New strata bill out for comment


As published in the Caymanian Compass  l  WEDNESDAY 9 JANUARY 2013

The Cayman Islands Law Reform Commission is inviting public comments on its newest draft Strata Titles Bill and accompanying discussion paper. The deadline for comments is 11 March.

The Strata Titles Bill, 2013, “contains a complete review of the regulation of strata titles in the Islands”, according to a news release. The new bill incorporates the narrower strata titles bill the commission submitted in 2011.

Building on 2011

According to the commission’s news release, “The commission received responses from a wide variety of persons including the legal associations, the Bankers’ Association, CIREBA, individual real estate agencies, strata owners, executive committees, the Water Authority and the Cayman Contractors Association. The clauses set out in the first bill were amended pursuant to comments submitted and have been inserted in this new bill.”

In response to the comments submitted on the 2011 bill, the new bill does not require audited statements and accounts for strata schemes of seven lots or greater. The discussion paper calls that requirement “the main area of objection” to the 2011 bill.

According to the discussion paper, “Many people objected on the ground that audits are quite expensive and most strata schemes could therefore not afford to comply with such requirements.”

Instead, the new bill allows for strata corporations to require, by way of a super-majority resolution, that their own statements and accounts be audited in accordance with generally-accepted accounting principles.

New matters

According to the news release, “Matters dealt with in the Strata Titles Bill, 2013, include the creation of strata lots and common property; the management and administration of strata schemes; phased development of strata schemes; the regulation of leasehold and vacant land strata schemes; protection of purchasers; termination of strata schemes and resolution of disputes.”

According to the discussion paper, the Ministry of Agriculture’s “preliminary views have been taken into account in the preparation of the bill”.

According to the paper, the bill replaces the old term “strata” with “strata scheme”, and also allows for the first time the registration of two-lot strata schemes, whereas at the moment the minimum number of lots is four.

“The ministry noted previously that notwithstanding that the current law contemplates four or more units for residential occupation it is not uncommon for four units to be construed to consist of two dwelling/business units (duplexes) and two garages or two air conditioning concrete pads. The legality of this under the Law has been questioned,” according to the paper.

The bill allows for the establishment of “mixed strata schemes”, where “one or more strata plans may be registered in relation to one parcel of land”. That kind of scenario has come into play in New South Wales, Australia, regarding mixed-use developments that include commercial and residential tenants in the same building. Originally enacted in 1973, Cayman’s strata law was modelled on New South Wales legislation that had been enacted in the 1950s.

The new bill allows strata schemes to acquire land to be used as common property “or for such other purpose of the corporation as may be determined by special resolution”.

Comments on the draft bill and discussion paper, or other input, should be submitted in writing by 11 March to commission director Cheryl Neblett at First floor, dms house, Genesis Close, George Town, or by e-mail to