- The restriction on by-laws being harsh, unconscionable and oppressive can be used as a sword to challenge unpalatable by-laws and as a shield to protect rights.
- By-laws can contain restrictions, but those restrictions must not interfere with property rights without good cause.
- By-laws containing cost recovery provisions are under threat and must be carefully worded.
The 2015 strata title reforms brought in a new requirement that a by-law must not be ‘harsh, unconscionable or oppressive’ (section 139(1), Strata Schemes Management Act 2015). This requirement was replicated in section 130(1) of the Community Lands Management Act 2021. If a by-law is found to be harsh, unconscionable or oppressive it may be declared to be invalid. At the date of writing, there are no reported cases in relation to community title schemes. This restriction has been used in strata title schemes to challenge a variety of different by-laws. The results of the challenges, at first glance, appear surprising but they share a common theme.