Strata Water Ingress NSW: What Lot Owners Need to Know After John Goubran & Associates Pty Ltd v The Owners – Strata Plan 57150 [2026] NSWDC 9

A recent New South Wales District Court decision is an important warning to owners, corporations, strata committees, and strata managers dealing with water ingress complaints in apartment buildings. In John Goubran & Associates Pty Ltd v The Owners – Strata Plan 57150 [2026] NSWDC 9, the Court awarded damages to a lot owner for lost rent after the owners corporation delayed too long in rectifying failed balcony waterproofing that caused ongoing water ingress into the lot below.

The case is especially important because it shows two things. First, an owners corporation may face liability in negligence where it fails to act with reasonable promptness after becoming aware of a common property defect. Secondly, even where a lot owner has suffered real loss, a claim under section 106 of the Strata Schemes Management Act 2015 (NSW) can still fail if it is brought outside the applicable limitation period.

For NSW strata owners, this decision is a reminder that water ingress claims should never be left to drift. Timing, evidence, and legal strategy matter.

What Happened in the Case

The plaintiff owned a unit in a strata building. That unit sat directly below Unit 12. From about September 2021, water began leaking into the plaintiff’s unit, particularly during heavy rain. Cracking, mould, staining, and internal damage followed. The issue was reported to the strata manager in November 2021.

A building report obtained by the owners corporation in April 2022 identified that the waterproofing on the balcony of Unit 12 had failed. The report also identified failed waterproofing on other balconies within the scheme. Even so, the remedial works to the balcony above the plaintiff’s unit did not begin until July 2024 and were only completed in December 2024.

The plaintiff said the lot could not be rented for a long period because of the condition of the premises and also claimed that the rent ultimately obtained was lower than what could otherwise have been achieved had the defect been fixed earlier.

Why the Owners Corporation Was Liable

The court found that the owners corporation was liable in negligence. Once the cause of the water ingress had been identified, a reasonable owners corporation should have appreciated that the plaintiff’s unit was at high risk of continuing damage and was not fit to be leased in that state.

The court accepted that remedial works in a strata scheme may involve reports, scopes of work, tenders, levies, and contractor engagement. However, those practical steps did not excuse the lengthy and unexplained delays in this case. The judgment makes clear that an owners corporation cannot simply absorb a serious water ingress issue into a broader building-wide project and then move at a pace that leaves one owner suffering ongoing loss for years.

The Court held that the remediation could have been undertaken much sooner. As a result, the plaintiff recovered $61,880 for lost rent.

What This Means for Strata Water Ingress Claims in NSW

This decision is highly relevant to owners dealing with balcony leaks, failed waterproofing, mould damage, cracked ceilings, damaged flooring, and loss of rent in NSW strata schemes. It confirms that where common property defects are known and are causing loss to a lot owner, the owners’ corporation must move with reasonable urgency.

The case is also a strong reminder that delayed repairs can have real financial consequences. An owners corporation that waits too long may expose itself to a damages claim, particularly where the lot becomes uninhabitable or unsuitable for leasing.

For owners, the case shows the importance of documenting the problem early. Photos, emails to the strata manager, expert reports, rental appraisals, and evidence of vacancy or reduced rent can become critical in proving loss.

Why the Section 106 Claim Failed

Although the plaintiff succeeded in negligence, the statutory claim under section 106 of the Strata Schemes Management Act 2015 (NSW) failed.

Section 106 requires an owners corporation to properly maintain and repair common property. It also allows a lot owner to recover reasonably foreseeable loss suffered as a result of a breach of that duty. However, section 106 contains a limitation period that runs from when the owner first becomes aware of the loss.

Before 30 June 2025, the limitation period was two years. The law was later amended so that the limitation period became six years. The plaintiff argued that because the amended pleading adding the section 106 claim was filed after the legislative amendment, the new six-year period should apply.

The Court rejected that argument. It held that the amendment did not revive a claim that was already out of time under the earlier two-year limitation period. In this case, the owner became aware of the loss in 2021. That meant the statutory claim had already expired before the amendment extending time came into effect.

This part of the decision is especially important for NSW lot owners. It shows that the 2025 extension from two years to six years does not necessarily rescue older Section 106 claims that were already statute-barred.

Why This Case Matters for Loss of Rent Claims

A major feature of this decision is the successful claim for lost rent. The Court accepted that the condition of the lot made it unsuitable to lease for a substantial period. It also accepted that the owners corporation’s delay in repairing the common property defect caused that loss to continue.

That is significant because many strata by laws sydney disputes involving water ingress are not just about repair orders. They are also about financial loss. Where water ingress, mould or balcony defects stop an owner from leasing the property or force them to accept lower rent, the financial consequences can be substantial.

This case shows that courts will look closely at causation, timing, and the evidence available as to likely rental value. Owners who have suffered vacancy loss or rental reduction should take care to preserve evidence from the earliest possible stage.

Common Property Water Leaks in Strata Buildings

In many NSW apartment buildings, water ingress issues arise from common property. This often includes balcony waterproofing membranes, flashing, roofs, external walls, and façade elements. Where those building components fail, the result is often water penetration into the lot below or adjacent lot.

In practice, these disputes are common across Sydney and greater New South Wales. They often involve a pattern of complaint, delay, investigation, partial action and then later litigation. By the time legal advice is sought, the owner may already have suffered extensive property damage, mold contamination, and rent loss.

That is why early advice from building dispute lawyers sydney is so important. A lot owner may have rights to compel repair works, pursue damages, or both. But the legal pathway depends heavily on the facts, the by-laws, the evidence, and the timing.

What Lot Owners Should Do If They Discover Water Ingress

When water ingress first appears, many owners assume the owners corporation will simply investigate and fix the issue. Sometimes that happens. Often it does not. The problem may instead become bogged down in committee indecision, engineering delay, staged works, special levies, or disputes over responsibility.

This decision shows why owners should not assume the matter will sort itself out. If there is clear water penetration, mould, cracking, or internal damage, the issue should be reported immediately and followed up in writing. The owner should also keep evidence of how the condition is affecting occupation, rental capacity, and market value.

Where there is continuing delay, legal advice should be obtained early. That is particularly so where the owner may be approaching the limitation period for a section 106 damages claim.

Strata Water Ingress Lawyers in NSW

At Pobi Lawyers, we advise on NSW strata disputes involving water ingress, balcony waterproofing failure, mould, common property defects, delayed repairs, and 106 damage claims. We act in matters involving lot owners, owners corporations, strata committees, and strata management across Sydney and New South Wales.

If your apartment has been damaged by a leaking balcony, failed waterproofing, roof leak, or other common property defect, it is important to assess your rights promptly. Delay can affect both the damage to the property and the viability of a legal claim.

Need Advice About a Strata Water Leak or Delayed Repair Claim?

If you are dealing with balcony waterproofing failure, water ingress from common property, mould, internal damage, or loss of rent in a NSW strata scheme, timely advice is essential. The right evidence and the right legal strategy can make a substantial difference to the outcome.

Pobi Lawyers advises on Section 106 claims, urgent repair disputes, loss of rent claims, NCAT strata proceedings, and court litigation involving common property defects in New South Wales.

Contact Pobi Lawyers if you need advice about your strata water ingress dispute.