Yeatman and Owners of Victoria Apartments Strata Plan 1659
[2010] WASAT 123
•27 AUGUST 2010
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
STREAM: COMMERCIAL & CIVIL
ACT: STRATA TITLES ACT 1985 (WA)
CITATION: YEATMAN and OWNERS OF VICTORIA APARTMENTS STRATA PLAN 1659 [2010] WASAT 123
MEMBER: MR M SPILLANE (MEMBER)
MR D LIGGINS (SENIOR SESSIONAL MEMBER)
HEARD: 14 SEPTEMBER 2009, 12 MARCH 2010 AND 14 APRIL 2010
DELIVERED : 27 AUGUST 2010
FILE NO/S: CC 2058 of 2008
BETWEEN: JOHN RAYMOND YEATMAN
HEATHER JOYCE YEATMAN
ApplicantsAND
OWNERS OF VICTORIA APARTMENTS STRATA PLAN 1659
Respondent
Catchwords:
Strata Titles Unit entitlement Variation of unit entitlement
Legislation:
Strata Titles Act 1966 (WA)
Strata Titles Act 1985 (WA), s 5, s 14(2), s 79, s 79(2), s 103H, s 103H(3), s 103H(3)(a), s 103H(3)(b), Sch 3
Valuation of Land Act 1978 (WA), s 4(1)
Result:
Applicant successful
Category: B
Representation:
Counsel:
Applicants: Mr T Saayman
Respondent: Mr R Kronberger
Solicitors:
Applicants: Saayman Law Pty Ltd
Respondent: Atkinson Legal
Case(s) referred to in decision(s):
Nil
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
The central issue in this matter was whether the inconsistency in the current allocation of unit entitlement identified and agreed by the experts was sufficiently great as to be unfair or anomalous.
The applicants contended that it was, and that all lots did not benefit equally, while, on the other hand, the respondent contended that the current system had been in place for 36 years and should be left in place, and that any issue that might arise could be agreed between the owners.
The Tribunal, having considered the experts' evidence and the relevant test set down in the Strata Title Act 1985 (WA), decided that the current allocation of unit entitlements was unfair and needed to be rectified as per the order made.
Background
The applicants are the registered proprietors of Lot 11 on Strata Plan 1659, more commonly referred to as Unit 8 Victoria Apartments, No 30 Avenue Street, Claremont, WA, 6010 (Lot 11).
Victoria Apartments is a riverside property comprising 24 lots of varying sizes. The building was built in about 1972 and the 24 lots are set out over eight floors in three columns which are described in the documents as the 'east column', the 'central column' and the 'west column'.
Lots in each of the columns are substantially the same as other lots in the same column subject to minor variations in size of approximately 3 square metres to 6 square metres.
Lots in the east and west columns are substantially larger than the lots in the central column having more windows and larger balconies, and the top floor apartments of both the east and west columns have substantially larger balconies.
Each lot has panoramic views of the Swan River, which become more expansive at each higher level.
A number of lots have the exclusive use of two car bays whilst others have the exclusive use of only one. Lot 11 has the exclusive use of one car bay.
Under the Strata Titles Act1985 (WA) (1985 ST Act) every strata plan is registered and is required pursuant to s 5 of the 1985 ST Act to be accompanied by a schedule specifying, in a whole number, the proposed unit entitlement in respect of each lot into which the parcel is to be subdivided and specifying also the proposed aggregate unit entitlement.
In respect of Strata Plan 1659, that schedule is attached to the strata plan as Annexure A and states that unit entitlement of each lot is '1' and the aggregate is '24' being equal to the total number of lots in the development.
Section 14 of the 1985 ST Act states:
(1)The unit entitlement of a lot, as stated in the schedule referred to in section 5, determines -
(a)the voting rights of a proprietor;
(b)the quantum of the undivided share of each proprietor in the common property; and
(c)subject to subsection (1)(c)(ii) of section 36, the proportion payable by each proprietor of contributions levied under that section.
