The Commissioner's Corner - Sale of a lot

Most of my articles focus on rights and responsibilities for owners of lots in a community titles scheme.

On the other side of the coin, what about the implications for the sale or potential sale of a lot in a scheme?

Firstly, there’s no requirement under the Body Corporate and Community Management Act 1997for a lot owner to have to seek the approval of the body corporate to sell their lot or to put their lot up for sale. There is also no obligation for the owner to inform the body corporate of their intention to do so.

Naturally if a lot is up for sale it might be the case that the real estate agent handling the sale might want to put up some signs and conduct an open house.

We get regular enquiries about the placement of signs relating to the sale of a lot.

While the Act and its Regulation Modules do not specifically discuss signage, it might typically be a by-law issue.

Remember, the body corporate has a responsibility to maintain common property and also an obligation to enforce by-laws.

The body corporate may well have an obligation to regulate how “for sale” or “open house” signs are placed on common property.

If there is a registered by-law stating that any signage on common property must have body corporate approval, then an owner selling their lot would need to seek that approval prior to the placement of the sign.

As is the case with any by-law related issue, the body corporate should not unreasonably withhold the permission. Each case will always be considered on its merits.

For example, a body corporate might have to consider whether the placement of “for sale” signs interfere with the use and enjoyment of common property. Following this through to its logical conclusion, if a “for sale” sign is blocking or restricting access to common property, then it might be quite reasonable for the body corporate to refuse permission.

Bear in mind that we are only talking about the placement of signs as they relate to common property. If the signs in question are intended to be placed outside of the boundaries of common property then the seller of the lot might need to check if the signs are being placed on local council land, which is not the responsibility of the body corporate.

All of these considerations apply to “open house” signs as well.

On the topic of an open house, one of the possible issues this raises is the access to scheme land by invitees (i.e. the people attending the open house).

This may not be much of an issue if the scheme land is openly accessible from the street, but if the scheme is only accessible by a locked entrance, such as a gate or electronic locking system, there may be valid concerns about non-occupiers of the scheme gaining access.

In the first instance I’d be suggesting early and open communication between the seller of the lot, the agent hosting the open house and the committee (and onsite manager if applicable).

Communicate early in the piece the intent to hold an open house, on what days and on what times. Regardless of whether a by-law requires this, it is common courtesy to make it clear, as it may have an impact on the other occupiers of the scheme.

Then, suggest some workable options. Rather than keeping propped open a secure door, for example, the agent might be better placed waiting at the door to let people in and escorting them to the lot. The agent might also be able to buzz people in via intercom, if there is one, although consideration should be given as to how the agent is going to advise visitors how to get to the lot.

A further consideration is for when visitors to the open house want to inspect common property. Visitors may, for example, want to look at the pool or car park once they finished their inspection of the lot.

The seller of the lot and the agent would be best advised to have a plan for this. Ideally, someone would escort visitors around common property. If this sounds too onerous, then consider it from the perspective of occupiers – be they owners or tenants – in the scheme who might encounter strangers walking around the property. Naturally, it might raise some concerns. Providing some notice and exercising some control over how visitors conduct themselves would go a long way towards overcoming those concerns.

This information is being provided solely from a body corporate perspective. My office does not regulate the conduct of real estate agents and concerns in this regard should be addressed to the Office of Fair Trading at www.fairtrading.qld.gov.au.

Once the sale is completed, that is usually the end of that owner’s involvement in the scheme. I say “usually” because the owner could of course have some further involvement in other ways – there is, for example, no restriction on a former owner being appointed proxy or power of attorney for another owner, or they may own another lot.

Also, a former owner may, in some circumstances, continue to have an interest in a dispute resolution application with my office, even after they cease to be registered owner.

Adjudicators have made orders about signage. Examples include Noosa Glades Two [2000] QBCCMCmr 566 (6 November 2000) and Kookaburra Park Eco Village [2008] QBCCMCmr 467 (16 December 2008). You can find adjudicators’ orders at www.austlii.edu.au.

For further information please contact the Information and Community Engagement Unit of my office on 1800 060 119 or visit our website www.qld.gov.au/bodycorporate.

Chris Irons, Commissioner for Body Corporate and Community Management