That’s three strikes for developer

Jimmy Thomson

April 9, 2011



    flat chat

    Imagine if you bought a car based on a test drive of the same model, and maybe a picture in a glossy brochure, but when it turned up, it had two doors instead of four.

    Even worse, you discovered that the sales contract allowed the garage owners to change whatever they liked.

    You’d be nuts to accept this and, even if you did, Fair Trading would be all over it like fake tan at a cheerleader convention.

    But when it comes to new apartments, some developers have a real problem with the concept of giving people what they paid for.

    A recent correspondent to the Flat Chat website said his block’s developer had not only changed common property after apartments were sold off the plan, he had included a clause in sales contracts saying new owners must agree to approve this change.

    Now, I’m no lawyer but I can think of three ways that this is probably illegal, not to mention morally corrupt and wrong.

    For a start, there are restrictions on what can be done with common property during the ”initial period” before the owners have their first AGM and effectively take over the running of their own homes.

    Second, developers can’t demand proxy votes or powers of attorney in their sales contracts – at least, if they do, the votes don’t count. And third, this possibly breaches the new federal laws on unfair contracts.

    With other owners not interested in taking on the developer, it sounds as if our complainant is on his own (although real lawyers are offering advice on the Flat Chat website).

    But this just shows one of the huge flaws in our strata system.

    If a developer sets out to deliberately cheat owners out of what they have paid for, isn’t that fraud?

    Maybe that’s something for the new Minister for Fair Trading, Anthony Roberts, to consider.

    Last week, the curse of Flat Chat struck when the shadow minister, Greg Aplin, didn’t even get his training wheels on before he was hoiked out of cabinet.

    The kiss of death was probably when we said he was well informed.


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