Section 103H of the 1985 ST Act under the heading 'Order for variation of unit entitlement' states:
(1)An application to the State Administrative Tribunal for an order under this section may be made -
(a)by the proprietor or a registered mortgagee of a lot in a scheme; or
(b)by the strata company for the scheme.
(2)An order under this section is an order amending the schedule of unit entitlement registered in respect of the scheme in a manner that the State Administrative Tribunal thinks appropriate.
(3)On the making of an application under subsection (1), the State Administrative Tribunal may make an order under this section if satisfied that -
(a)the proportion that the unit entitlement of any lot in the scheme bears to the aggregate unit entitlement of all lots in the scheme is not consistent with the proportion that the value of that lot bears to the aggregate value of all lots in the scheme; and
(b)that the lack of consistency is sufficiently great as to be unfair or anomalous.
(4)References in subsection (3)(a) to value are to -
(a)capital value as defined in the Valuation of Land Act 1978, in the case of lots in a strata scheme; and
...
The applicants purchased and moved into Lot 11 at the beginning of 2007 and, having lived there for 12 months, began to question the fairness of the method of calculating levies.
The applicants sought to have the unit entitlement varied through the strata council and eventually at an annual general meeting in November 2008 without success before bringing the matter to this Tribunal.
Issues
As set out in s 103H(3) of the 1985 ST Act above, the issue to be determined by the Tribunal in these proceedings and in respect of which the Tribunal has to be satisfied before it can make an order is whether:
a)the proportion that the unit entitlement of any lot in the scheme bears the aggregate unit entitlement of all lots in the scheme is not consistent with the proportion of the value of that lot bears to the aggregate value of all lots in the scheme; and
b)the lack of consistency is sufficiently great as to be unfair or anomalous.
Applicants' evidence
Mr John Yeatman gave the principle evidence on behalf of the applicants. This evidence was supported by his wife, Mrs Heather Yeatman, and Mr Stephen Bailey, the owner of Unit 2 (Lot 2).
Both Mr Yeatman and Mr Bailey referred to a program of works which has been undertaken by the strata council over the past number of years and is ongoing.
Examples of the works referred to are:
(a)Upgrade to the entry foyers at an approximate value of $80,000;
(b)Structural repairs to the ventilation and refuse chutes at an approximate value of $15,000;
(c)Repairs and improvements to balustrades at an approximate value of $136,000;
(d)Improvements to the security of the Victoria Apartments at an approximate value of $10,000;
(e)Improvements, relocation and repairs to the stop valve at an approximate value of $30,000;
(f)Repairs and improvements to the lifts mechanical controller at an approximate value of $200,000;
(g)Painting of the building and garages at an approximate value of $150,000;
(h)Repairs and replacement of the downpipes at an approximate value of $15,000;
(i)Improvements, replacements and repairs to the window and door frames of the Victoria Apartments at an approximate value of $200,000;
(j)Removal of the nib wall at an approximate value of $18,000;
(k)Membrane surface coating at an approximate value of $70,000;
(1)Improvements to individual floor landing foyers at an approximate value of $20,000;
(m)Repair and replacement of garage roof tiles at an approximate value of $25,000;
(n)Resurfacing of driveway at an approximate value of $10,000; and
(o)Improvements to the entry canopy, including lighting and lining, at an approximate value of $25,000.
Both Mr Bailey and Mr Yeatman confirmed that, due to the program of works, individual lot levies have risen substantially over the past number of years.
Mr Yeatman explained that the program of works has not or will not benefit lots equally for many reasons, and gave examples such as:
(a)There are two separate but almost identical entrance lobbies on the ground floor of Victoria Apartments, each providing access to one of two lifts. The lobby and lift towards the east of the complex only services eight lots, whilst the lobby and lift towards the west side services 16 lots. Nonetheless, the upgrade costs were identical for each lobby and lift. The consequence is a disproportionately larger benefit being received by those lots in the east column.
