Owners Corporations are frugal with the spending of money. Ultimately, Owners Corporations do not want to spend a cent on anything. This year, I saw the tightest Community Association create the greatest vulnerability.
This Community Association had grassy areas which were part of common property but were used by the individual lot owner who was adjacent to the grass area.
The Strata Manager obtained a quote for the maintenance of this grass and gardens. The quote was $500.00 plus GST per annum. In other words, approximately $42.00 per month for all the grass area to be mowed and maintained.
The Community Association voted no to a resolution to appoint this contractor. They passed a policy that said that each lot owner would mow the grass area out the front of their property.
What this action did was to transfer the liability to the Community Association. If a contractor chops their foot off with a whipper snipper, Workers Compensation pay for the injury. If a lot owner cuts their foot off, the Community Association are liable.
If this occurred, there may be a claim on public liability. The Community Association were advised that, if they are requiring volunteer work to be undertaken by lot owners, public liability would not be a given. In other words, the insurer may not pay out in relation to the client. The Community Association therefore maybe liable to pay:
- The medical expenses,
- Loss of work, and
- Pain and suffering.
Community Associations and Owners Corporations should always be careful about getting volunteers to do work. They accept liability, and a public liability may not cover such a claim.
Often this is the case of cutting off your nose to spite your face.