Saad v The Owners - Strata Plan No 75928 [2025] NSWCATCD 108 | Case summary

NCAT Consumer and Commercial|2025-08-05

The Owners - Strata Plan No 75928 (first respondent)

I have decided to dismiss the applications for the reasons below.
I have made no costs orders since no party was legally represented by leave and no other costs which could be the subject of orders were referred to.

The applicant is a lot owner in a 32-lot strata scheme in Erskineville, an inner western suburb in Sydney, NSW. The lot is tenanted.
In 2024/00320022 filed 27.viii.24 against Ace Body Corporate in Chippendate (the strata manager), John Patrick Baylouni, Pu Koh, George Kokkinos and James Still, the applicant sought orders under Strata Schemes Management Act 2015 (NSW) (SSMA) ss 72 (termination of strata manager), 90 (costs in proceedings between owners corporation and lot owner), 131 (licence for lot owner to use common property), 187, 188 (access to strata records) and 238 (removal of strata committee). In reality, the application was for orders under ss 237 and 238 respectively for removal of the strata manager and the strata committee (SC) and the appointment of a compulsory strata manager.
The grounds for removal were: alleged waste of more than $35,000 from the scheme sinking fund rather than using insurance and with a contractor not licensed to work on a class 2 building in addition to his contractor's licence; endangering persons with not repairing the building façade; forcing entry into the applicant's lot; refusing access to strata records on the applicant's proper requests; not obtaining professional reports and sufficient quotations for works; providing misleading information to and withholding information from the applicant and other lot owners about the works in the applicant's lot; the strata manager using abusive language to lot owners including the applicant. There were general allegations of dishonest behaviour and the list was said to be "only some of the behaviours".
In 2024/00319982 filed 26.viii.24 the applicant sought similar relief against the strata manager and the owners corporation (OC) under the same provisions and said that interest should be charged.
In 2025/00005767 the applicant joined the OC as respondent and added claimed relief under SSMA s 237.
After an adjourned directions hearing on 25 September 2024 where the applicant (for unclear reasons) could not appear by telephone, on 7 November 2024 orders were made for the two existing proceedings to be heard together with evidence in one being evidence in the other. Access to strata records was to be applied for by 11 November 2024 and provided on 14 November 2024 under SSMA ss 182 and 183 in respect of strata records. A preparation timetable was directed.
On 8 January 2025 the new proceedings by the applicant were ordered to be heard with the existing proceedings, with evidence in one being evidence in the others.
There had been previous proceedings 2022/412237 and 2022/418293 in which some similar relief had been sought. I dismissed proceedings (then numbered SC 22/37060) on 10 February 2023 under s 55(1)(c) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) for non-appearance by the applicant without a satisfactory explanation.
At the final hearing of the present three proceedings, the applicant was self-represented. The chair of the OC (Mr Koh), appearing remotely, represented himself and the OC. Unsuccessful attempts to contact Mr Kokkinos were made to see if he wished to be represented.
The applicant objected to the named strata manager (Mr Baylouni) appearing by AVL. After about 20 minutes of difficulty connecting with the strata manager, I allowed the remote appearance (which the strata manager said he had applied for on 21 February 2025) for medical reasons arising from an accident the preceding week, with the proviso that any further connection problem would require a means to appear personally. Mr Baylouni explained that John Bay Holdings PL ran the strata management business but that he held the business name. He was the sole director and authorised to speak for the company. The company was to be joined as a further respondent without objection.
Mr Still was to be removed as a party since he was no longer a member of the SC and the only relief claimed against him was removal from the SC.
The applicant sought to join one or two further persons as respondents. There was uncertainty as to whether they were on the SC at the time of the relevant events or presently. The applicant accepted that this had not been raised at one of the three directions hearings and that an adjournment would be required to enable new individual respondents to prepare. I refused the joinder application. There was insufficient reason to adjourn further after a joinder.
The applicant was not cross-examined, it was said on the basis that the material presented was not relevant to the orders sought.
The applicant cross-examined (at length between them) Mr Baylouni,and the chair. The hearing went until 4.20pm with shortened mid-morning and lunch adjournments.
On reserving my decision, I made the following orders:

2. Order as follows:

2.1 On or before 18 March 2025 the applicant is to file and serve by email a note that specifies only the following legislative provisions or provisions of the by-laws of SP 75928 (to the extent, if at all, that such provisions exist): (1) requiring three quotations for any works required to be undertaken by the owners corporation (or the strata committee for the owners corporation) on the common property of the owners corporation; (2) empowering the Tribunal to order a financial audit of a strata scheme; (3) specifying what licences are required for a builder to undertake waterproofing works.