(b)The lift maintenance costs are also substantially the same, despite the lift in the east of the complex servicing fewer apartments.
(c)The improvements to balconies, balcony doors, railings and windows benefit those apartments in the east and west columns to a greater extent, as the size of the balconies and number of windows in those columns are greater than the apartments in the central column.
(d)The upgrades, repairs or improvements to the garages and/or the roofing over the garages benefit those apartments with exclusive use of more than one garage.
(e)Upgrades, repairs, maintenance or improvements to the common property and grounds do not commercially benefit lots equally, as lots with a higher comparative value receive a disproportionately higher commercial benefit than those lots with a lower comparative value.
(f)Over the longer term, maintenance, improvement and upgrades to Victoria Apartments will see a comparatively higher benefit being received by those lots with a higher comparative value, as those lots will grow in value over time by higher amounts than those lots with a lower comparative value.
It was both Mr Yeatman's and Mr Bailey's evidence that, in their opinion, the calculation of unit entitlements was inequitable, unfair and unjust.
Respondent's evidence
Mr George Barrett and Mrs Ruth Barrett furnished a response to the applicants' claim, which stated in part:
•Since 1973, the unit entitlements of the lots have been equal.
•Since 1974, the exclusive use rights have been granted to lot proprietors to over 34 parking spaces on the basis that:
(a)each of Lots 1, 6, 9, 12, 13, 15, 16, 18, 21 and 22 has the right to use two garage spaces; and
(b)each of the other lots has the right to use one garage space.
•At the 2003 Annual General Meeting (AGM), owners agreed that, because of differences in the size and number of windows in individual apartments, any replacements would be at the expense of individual owners. Repairs would continue to be a strata expense. This agreement was formulated to promote fairness, and has been observed by several proprietors who have paid for their own replacement windows.
•It was also explained that a proposed by-law regarding windows has been drawn up but has not been accepted at an AGM.
•If owners are forced to change levy arrangements in the manner proposed by the applicants, some owners would:
(a)have to pay more than they currently do in levies;
(b)suddenly acquire an extra percentage of the common property; and
(c)have increased voting rights,
while other owners would:
(a)have to pay less than they currently do in levies;
(b)have to give up a percentage of the common property; and
(c)suffer a decrease in their voting rights.
•They submitted that the system of levies should be assessed not in respect of an arbitrary system, such as that supplied by professional valuers, but with fairness, taking into consideration both past practice and proposed changes to by-laws which are already in train.
•They conceded that, while it was demonstrable that there has been a possible inequity (as in window replacements and floor landings), owners have met their own costs and there is no reason to suppose that similar arrangements could not be made in the future.
•The respondents believe that the principle of 'user pays' is an important one. All owners are served by the strata manager and a security system; all use the rubbish disposal facility and the driveway, walk through the foyers and have the common areas and grounds maintained, and all should pay equally for these services.
•They believe that, in general, owners of more valued lots have paid more for them, and have therefore paid more in stamp duty and more for settlement fees, and that they should not pay more for the same services as are enjoyed by the owners of lower valued lots.
Other submissions
Section 79(2) of the 1985 ST Act states:
A strata company that is given notice of an application to the State Administrative Tribunal under this Part shall forthwith serve a copy of the notice on each -
(a)proprietor;
(b)mortgagee who has given notice in writing of his interest to the strata company; and
(c)occupier who would be affected if the order sought were made.
Following the main hearing in the matter in September 2009, the Tribunal reserved its decision and, as part of its consideration, sought to confirm whether s 79 of the 1985 ST Act had been complied with. By letter dated 1 March 2010, solicitors for the applicants wrote to the Tribunal stating:
We confirm that a copy of a claimant's application in this matter was served on each of the proprietors of the above strata plan by pre-paid post with delivery sent on 17 December 2008 to each proprietor's address listed on the role of proprietors maintained by the Strata Company.
