Strata Title
15. Covenant Chargee
Authors: Staff Legal Eagle
Firm / Chambers:
Last updated: 22 Sep 2015
- Someone who holds an agreement over the property which imposes certain obligations or restrictions is a covenant chargee. Their name must appear on the strata roll.
- A covenant chargee or a mortgagee has a priority to vote ahead of the lot owner.
- Under the Conveyancing Act 1919 (NSW) various public authorities may create a positive covenant over land that they do not own. Some examples are Australia Post and Sydney Water.
- The owners’ corporation can also create a positive covenant that burdens or benefits just the common property or all the land in a strata scheme. This can only be done through a unanimous resolution.
- A positive covenant requires the carrying out of a particular obligation by the registered proprietor. Examples include an obligation to repair or insure a building.
- A public authority, owners’ corporation or other person who holds a positive covenant may register a covenant charge over the land if the registered proprietor does not comply with the terms of the positive covenant.
- The covenant charge gives its holder the powers of a mortgagee. This includes the power to sell the subject land if that is necessary to recover costs that have arisen from the registered proprietor’s non-compliance.
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