The Extend­ed 6 Year Lim­i­ta­tion Peri­od For SSMA Sec­tion 106 Stra­ta Claims Is Not Retrospective

In the recent deci­sion of John Goubran & Asso­ciates Pty Ltd ACN 070 974 819 v The Own­ers – Stra­ta Plan 57150 [2026] NSWDC 9 (Goubran) it was held that the lim­i­ta­tion peri­od which was amend­ed from 2 years to 6 years from 1 July 2025 under s106(6), is not ret­ro­spec­tive and does not extend the lim­i­ta­tion peri­od beyond 2 years where this for­mer lim­i­ta­tion peri­od was ‘extin­guished’ pri­or to the changes com­ing in.

The Dis­trict Court stat­ed that the change of the lim­i­ta­tion peri­od to 6 years was sub­ject to the pre­sump­tion against ret­ro­spec­tiv­i­ty ref­er­enced in Rod­way v R [1990] HCA 19. Note that ret­ro­spec­tiv­i­ty in this con­text, if it applied, would have the effect of re-enliven­ing a pre­vi­ous­ly extin­guished claim. Nev­er­the­less, this con­cept does not apply as the deci­sion was not a pro­ce­dur­al change. 

This case char­ac­teris­es the change from 2 to 6 years as ‘extend[ing]’ the lim­i­ta­tion peri­od. The notion of an exten­sion sug­gests that the lim­i­ta­tion peri­od was not extin­guished and then rein­stat­ed as 6 years. This means that it just length­ens the exist­ing time of 2 years. 

The effect of this is, that a claim with­in 2 years of the date the 6 year change came into effect, would be extend­ed to the 6 years as ‘[t]he amend­ment to s 106(6) of the Act affects exist­ing rights and oblig­a­tions’. How­ev­er, if the aware­ness arose more than 2 years before 30 June 2025, being the date the change came into effect, then the lim­i­ta­tion peri­od is lim­it­ed to 2 years. 

What is the date you become aware of your loss?

The Goubran case also com­ment­ed on when the lim­i­ta­tion peri­od start­ed to run in that case under sec­tion 106(6) of the SSMA. 

Although in our view, the com­ments made, seemed to align the date of aware­ness of “loss” to the “cause” rather than the “effect” when the lot own­er in this case tried to amend his exist­ing claim plead­ing com­mon law neg­li­gence to bring in an addi­tion­al claim under sec­tion 106(5) of the SSMA after the leg­is­la­tion changes were brought in. 

The ear­li­er estab­lished inter­pre­ta­tion of when one ‘becomes aware of the loss’ can be found in White House Devel­op­ments Pty Ltd v The Own­ers — Stra­ta Plan No 70276 [2025] NSW­CAT­AP 68 at para­graph [70] when it cites The Own­ers — Stra­ta Plan No 74232 v Tezel [2023] NSW­CA 35 (Tezel).

Tezel found that an own­er must become aware of ‘the type or kind of loss’ as opposed to the spe­cif­ic loss claimed. Addi­tion­al­ly, at para­graph [39] of Tezel, the court said that an own­er does not become aware of loss on ‘the date on which the rel­e­vant cause of action accrues’. 

In Goubran, it was found that the appli­cant ‘became aware of the loss…’ when the water ingress was first noticed in the apart­ment. Not when the own­er became aware he would suf­fer rental loss. This departs from cas­es where it has been held that a ‘loss’ under sec­tion 106(5) of the SSMA aris­es when an own­er becomes aware of that type of loss rather than an aware­ness of the breach itself. 

This deci­sion could have sig­nif­i­cant impact for own­ers when estab­lish­ing the date of aware­ness of loss and could mean an own­er bring­ing a claim for loss, may be out of time, if an own­er is aware of the dam­age well before being aware of the loss. 

In our view, the find­ings in Tezel are jus­ti­fied when deter­min­ing ‘aware­ness of loss’ under sec­tion 106(6) of the SSMA.

For further information please contact:

Michael Byrnes, Partner
Phone: + 61 2 9233 5544
Email: mjb@swaab.com.au

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