Having considered that explanation, the Tribunal brought the parties back for further directions on 12 March 2010, at which time, counsel for both the applicants and the respondent made submissions in respect of compliance with s 79 of the 1985 ST Act.
As there was a possibility that there could a substantial change in the levies paid by different proprietors, the Tribunal believed it was important to ensure that there was no doubt that s 79 of the 1985 ST Act had been fully complied with and that the substantial effort the parties had gone to was not wasted.
In the circumstances, the Tribunal made the following orders:
1.On or before 19 March 2010 the respondent is to ensure that Notices of the application in the matter is served in compliance with s 79 of the Strata Titles Act 1985 together with a copy of this order.
2.A copy of the application together with a copy of the transcript of the hearing dated 14 September 2009 and Exhibits 11 and 12 from that hearing are to be made available for inspection at the offices of the Strata Manager between March 22 2010 and 7 April 2010.
3.Any person notified under Order 1 above who wishes to make a submission in the matter is invited to attend the next directions hearing listed in the matter on 14 April 2010 at 2:15 pm.
At a further directions hearing on 14 April 2010, the parties confirmed that the orders of 12 March 2010 set out above had been complied with. As a result, two brief written submissions were received by the Tribunal from Kiat Tan (Lot 24/Unit 24) and Geoffrey and Marjorie Pearson (Lot 10/Unit 7), and only the parties' representatives attended the directions hearing on 14 April 2010. The Tribunal is satisfied that s 79 of the 1985 ST Act has been properly complied with.
Apart from Mr and Mrs Barrett and those referred to above, written submissions were also received from the following owners who largely supported the respondent's position and outlined similar issues:
•James and Rose Basson (Lot 9/Unit 19);
•Joan Castanelle (Lot 18/Unit 22);
•John and Beth Fitzhardinge (Lot 17/Unit 12);
•Andrew Kam (Lot 12/Unit 20);
•Jenny Lowe (Yoke Ying Nyam) (Lot 21/Unit 23); and
•Ian and Kaye Manning (Lot 22/Unit 15).
Expert evidence
The applicants filed a statement of evidence by Mr Bradley Dawson, a licensed and certified practicing valuer, dated 21 August 2009, in which he stated:
23.I confirm in my expert opinion that the proportion of the current registered unit entitlement of any lot at Victoria Apartments bears to the aggregate unit entitlement of all lots at Victoria Apartments:
(a)Is not consistent proportion that the capital value of that lot bears the aggregate value of all lots in the scheme;
(b)Is not in keeping with the usual, normal or ordinary method of calculating unit entitlements under the [ST] Act; and
(c)Suffers a variance in excess of 5%.
24.In my expert opinion the Victoria Apartments' unit entitlements ought properly be amended to reflect my Form 3.
Mr Dawson proposed a new unit entitlement for each of the 24 lots/units.
Prior to the hearing, the Tribunal received a joint statement of experts, dated 4 September 2009, from Mr Dawson and Mr William John Garmony, a certified practising valuer on behalf of the respondent.
That joint statement confirmed that, at a meeting of 28 August 2009, both Mr Garmony and Mr Dawson had concluded:
5.That the parcel and building containing Strata Plan 1659 and comprising twenty four residential apartments in a multi storey building on Lot 13 as contained on Diagram 44290 known as Victoria Apartments, 30 Victoria Avenue, Claremont to have the unit entitlements as set out below.
6.Lot Number Unit Entitlement
133
230
337
436
532
641
739
835
944
1041
1137
1246
1343
1438
1547
1644
1739
1848
1946
2041
2150
2253
2344
2456
Aggregate 1000
7.And further, William John Garmony and Bradley John Dawson both licensed Valuers licensed under the Land Valuers Licensing Act 1978 certify that the unit entitlement of each lot (in this certificate, excluding any common property lots), as stated in the schedule bears in relation to the aggregate unit entitlement of all lots delineated on the plan a proportion not greater than 5% more or 5% less than the proportion that the value (as that term is defined in section 14 (2a) of the Strata Titles Act 1985) of that lot bears to the aggregate value of all the lots delineated on the plan.
