Colman v SP61131: s 106(5) damages & mitigation
Colman v The Owners – Strata Plan 61131 [2025] NSWSC 63
In short
Retrospective approval is available: The Supreme Court confirmed that both an owners corporation and the Tribunal can approve common property works after they have been carried out. However, retrospective approval is only available within the framework of the Strata Schemes Management Act 2015 (Act).
Approval must first be sought: The Tribunal cannot grant retrospective approval under s 126(2) unless the lot owner first sought the relevant approval from the owners corporation and the owners corporation unreasonably refused consent.
Constructive refusal is possible: The Court recognised that an owners corporation may unreasonably refuse consent without a formal vote. Whether there has been a refusal depends on the circumstances of the particular case.
No recovery without approval: The Court held that the cost of common property repair works cannot be recovered where those works have not been approved, either prospectively or retrospectively, by the owners corporation or the Tribunal.
Section 108 approvals cannot be delegated: Works requiring approval under s 108 of the Act cannot be delegated to a strata committee for approval. Such works require approval by special resolution of the owners corporation.
Background
Mr Colman owned a lot in a Pyrmont strata scheme that included a rooftop terrace. Following investigations into water ingress affecting another lot, contractors engaged by the owners corporation began repair works involving an expansion joint on the terrace. During those works, broader waterproofing issues were identified.
Mr Colman subsequently arranged for extensive works to be undertaken, including the removal and replacement of terrace tiles and the waterproofing membrane. Those works affected common property and were carried out without prior approval from the owners corporation.
Mr Colman later sought retrospective approval for the works and claimed damages from the owners corporation for the cost of carrying them out. He argued that the works were necessary because the owners corporation had failed to comply with its statutory duty to maintain and repair common property under s 106 of the Act.
He also argued that by-law 44, titled Past Works Roofing, either authorised the works or empowered the strata committee to approve them.
Decision
The Court dismissed Mr Colman's appeal from the Appeal Panel and upheld the earlier Tribunal decisions.
The Court held that:
The Tribunal has power under s 126(2) to retrospectively approve common property works already undertaken by a lot owner. An owners corporation also has capacity to grant retrospective approval in appropriate circumstances.
The Tribunal's power only arises where the relevant approval has first been sought from the owners corporation and unreasonably refused. An owner cannot bypass the owners corporation and seek approval directly from the Tribunal.
Although a refusal of consent may sometimes be constructive, the circumstances of this case did not establish an unreasonable refusal enlivening s 126(2).
By-law 44 did not authorise the waterproofing and tiling works. Properly construed, the by-law was confined to roofing works and related ancillary works and did not provide a general approval for any works undertaken prior to its registration.
Even if by-law 44 had purported to authorise the strata committee to approve the works, it could not have validly delegated approval powers for works requiring approval under s 108, because those works required a special resolution of the owners corporation.
The owner could not recover the cost of the works because they had never been approved by either the owners corporation or the Tribunal. The Court held that compensation or damages for common property repair works are not available where the works have not received the approvals required by the Act.
Implications
The decision confirms that retrospective approval of common property works remains available under the Act, but only where the statutory approval pathway has been followed. Lot owners cannot undertake substantial works to common property and then expect the Tribunal to validate them without first seeking approval from the owners corporation.
The decision also provides useful guidance on constructive refusals of consent and confirms that approvals required under s 108 must be given by the owners corporation itself and cannot be delegated to a strata committee. Finally, it reinforces the importance of obtaining approval for common property works before seeking to recover any associated costs from an owners corporation.
