Knife fights and Airbnb

Another wild fight in an Airbnb apartment in the CBD left a number of young people with stab wounds and residents fuming about the under-regulated short-stay industry.

A brawl broke out in a Spencer St apartment in March as about 50 revellers gathered at a private party.

Police believe the fight began in the apartment and subsequently spilled into the lift and foyer. CCTV footage showed teens running from police along city streets. 

The foyer and lobby of the building were declared a crime scene.

Police are reportedly investigating if there was a breach of the coronavirus restrictions given the number of people at the apartment. The current restrictions limit residential gatherings to 30 people.

Perhaps a lawyer could help us interpret the Owners Corporations Amendment (Short-stay Accommodation) Act 2018 – the so-called “Airbnb Act”. 

Would this latest stabbing frenzy, a near-tragedy, be deemed to be “multiple incidents” or one incident with multiple victims?

It makes a difference, because under the legislation we have the ludicrous situation where terrified residents would need to report three stabbing incidents in a 28-day period to be given a chance of insultingly paltry redress.

Owners’ corporation amendments are now law

The Owners Corporations and Other Acts Amendment Act 2021 has been passed by both houses of the Victorian Parliament and will take effect from the beginning of December this year, unless an earlier date is proclaimed. 

One of the biggest changes is the classification of owners’ corporations (OCs) into five tiers. The top three tiers apply to buildings with 10 to 50, 51 to 100 and more than 100 lots. A couple of changes will affect operational activities:

  • Legal proceedings up to $100,000 can be initiated by ordinary resolution
  • A common seal is no longer needed on documents
  • Insurance excess costs can be passed onto lot owners in certain situations

A couple of clauses might be tested out soon as a result of short-stay activity: 

  • The “benefit principle” can apply to levies. This has potentially huge ramifications for short-stay operators who impose significant wear and tear or security costs on buildings. The changes mean that additional costs can be levied without regard to the “lot liability”.
  • Occupiers will be responsible for guests’ behaviour: In the case of wild parties, the occupier could be held liable.

These will be two aspects that we will be watching carefully.

The legislation also introduces a raft of amendments that limit developers from handing lucrative and often unfair OC management contracts to their mates.

Sadly, as we reported in last month’s edition, the government left the same massive loophole open for owners and residents to be shackled to a host of other contractors for vital services such as facilities management, cleaning and utilities. Some of the contracts are 25 years and we have had an example of 99 years reported to us.

This is a disastrously incompetent oversight that the government was too stubborn to recognise, despite having the facts laid in front of them.

Last hurrah for proxy-farming short-stay operators

In a bizarrely conducted committee election, an inner-city group of lot owners has engineered a most peculiar and undoubtedly short-lived victory.

At a recent annual general meeting (AGM), lot owners in a 300-apartment complex were offered the chance to vote “for” or “against” each of the candidates standing for the committee. There was also an option to abstain.

This is the first time we have ever heard of an election where electors could vote “against” a candidate. Extraordinarily, all this transpired under the auspices of the OC manager.

The result was decided entirely on the proxies held by interests associated with a short-stay company operating in the complex. 

Of the 13 candidates, only eight were elected – the other five being effectively vetoed by the counting of votes “against”.

What an absurd, undemocratic way of conducting an election. The Owners’ Corporation Act allows for 13 candidates to be elected; the Act does not allow for any candidates to be blocked. The declared result has a decidedly unsavoury fragrance and surely will be overturned soon. 

Thankfully, under the new Act proxy-farming is now outlawed. That is something the government got right!

Financial and mental health costs of cladding 

Two Australian scientific studies published this month have delved into the financial and well-being impact of flammable cladding.

The findings by RMIT University researchers provide real insight into the impact of combustible cladding on apartment owners who had no knowledge of what was to come when they purchased their apartment. 

The participants in the study were from Victoria, Queensland, Western Australia and the ACT.

The key outcomes from the first paper on financial implications were the accumulating costs beyond the rectification work:

  • special levies
  • higher levies long term
  • rising insurance premiums
  • legal fees
  • cost of fixing other fire safety defects, such as sprinklers
  • possible loss of property value.

This study found that the financial burden on households has influenced many life decisions, such as retirement, holidays, and buying or selling major assets.

The key messages from the second paper on well-being were about how owners and occupiers are coping, detailing:

  • frustration, concern and anger
  • safety fears, especially in higher-risk buildings 
  • long-term negative emotions harming mental health and wellbeing
  • serious concerns for people’s lives from the resultant financial stresses.

All participants in the study were very upset that building industry-related professions and the government could have approved flammable cladding at all. 

Frustration was compounded for owners on finding that their building warranty was mostly useless in this situation.

If you would like more information on this research, please contact us via our website, We will bring you more details in the next edition of this column.

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