Beyond the Purchase Price: The Hidden Dangers in Strata Records

You have budgeted for the deposit, the stamp duty, the loan repayments and the quarterly levies quoted in the listing. Then, eighteen months after settlement, an envelope arrives. Special levy: $31,000. Payable in ninety days. Where was that in the purchase price?

It wasn't. It was sitting in the owners corporation's records — in the minutes, the engineer's reports, the quotes and the correspondence — well before you signed anything. And a recent decision of the Appeal Panel of the NSW Civil and Administrative Tribunal is a timely reminder that having a legal right to look at those records is a very different thing from being able to actually find what matters inside them.

The Case: Daley v The Owners – Strata Plan 2754 [2026] NSWCATAP 38

This dispute did not involve a purchase. It involved a lot owner who wanted to inspect the records of their own scheme. But the reasoning has obvious implications for anyone conducting pre-purchase due diligence, because a pre-purchase strata search ordinarily uses the same statutory inspection mechanism under the Strata Schemes Management Act 2015 (NSW), with the searcher or purchaser inspecting under the authority of the current owner.

The owner made a written request to inspect the owners corporation's books and records and paid the prescribed fee. The scheme's records were kept electronically. The owner then carried out the search and came away without the documents they had asked for. The files were, on the owner's account, in a mess, and there were technical problems getting into them.

The owners corporation's response was blunt. Access had been given. Any difficulty in using it was the owner's problem to solve. The Tribunal at first instance did not find in the owner's favour. The owner appealed.

When Access May Not Be Enough

The Appeal Panel drew a distinction that deserves attention. What must be made available is access to the actual documents requested, not simply access to the scheme's records as one undifferentiated mass. The documents may have been provided in a narrow technical sense without necessarily having been made available in the sense required by the legislation.

Whether any given arrangement is good enough will turn on the circumstances: the nature of the storage system and the software, whether links to the required documents are supplied, whether the documents can otherwise be easily viewed or located, the design of the interface, and whether all of that is accessible to someone who is not an expert strata searcher.

The benchmark is not what a seasoned professional could prise out of a badly organised system on a good day. The Appeal Panel found there was a real question to be answered about whether these documents had ever been made available at all, and sent the matter back to the Tribunal to be determined.

What This Case Means for You

If you are buying into a strata scheme, start with this: the certificate and the records are two different animals, and only one of them tells you the whole story.

The statutory information certificate is a prescribed snapshot. It tells you a great deal about liabilities and contributions that have already been formalised, including levies, arrears and other prescribed information. It does not necessarily tell you about major expenditure that is still being investigated, quoted or debated and for which no contribution has yet been determined.

Consider a couple buying a two-bedroom unit in a 1990s block. The certificate comes back clean — no arrears, no special levy. But fourteen months earlier, the committee minutes record an engineer's report on concrete spalling to the balconies, a rectification estimate of $2.1 million, and a resolution to revisit funding once quotes are in. Nothing has been struck. Nothing is payable. The certificate is entirely accurate. And the liability may still be coming, potentially to whoever owns the lot when the contribution is ultimately determined.

That is why the records matter. If your searcher reports that they could not access what they needed, treat that as a finding rather than a non-event. It is not necessarily your problem to work around, and an owners corporation cannot assume that simply pointing a searcher towards a disorganised electronic archive will satisfy its statutory obligations.

Who ultimately bears a special levy between vendor and purchaser is not necessarily determined by who owns the lot when an instalment falls due. It depends on when the contribution was determined, what was disclosed in the contract and the terms of the particular contract for sale.

Under the current standard NSW contract, for example, an undisclosed non-regular contribution determined on or before the contract date is generally allocated to the vendor, while one determined after the contract date is allocated to the purchaser. The position can differ depending on the contract and the circumstances, particularly where the contribution has been disclosed or special conditions apply.

This is worth checking before exchange, especially where substantial works are already under discussion. A purchaser may have limited recourse merely because the owners corporation was already contemplating a significant future expense when the contract was signed.

It is also worth knowing that the rules have shifted. Since 1 April 2026, strata information certificates must disclose more, including details of any exclusive supply network — often called an embedded network — certain orders and compliance action against the owners corporation, and recent and upcoming meetings. From July 2025, higher prescribed inspection fees apply where records are inspected by a person authorised by an owner, which will often include a professional strata searcher.

And under the current law, an owner generally has six years from first becoming aware of the loss — rather than two — to bring a damages claim under section 106 arising from an owners corporation's failure to maintain and repair common property.

None of those reforms removes the need to read the records. So order the search early, ask specifically for several years of minutes and the capital works fund plan rather than accepting a summary, and read the minutes yourself. Look for engineers' reports, major quotations, recurring maintenance problems, litigation, insurance issues and motions that have been deferred rather than resolved.

The number that hurts is rarely sitting neatly in the financial statements. It is usually in a paragraph someone wrote about a leaking roof three years ago. If you are buying into a strata scheme and something in the records doesn't sit right — or you have already settled and a levy has landed that you did not anticipate from the information available before purchase — it is worth getting advice before you make your next move.

At Surge Legal, we advise purchasers and owners on strata due diligence, contract review, disclosure disputes and dealings with owners corporations.

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This article is a general summary of Daley v The Owners – Strata Plan 2754 [2026] NSWCATAP 38 for information purposes only. It does not constitute legal advice. Please contact Surge Legal to discuss your individual circumstances.