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Landmark Supreme Court short-stay decision

11 Aug 2016

Landmark Supreme Court short-stay decision Image

A landmark Supreme Court decision has paved the way for short-stay accommodation across the state.

Supreme Court Justice Peter Riordan last month ruled that the Watergate Owners’ Corporation (OC) did not have the power to make rules banning owners from leasing apartments to short-term visitors.

The Docklands-based building has been involved in ongoing legal battles over the issues of short-stay apartments since 2012 and the case was being closely watched across Victoria and nationally.

The most recent decision followed the OC’s appeal of a 2015 VCAT decision, which similarly found that the OC did not have the power to make rules prohibiting short-stays.

Watergate OC chairperson Barbara Francis said it was too early to say whether the OC would appeal the Supreme Court decision.

“We’ll review the decision and canvass the support of the hotel accommodation industry before deciding,” she said.

Watergate short-stay operator Paul Salter said the Supreme Court decision was “absolutely correct” and “upheld the proprietary rights of property ownership.”

In his published decision, Justice Riordan said that under the Subdivision Act 1988 and the Owners Corporation Act 2006, the Parliament did not demonstrate an intention to give OCs the power to make rules prohibiting short-term letting of apartments.

According to Justice Riordan, the legislation does not reveal any intention for OCs to be able to “substantially interfere” with lot owners’ proprietary rights or to give OCs the power to overrule uses permitted under planning legislation.

Justice Riordan found that a parliamentary intention to give OCs the power to “substantially inhibit” the conduct of owners on their own property, would need to be expressed “in clear and unambiguous language”.

According to lobby group We Live Here, this finding gives clear direction to government.

Ms Francis, who is also a director of resident lobby group We Live Here, called on the government to change the laws “before it is too late”.

“At last the State Government has now been provided with definitive guidance by the Supreme Court about what it needs to do in order to protect owners, residents and the hotel industry,” Ms Francis said.

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