Section 14(2) of the 1985 ST Act, under the heading 'Unit entitlement of lots', states:
The certificate of a licensed valuer which is required by sections 5B(1)(b), 8A(h), 21T(1)(d) and 31E(1)(d) to accompany a strata/surveystrata plan and a plan of resubdivision lodged for registration shall be in the prescribed form and shall certify that, or to the effect that, the unit entitlement of each lot, as stated in the schedule referred to in those sections, bears in relation to the aggregate unit entitlement of all lots delineated on the strata/surveystrata plan a proportion not greater than 5% more or 5% less than the proportion that the value of that lot bears to the aggregate value of all the lots delineated on the plan.
Section 14(2a) of the 1985 ST Act then states:
In subsection (2) -
value means -
(a)in the case of a strata scheme, the capital value within the meaning of the Valuation of Land Act 1978; ...
Section 4(1) in the Valuation of Land Act 1978 (WA) defines 'capital value' as follows:
capital value of land means the capital amount which an estate of fee simple in the land might reasonably be expected to realize upon sale provided that where the capital value of land cannot reasonably be determined on such basis, the capital value of such land shall be the sum of, first, the unimproved value of the land, and, secondly, the estimated replacement cost of improvements to the land after making such allowance for obsolescence, physical depreciation, and such other factors as are appropriate in the circumstances;
At the hearing, it was put to the parties that, as their expert valuers agreed the unit entitlement that should now apply, which was that set out in the schedule attached to their joint experts' statement dated 4 September 2009 and set out above, should the Tribunal not accept, on that evidence, that the test set out in s 103H(3) of the 1985 ST Act was satisfied?
The applicants' representative agreed with that proposition, and Mr Kronberger, on behalf of the respondent, stated:
My instructions are that we should proceed and that we should concede that the valuers have taken into account the respective values and the aggregate values for the purpose of subsection (3)(a). Now, whether the Tribunal is satisfied to that extent is another issue.
The Tribunal, in seeking to clarify the position, stated:
What I read from Mr Kronberger is that I think they'll accept that and the one point that's remaining is that clearly therefore there is a lack of consistency. That's what (3)(a) says, there is a lack of consistency but the question now remains, is that lack of consistency sufficiently great as to be unfair and anomalous, and that's the question that you want the [T]ribunal to decide.
The matter then proceeded by consent on the basis that the first test under s 103H(3)(a) of the 1985 ST Act was, based on the experts' evidence, satisfied, and that there was a lack of consistency in the proportion that the capital value of the applicants' lot bears to the aggregate value of all lots in the scheme.
What remained for the Tribunal to consider was the second limb of the test set out in s 103H(3)(b) of the 1985 ST Act and whether that 'lack of consistency is sufficiently great as to be unfair or anomalous'.
Consideration
Under the Strata Titles Act 1966 (WA), when a strata plan was registered, it was not necessary for the unit entitlement to have any relationship to the relative values of the lot, and it could be an arbitrary apportionment.
The principle of unit entitlements being based on relative values of lots rather than on such arbitrary apportionment was introduced by the 1985 ST Act.
Mr McIver, the then Minister for Lands and Surveys, in the second reading speech introducing the 1985 Bill to Parliament, stated:
Unit entitlements: In clauses 14 to 16 there are provisions ensuring that unit entitlements are equitably set, and permitting recourse to the Land Valuation Tribunal in some cases of dispute as to the proper unit entitlement.
Clause 8 of the Transitional Provisions contained in Sch 3 of the 1985 ST Act also recognised the change.
On the introduction of the State Administrative Tribunal Act 2005 (WA), the functions of the Land Valuation Tribunal were taken over by this Tribunal.
