to section 67(4) of the CTTT Act, which allowed for specific directions on rehearing. Consequently, the District Court's power was limited to determining the appeal or, if an error of law was found, remitting the matter for redetermination. The Court of Appeal determined that the original decision of the CTTT should be set aside and the matter remitted for redetermination by the New South Wales Civil and Administrative Tribunal (NCAT).

The Court of Appeal ordered that the District Court's order remitting the matter to the CTTT be set aside. In its place, the court ordered that the CTTT's decision dismissing the application for variation of unit entitlements be set aside. The matter was remitted to NCAT for redetermination of whether the original allocation of unit entitlements was unreasonable, and if so, whether they should be reallocated and to what extent. Crucially, the court declared that in making this redetermination, NCAT was entitled to take into account the potential impact of any variation on the level of control enjoyed by lot holders and the potential for deadlock in voting at owners' corporation meetings. The applicant was ordered to pay the costs of the respondents.