A key responsibility of an owners corporation is to maintain and repair common property. When this duty is not met, lot owners have the right to seek compensation under Section 106(5) of the Strata Schemes Management Act 2015 (SSMA).

However, there are strict time limits on when these claims can be made. The question many owners ask is: can these time limits be extended?

The Court of Appeal decision in Tezel clarified that the 2-year time limit for damages claims runs from the moment an owner first becomes aware of the loss. This is similar to how the Home Building Act (HBA) sets time limits based on the date an occupation certificate is issued.

Importantly, this is not a rolling time limit that resets every time a new loss is suffered. Instead, the 2-year period starts from the fixed date when the owner first notices the damage.

The Tezel case also highlighted that different types of losses may have different starting points. For example:

• If an owner notices damage to their lot property (such as stained carpet), the 2-year period for that type of loss (damage to lot property) begins from that point.
• If they then suffer other loss, such as lost rental income, the 2-year period for that category starts when the loss begins.

This means owners need to be vigilant in tracking and documenting any damage or financial impact as soon as it occurs.

Under Section 41 of the NCAT Act, the Tribunal has the power to extend time limits for certain matters. In the past, NCAT had allowed extensions for damage claims against an owners corporation. However, this changed with the Pickard case.

In February 2020, a lot owner noticed water leaks from their shower recess. Two years and two months later, they lodged a damages claim with NCAT. Initially, the Tribunal granted an extension under Section 41 of the NCAT Act, but this decision was later overturned by the Appeal Panel, which ruled that Section 41 cannot be used to override the 2-year time limit in Section 106(6) of the SSMA. In other words, once the 2-year period has passed, owners lose their right to claim any damages under s 106(6), though there could be rights under nuisance/negligence.

This ruling has wider implications beyond Section 106(6). Other specific time limits for legal action in the SSMA are also fixed and non-extendable:

• Section 89: Claims against the developer for inadequate levy estimates must be made within 3 years after the end of the initial period.
• Section 143(4): After 2 years, it is assumed that all preliminary steps to pass a by-law (like having a written consent) were followed, meaning any such challenge to a by-law must be made within this timeframe.
• Section 147(4): A penalty application for failing to comply with a by-law must be lodged within 12 months of the notice being issued.

To ensure you don’t miss out on your right to claim damages, keep the following in mind:

• Act promptly – If you notice damage to your property, record and diarise the date and notify the strata manager as soon as possible.
• Keep records – Maintain a diary of issues, including photos and written communications about the damage.
• Seek legal advice early – If you believe you have a claim, don’t wait too long to get advice and start proceedings.

Understanding these rules can save lot owners from costly mistakes and help strata communities manage legal risks more effectively. If you are uncertain about your rights, consulting a strata lawyer or professional strata manager can help clarify your options.