Reforms to unit titles legislation will make it easier to use and live in mixed-use developments, the ACT Government claims.

Mick Gentleman, ACT Minister for Planning and Land Management, said new reforms that took effect from 1 July will clarify existing processes, simplify rules, and make managing unit plans easier for everyone.

The ACT Government’s Build, Buy, Renovate website provides the following information.

Registration of alternative rules

The Unit Titles Legislation Amendment Act 2023 amended the Land Titles (Unit Titles) Act 1970 to require owners corporations to lodge an updated compilation of all of their alternative rules each time they change a rule or rules.

Previously, owners corporations were only required to lodge an amended rule or rules. This change means that prospective owners will have access to a full and current set of rules when they are purchasing a unit.

Exemption from insurance requirements

Unit owners may exempt themselves from the requirement to take out and maintain building insurance. This can only be done if the development contains class B units, and the exemption resolution must be unanimous. This typically occurs where each unit has building insurance, and unit owners decide that additional building insurance for the whole complex is not required.

Under the previous arrangements, once the decision to be uninsured was made, it later lapsed at the next annual general meeting. This was an issue as there was no notification of this exemption lapsing, meaning that owners, and particularly prospective and new owners, may not have been aware that their unit did not have building insurance.

The Unit Titles (Management) Act 2011 has been amended to:

• require owners corporations to register their resolution to exempt themselves from building insurance with the Registrar-General within three months of the decision
• clarify that the exemption remains in effect until another resolution amending or revoking the exemption resolution is registered and
• note that the exemption resolution does not affect the requirement for an owners corporation to take out and maintain public liability insurance.

Streamlining unit titles applications

The requirements for a unit title application are set out in the Unit Titles Act 2001 and the Unit Titles Regulation 2001. The combined effect of this legislation is that a unit titles application must include certain documentation (similar to a Development Application), such as a unit title assessment report.

The contents for the unit titles assessment report are prescribed by the Regulation. The Regulation also prescribes accompanying material for a unit titles assessment report. The legislation did not afford any discretion to the planning and land authority to waive the provision of all required documents.

Lodgement of the Unit Title application for a completed development was often delayed because the certificate of occupancy and use and the Transport Canberra and City Services operational acceptance for works on public unleased land had not yet been obtained.

Reforms to the unit title application process will make it possible to lodge a Unit Title application without the following ‘required material’:

1. the most recent certificate of occupancy and use—
   1. for each unit in the parcel and
   2. for any structure within the boundaries of the common property.
2. if a work approval for the development is required under the Public Unleased Land Act 2013, section 19 (Approval to carry out work on public unleased land)—a copy of the approval.

The ‘required material’ may now be lodged with the unit title application and if not lodged must be provided by the applicant as further information to accompany the Unit Title application prior to approval of the Unit Title being granted.

Subleasing common property

Subleasing of the common property of a units plan is permitted in certain circumstances. This provision formalises the process of using common property for business activities, provides a clear framework for subleasing common property, and provides a structure to protect the rights of unit owners.

The changes to the Unit Titles (Management) Act 2011 have been drafted to be deliberately broad. They allow individual owners corporations to agree to agree to host a wide range of activities on their common property. Subleased businesses or activities could include a coffee cart, a florist, or the installation of parcel lockers.

It will be a decision for the owners corporation to determine what businesses or activities best suit their complex, common property and residents.

Sublessees will be required to take out and maintain public liability insurance for the affected part of the common property. This will need to be agreed to by both the owners corporation and the entity conducting the business or activity.

Rather than specify what activities may or may not be permitted as part of a sublease, the provisions instead ensure that unit owners and occupiers will not be unreasonably disadvantaged by any business or activity taking place as part of a subleasing arrangement. Subleasing will only be able to be:

• approved via a special resolution
• apply to common property not already subject to a special privilege and
• not unreasonably interfere with the use or enjoyment of a unit.

The unreasonable interference test will provide will ensure that unit owners and occupants do not have their access to their unit restricted, their views obstructed, or are not affected by strong odours or loud sounds.

Sustainability infrastructure

The Unit Titles Legislation Amendment Act 2020 included amendments to the Unit Titles (Management) Regulation 2011 that were aimed at ensuring unit owners and occupiers are able to install and access sustainability infrastructure. These changes provided that permission to install sustainability infrastructure must not be unreasonably withheld. The 2020 changes did, however, allow for permission to install sustainability infrastructure be reasonably withheld where there are safety or structural considerations.

The Unit Titles Legislation Amendment Act 2023 adds further examples where permission for the installation of sustainability infrastructure may be withheld, being financial considerations or equity of access to common property, easements, utility services, or facilities.

These changes are not intended to prevent or discourage unit owners and occupiers from installing or accessing sustainability infrastructure. They will, however, help address circumstances where the installation by one owner of sustainability infrastructure may impede another unit owner’s equal access to similar sustainability infrastructure in the future, or impose a large cost on unit owners.

For example, the installation of an electric vehicle (EV) charging point for a unit owner may result in a significant impact on the electrical loading for existing electrical conduits, and prevent another unit owner from installing an EV charger as it may overload the electrical system. It may also require a major upgrade to the existing electrical network within a units plan, which could be prohibitively expensive.

Decisions to install sustainability infrastructure on common property have the potential to impact on an owners access to the shared spaces, and may result in additional levies paid by owners to cover installation and maintenance costs. The new provisions will help make the owners corporation aware that these types of issues should be considered before any decisions are made.

Improving administration

The Unit Titles Legislation Amendment Act 2023 delivered stage two of the Unit Titles Reform Project. It streamlined and improved legislative processed by amending several Acts that related to development and management of units plans. These reforms included:

• removing the requirement to lodge multiple copies of units plans, now plans are lodged online
• preventing the elimination of a unit in a two-unit Class A units plan if one unit is the subject of a building damage scheme
• allowing existing owners corporations to opt in to a Building Management Statement via a special resolution
• clarifying circumstances in which owners corporations may recover insurance excess payments
• removing the requirement for a unit owner to give the owners corporation notice if they enter into an agreement to sell the unit, with notification to be provided at settlement
• placing a four month time limit for an eligible person to request a unit title update certificate from an owners corporation, after they have obtained a unit title certificate
• clarifying that all units plans with more than $250,000 in the combined funds under management must participate in an annual audit of their financial records.

“As our city grows, more Canberrans are living and working in unit titled properties in the ACT,” Mr Gentleman said. “With so many different styles of units in the ACT, we want to make it easier for Canberrans who live and work in those developments to use their common areas and make necessary upgrades and changes to suit their buildings.

“These reforms will provide more flexibility for those managing units and mixed-use developments by clarifying the circumstances around approval of sustainable infrastructure and the sub-leasing of common areas for minor business activities such as coffee carts.

“The ACT Government has been working closely with the Unit Titles Reform Consultative Group to deliver our commitment to improve unit titles legislation for new and existing units plans in the ACT”

The Unit Titles Legislation Amendment Act 2023 is part of the Unit Titles Reform Project, which aims to improve the development, governance, and management of new and existing unit title properties in the ACT.

The Unit Titles Legislation Amendment Act 2023 is available on the ACT legislation register.