By Tara Plumbe, Partner and Zara Penklis, Law Graduate
Section 106(5) of the Strata Schemes Management Act 2015 (‘The Act’) allows lot owners to recover damages for ‘reasonably foreseeable’ loss caused by an Owners Corporation’s failure to maintain common property. Until 30 June 2025, the limitation period to bring a claim under section 106(5) was two years from when the lot owner “first became aware” of the losses claimed. However, in July 2025, the Act was amended to extend the limitation period for claims under s 106(5) to six years. This created significant uncertainty about whether claims that had previously expired under the old limitation period could now be revived.
According to the District Court in John Goubran & Associates Pty Ltd ACN 070 974 819 v The Owners – Strata Plan 57150 [2026] NSWDC 9, they cannot. The Court stated definitively that any extension in the statutory limitation period will not apply retrospectively.
A Lot Owner, JG&A, brought a claim in negligence and sought damages from the Owners Corporation. Crucially, JG&A became aware of the ‘loss’ giving rise to the claim in December 2021, meaning that under the old law, the limitation period lapsed in December 2023. Nonetheless, the Plaintiff filed the claim in July 2025, arguing that the new limitation period of 6 years applied. The Court rejected this argument.
The Court relied on Rodway v The Queen [1990] HCA 19, where the High Court found that limitations periods should not operate retrospectively to revive a cause of action which has become barred unless it is clearly intended by Parliament. Applying that reasoning, the Court found that giving the amendment retrospective effect would undermine the Owner’s Corporation’s substantive rights, such as the right to be remain free of a claim and therefore could not be characterised as a merely procedural rule. As the limitation period for the Lot Owner’s claim expired in December 2023, well before the amendment took effect, the claim was out of time and could not be revived by the later legislative change.
However, if the limitation period had not already expired before the amendments to the Act took effect, the outcome may have been different. In Jeeng v Nuffield (Australia) Pty Ltd [1959] HCA 40, the High Court confirmed that if a limitation period is extended before the deadline to bring a claim has passed, the new period generally applies. Therefore, if the time-limit to bring an action had not lapsed by 1 July 2025, the 6-year limitation period would apply.
The crucial takeaway for clients facing recovery claims under s 106(5) is that the recent extension of the limitation period cannot revive an expired claim. However, this does not mean that older claims are automatically excluded. If the Lot Owner’s claim was still ‘in time’ under the old two-year limit when the law changed in July 2025, they can still rely on the new six-year period.
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