These by-laws may not be amended during the initial period and may only be amended after the expiry of the initial period by special resolution and with the written consent of each person entitled by the by-law to use the restricted association property - see s.54(5) Community Land Management Act 1989.
Part of the association property within a community, precinct or neighbourhood scheme can be restricted to the use of proprietors or associations within the scheme - see s.54 Community Land Management Act 1989. For example, in a large scheme containing two swimming pools half of the proprietors may be given restricted use rights to one of the pools with the remaining proprietors having rights over the other pool.
In return for the restricted property rights a by-law can be drafted requiring the proprietors benefited to maintain the facility or to pay an additional contribution to its upkeep.
The relative contribution that each proprietor pays as a levy toward association expenses is calculated according to unit entitlement. The only way that this can be varied is by means of a restricted property by-law where one or more of the proprietor's gains a benefit in respect of association property and in return pays an additional contribution. As a consequence restricted property by-laws can be used in a number of ways to tailor a scheme to closer reflect the desires of the developer and proprietors.
If a developer does not propose to give a development contract in respect of a community or precinct scheme but wants to ensure continued access to the site so that construction can be completed, a restricted property by-law may be used. An area of association property still under construction, eg the tennis court, can be restricted to the developer, as a proprietor of a development lot, until the tennis court is completed. Also, by this method the developer's contribution to the association during the construction phase can be altered. A restricted property by-law giving the developer construction rights will often be limited in time in some way, usually until construction has been completed.
Another way in which restricted property by-laws are used is to pass the care and maintenance of the association property of subsidiary schemes up to the community association. In many community schemes the majority of facilities will form part of the community association property. Even so, all subsidiary schemes must have their own association property. To ensure a consistent maintenance standard and to cut cost's it would be more efficient for the maintenance of all association property within a community scheme to be controlled by the community association.
By use of a restricted property by-law the association property of a subsidiary precinct or neighbourhood scheme can be restricted to the use of the community scheme. In return, the community scheme will be responsible for maintenance of the precinct or neighbourhood property. When used in this way the term "restricted property" is somewhat anomalous as the use is not restricted to fewer proprietors but expanded to allow use by all members of the community.
All details of restricted association property should be set out in a by-law and must include:
- a description of the restricted property
- details of the lot owners, associations, strata corporations or other persons having the benefit of its use
- the terms and conditions of its use
- particulars relating to access to the property and the provision and keeping of any key(s) necessary
- particulars of the hours during which the property may be used
- provisions relating to the maintenance of the property
- matters relating to the determination, imposition and collecting of levies to be imposed.
A person entitled to use restricted association property may lose that entitlement if the person fails to comply with a condition of use or to pay contributions to the association for the use of the restricted property - see s.54 Community Land Management Act 1989.