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20181085-ASC12 - Ballada Pty Ltd v North Point Brisbane & Anor [2013] QCATA 184
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CITATION: Ballada Pty Ltd v North Point Brisbane & Anor
[2013] QCATA 184
PARTIES: Ballada Pty Ltd
Mr Andrew Leo Abasa
(Applicants/Appellants)
V
North Point Brisbane CTS 7575
Queensland Police Credit Union Ltd
(Respondents)
APPLICATION NUMBER: APL319-12
MATTER TYPE: Appeals
HEARING DATE: On the papers
HEARD AT: Brisbane
DECISION OF: Hon James Thomas AM QC, Judicial
Member
DELIVERED ON: 19 June 2013
DELIVERED AT: Brisbane
ORDERS MADE: 1. Appeal dismissed.
2. Decision of the Adjudicator in North
Point Brisbane [2012] QBCCMCmr
355 dated 7 August 2012 confirmed.
CATCHWORDS: APPEAL – where decision by adjudicator
under Body Corporate and Community
Management Act 1997 – determination of
issues raised before adjudicator – appeal
confined to evidence and issues already
raised –
Decision by body corporate to upgrade air-
conditioning system - whether notice of EGM
timely and technically adequate - whether
issues raised for adjudicator’s determination
– whether unit owner cast a vote by post
before meeting – vote sent but not received –
whether vote “given” – Acts Interpretation Act
1954 s 39A(1) and Body Corporate and
Community Management (Commercial
Module) Regulation 2008 s 54(2) - whether
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QCAT
Queensland Civil and Administrative Tribunal
CITATION:
PARTIES:
APPLICATION NUMBER:
MATTER TYPE:
HEARING DATE:
HEARD AT:
DECISION OF:
DELIVERED ON:
DELIVERED AT:
ORDERS MADE:
CATCHWORDS:
Retrieved from AustLII on 30 March 2020 at 16:29:45
Ballada Pty Ltd v North Point Brisbane & Anor
[2013] QCATA 184
Ballada Pty Ltd
Mr Andrew Leo Abasa
(Applicants/Appellants)
Vv
North Point Brisbane CTS 7575
Queensland Police Credit Union Ltd
(Respondents)
APL319-12
Appeals
On the papers
Brisbane
Hon James Thomas AM QC, Judicial
Member
19 June 2013
Brisbane
1. Appeal dismissed.
2. Decision of the Adjudicator in North
Point Brisbane [2012] QBCCMCmr
355 dated 7 August 2012 confirmed.
APPEAL — where decision by adjudicator
under Body Corporate and Community
Management Act 1997 — determination of
issues raised before adjudicator — appeal
confined to evidence and issues already
raised —
Decision by body corporate to upgrade air-
conditioning system - whether notice of EGM
timely and technically adequate - whether
issues raised for adjudicator's determination
— whether unit owner cast a vote by post
before meeting — vote sent but not received —
whether vote “given” — Acts Interpretation Act
1954 s 39A(1) and Body Corporate and
Community Management (Commercial
Module) Regulation 2008 s 54(2) - whether
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body corporate made “suitable alternative
arrangements” instead of a mailbox for
reception of mail –
Whether resolutions invalid for uncertainty or
unreasonableness – whether resolutions
required to be carried without dissent -
whether project shown to be unauthorised –
Whether applicant unit owners could claim
cost of air conditioning project against
another unit owner if project not duly
authorised –
Grant of exclusive use of common property
for car spaces - nature of such grant -
Community Management Statement by-law
30 - whether owner of such right entitled to
retain proceeds of rental of such spaces -
whether body corporate for unit owners have
any right to an account of such earnings –
Installation of ATM machine in common
property area - whether committee resolution
authorising installation should be set aside -
need for claim against body corporate to set
aside committee resolution - whether issue
properly raised before adjudicator - whether
applicant unit owners had any cause of action
against the unit owner installing the machine.
