Sharma v Hoque [2026] NSWCATAP 198 (24 June 2026) is not a strata case. But it may have an important strata consequence of which to be aware.

The Legal Trap: Landlord Liability for Common Property Defects

The Appeal Panel has reaffirmed that a landlord may remain liable to a tenant under the Residential Tenancies Act 2010 (NSW) (RTA) even where the relevant defect that the tenant complained about relates to common property which is the owners corporation’s responsibility to repair, replace or maintain. The same conclusion was previously reached by the Appeal Panel: see McCartney v Wood [2023] NSWCATAP 131 [77]-[79].

Section 63 of the RTA requires the landlord to provide and maintain the premises in a reasonable state of repair. Section 44 of the RTA permits an excessive rent order where goods, services or facilities provided with the premises are reduced or withdrawn or given the state of repair of the residential premises.

That matters for owners corporations I Case study: Sharma v Hoque

In Sharma, the tenants recovered rent reductions from the landlord for various defects, including a gas and water leak, balcony leak, faulty intercom, air conditioning and lift issues.

The landlord argued that some of these matters were “strata” issues and were outside of landlord’s control. The Tribunal and the Appeal Panel rejected that argument. The Appeal Panel held that a landlord may be in breach of the obligation to repair the residential premises even where delay in doing so is caused, or partly caused, by an owners corporation.

The Strata Impact: Passing the Financial Loss to the Owners Corporation

The strata point is this: where an owners corporation breaches section 106 of the Strata Schemes Management Act 2015 (NSW) (SSMA) by failing to repair common property, and that breach causes the landlord to become liable to the tenant, the landlord may have a claim against the owners corporation.

Section 106 of the SSMA and Statutory Duty

Section 106 of the SSMA requires an owners corporation to maintain and keep common property in good and serviceable repair. It also gives a lot owner a right to recover, as damages for breach of statutory duty, any reasonably foreseeable loss suffered by the owner as a result of the owners corporation’s breach of that strict duty. The current limitation period under section 106(6) is six years from when the owner first becomes aware of the loss.

Forecasting the Chain of Loss

A rent reduction or a compensation order made in favour of a tenant may therefore become part of the landlord’s loss. That loss may not be remote merely because it is first suffered by the tenant.

In some cases, it may be foreseeable that, if common property defects affect a rented lot in a strata scheme, the tenant may seek rent reduction or compensation from the landlord. It may be equally foreseeable that the landlord may then look to the owners corporation if the underlying cause was an unremedied common property defect.

Key Takeaway for Strata Managers and Owners Corporations

Owners corporations should not assume that delay only exposes them to repair and remediation orders or to loss of rental income. Delay in rectifying common property may create a chain of financial loss. Where a rented lot is affected, that chain may run from the tenant to the landlord, and then back to the owners corporation under section 106 of the SSMA.

Owners Corporation Responsibilities: Beyond Strata Law

Sharma is not new law. But it is a useful reminder that disputes about an owners corporation’s duty does not sit neatly inside strata law. A failure to repair common property can have consequences for tenancies, and those consequences may become recoverable loss in a later section 106 claim against the owners corporation.