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Owners’ Corporation Law - September 2016

30 Aug 2016

Pet ownership to soar

Last month, the VCAT struck down rules passed by an owners’ corporation (OC) that prohibited pets from being kept in residential lots or on the common property.

Despite the OC passing a special resolution among all owners to introduce a “no pets” rule in 2014, a tenant who moved into the complex in late 2015 brought her pet cavoodle and maintained that it would not be removed.

The OC issued several breach notices but ultimately, when it filed an application in VCAT to enforce the dog’s removal, VCAT instead declared the rules to be invalid, of no effect and unfairly discriminatory.

A victory for the cavoodles of Melbourne then.

But not just for the cavoodles – this is also a victory for the spaniels, the terriers, the ridgebacks, not to mention the moggies, the Siamese, the Persians and we can’t leave out the mice, the bunny rabbits and the snakes either.

The decision likely means that all rules that prohibit pets throughout Victoria run the risk of being found invalid and of no effect. Consequently, all owners’ corporations that currently have a no-pet rule or policy are at risk of having this struck down.

This stems from the Supreme Court decision in July from Riordan J that ruled against an OC in regard to a rule regulating short-term letting in the building.

The judgment clarified the extent of an OC’s rule-making powers, which found that, although OCs have wide-ranging powers and functions to make rules to control and manage the common property, when it came to rules to manage the private use of lots, these powers are, in fact, limited.

As both the Supreme Court and the VCAT have now noted, even if a rule is found to be validly made about a matter involving the common property, it can be ruled as unfairly discriminatory and of no effect if there is no reasonable justification for such discrimination.

In this case, the rule banning pets from the common property was found to be unfairly discriminatory based on the layout of the common property and the likely interface and meeting point for residents and dogs on the common property.

Accordingly, the decision confirms that the Victorian Parliament has not acted to confer powers on owners’ corporations that would substantially interfere with the rights and privileges usually attendant upon freehold owners.

In fact, the Victorian Parliament has not conferred many powers in favour of owners’ corporations much beyond the administration of the common property, although even that power may not stand in certain circumstances.

The recent issues paper that was published as part of its review of the Owners’ Corporation Act 2006 by Consumer Affairs has not proposed to increase the rule-making powers of an OC either.

As it happens, Consumer Affairs is currently investigating whether the model rules should be expanded to include a power to regulate pets on lots or on the common property.

However, any new legislation will not be enacted within the next two years, meaning that, for now, OCs may well find themselves in serious doggy doo-doo.

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