What has happened?
In The Owners – Strata Plan 1998 v Perifa Gerrale Pty Ltd [2026] NSWLEC 9, the Land and Environment Court gave effect to a strata renewal plan for the redevelopment of three 1960s apartment buildings in Cronulla. Three dissenting owners will be required to sell their lots to the developer.
Context
Under the Strata Schemes Development Act 2015 (SSD Act), a strata scheme can be collectively sold or redeveloped if at least 75% of owners support a strata renewal plan and the Court gives effect to it. Before doing so, the Court must be satisfied of the matters in s 182, including that:
any relationship between lot owners and the developer has not prevented the plan being prepared in good faith; and
for a redevelopment, the settlement terms for dissenting owners are just and equitable.
The scheme comprised 33 apartments with associated parking lots. The objectors argued that the strata committee's secretary had a relationship with the developer's principal that compromised the plan.
The decision
Justice Duggan found that:
a "relationship" for the purposes of s 182(1)(a) requires more than mere knowledge of or familiarity with another person. The two men knew of each other and each other's businesses, but there was no financial, emotional or business connection;
in any event, the question is whether a relationship prevented the plan being prepared in good faith, not merely whether one existed; and
late notice to the Registrar-General was not fatal, as the Court can be satisfied despite a defect or irregularity that has not caused substantial injustice.
The Court made orders giving effect to the plan. Dissenting owners must exchange contracts with the developer within 14 days, with completion 12 months later. Leases will end on completion, with the developer paying any break costs, and the scheme will then be terminated.
How will this affect you?
Strata renewal is a workable pathway for redeveloping older buildings, even where some owners object.
Strata committees and developers should still disclose any connections fully. The Court will scrutinise relationships, although casual business familiarity is not enough to derail a plan.
Dissenting owners should focus on the statutory tests, particularly whether the settlement terms are just and equitable, and obtain independent valuation advice.
Further information
For further information please contact Darren Bick, Director, on +61 416 167 556 or darren.bick@bicksteele.com.au.