The 1985 amendments imposed the requirement for a licensed valuer to allocate and certify the unit entitlement of each lot, based on its value in proportion to the total value of all lots in the scheme.
Section 14(2) of the 1985 ST Act also imposed the limitation that such proportion could not vary by more than plus or minus 5% from the value that the lot bears to the aggregate value of all the lots in the scheme.
The current unit entitlement with each lot having an identical allocation, varies more than the 5% allowed under the 1985 ST Act, as is confirmed by Mr Dawson at para 23 of his statement, where he confirmed that it '[s]uffers a variance in excess of 5%'.
The second limb of the test in s 103H(3), and in respect of which the Tribunal must decide is concerned with the question of degree and whether the lack of consistency identified by the experts is sufficiently great as to be unfair or anomalous.
The lay witness' differed on whether that was the case. The applicants believed it was, while the respondents believed that it was not.
The Shorter Oxford Dictionary (5th ed, 2002) defines 'unfair' as 'not equitable or unjust' and defines 'anomalous' as 'irregular or abnormal'.
The respondent argued that the present position has been in place for some 36 years and should remain in place, and it is open to the strata company to deal with the matter by a bylaw if necessary. Further, the respondents conceded that, while it may be demonstrable that there was a possible inequity, arrangements could be made to deal with this, as has happened in the past with window replacement.
However, it is not a matter that the Tribunal believes should simply be left to arrangements between owners, as has happened in the past. Parliament has seen fit to introduce a system whereby unit entitlements are now equitably set for all owners, using a formula that allows only relatively minor variations.
To put the difference between the levies based on the existing unit entitlement, as against those that would result from that proposed by the two experts based on capital value into context, the applicants furnished the following table:
Applicants' table
| LEVEL | LOT | UNIT | COLUMN | EXISTING UNIT | PROPOSED UNIT | VARIATION % | PROPOSED | CHANGE IN |
| 1 | 1 | 1 | WEST | 1 | 33 | * -20.8% | $7,254.72 | -$1905.28 |
| 2 | 2 | CENTRAL | 1 | 30 | -28.0% | $6,595.20 | -$2564.8 | |
| 3 | 17 | EAST | 1 | 37 | -11.2% | $8,134.08 | -$1025.92 | |
| 2 | 4 | 3 | WEST | 1 | 36 | -13.6% | $7,914.24 | -$1245.76 |
| 5 | 4 | CENTRAL | 1 | 32 | -23.2% | $7,034.88 | -$2,125.12 | |
| 6 | 18 | EAST | 1 | 41 | -1.6% | $9,013.44 | -$146.56 | |
| 3 | 7 | 5 | WEST | 1 | 39 | -6.4% | $8,573.76 | -$586.24 |
| 8 | 6 | CENTRAL | 1 | 35 | -16.0% | $7,694.40 | -$1,4656.60 | |
| 9 | 19 | EAST | 1 | 44 | +5.6% | $9,672.96 | +$512.96 | |
| 4 | 10 | 7 | WEST | 1 | 41 | -1.6% | $9,013.44 | -$146.56 |
| 11 | 8 | CENTRAL | 1 | 37 | -11.2% | $8,134.08 | -$1,025.92 | |
| 12 | 20 | EAST | 1 | 46 | +10.4% | $10,112.64 | +$952.64 | |
| 5 | 13 | 9 | WEST | 1 | 43 | +3.2% | $9,453.12 | +$293.12 |
| 14 | 10 | CENTRAL | 1 | 38 | -8.8% | $8,353.92 | -$806.08 | |
| 15 | 21 | EAST | 1 | 47 | +12.8% | $10,332.48 | +$1,172.48 | |
| 6 | 16 | 11 | WEST | 1 | 44 | +5.6% | $9,672.96 | +$512.96 |
| 17 | 12 | CENTRAL | 1 | 39 | -6.4% | $8,573.76 | -$586.24 | |
| 18 | 22 | EAST | 1 | 48 | +15.2% | $10,552.00 | +$1,392.32 | |
| 7 | 19 | 13 | WEST | 1 | 46 | +10.4% | 10,112.64 | +$952.64 |
| 20 | 14 | CENTRAL | 1 | 41 | -1.6% | $9,013.44 | -$146.56 | |
| 21 | 23 | EAST | 1 | 50 | +20.0% | $10,992.00 | +$1,832.00 | |
| 8 | 22 | 15 | WEST | 1 | 53 | +27.2% | $11,651.52 | +$2,491.52 |
| 23 | 16 | CENTRAL | 1 | 44 | +5.6% | $9,672.96 | +$512.96 | |
| 24 | 24 | EAST | 1 | 56 | +34.4% | $12,311.04 | +$3,151.04 | |
