Peta Athens decided to stop paying strata levies in 2018 after waiting since 2011 for the water penetration to his roof-top apartment to be fixed.
He says that the Owners Corporation must compensate him for the damage he has suffered because it is in breach of its statutory obligation to repair and maintain the common property (under s 106(1) Strata Schemes Management Act 2015 (NSW)).
The amount of compensation exceeds the amount owning for the strata levies.
The is a status report upon the proceedings.
The water penetration disputes and solutions
Peta Athens is the owner of Unit 42 (Lot 42) in Strata Plan No 47035. The building is situated in Kingsford, a suburb of Sydney. It has 12 storeys with 42 residential lots and two commercial lots. The strata plan was registered in June 1994.
Lot 42 is a two-bedroom standalone residence which has been built on the roof of the building. The roof is constructed from a series of flat reinforced concrete slabs, waterproofed with a liquid-applied waterproofing system. Exposure to wind and weather has resulted in at least some of the water penetration problems encountered in recent years.
Unit 42 is at the top of the building
In June 2013, Peta Athens first sought the Owners Corporation rectify the water ingress to his unit and to repair the damage which had occurred over the previous 2 years. Not satisfied with the response, in September 2013, he made an application to NCAT (the Civil and Administrative Tribunal of NSW) for an independent contractor to inspect and report on water ingress.
In December 2016, agreement was reached in the NCAT proceedings to rectify the water penetration issues and for make good works in relation to the damage to Lot 42 and personal items caused by the water penetration, in accordance with a joint expert report. The works was not completed until March 2018 (including the design, installation and replacement of sliding doors). The cost was $340,565.19 for the remedial work and $28,888.75 for the consultants.
Further water penetration issues arose in relation to the sliding doors. A fresh NCAT application was made in 2020. A further joint expert report was prepared in January 2021 which recommended further works.
On the morning of the hearing on 22 February 2021, the Owners Corporation agreed that these waterproofing works be caried out:
- Install a canopy and screen before or in front of the external sliding doors of bedrooms 1 and 2 within 6 months;
- Inspect the adequacy of the waterproofing of the roof of lot 42 within 6 months and arrange for the necessary works to be carried out.
Refer: Athens v The Owners – Strata Plan No. 47035 [2021] NSWCATCD 42
Note that this did not dispose of the proceedings. The hearing proceeded on the application by Peta Athens for the compulsory appointment of a strata manager.
The application was refused.
He made a further application January 2024 for the compulsory appointment of a strata manager to complete the works agreed in February 2021 within 6 months. The Owners Corporation opposed the application and provided evidence that the only work yet to be completed was the installation of the canopy and screen, for which development consent from Council was in progress. The application was dismissed.
In February 2026, the Appeal Panel of NCAT dismissed the appeal against the refusal to order the compulsory appointment of a strata manager.
Refer: Athens v The Owners – Strata Plan No 47035 [2026] NSWCATAP 35
The strata levies dispute
In the meantime, in December 2019, the Owners Corporation (OC) commenced recovery action in the Local Court against Peta Athens for strata levies unpaid since December 2017.
He defended the proceedings by way of a complete set off against the strata levies owning because he was owed a greater amount by way of a “common law negligence claim against the OC for all the economic and medical damages suffered by the OC’s negligence to prevent and rectify the water penetration issue to common property (roof, windows, sliding doors) that has made this lot unliveable since 2012”.
The proceedings were transferred to the Supreme Court of NSW because the amount of the proposed set off claim (the cross-claim) was said to total ‘over $2 million’, which exceeded the jurisdiction of both the Local Court and the District Court.
As of December 2025, when the proceedings were heard by the NSW Supreme Court, the outstanding strata levies totalled $123,293.99 including interest.
But the NSW Supreme Court decided that the proceedings could not continue to be heard in its Court and needed to be transferred to NCAT. This was because proceedings were current in NCAT since April 2020, before the Local Court proceedings were commenced.
The Supreme Court said: “s 232 of the Strata Schemes Management Act 2015 (NSW) would encompass the capacity of the Tribunal to hear and determine the damages claim made by the defendant,”
“in particular, the causes of action of negligence and nuisance and the extent of the damages claimed, including both as to their limit and those arising from personal injury.”
The Court added: “I am against the plaintiff [the Owners Corporation] on the separation of the levies’ claim from the cross-claim. I appreciate that there is no defence, other than the set-off arising from the cross-claim to the levies’ claim, but even if partially successful, the cross-claim could well exceed, and therefore effectively extinguish, the levies’ claim.”
Refer: The Owners – Strata Plan No 47035 v Athens [2025] NSWSC 1588 (Acting Justice Elkaim)
Comments
No details are publicly available of the damages claim made by Peta Athens.
Usually, the losses would include replacement of floor coverings, furnishings and personal belongings damaged by water, mould removal treatment, motel room rental and insurance excess.
The fact that the NSW Supreme Court accepted that the cost of loss or damage can be used as an offset against strata levies must ring alarm bells for Owners Corporations which take their time to carry out the repair and maintenance work to common property to prevent water ingress continuing to damage an owner’s property.
To answer the question asked at the start, the NSW Supreme Court decision does not allow owners to stop paying strata levies until the water leaks are fixed. But it does allow owners to offset the amount of their continuing loss against strata levies payable if the repairs are not carried out quickly.