Strata Title
5. The Initial Period
Authors: Staff Legal Eagle
Firm / Chambers:
Last updated: 21 Sep 2015
- When a strata plan is registered in NSW an initial period begins. This period continues until one-third of the unit entitlements for the building have been sold.
- The owner of the building (usually the builder or the developer) will have majority control of the unit entitlements in the initial period. This allows them to control the decisions made by the owners’ corporation during the initial period. To protect the owners of the other units in the strata scheme during this initial period numerous restrictions are placed on the owners’ corporation. For example it cannot:
- remove, add or amend by-laws that do not give a right or obligation to all lots;
- sell or alter common property unless permitted by the contract;
- borrow or lend money;
- incur debts (that haven’t been accounted for); or
- appoint a strata manager to continue after the first Annual General Meeting (AGM).
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