When a strata dispute ends up in proceedings in the State Administrative Tribunal (SAT), the council of owners might engage lawyers to assist them.
The situation can be potentially tricky to navigate where the council, which represents the strata company, is in dispute with a disaffected group of lot owners.
Imagine if half a dozen lot owners disagreed with a decision of the council on, say, installing a new elevator system.
On the one hand, such a group of people are opponents of the council and, therefore, the strata company.
On the other hand, that same group continues to have the same rights as all other lot owners. Those include their usual rights of access to information held by the strata company in general.
That information could be anything from minutes of a council meeting deciding what to do about the disaffected group, to legal advice received by the council.
What an advantageous situation it would be to be able to see what your opponent’s lawyers have advised them!
So what happens when the disaffected group seeks information held by their ‘‘opponents’’, the council?
In normal litigation situations, an opposing party cannot obtain documents from their opponents if those are subject to legal protections such as confidentiality or legal professional privilege.
Yet, a council must give some kind of disclosure to all lot owners, including the disaffected group of owners, about SAT proceedings that have been taken against the strata company.
How can this be reconciled?
The Strata Titles Act 1985 (WA) (Act), read together with the common law, gives guidance as to how to treat documents related to legal or tribunal proceedings.
Section 198(2)(a) of the Act, in conjunction with s45(1)(b) of the State Administrative Tribunal Act 2004 (WA), requires the strata company to give notice or information about the SAT proceedings to all members.
However, the Act is silent on the rights and duties under the common law when it comes to disputed documents, such as those protected by confidentiality or privilege.
But first, what does “confidential” mean? Let’s say person A gives information to person B in circumstances where person B knows that it was not to be disclosed to any third party. In this situation, a court will enforce the obligation not to give disclosure.
A full analysis of this topic is outside the scope of this article. However, simply put, the privilege gives a person the right to refuse to deliver to any third party such communications as occurred between them and their lawyer.
This privilege is to encourage the highest level of confidentiality and frankness between lawyer and client. This is seen as necessary to support a good quality legal system.
The debate between the disaffected group and the council could run like this.
The disaffected group could try to argue that they are documents of the strata company under s107(2)(a) of the Act as they are members of the strata company.
They are therefore entitled to access documents relating to the decisions of the council and also their correspondence with their lawyers.
Perhaps they would argue that the lawyers are engaged by the strata company and that all members of the strata company should be able to access them too.
The response of the council can reasonably be that confidentiality or privilege attaches to such documents. Therefore, they are entitled to refuse to disclose them to any person. This would mean anyone, including lot owners and, therefore, the disaffected lot owners.
The basis for such a response would be that the strata company is, by law, a separate legal entity. It can sue and be sued in its own name, just as any natural person can sue or be sued in their name.
It follows that a council can quite reasonably say that confidentiality and privilege protect the communications between the strata company (as represented by the members of the council) and their lawyers.
And, of course, such documents could be highly valuable to an opponent, as they will disclose a view as to any tactics, strengths or weaknesses from the viewpoint of the strata company. The council is, therefore, fully entitled to refuse access to such documents.
For assistance with strata issues speak to:
Tel: 9200 4900
Article first published in The WA Strata Magazine September 2023