Goubran v SP57150: negligence and s106(6)
John Goubran & Associates Pty Ltd ACN 070 974 819 v The Owners – Strata Plan 57150 [2026] NSWDC 9
In short
The District Court found that the owners corporation breached its duty of care by failing to remediate known waterproofing defects within a reasonable time after identifying the source of water ingress.
The plaintiff recovered $61,880 for lost rental income caused by the delay in carrying out common property repairs.
A claim for breach of statutory duty under s 106 of the Strata Schemes Management Act 2015 was dismissed because it was commenced after the limitation period that applied when the cause of action arose.
The Court held that the 2025 amendment extending the limitation period from two years to six years did not revive an already time-barred claim.
Background
Water ingress into the plaintiff’s lot became apparent in September 2021, with pooling water, mould, cracking and other damage later identified. The source of the problem was ultimately traced to failed waterproofing on the balcony of the lot above and defective flashing associated with common property.
The owners corporation obtained an engineering report in April 2022. That report concluded that the waterproofing membrane had failed and attributed the water damage and cracking in the lot to water ingress from the balcony above. The report also identified wider waterproofing issues throughout the scheme.
Although scopes of work, tenders, levies and project management arrangements followed, remedial works did not commence until July 2024 and reached practical completion in December 2024.
Legal issue and statutory framework
The proceeding raised two principal issues:
Whether the owners corporation was negligent in the way it responded to known water ingress affecting Lot 7.
Whether the plaintiff could recover damages for breach of the owners corporation's statutory repair duty under Strata Schemes Management Act 2015 (Act), particularly having regard to the amendment extending the limitation period in s 106(6) from two years to six years.
The court accepted that balconies and external walls were common property and that the owners corporation owed a duty to take reasonable care to maintain and repair common property so as to avoid foreseeable harm to affected lots.
Decision
The court accepted that an owners corporation managing a 24-lot scheme would need to undertake investigations, obtain expert advice and coordinate repairs. However, it found that the delays after receipt of the April 2022 report were excessive and largely unexplained.
In particular, the court pointed to the period between April 2022 and June 2023 before a final scope of works was produced, and the further delay before a contractor was engaged. The court held that the owners corporation chose to address scheme-wide defects through a prolonged staged process rather than promptly addressing the known source of continuing damage to the lot. That approach was inconsistent with its duty of care to the plaintiff.
The court found that a reasonable owners corporation would have taken steps to implement remediation shortly after receiving the April 2022 report and that the plaintiff had established negligence. It also rejected arguments that the plaintiff failed to mitigate its loss.
The statutory duty claim produced a different result. The court found that the plaintiff became aware of its loss in September 2021. Although s 106(6) was amended in 2025 to extend the limitation period to six years, the earlier two-year limitation period had already expired. Applying principles from Rodway v R [1990] HCA 19, the court held that the amendment could not retrospectively revive a claim that was already statute-barred.
Outcome
The court dismissed the statutory duty claim under s 106 of the Act as out of time but upheld the negligence claim. Damages were assessed by reference to lost rental income from 14 May 2022 to 23 January 2024, resulting in an award of $61,880. Judgment was entered for the plaintiff in that amount, with costs to be determined separately.
