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In a development or apartment building which is subject to the Unit Titles Act 2010 (the Act) part of the common area may be used for a specific purpose, in the short or long-term, by a person or entity which is granted the right to do so.
Where a person seeks to use a portion of common property for a particular purpose, such as for storage, a license may be granted by the body corporate. With this licence comes various requirements of the Act) that must be complied with in order to ensure the licence is binding on current and future owners of the principal units within the development.Bearing in mind that the owners for the time being of the principal units within a unit title development comprise the body corporate, it is questionable whether informal or non-compliant licences (i.e. a licence that is not granted in accordance with the Act) will bind current principal unit owners, and very unlikely that they bind future owners. An informal licence may be challenged and can lead to a number of issues down the track (insurance compliance, repairs and maintenance, etc).In order to grant a compliant licence, the body corporate must undertake the process of formal approval. This process is primarily in accordance with section 56 of the Act, and there is also the need for the designated resolution procedure to be complied with (which provides for an objection process).If you are unsure whether a licence you have already granted is binding (on current and/or future owners); or if you considering entering into a licence with an owner, or a third party, and want to understand the process, please contact us and we can explain the process in more detail.This article is published for general information purposes only. Legal content in this article is necessarily of a general nature and should not be relied upon as legal advice. If you require specific legal advice in respect of any legal issue, you should always engage a lawyer to provide that advice
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