21 JUNE 2016
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Owners Corporations (Short Stay Accommodation) Bill 2016:
Proposed amendments to the Owners Corporations Act 2006
The ever-increasing popularity of the short stay accommodation industry (including online letting
services) is causing growing unrest within strata titled developments.
Regulation has been slow to catch up with the phenomenon of short stay accommodation. Owners and
Owners Corporations have found themselves powerless to restrain those "short stay" guests who have
been unruly, caused damage to property, behaved inappropriately or otherwise interfered with the ability
of other lot owners to use building amenities.
In an attempt to address such concerns, the Victorian Government has introduced the Owners
Corporations (Short Stay Accommodation) Bill 2016 (the Bill).
Complaints regarding "proscribed conduct"
If enacted, the Bill will introduce a complaint process and empower VCAT to hear and determine
disputes relating to an alleged breach by a "short-stay occupant" of "proscribed conduct" (short-stay
"Proscribed conduct" for short-stay accommodation arrangements is defined to include:
unreasonably creating noise or behaving in a manner likely to substantially interfere with the
peaceful enjoyment of another occupier;
using a lot or the common property so as to cause a substantial hazard to the health, safety and
security of any person;
unreasonably and substantially obstructing the lawful use and enjoyment of the common property
by an occupier; or
substantially damaging or altering a lot, common property or a structure thereon (intentionally or
The manager or an owner or occupier of a lot may make a complaint in the prescribed form to the
Owners Corporation about an alleged breach by a short stay occupant of proscribed conduct or may
commence proceedings at VCAT themselves.
VCAT's power to make Orders
Where the Owners Corporation believes, on reasonable grounds, that a short-stay occupant breached
the proscribed conduct, the Owners Corporation would be able to take action in VCAT.
If the Owners Corporation decides to take action, it must give notice of the breach and of the required
rectification to the "short-stay provider". The "short-stay provider" is the person who leased or licensed
their lot under a short-stay accommodation arrangement. This may be the owner, the tenant or an
"agent provider" who, for a fee, arranges and manages short-stay accommodation on behalf of a lot
owner or its tenant.
It is proposed that VCAT will be given the power to make one or more of the following orders where a
short stay occupant has breached proscribed conduct:
1. Prohibition Order (s 169D) - Prohibition on the use of a lot for the purpose of short stay
accommodation where breach notices have been served by the Owners Corporation on a short stay
provider on at least 3 separate occasions within 24 months. The prohibition would last for a period to
be specified by VCAT.
2. Loss of Amenity Compensation Order (s 169E) - Compensation order in favour of a resident in the
same building who has suffered loss of amenity caused by a breach of proscribed conduct by a short
stay occupant. Maximum compensation is $2,000 for each affected resident for each breach and
this is in addition to any other award for damages. However, a resident must bring their application
for relief within 60 days of the alleged breach.
3. Order for a Civil Penalty (s 169G) - A penalty of up to $1100 payable to the Victorian Property
4. Order of Damages (s 165) - Order of damages against the short stay occupant due to damages
caused to common or private property in the building.
The short stay provider and short stay occupant would be jointly and severally liable for Orders made
under section 169E, 169G and some orders for damages under section 165. This is to overcome issues
Owners Corporations have with chasing visitors for breaches of Owners Corporation Rules. If the Bill is
enacted, this likely to become an issue for owners unless they can successfully track down their short
stay guests after they have vacated. As a result of this, prudent short stay providers will require more
identification be provide by their short-stay occupants in future.
Status of the Bill
The Second Reading Speech was read on 25 May 2016. Debate on the Bill has been adjourned until
21 June 2016. At present, the Bill is stated to come into effect on 1 July 2017 but may be amended
For more information
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