McArthur v The Owners – Strata Plan No. 30924 [2025] NSWCATCD 207

A recent reported NCAT decision concerned a dispute between a lot owner and the owners corporation arising out of emergency works to a bathroom shower within a strata scheme. Water was leaking from the applicant’s lot into the lot below, prompting urgent complaints from the affected occupier. The owners corporation, through its strata manager, arranged for a plumber to attend the applicant’s lot, investigate the source of the leak, and carry out rectification works to the shower floor.

The works were undertaken without prior notice to, or express consent from, the lot owner. Following completion, the lot owner complained that the repairs were inadequate and had caused damage, including mismatched tiles, cracked tiles, mould, loss of rental income, and a diminution in the value of the lot. The lot owner sought orders requiring the owners corporation to undertake extensive remedial works and to pay damages exceeding $45,000.

The owners corporation denied liability. It contended that the water ingress constituted an emergency permitting entry without consent, that it had complied with its statutory duty to repair common property, and that the alleged losses were not supported by cogent evidence.

Key Issues

The Tribunal was required to determine four central issues:

1. Whether the owners corporation was entitled to enter the lot without consent under the emergency access provisions of the Strata Schemes Management Act 2015 (NSW).
2. Whether the works carried out amounted to a breach of the owners corporation’s repair obligations, including whether non-compliance with Australian Standards was determinative.
3. Whether the owners corporation caused damage to lot property for which compensation was payable.

4. Whether the lot owner had proven recoverable loss, including remediation costs, mould contamination, and rental loss.

The lot owner argued that the owners corporation unlawfully entered the lot because the circumstances did not amount to an “emergency”. On this basis, it was submitted that consent or a Tribunal order was required before entry.

The lot owner further argued that the works were defective and substandard, asserting that a “patch repair” did not comply with Australian Standard AS 3740-2021 for waterproofing. It was contended that the owners corporation was required to fully re-waterproof the bathroom to modern standards and replace all tiles so as to restore the original appearance.

In addition, the lot owner claimed that the works caused physical damage (including cracked tiles), mould contamination, loss of rent due to tenant departure, and a reduction in the lot’s value.

The Respondent’s Arguments

The owners corporation submitted that the water ingress was urgent, ongoing, and posed a real risk of damage to another lot, satisfying the statutory concept of an emergency. It also relied on evidence that the lot owner’s property manager had requested urgent attendance by a plumber, amounting to authorisation in any event.

On the substantive works, the owners corporation argued that its statutory duty is one of maintenance and repair, not improvement. It relied on expert evidence that the repair was functionally effective in stopping the leak and therefore represented, at minimum, compliance with its obligations.

Finally, it submitted that the alleged losses were either not “damage” within the meaning of the legislation or had not been proven with sufficient precision.

The Tribunal’s Decision

The Tribunal dismissed the application in full.

Emergency access

The Tribunal held that the owners corporation was entitled to enter the lot without consent. The evidence showed an unforeseen and urgent water leak continuing for several days, with a real risk of damage to another lot. In that context, and bearing in mind the strict statutory duty to maintain and repair common property, the situation amounted to an emergency justifying immediate access.

Repair methodology and Australian Standards 

The Tribunal rejected the argument that non-compliance with Australian Standards automatically established liability. Australian Standards do not have the force of law unless incorporated by legislation. The critical question was whether the owners corporation had achieved at least minimal compliance with its repair obligations. On the expert evidence, the patch repair was found to be reasonable, functionally effective, and fit for purpose in stopping the leak.

The Tribunal emphasised that a lot owner is not entitled to dictate how an owners corporation performs its repair obligations, nor to require upgrades or aesthetic improvements absent a resolution of the owners corporation.

Alleged damage and loss 

The Tribunal drew an important distinction between physical damage to a lot and dissatisfaction with appearance. Mismatched tiles, while unattractive, did not constitute “damage” for which compensation was payable. Claims for diminution in value and rental loss failed due to the absence of cogent evidence.

The Tribunal accepted that a tile had been cracked but refused to award compensation because no evidence was provided as to the cost of repair. Claims for mould remediation were also rejected as they were supported only by hearsay and unsubstantiated quotations.

Key Takeaways for Owners Corporations and Lot Owners

1. Emergency access powers are broad. Ongoing water ingress threatening another lot will generally justify immediate entry without consent.
2. Repair does not mean upgrade. Owners corporations are required to fix defects, not to deliver full modern compliance or aesthetic perfection.

3. Non-compliance with Australian Standards alone does not establish liability unless required by legislation or shown to cause failure of the repair.

4. Evidence matters. Claims for damages must be supported by proper evidence. The Tribunal will not speculate or “guesstimate”.

5. Minimal compliance can be enough. If a repair is effective and fit for purpose, the Tribunal will not order more extensive works simply because a lot owner prefers a different outcome.

This decision reinforces a practical and restrained approach from renowned strata lawyers by balancing the owners corporation’s strict statutory duties with realistic limits on liability and compensation.