Hello Sir/Madam,

Every day Graham and Jennifer answer numerous questions on Paddocks Club across all sorts of issues that arise in community schemes. We share a recent example below from a Managing Agent that you may find helpful...

SPECIAL LEVY Q&A

Question: We have a situation where a purchaser bought a sectional title unit.
A special levy was approved before the offer to purchase was signed and the purchaser was not made aware thereof. The special levy is due and payable in December.
Will the new owner be liable for the full special levy?

Answer: Section 3(3) of the STSM Act provides that a special levy becomes due on the passing of a resolution by the trustees of the body corporate levying such contribution. This can be recovered from the persons who were owners of units at the time when such resolution was passed. However, upon the change of ownership of a unit, the successor in title becomes liable for the pro rata payment of such contributions from the date of change of such ownership.
Therefore, in the situation you described, where the special levy was approved before the offer to purchase was signed, the new owner becomes liable for any of the special levy payments that are due after they take transfer of the unit. So if the special levy is only payable in December it will be for the new owner’s account.
I hope that helps.

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