Body Corporate and Community
Management Act 1997, s170, s 289(2)
Body Corporate and Community
Management (Commercial Module)
Regulation 2008, s 34, s 39, s 41, s 54(2),
s 62, s 119, s 123, s 129
Acts Interpretation Act 1954, s 39A(1),
s 39A(3)
North Wind Pty Ltd v Proprietors - Strata Plan
3143 [1981] 2 NSWLR 809, cited
Independent Finance Group Pty Ltd v Mytan
Pty Ltd & Anor [2001] QCA 306, cited
Katsikalis v Body Corporate for "The Centre"
[2009] QCA 77, cited
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of
Queensland Civil and Administrative Tribunal Act 2009.
REASONS FOR DECISION
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body corporate made “suitable alternative
arrangements” instead of a mailbox for
reception of mail —
Whether resolutions invalid for uncertainty or
unreasonableness -— whether resolutions
required to be carried without dissent -
whether project shown to be unauthorised —
Whether applicant unit owners could claim
cost of air conditioning project against
another unit owner if project not duly
authorised —
Grant of exclusive use of common property
for car spaces - nature of such grant -
Community Management Statement by-law
30 - whether owner of such right entitled to
retain proceeds of rental of such spaces -
whether body corporate for unit owners have
any right to an account of such earnings —
Installation of ATM machine in common
property area - whether committee resolution
authorising installation should be set aside -
need for claim against body corporate to set
aside committee resolution - whether issue
properly raised before adjudicator - whether
applicant unit owners had any cause of action
against the unit owner installing the machine.
Body Corporate and Community
Management Act 1997, s170, s 289(2)
Body Corporate and Community
Management (Commercial Module)
Regulation 2008, s 34, s 39, s 41, s 54(2),
s 62,8 119,s 123,s 129
Acts Interpretation Act 1954, s 39A(1),
s 39A(3)
North Wind Pty Ltd v Proprietors - Strata Plan
3143 [1981] 2 NSWLR 809, cited
Independent Finance Group Pty Ltd v Mytan
Pty Ltd & Anor [2001] QCA 306, cited
Katsikalis v Body Corporate for "The Centre"
[2009] QCA 77, cited
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of
Queensland Civil and Administrative Tribunal Act 2009.
REASONS FOR DECISION
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[1] This is an appeal (or an application for leave to appeal) against an
adjudicator’s decision concerning disputes between two unit owners and
the body corporate for the North Point Brisbane Community Titles
Scheme, and between those unit owners and another unit owner (the
Queensland Police Credit Union).
Nature of dispute
[2] The applicants are Ballada Pty Ltd (“Ballada”) and Mr Andrew Abasa.
Both are unit owners in the scheme.
[3] The North Point Brisbane Community Titles Scheme 7575 contains 76 lots
and common property. Under the Scheme’s Community Management
Statement (“CMS”) the applicable regulatory module is the Body
Corporate and Community Management (Commercial Module) Regulation
2008 (“the Commercial Module”). The scheme is registered as Building
Units Plan 7688.
[4] The Queensland Police Credit Union (“QPCU”) is the proprietor of the
ground floor and first level of the North Point building, from which it
conducts a credit union business. It also owns a substantial number of
other units in the building, and is the proprietor of 35 of the 76 lots in the
scheme.
[5] The relief initially sought by the applicants was the setting aside of various
motions that had been carried at an Extraordinary General Meeting
(“EGM”) of the Body Corporate on 12 July 2011 authorising the body
corporate to proceed with an air-conditioning scheme as amended. The
issues expanded as the adjudication proceeded, and in due course the
QPCU was added as a respondent against which multiple claims were
made. These included that the QPCU should be ordered to pay all the
costs of the new air-conditioning system installed and to be installed on
the ground floor and level 1 at North Point, that it account for all monies
received in respect of car-parks let out by it on the upper level car park,
that it pay rental and compensation in respect of its use of an ATM
situated in the ground floor lobby and that it be ordered to do various
things in relation to the ATM.
[6] The QPCU has also been included as a respondent in the present appeal.
However it did not file any submissions on the appeal, and has been
content to rely on the submissions of the respondent body corporate.
[7] The Adjudicator’s decision was adverse to the applicants on all issues,
resulting in the dismissal of their application on all points.
Nature of appeal
[8] The right to appeal an adjudicator’s decision arises under part 11 of
chapter 6 of the Body Corporate and Community Management Act 1997
(“the BCCM Act”) (ss 288A-294). Under s 289(2) an appeal from an
adjudicator’s determination lies only on a question of law.