| Totals | 24 | 1000 | 0.00% | $219,840.00 | $0.00 |
Note:In the Table submitted by the applicants, the Changes in Levies that reduced in dollar value and the corresponding Variation in percentage terms were coloured red. But, as these reasons will not be published in colour, the Change in Levies and the corresponding Variation in percentage terms, which are coloured red in the applicants' table are reproduced in the table in these reasons preceded by a minus sign, and the Changes in Levies and the corresponding Variation in percentage terms that will increase in dollar value are preceded by a plus sign.
Under the current allocation of unit entitlements, all units pay an equal amount of $9,160, but under the proposed changes based on the formula introduced by the 1985 ST Act, there would be a difference of nearly 62% between the levy Unit 24 will pay, being the highest, and the levy Unit 2 will pay, which would be the lowest. Under the proposed allocation, Unit 24 will incur an increase in its levy of 34.4%, or $3,151.04, whereas Unit 2 will see a decrease in its levy of 28%, or $2,564.80.
If the lack of consistency identified and agreed by the experts is not rectified, then the owner of Unit 2 will continue to pay a levy that is approximately 28% greater than he should be paying, based on the current value of his unit, while the owner of Unit 24 will continue to pay a levy which is approximately 34% less than he should be paying, based on the capital value of his unit.
Therefore, under the current allocation, those with lower valued lots are currently and would into the future be required to pay significantly greater levies than they would if the unit entitlement were adjusted, and it may be that the resale value of those lots may also be adversely affected.
The allocation as proposed by the experts would, in the Tribunal's view, provide a more equitable distribution of the burden of the levy across all lot owners, based on the value of their units, and would ensure that the value of each lot is correctly reflected in the unit allocation. Further, such allocation would be in line with the regime Parliament introduced in the 1985 ST Act to ensure that unit entitlements are set in line with capital values as against the arbitrary system prior to 1985.
The Tribunal recognises the change in the unit entitlements will not only change the proportion of levies payable by each proprietor, but will also change the voting rights of proprietors and the quantum of the undivided share that each proprietor has in the common property. However, those with a larger unit entitlement, and who therefore pay higher levies, will have the benefit of a larger share of the common property and increased voting rights.
Conclusion
In the circumstances, the Tribunal is satisfied, on the evidence before it and for the reasons outlined above, that the lack of consistency identified and agreed by the experts is sufficiently great as to be unfair or anomalous, and orders will be made to vary the current unit entitlement of Strata Plan 1659 to that proposed by the experts in their joint statement.
Orders
1.The schedule of unit entitlement currently registered in respect of Strata Plan 1659 for the premises known as 'Victoria Apartments' and located at No 30 Victoria Avenue, Claremont in the State of Western Australia is amended by being deleted and replaced by the following schedule:
Lot Number Unit Entitlement
133
230
337
436
532
641
739
835
944
1041
1137
1246
1343
1438
1547
1644
1739
1848
1946
2041
2150
2253
2344
2456
Aggregate 1000
I certify that this and the preceding [62] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
MR M SPILLANE, MEMBER
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