2.2 On or before 25 March 2025 the respondents are to file and serve by email a note that specifies only legislative provisions or provisions of the by-laws of SP 75928 (to the extent, if at all, that such provisions exist) on matters (1) to (3) in order 2.1 that the respondents say supplement or contradict the provisions specified by the applicant.

In response, the applicant filed a note on 25 March 2025 specifying SSMA s 102 with Strata Scheme Management Regulation 2016 (NSW) (SSMR) reg 25.

SSMA s 37 provides "It is the duty of each member of a strata committee of an owners corporation to carry out his or her functions for the benefit, so far as practicable, of the owners corporation and with due care and diligence." A note says that s 260 provides protection from personal liability for SC members who act in good faith in executing their functions.
SSMA s 237 provides as follows:

(1) Order appointing or requiring the appointment of strata managing agent to exercise functions of owners corporation The Tribunal may, on its own motion or on application, make an order appointing a person as a strata managing agent or requiring an owners corporation to appoint a person as a strata managing agent -

(a) to exercise all the functions of an owners corporation, or

(b) to exercise specified functions of an owners corporation, or

(c) to exercise all the functions other than specified functions of an owners corporation.

(2) Order may confer other functions on strata managing agent The Tribunal may also, when making an order under this section, order that the strata managing agent is to have and may exercise -

(a) all the functions of the chairperson, secretary, treasurer or strata committee of the owners corporation, or

(b) specified functions of the chairperson, secretary, treasurer or strata committee of the owners corporation, or

(c) all the functions of the chairperson, secretary, treasurer or strata committee of the owners corporation other than specified functions.

(3) Circumstances in which order may be made The Tribunal may make an order only if satisfied that -

(a) the management of a strata scheme the subject of an application for an order under this Act or an appeal to the Tribunal is not functioning or is not functioning satisfactorily, or

(b) an owners corporation has failed to comply with a requirement imposed on the owners corporation by an order made under this Act, or

(c) an owners corporation has failed to perform one or more of its duties, or

(d) an owners corporation owes a judgment debt.

(4) Qualifications of person appointed A person appointed as a strata managing agent as a consequence of an order made by the Tribunal must - (a) hold a strata managing agent's licence issued under the Property, Stock and Business Agents Act 2002, and

(b) have consented in writing to the appointment, which consent, in the case of a strata managing agent that is a corporation, may be given by the Secretary or other officer of the corporation or another person authorised by the corporation to do so.

(5) Terms and conditions of appointment A strata managing agent may be appointed as a consequence of an order under this section on the terms and conditions (including terms and conditions relating to remuneration by the owners corporation and the duration of appointment) specified in the order making or directing the appointment.

(6) Return of documents and other records A strata managing agent appointed as a consequence of an order under this section must cause a general meeting of the owners corporation to be held not later than 14 days before the end of the agent's appointment and must on or before that meeting make arrangements to return to the owners corporation all documents and other records of the owners corporation held by the agent.

(7) Revocation of certain appointments An order may be revoked or varied on application and, unless sooner revoked, ceases to have effect at the expiration of the period after its making (not exceeding 2 years) that is specified in the order.

(8) Persons who may make an application The following persons may make an application under this section -

(a) a person who obtained an order under this Act that imposed a duty on the owners corporation or on the strata committee or an officer of the owners corporation and that has not been complied with,

(b) a person having an estate or interest in a lot in the strata scheme concerned or, in the case of a leasehold strata scheme, in a lease of a lot in the scheme,

(c) the authority having the benefit of a positive covenant that imposes a duty on the owners corporation,

(d) a judgment creditor to whom the owners corporation owes a judgment debt.

"(1) The Tribunal may, on its own motion or on application by an interested person, make any of the following orders:

(a) an order removing a person from a strata committee;

(b) an order prohibiting a strata committee from determining a specified matter and requiring the matter to be determined by resolution of the owners corporation;

(c) an order removing one or more of the officers of an owners corporation from office and from the strata committee.

