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.
What business activities will be allowed?
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.
What protections will unit owners and occupiers be given?
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.
