Legislative Assembly for the ACT: 2008 Week 10 Hansard (26 August) . . Page.. 3701..
MR BARR (continuing):
experienced difficulties with the Magistrates Court and is in very strong support of what the government is proposing.
This legislation will provide further protection for the purchasers of units, especially those buying off the plan, and will better control the actions of owners, corporation managers and the executive committees and their members. We have had more than two years of consultation in response to strong public feedback that the current dispute resolution mechanism in the act was not operating effectively. I would like to highlight some of the key aspects of the bill. This legislation protects consumers after a units plan is registered. During the period defined as the development control period, an owners corporation cannot enter into a contract unless that contract is disclosed in a contract for sale of a unit in a units plan. So starting from the day the units plan is registered and ending on the day that more than one-third of unit entitlements of the units plan are held by persons other than the developer, there are controls on what the owners corporation can do. That period is defined as the developer control period, and during this period an owners corporation cannot enter into that contract.
It would appear the Liberals are opposed to this unit owners protection measure. They believe that developers should continue to have absolute rights over owners corporations, free, it would seem, to lock them into expensive service contracts and other arrangements detrimental to the interests of unit owners. One instance that has been brought to the government's attention is in relation to a major southside development where the developer who owned the majority of units in that development engaged a relative as a managing agent against the wishes of the minority of individual unit owners. This is the sort of unscrupulous activity that this legislation will address. This is the sort of activity that the Liberal Party supports. That is where the Liberal Party stands in 2008.
There are a number of other consumer protection provisions included in the bill. Community consultation revealed a very strong view that more disclosure is needed to protect purchasers under off-the-plan contracts. This bill includes a number of disclosure provisions which are not onerous or unreasonable to expect of a developer, including disclosure of proposed articles of the owners corporation, details of contracts the developer intends the owners corporation to enter into, and, importantly, the developer's estimation of the buyers' contribution to the corporation's general funds for two years after the plan is registered. An example of why this is important is that I am advised that someone who purchased off the plan was given an initial estimate on exchange of contracts that the body corporate fees would be in the order of $2,500 per annum. That became $8,500 per annum on settlement.
We have heard a lot about people reaching into other people's pockets, and we have heard a lot of accusations from the Liberal Party about that being the government's intent in this legislation, but they are quite happy to sit by and watch developers stick their hands into the pockets of people who have purchased off the plan to the tune of something like $6,000 a year. That is fine; the Liberal Party sanctions that. That is their developer mates, so that is fine. That is not a worry at all, there are no concerns about that.
Mr Seselja, in his media release, even went so far as to point this out as a terrible thing that developers might be required to forecast and to give a reasonable estimation