The Owners Strata Plan 50276 v Thoo

The appeal concerned a dispute between The Owners Strata Plan 50276 (the appellants) and Mr. Thoo (the respondent) regarding the maintenance of a mechanical exhaust ventilation system. The respondent, an owner of a lot within the strata scheme, alleged that the owners corporation had a duty to renew or replace the existing system and to install an additional system to service his lot. The matter came before the Court of Appeal of New South Wales, with Barrett JA, Tobias AJA, and Preston CJ of LEC presiding.

The primary legal issues before the court were whether the Owners Strata Plan 50276 had a statutory duty under the *Strata Schemes Management Act 1996* (NSW) to renew or replace the mechanical exhaust ventilation system, and whether this duty extended to installing an additional system for the respondent's lot. The court also considered whether the respondent's proprietary right in the common property imposed such a duty, and the validity of a special resolution passed by the owners corporation that deemed it inappropriate to renew or replace the system, including whether this resolution constituted a fraud on the minority.

The court's reasoning focused on the interpretation of sections 62 and 75 of the *Strata Schemes Management Act 1996*. Section 62(2) outlines the duty to renew or replace fixtures and fittings that are part of the common property, while section 75(2) details the purposes for which a sinking fund may be used, including renewing or replacing fixtures and fittings that are part of the common property and meeting other expenses of a capital nature. The court noted that section 75(2)(d) reflected the content of section 62(2). The court also considered section 65A, which permits an owners corporation to make or authorise changes to common property if a special resolution has been passed.

The appeal was allowed, and the cross-appeal was dismissed. Declarations and orders made by the primary judge were set aside, and the respondent's third further amended statement of claim was dismissed. The respondent was ordered to pay the appellants' costs of the proceedings at first instance and on appeal, with a certificate under the *Suitors' Fund Act 1951* available if otherwise qualified. The parties were directed to file written submissions regarding the consequential effect on certain outstanding orders.