Stolfa v Hempton

The appeal concerned a dispute between Mr Stolfa and the owners corporation of a strata scheme regarding works undertaken to enclose a verandah that formed part of the common property. Mr Stolfa contended that the enclosure of the verandah, which was attached to his specific lot, constituted an enhancement or improvement of common property requiring a special resolution under section 65A of the *Strata Schemes Management Act 1996* (NSW). The owners corporation argued that the works were authorised. The appeal was heard in the Court of Appeal of New South Wales by Allsop P, Basten and Young JJA.

The primary legal issues before the Court of Appeal were whether the enclosure of the verandah was an unauthorised improvement to common property, and if so, whether the owners corporation had nonetheless authorised the works through a special resolution or other means. The court also considered whether equitable estoppel was available to Mr Stolfa and whether damages should have been awarded in lieu of injunctive relief.

The Court of Appeal reasoned that the works constituted repairs and maintenance of the common property, which were authorised under section 62 of the *Strata Schemes Management Act 1996*, and therefore did not require a special resolution under section 65A. Furthermore, even if the works were considered an improvement, the court found that a special resolution authorising the enclosure, supplemented by a subsequent special resolution approving the plans, was sufficient to authorise the works. The court also determined that equitable estoppel was not available in the circumstances and that the primary judge had correctly declined to award injunctive relief as a matter of discretion. The court further held that it was too late to remit the question of damages in lieu of an injunction, as this case had not been run on that basis below.

The Court of Appeal extended time for the filing and serving of an application for leave to appeal, granted leave to appeal, and directed that the notice of appeal stand as filed. However, the appeal was ultimately dismissed with costs.