(2) Without limiting the grounds on which the Tribunal may order the removal from office of a person, the Tribunal may remove a person if it is satisfied that the person has:

(a) failed to comply with this Act or the regulations or the by-laws of the strata scheme; or

(b) failed to exercise due care and diligence, or engaged in serious misconduct, while holding the office."

An "interested person" is defined in s 226 relevantly to include a lot owner.

SSMA ss 237 and 238 give, by the word "may", a discretion to the Tribunal which needs to be exercised on principled grounds and may lead to an appointment or a removal, respectively, not being made even if some conduct would satisfy the criteria in s 237 (or s 238): McGrath v Owners SP 13631 [2022] NSWCATCD 60.
The removal of a strata scheme officer under s 238 or the appointment of a compulsory strata manager under SSMA s 237 is not lightly done and similar principles apply, mostly derived from authority on s 237.
It is unlikely that principled grounds would lead to exercise of the discretion to remove an officer of the OC (chair, secretary, treasurer) or other elected member of the SC for isolated incidents, however important in themselves in terms of consequences, unless the incidents showed serious misconduct or dereliction of duty (including disobedience to Tribunal or Court orders) that justified overturning an elected outcome: Linney v Owners SP 11669 [2021] NSCATCD 123 at [94]; Lockrey v Rosewall [2022] NSWCATCD 27 at [15]- [16].
Equally, the appointment of a compulsory strata manager, like the removal of a strata scheme officer, is not lightly made and requires some dereliction of duty or dysfunction in operation of the scheme, usually not arising from an isolated incidence unless it showed serious misconduct or dereliction of duty (including disobedience to Tribunal or Court orders): see, eg, Kahn v Owners SP 2010 [2017] NSWCATAP 39 at [30]; Owners SP 14593 v Soares [2019] NSWCATAP 3 at [44], [46]; Anderson v Owners SP 61034 [2019] NSWCATAP 61 at [41]- [42].
The aim of SSMA s 237 and s 238 and their predecessors in the 1996 Act is, where possible, to maintain a democratic system which the legislative scheme has established, rather than remove someone so elected or substitute a compulsory appointment as strata manager: Kahn v OC SP 2010 [2017] NSWCATAP 39 at [30].
Focusing on SSMA s 237, it is not enough that the owners or groups or factions of them simply do not get along: Bischoff v Rita Sahade [2015] NSWCATAP 135. The evidence may show a properly functioning strata scheme in all practical respects despite any personal animosities or disagreements on the decisions made: Robinson v Owners SP 61717 [2018] NSWCATCD 49 at [53]- [58]; Anderson v Owners SP 61034 [2019] NSWCATAP 61 at [41]- [42]. Disagreement by a lot owner or a number of lot owners with the properly-made decisions of the SC or OC does not establish that the scheme is not functioning satisfactorily: Hoare v Owners SP 73905 [2018] NSWCATCD 45 at [202]. The same applies in the context of OC officers or other SC members.
However, if dispute becomes chronic, complex and/or litigious the trigger point may well have been reached: Moallem v CTTT [2013] NSWSC 1700 at [7]; Bate v Owners SP 60549 [2018] NSWCATCD 36 at [77]- [78]. This may also be the case where there is a clear and substantial dereliction in the duty of the SC and/or the strata manager to manage the scheme in accordance with statutory requirements and in the interests of all lot owners under SSMA s 9(2) and its statutory predecessors, without discrimination: Gershberg v Owners SP 5768 [2011] NSWCTTT 411; Owners SP 14593 v Soares [2019] NSWCATAP 3 at [44], [46].
Failure to engage or reasonably to act in accord with relevant expertise and advice, including the strata manager for voluntary members of a strata committee, may be a sufficient indicium: Co Funds Management PL v Owners SP 78945 [2011] NSWCTTT 488 at [27]- [28].
There may be a need for intervention to provide a "clean slate", to re-establish proper functioning, and to facilitate non-repetition of dysfunctional conduct or non-compliance with statutory requirements (which in the case of a compulsory strata manager may require the maximum appointment period of two years): Kotevski v Seadon and Owners SP 82413 [2013] NSWCTTT 597 at [74]. For a compulsory strata manager, this may require continuation on a serial basis if the complexity of the mix of uses in the scheme, the size of the scheme or other ongoing management issues are present: Foong v Scutella [2021] NSWCATAP 225.
If a compulsory strata manager is appointed, it should be someone who, in addition to giving the statutory consents, will provide the necessary impartial management at least cost: Farland v Simmons [2018] NSWCATCD 28 at [45].
In the present proceedings, no invalidation of an election of an SC member was sought under SSMA s 24(2), nor of a resolution of the OC at a general meeting under s 25. There was no indication in the evidence that the procedure under SSMA Sch 2 para 9(3) was available and invoked for invalidating an SC decision by notifying that it was opposed before being made by lot owners with more than one-third of unit entitlements.
SSMA s 102 provides as follows:

