The rules

Who the rules bind

Once a rule is made under the Owners Corporations Act 2006 and is registered with Land Use Victoria, it applies, in Consumer Affairs Victoria’s list, to “the owners corporation”, “lot owners”, “tenants”, “sub-lessees” and “occupiers or tenants”. Every lot owner and tenant must receive a copy of the rules before moving in.

A rule must comply with the Owners Corporations Act 2006 and also with the Australian Consumer Law and Fair Trading Act 2012, and must not conflict with any other law, such as privacy and anti-discrimination laws.

The model rules

The model rules sit in Schedule 1 of the Regulations, and Consumer Affairs Victoria publishes them as a Word document. They run under seven headings. One rule from under each heading, quoted:

1. 1.4Health, safety and security: smoke penetration“A lot owner or occupier in a multi-level development must ensure that smoke caused by the smoking of tobacco or any other substance by the owner or occupier, or any invitee of the owner or occupier, on the lot does not penetrate to the common property or any other lot.”
2. 2.1Committees and sub-committees“A committee may appoint members to a sub committee without reference to the owners corporation.”
3. 3.1Management and administration: metering of services“The owners corporation must not seek payment or reimbursement for a cost or charge from a lot owner or occupier that is more than the amount that the supplier would have charged the lot owner or occupier for the same goods or services.”
4. 4.1Use of common property“An owner or occupier of a lot must not obstruct the lawful use and enjoyment of the common property by any other person entitled to use the common property.”
5. 5.3Lots: notice of renovations“An owner or occupier of a lot must notify the owners corporation when undertaking any renovations or other works that may affect the common property and/or other lot owners’ or occupiers’ enjoyment of the common property.”
6. 6.2Behaviour of persons: noise“An owner or occupier of a lot, or a guest of an owner or occupier, must not unreasonably create any noise likely to interfere with the peaceful enjoyment of any other person entitled to use the common property.”
7. 7Dispute resolution“The parties to the dispute must meet and discuss the matter in dispute, along with either the grievance committee or the owners corporation, within 28 calendar days after the dispute comes to the attention of all the parties.”

The model rules also cover parking, damage to common property, changes of use and the outside appearance of lots, among others; the Word document has them all. An owners corporation writing its own rules should use the model rule headings and state clearly whether each model rule still applies.

What a rule can be about

Consumer Affairs Victoria lists the subjects, in this order: “health, safety and security”, “use of common property”, “use of and works to lots”, “design of lots”, “management and administration”, “behaviour of persons”, “vehicles and parking”, “committees and sub-committees” and “payment of fees”. Rules can also cover dispute resolution, notices and documents, and the common seal.

Some limits are written in. An owners corporation must not make rules that unreasonably prohibit sustainability items on the outside of a lot, such as solar hot water systems and solar panels. And it cannot enforce a rule that is ambiguous, unreasonable or unfairly discriminatory: no rule can keep children from living in a lot, except in a retirement village, and none can restrict the use of a guide dog.

Wording that tips into unfair

Consumer Affairs Victoria flags five subjects where careless wording goes wrong, in this order:

• Flammable materials. A ban should not be so wide that it catches a box of matches or a cigarette lighter.
• Moving furniture. Requiring permission to move fixtures or bulky or fragile furniture may be fair, given the risk to common property, but an owners corporation cannot stop people moving or rearranging furniture such as chairs and tables in normal day-to-day use.
• Overnight guests. CAV calls a ban an unnecessary and unreasonable restriction on the occupier’s quiet use and enjoyment.
• Pets. A blanket ban may be unfair, since it could stop someone keeping a goldfish; a rule against pets that could damage the property, be a danger or nuisance, or breach council requirements would be unlikely to meet the same objection.
• Entertaining. A blanket ban on having guests over may be unfair; a rule against entertaining that harms the property, causes a nuisance or breaks council or EPA requirements would be unlikely to meet the same objection.

CAV adds that an owners corporation can control some conduct by allowing it only “with the owners corporation consent, which will not be unreasonably withheld”.

Making a new rule

Consumer Affairs Victoria’s steps, in its order:

1. Draft the rulesThe committee, secretary or manager works out the purpose, scope and wording. Consolidated rules must be recorded with the plan of subdivision, so the owners corporation should revoke any existing rules.
2. Organise a meeting or ballotThe notice goes out at least 14 days ahead, with the rules on the agenda, the text of the resolution and a copy of the proposed rules.
3. Ask the owners corporation to adopt the rulesAt least 75% of votes in favour passes a special resolution. At least 50%, with no more than 25% against, or a vote at a general meeting that has a quorum and no votes against (CAV’s voting guidelines), passes an interim special resolution: the notice and minutes must reach every lot owner within 14 days of the ballot closing, and the decision can be acted on after 29 days only if no petition representing more than 25% of lot entitlements has arrived. A petition in time means the rules are not adopted.
4. Register the new rules with Land Use VictoriaThe secretary certifies a copy of the consolidated rules on Land Use Victoria’s approved form, and it is lodged with the prescribed fee. Rules that are not registered are void and cannot be enforced.
5. Update records and notify lot owners and occupiersThe owners corporation must tell lot owners about the new rules, update its register, tell tenants, sub-lessees and other occupiers, and put the consolidated rules on the noticeboard if there is one.

Even before registration, new rules must be mentioned in the owners corporation register and in any certificate it issues, so that buyers learn of them. The certificate guide shows where the rules travel at a sale.

Short stays

Since 1 January 2025, a Victorian owners corporation can make a rule, by special resolution, banning the use of lots for short stay accommodation, meaning a booking for an unbroken period of less than 28 days. The rule cannot apply to a lot that is the owner’s or occupier’s principal place of residence, so someone living in their apartment can still let it, or rooms in it, while they live there or are briefly away. Before making one, CAV suggests checking the local council’s own rules on short stays, and planning for bookings already made, or giving the rule a later start date.

When a rule is broken

People who break rules sometimes simply do not know them, and CAV says every new resident, owner or occupier, should get a copy. Beyond that, an owners corporation can apply to VCAT to enforce its rules, and the tribunal can impose penalties for breaches. The steps before that point, from a written complaint to a notice to rectify, are in the dispute guide.