Owners Corporations, hosts and other occupiers dealing with short-stay accommodation operations, such as Airbnb. Apartment owners and occupiers who host Airbnb guests may now be held liable for damage, noise or loss of amenity caused by their Airbnb guests.

How do these recent changes to the law impact apartment owners/occupiers and Owners Corporations?

Airbnb and other forms of short-stay accommodation have grown rapidly over the past few years, providing people with alternative options when travelling or looking to spend a night or two out of home. However, short-stay accommodation use in apartment buildings may cause issues for other owners, tenants and property managers, who can find themselves in the unfortunate position of having to deal with loud and destructive guests who interfere with others' enjoyment and use of the property.

In Victoria, recent amendments to the Owners Corporations Act 2006 introduced changes to the law regarding short-stay accommodation. As of 1 February 2019, apartment owners and occupiers who host Airbnb guests may now be held liable for damage, noise or loss of amenity caused by their Airbnb guests.

What do these changes mean for short-stay accommodation properties?

These new laws enable other owners and occupiers within a building to complain to the Owners Corporation about the conduct of Airbnb hosts and their guests. A complaint can be made that Airbnb guests are:

Creating an unreasonable amount of noise likely to substantially interfere with the peaceful enjoyment of an occupier or their guests, or
Behaving in a manner likely to unreasonably and substantially interfere with the peaceful enjoyment of other occupiers or their guests, or
Using the common property so as to cause a substantial hazard to the health, safety and security of other occupiers or their guests, or
Unreasonably and substantially obstructing the lawful use and enjoyment of the common property by other occupiers or their guests, or
Substantially damaging a unit or the common property, either intentionally or negligently.

The Owners Corporation can then choose to give the host a notice requiring them to rectify the issue. If the host fails to do so, the Owners Corporation may then elect to apply to VCAT, seeking an order prohibiting short-stay accommodation on the property. If granted, such an order can also require payment of compensation for either:

The loss of amenity caused, or
As a penalty for failure to rectify the damage, or
Any other order that VCAT believes is appropriate.

What courses of action are available?

As an owner or tenant of the premises

If you believe that an Airbnb guest has engaged in the conduct listed above, you are entitled to make a complaint to the Owners Corporation. A complaint must be in writing, using a specific form. The Owners Corporation must make a copy of this form available to you upon request.

The Owners Corporation is then responsible for dealing with the complaint, and will inform you if no action will be taken. If you are unsatisfied with this response, you may then elect to make an application to VCAT for an order prohibiting short-stay accommodation on the property (as mentioned above).

You can find more information about commencing or undertaking proceedings at VCAT here.

Owners Corporation obligations

If a complaint has been made, the Owners Corporation must decide whether to take action regarding the complaint. An Owners Corporation can only do so if there is a strong belief that the Airbnb guest has committed the acts outlined in the complaint. Even so, there is no obligation on the Owners Corporation to take any action.

If the Owners Corporation decides to act on the complaint, the first step is to give written notice to the unit owner and to the Airbnb host, notifying them that a complaint has been made, and informing them of the allegations outlined in the complaint.

The notice will request that they rectify the breach by either:

Fixing any common property that has been damaged, or
Cease making unreasonable amounts of noise.

The Owners Corporation must also inform the unit owner and the Airbnb host that they may also choose to apply to VCAT for an order to resolve the matter.

If the breach is not rectified to the satisfaction of the Owners Corporation, they may then apply to VCAT for any of the orders set out above.

In addition to the above, the Owners Corporation has an obligation to provide a report at the Annual General Meeting regarding the complaints that have been made and the action, if any, that has been taken to resolve them.

Airbnb Hosts

Should a complaint be made about the conduct of your guests, these laws allow you to be held liable for any damage or disruption caused by them. If you receive a notice from the Owners Corporation requiring you to rectify a breach, a failure to do so could result in an application being made to VCAT for an order prohibiting you from using the property for Airbnb or other short-stay accommodation purposes.

You may also be required to make a payment, either as a penalty or as compensation to other lot owners, for the loss of amenity caused by your guests.

In order to prevent these outcomes, you should act in advance to protect your interests by taking reasonable steps to prevent your guests from engaging in the conduct outlined above. If this is not possible, steps should be taken to rectify any issues that arise as soon as possible, in order to avoid potential VCAT proceedings.

How can Sharrock Pitman Legal assist?

