Event and Time
Event Description
This case involves an application by the Owners – Strata Plan No 80877 (Owners Corporation, OC) for a termination order of the strata scheme under section 136 of the Strata Schemes Development Act 2015 (NSW) (SSDA). The application arises due to severe defects in the building known as Mascot Towers, which has rendered it largely uninhabitable.
Application and Claims
The OC seeks:
- An order to terminate the strata scheme.
- Directions for winding up the scheme.
Key facts include:
- Significant structural issues leading to evacuation by Fire and Rescue NSW in June 2019.
- Financial disputes with various lenders and potential interest of multiple registered mortgagees.
- The OC’s claim that it is insolvent and unable to pay for necessary repairs.
Judicial Decisions
- The application for termination is dismissed.
- The parties are instructed to negotiate costs and report to the Associate if no agreement is reached.
Dispute Points and Legal Basis
Dispute Points
- Owners Corporation's Position: The OC argues it cannot fund rectification works due to the financial burden of previous debts and asserts the necessity of a termination order due to being effectively insolvent.
- Lannock Capital's Position: Lannock opposes the termination and argues creditors, particularly mortgagees, should receive priority in payment from any sale proceeds following termination.
- Banking Institutions (Mortgagees): They do not oppose the termination but claim that their interests must be preserved and prioritized before payments to Lannock.
- Anthony Stevens (Lot Owner): Supports the termination but contends for specific directions on the liquidation process.