NCAT-Ordered UOE Reassessment

UNIT OF ENTITLEMENT NEWS

This is a fictional case study based on processes available under NSW strata legislation.

When unit entitlements no longer reflect the true value of each lot, owners have the right to seek a fairer allocation. This fictionalised example shows how a group of owners successfully challenged their outdated schedule through NCAT — and what your scheme should know if facing a similar situation.

The Dispute

The strata scheme in question was a 30-lot residential development in a growing part of metropolitan NSW. When originally registered by the developer, unit entitlements were allocated in a manner that appeared arbitrary — with similar-sized lots assigned different entitlements, and some penthouses enjoying generous under-allocations.

Over time, a pattern emerged: larger lots were paying disproportionately low levies, while smaller lots were covering more than their share.

Several owners raised concerns and attempted to resolve the matter through informal discussions. When no agreement could be reached, one group of owners initiated proceedings at NCAT under Section 236 of the Strata Schemes Management Act 2015 (NSW), requesting a formal reallocation of the unit entitlements.

The Tribunal Process

The applicants commissioned a professional UOE valuation, which assessed each lot’s value based on:

• Internal area
• Market comparisons
• Lot position, aspect, and exclusive-use features

The valuation showed significant inconsistencies with the registered schedule.

At the NCAT hearing, the respondents (a group of owners opposing the change) questioned the need for reassessment, arguing that no one had previously objected and that the original schedule was legally registered.

However, NCAT found that the evidence provided met the statutory test: the existing entitlements were “unjust” and did not reflect a fair apportionment of ownership or liability.

The Outcome

NCAT ordered a new schedule of unit entitlements to be registered, based on the independent valuation. The outcome included:

• Increased levies for some lots (especially those with rooftop or premium positions)
• Reduced levies for smaller or lower-value lots
• A clear precedent for other schemes facing similar disputes

What the Law Says

Under Section 236 of the Strata Schemes Management Act 2015 (NSW), NCAT can order the reallocation of unit entitlements if:

• The current allocation is unjust
• A valuation compliant with the Act is provided
• It is in the interest of equity and fairness

Unlike a special resolution, which requires 75% owner approval, an NCAT-ordered change does not require a vote — only sufficient evidence.

Lessons for Other Strata Schemes

• Historical fairness matters: Just because a UOE schedule is registered doesn’t mean it’s right
• Professional valuation is essential: No Tribunal decision will proceed without a compliant report
• Transparency builds trust: Owners are more willing to accept change when the process is evidence-based and impartial

Conclusion

This case proves that the system can work when owners feel disadvantaged — and take the right steps. Reallocating unit entitlements can be complex, but it’s often necessary to restore fairness.

At Evolve Reporting, we produce UOE valuations that stand up to legal and regulatory scrutiny. If you suspect your scheme’s UOE schedule is outdated or unfair, we can help guide you through the process — from valuation to resolution.

Disclaimer: This article is for informational purposes only and is based on fictionalised scenarios. It does not constitute legal advice. Owners corporations should seek independent legal or professional advice for their specific circumstances.