At Sharrock Pitman Legal, we have Accredited Specialists in Commercial Law and Property Law, and an experienced Litigation team. Our lawyers provide expert advice and guide you through any issues you may be experiencing within your Owners Corporation. Please contac us on 1300 205 506 or email sp@sharrockpitman.com.au. Alternatively fill in the form below.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.

Written by a member of our Legal Team

For further information contact

Crystal Roman

Crystal Roman is lawyer in our Property Law team. Crystal can be contacted on (03) 8561 3328 or by email crystal@sharrockpitman.com.au.

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Owners Corporations, hosts and other occupiers dealing with short-stay accommodation operations, such as Airbnb. Apartment owners and occupiers who host Airbnb guests may now be held liable for damage, noise or loss of amenity caused by their Airbnb guests.

However, in this article we will set out the factors that influence how long it will take to obtain a Grant of Probate and to administer an estate in Victoria.

The basics

First things first: what is a Grant of Probate? A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will. Without Probate, the asset holders (say a bank or share registry) cannot be satisfied as who has the correct authority to receive the deceased's assets and may refuse to pay out.

Sometimes, for smaller estates or if assets are mostly jointly owned with a surviving spouse, asset holders might agree to release payment without requiring a Grant of Probate. This is usually on the basis that the person who receives payment promises to repay (or Indemnify) the asset holder if it turns out they paid to the wrong person.

If there is no Will, then you cannot obtain a Grant of Probate. Instead you obtain Letters of Administration. This is effectively the same, in terms of authorising someone to administer the estate, and would usually be obtained by the person who is the closest next-of-kin to the deceased.

“A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will.”

Timeframes for Probate in Victoria

In order to obtain a Grant of Probate, the Supreme Court needs to be given information about the assets and liabilities of the estate, the deceased person, the witnesses to the Will, the executors and the Will itself. An advertisement of your intention to apply for Probate must also be published on the Supreme Court website for at least 14 days prior to any application being lodged.

Often, making enquires to obtain all the necessary information can take a number of weeks. Also, you will need the Death Certificate for the application for Grant of Probate and possibly for making proper enquires regarding the assets and liabilities. Waiting for the Death Certificate to issue can therefore add a few more weeks to the process. Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.

The Court itself usually does not take long to process the application (maybe another 1 to 2 weeks) and this is completed using the electronic Supreme Court filing system. This means you do not have to go to a Court hearing. The timeframe for processing applications for Letters of Administration is even less, given that there is no Will document for the Court to consider. There is also a general discretion for the Court to raise a 'Requisition' asking for more information before they review the application - this can sometimes delay matters.

“Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.”

So, here we are a few months after death and you finally have a Grant of Probate or Letters of Administration. It is important to remember that this is the start of the estate administration and not the end. For a very simple estate, you might only need a further month or so to cash the assets and pay them to the correct beneficiaries. However, it can often be more complex than that. Factors that determine the timeframe to administer the estate include:-

Some assets will take time to cash or transfer. For example, if selling a property, final settlement might be 60/90/120 days from the day of sale.
There is a 6 month period for challenges to be brought against the estate and executors must wait until this period expires before distributing the estate, if there is any risk that a disgruntled family member might come forward.
There might need to be final tax returns for the deceased or for the estate. Failing to wait for the ATO to process these could leave the executor personally liable for a tax bill.

You might need to advertise for creditors to come forward and wait for a period of months while this advertising timeframe expires. This protects the executor if they are unsure of all of the deceased's financial dealings and creditors.
It might not always be a good time to immediately cash estate assets. For example, the shares just took a nose-dive, do you still sell regardless of available price?

There is a general rule that executors have an 'executor's year' to complete the estate administration. This means that you should be aiming to have the estate finalised and distributed within 12 months from the date of death.

Liability limited by a scheme approved under Professional Standards Legislation.

Need help with Probate?

Our expert legal team is ready to take your call!

Mitchell is the Managing Principal of Sharrock Pitman Legal. He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate and can answer all your questions related to probate.

For further information, contact Mitchell on his direct line:

DIRECT LINE:

(03) 8561 3318

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Land Development and Joint Ventures

To Airbnb or not to Airbnb: New rules for Owners Corporations regarding short-stay accommodation

Owners Corporations, hosts and other occupiers dealing with short-stay accommodation operations, such as Airbnb. Apartment owners and occupiers who host Airbnb guests may now be held liable for damage, noise or loss of amenity caused by their Airbnb guests.

How do these recent changes to the law impact apartment owners/occupiers and Owners Corporations?

What do these changes mean for short-stay accommodation properties?