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1. The Truth About Strata; what
purchasers really need to know.
Part 3
Are There Building Defects?
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

2. All apartments leak?
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www.teyslawyers.com.au

3. Why Apartments Leak?
Why Balconies Leak
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4. Defects Are Time Bombs For
Inspectors and Managers
• At least 5 different time
limits apply to
commencing recovery
action
• Failing to warn
purchasers can amount
to negligence
• Failing to warn
purchasers of claims
made can amount to
negligence
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

5. When Does The Clock Start?
• The earliest possible date
is ‘completion’
• Completion can be
– Practical completion of
building contract
– Certificate of occupation
by local authority
– Registration of strata plan
• All dates should be
identified for advisors
• Be conservative
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

6. There Are Five Races for Justice
NonStructural
Insurance
Structural
Insurance
© Copyright 2011 Teys Lawyers
Negligence
Statutory
Warranties
Misleading
and
Deceptive
Conduct
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7. Non-Structural Home Warranty
Insurance
• Two pre-conditions
– Three stories or less (not
including car park)
– Insolvency, death or
disappearance of builder
• Claim notified within six
months of awareness,
and
• Claim matter within two
years from completion
• Be conservative about
what is non-structural
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

8. Structural Home Warranty Insurance
• Two pre-conditions
– Three stories or less (not
including car park)
– Insolvency, death or
disappearance of builder
• Claim notified within six
months of awareness,
and
• Claim made within six
years from completion
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

9. Negligence
• Defendants
–
–
–
–
Six year limit
10 year sunset from
final occupation
certificate
© Copyright 2011 Teys Lawyers
From manifestation
Builder
Designer
Developer
Principal certifying
authority
– Strata manager
– Building materials
supplier
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10. Statutory Warranties
• Defendants
– Builder
– Developer
• Applies to all buildings
regardless of size
• Rights expire seven
years after completion
of the work
• Be conservative about
‘completion’
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

11. Misleading & Deceptive Conduct Cases
Misleading and
deceptive conduct
Best paper trail wins
Federal and State
Court jurisdiction
© Copyright 2011 Teys Lawyers
Includes builder,
developer, sales agent,
strata manager
Six year time limit
from offending
conduct
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12. Different Races, Same Steps
Engagement
with the
enemy
Proceedings
stop the
clock
Dispute
resolved
Correspondence
about cracks and
leaks
Cracks
and leaks
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

13. Inspector’s Duty of Care
 To carefully inspect and clearly
report on all records provided
 To identify obvious records omitted
 To report defects identified in
records and cases started
? To alert purchasers to strict time
limits and need for legal advice
× To apply time limits
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

14. Strata Manager’s Duty of Care
 To provide all the records
 To identify records not
produced and why
 To alert OC to time limits
and need for legal advice
× To explain or interpret
documents
× To advise on prospects
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

15. Strata Inspectors Association
• Association incorporation
• Emailing list prepared
• Code of ethics agreed
• Website launched
• Free legal advice
• First AGM to be held today
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au

16. About the Presenter
Michael Teys is the Founder and Principal Lawyer of TEYS
Lawyers. He has a Bachelor of Laws and practices exclusively in
the area of strata title law. He is a Fellow of the Australian
College of Community Association Lawyers. He was formerly an
Adjunct Lecturer with Charles Sturt University. He appears
weekly on SKY News Business Channel's Property Success with
Margaret Lomas and is a regular panellist for the property
edition of Your Money, Your Call for the same channel. You can
find out more about Michael at www.michaelteys.com
TEYS Lawyers practice nationally in strata title law representing owners
corporations, bodies corporate and apartment owners. The firm’s practice groups
include building defects, management rights, strata community disputes, by-laws
and rules and levy and fee collection.
Subscribe for their free e-newsletter StrataSpace and find out more about them at
www.teyslawyers.com.au
© Copyright 2011 Teys Lawyers
www.teyslawyers.com.au