102 Limits on spending by owners corporation

(1) An owners corporation must obtain at least 2 independent quotations for proposed expenditure for an item or matter that is more than the amount prescribed by the regulations for this section.

(2) If the owners corporation is not able to comply with subsection (1), the secretary of the owners corporation must add an item to the agenda of the next general meeting of the owners corporation to note -

(a) the item or matter for which the quotations were required, and

(b) the reasons the owners corporation was unable to obtain the quotations.

(3) An owners corporation for a large strata scheme must not spend more on an item or matter than the amount specified for the item or matter in the estimates prepared at an annual general meeting, plus 10%.

(4) The owners corporation may, by resolution at a general meeting, remove the limitation imposed by subsection (3) generally or in relation to a single item or matter.

(5) This section does not apply to expenditure for emergency purposes, including in relation to the following -

(a) burst or blocked water or sewerage pipes,

(b) serious damage caused by a storm, fire or another natural disaster,

(c) unexpected electrical or security system failures,

(d) glass breakages that affect the security of a building in the strata scheme or could result in damage to the inside of the building.

(6) In this section -

independent quotations means quotations from persons who are not connected with each other.

25 Limits on spending by owners corporations

For the Act, section 102(1), the prescribed amount is $30,000.

SSMA s 106 imposes a strict duty on an owners corporation to keep the scheme building in maintenance and repair.

The applicant said that the first contact to gain access to the applicant's lot's balcony was by the builder to conduct a water test on 20 June 2022. The strata manager on 6 July 2022 sought access for remediating "urgent water issues"; the applicant contended that the problem was said to have been known since April 2022 so was not an emergency, but approval procedures were not followed - an email from the chair on 26 July 2022 said that the three quotations required had been "waived". There was no professional report or quotation; the chair's further email on same date said "We didn't ask for a report because it seems to be very straightforward repair work, and similar to what we had done previously."
The applicant further said that there were large outer cracks on her bedroom wall facing the street which allowed water entry and created a strong damp smell.
The strata manager was said to have responded with harassment, threats, intimidation and discrimination, including refusing a copy of the garage access remote and internal repairs for the water damage and seeking a fee for allowing the applicant to install window sound proofing.
An audit was said to have been refused.
The applicant put into evidence photographs of internal wall and ceiling cracks. There were also photographs of dead planter box plants and weeds growing out of external walls, together with external cracking. There were reports that the computer files which provided the strata records could not be extracted: "The destination path is too long. Rename the Compressed (zipped) Folder and try again."
No alternative strata manager was proposed by the applicant.
In closing submissions the applicant's complaints ranged further than what was in evidence.
The respondents answered each element of the applicant's complaint, as set out in the evidence, in their evidence (including in cross-examination) and submissions.
Thus, the remedial works were not covered by the building insurance and a claim had been lodged against insurance for what was covered, including emergency alternative accommodation which would not have left the applicant out of pocket as the tenant would continue to pay rent. Relevant extracts from the insurance policy were in evidence and supported what the respondents said.
Matters had been reported to the 2022 AGM without complaint except from the applicant. The reports included that engineers had been engaged in early 2022 to prepare a tender for remediation of the cracks and that process was ongoing, including engineering confirmation that the cracks were not structural. Reports and quotations were provided to the applicant, together with explanation that there was a statutory obligation to make good damage occasioned by remedial works.
A $5,000 deposit for works to the applicant's balcony was lost when access was denied on the scheduled date. Emergency access powers were invoked after receiving an expert mould report on a lot (lot 1) which had first reported water ingress in March 2022. The detailed mould report was in evidence.
No restrictions on SC expenditure to fulfil SSMA s 106 obligations had been imposed at the 2021 AGM so the SC could incur the relevant expenditure without further OC approval, in addition to being able to do so as emergency works. The works remained emergency works despite the period to remediate owing to the weather and other constraints.
The SC had sought three quotations for water ingress reported from March 2022 but there were difficulties in getting all but the appointed builder to quote with a scarcity of building contractors.
That builder gave an initial report on 31 May 2022. It attributed the water ingress most likely to waterproofing failure in the balcony tiles and planter boxes and said further investigation of the balconies and planter boxes including those of the applicant's lot (above lot 1) were required.
The opinion was confirmed after such inspection in the builder's subsequent report of 24 June 2022. The plants growing out of the wall indicated trapped dampness with water ingress through this source of water entry as well. The trifold quotation cost totalled approximately $35,000 plus GST. The difficulties in accessing the areas of remedial work due to the building configuration were set out. Further areas of required remediation and investigation were raised. There were photographs and a detailed quotation and scope of works followed.
The applicant withdrew on the day appointed for the works an attempt to stop access for the works (22 August 2022). Repairs to the applicant's lot's balcony and unit 1 were completed on 21 September 2022.
A waterproofing certification for the remedial work on the applicant's balcony, dated 7 September 2022, was in evidence.
The communications between the strata manager, SC and the applicant were consistent with the strata manager and SC's contentions, supported by the above evidence, that the remedial work was urgent and that the applicant was informed about the substantiating reports and provided with copies. The builder denied any harassment. The strata manager's emails were direct in terms of what was requested but set out offers of access to reports and contained explanations of weather difficulties that made arranging access with some flexibility important, plus explanations of scope of works and the reason for the works. The chair's emails were similar.
While communicating with the applicant could have occurred earlier (for instance, after the formal quotation and scope of works dated 23 June 2025), there appears to be in the circumstances no loss to the applicant arising from such delay and it is not clear what different path could have been followed. The chair's careful and detailed email of 26 July 2022 provided an explanation for not communicating earlier:

