Before strata title was introduced in the 1960s, apartments were governed by company title.
Unlike owning a specific area of the building, as with a strata title, a company title is similar to owning shares in a company. The particular shares you may buy are allocated to your unit and carspace.
It shouldn’t be a deterrent in buying a property, but you should be aware of the differences between strata and company title so you know where you stand.
Let’s take a look at significant company title requirements, both similar and different to strata title.
Work Health and Safety
In general, Company Title buildings are covered under the Work Health and Safety Act 2011 (NSW) and Work Health and Safety Regulations 2011 (NSW). This means that the company will be subject to the requirements under the act to ensure the health and safety of its members.
It must be noted that clause 684 of the Work Health and Safety Regulations 2011 (NSW) allows an application to be made to Safe Work Australia, for exemptions to be made regarding any of the regulations. This exemption may be granted to a person, or a class of persons, and Safe Work Australia looks at factors listed under clause 685 when determining the application. These factor include the resulting standard of health and safety at the workplace, the level of risk associated with the granting of the exemption and whether there are any exceptional circumstances.
The significance of an exemption granted under clause 684 is that managers of Company Title or Strata Title body corporates may effectively be removed from any personal liability arising from the regulations.
Child Safety Window Devices
Clause 78 of the Work Health and Safety Regulations 2011 (NSW) mandates that the risks to health and safety associated with a fall by a person from one level to another that is reasonably likely to cause injury must be eliminated. If the risk of fall cannot be eliminated, it must be minimised as per clause 79. These clauses are effectively, an extrapolation of the general duty to ensure health and safety provided under the Work Health and Safety Act 2011 (NSW). Subsequently, Company Title buildings will have to install child safety window devices on levels above the ground floor, so as to ensure that the company, at least, minimises the risk of fall.
Asbestos
Clause 420 of the Work Health and Safety Regulations 2011 (NSW) provides a general duty to ensure that the exposure of a person to airborne asbestos is either eliminated so far as is reasonably practicable or minimised. This duty, similar to the duty to manage risk of fall, arises from the general duty to ensure health and safety.
Specifically, this duty entails Company Title buildings to ensure that the exposure standard for asbestos is not exceeded at the site. Company Title buildings will also need to, pursuant to clause 422, engage a competent person to identify, as reasonably practicable, all asbestos on site. The presence and location of asbestos is also to be indicated, and if possible, marked.
Regarding any significant removal of asbestos, companies are required under clause 458 to engage a licensed asbestos removalist. An asbestos removal supervisor may also have to be engaged, depending on the level of work, as pursuant to clause 459.
Sinking Fund Costs
Sinking fund forecasts are not required to be carried out by Company Title buildings, as they are not covered under the Strata Schemes Management Act 1996 (NSW), pursuant to s 3. It may be noted that the Strata Schemes Management Act 1996 (NSW) provides this requirement under s 75A.
Generally
The compliance requirements of Company Title buildings fall under company law, rather than Strata Title law, and subsequently, are governed by their Constitutions and regulated by the Corporations Act 2001 (Cth). They may also have rights and obligations under other legislation, including the Work Health and Safety Act 2011 (NSW), the Environmental Planning and Assessment Act 1979 (NSW) and its associated regulations, and Part 3 of the Local Court Act 2007 (NSW).
Owners corporations of Strata Title buildings are regulated by a range of legislation and regulations specific to strata title, including the Strata Schemes Management Act 1996 (NSW). More importantly, all Strata schemes are subject to a set of by-laws.
If you feel you need help to get clarity on your Company Title, please feel free to give us a call on (02) 9199 8597 or email us.
The information contained in this post is current at the date of editing – 16 November 2023.