"I understand it must be confusing and frustrating for you not knowing all the details and to not be involved at the very beginning. But this being a straightforward repair we didn't think it would be such an issue and get such resistance. We're dealing with 2 other leaking issues in the building and haven't had any problems. Repair works had been scheduled and cancelled at the last minute twice, which has cost the body corporate money in lost deposit and unit 1 having to live for even longer in a wet apartment. ... and you get a new balcony! So we are confused why you are so against this? ... The committee is more than happy to have chat via zoom to answer an[y] questions or concerns you may have. Just let us know when it suits you."

There was an explanation as to the time period it took to investigate and arrange what remained an urgent and emergency remediation. It was clear that the SC had been involved in the process throughout, as explained by the chair to the applicant in the chair's email of 26 July 2022. The cancellations were because of denial of access by the applicant.
There was no expert opinion to support a view that the remediation was not urgent and emergency in nature, or was of major construction in nature as the applicant contended.
There was no supporting material for the contention that the builder's work was not appropriately licensed or not subject to the usual statutory warranties in the Home Building Act 1989 (NSW) s 18B.
The applicant, in an email from the chair on 28 July 2022, was invited to raise the SC's justification for not obtaining more quotations in circumstances described above at an EGM or an imminent AGM. There is no evidence that the actions of the SC were the subject of criticism in such a meeting and it appears that the SC remained the same in composition for those who wished to continue.
There was no evidence supportive of financial mismanagement or wrongdoing by the strata manager or the SC members.
There was no evidence beyond this episode that came anywhere near meeting the requirements for exercise of the discretion in SSMA ss 237 and 238 to remove the strata manager or members of the SC.
The applications will be dismissed.

(1) Join John Bay Holdings PL as sixth respondent.

(2) Remove James Still as fifth respondent.

(3) Applications dismissed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Schemes Management Act 2015

Schemes Management Regulation 2016

Administrative Tribunal Act 2013

Scheme Management Regulation 2016

Stock and Business Agents Act 2002

Saad v The Owners - Strata Plan No 75928 [2025] NSWCATCD 108;

At a glance

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Judgment (17 paragraphs)

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Legislation Cited (6)