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[1]
This is an appeal (or an application for leave to appeal) against an
adjudicator’s decision concerning disputes between two unit owners and
the body corporate for the North Point Brisbane Community Titles
Scheme, and between those unit owners and another unit owner (the
Queensland Police Credit Union).
Nature of dispute
[2]
13]
[4]
[5]
[6]
[7]
The applicants are Ballada Pty Ltd (“Ballada”) and Mr Andrew Abasa.
Both are unit owners in the scheme.
The North Point Brisbane Community Titles Scheme 7575 contains 76 lots
and common property. Under the Scheme’s Community Management
Statement (“CMS”) the applicable regulatory module is the Body
Corporate and Community Management (Commercial Module) Regulation
2008 (“the Commercial Module”). The scheme is registered as Building
Units Plan 7688.
The Queensland Police Credit Union (“QPCU”) is the proprietor of the
ground floor and first level of the North Point building, from which it
conducts a credit union business. It also owns a substantial number of
other units in the building, and is the proprietor of 35 of the 76 lots in the
scheme.
The relief initially sought by the applicants was the setting aside of various
motions that had been carried at an Extraordinary General Meeting
(“EGM”) of the Body Corporate on 12 July 2011 authorising the body
corporate to proceed with an air-conditioning scheme as amended. The
issues expanded as the adjudication proceeded, and in due course the
QPCU was added as a respondent against which multiple claims were
made. These included that the QPCU should be ordered to pay all the
costs of the new air-conditioning system installed and to be installed on
the ground floor and level 1 at North Point, that it account for all monies
received in respect of car-parks let out by it on the upper level car park,
that it pay rental and compensation in respect of its use of an ATM
situated in the ground floor lobby and that it be ordered to do various
things in relation to the ATM.
The QPCU has also been included as a respondent in the present appeal.
However it did not file any submissions on the appeal, and has been
content to rely on the submissions of the respondent body corporate.
The Adjudicator’s decision was adverse to the applicants on all issues,
resulting in the dismissal of their application on all points.
Nature of appeal
[8]
The right to appeal an adjudicators decision arises under part 11 of
chapter 6 of the Body Corporate and Community Management Act 1997
(‘the BCCM Act’) (ss 288A-294). Under s 289(2) an appeal from an
adjudicator’s determination lies only on a question of law.
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[9] The present appeal is governed by s 146 of the Queensland Civil and
Administrative Tribunal Act 2009 (“the QCAT Act”). Such an appeal,
which is on a question of law only, is confined to the evidence that was
obtained by or presented to the Adjudicator.
[10] The material attached to the application for appeal contains a quantity of
documents, and seeks to raise some issues that were not raised before
the Adjudicator. There was adequate opportunity for the parties to raise
the issues about which they were in dispute, and to present all relevant
material during that procedure. The appeal must of course be confined to
the evidence and issues that were presented to the Adjudicator.
[11] The ultimate issue is whether the Adjudicator has shown to have erred on
a question of law that affected the outcome.
Facts
[12] Until 2011 the air conditioning system for the building was a “water based”
system operated from a cooling tower on the roof, with individual unit
systems in each unit which, upon failure, would be replaced or repaired by
individual owners.
[13] At the Annual General Meeting of 19 April 2011 it was unanimously
resolved to discontinue the current water cooling air-conditioning system
and install an individual system for each lot, with ownership of those
systems to be transferred to each lot owner. The minutes noted that the
work would be conducted on the lower levels as the first measure. Neither
applicant voted on the issue.
[14] Further planning and negotiation with contractors led the management
committee to the view that some variation of the original planning was
necessary. Proposals for the updated changes, including full quotations
and specifications concerning the system upgrade were notified for
consideration at an EGM on 12 July 2011. Notice was sent to all owners
dated 20 June 2011 of the resolutions that were considered necessary in
order for the matter to proceed. The agenda included 8 motions, 4 of
which were listed as motions requiring resolution without dissent.
[15] The applicant Ballada acted at material times through Mr Kildey, an
architect. The initial dispute the subject of his application was his claim
that he cast a valid postal vote against the proposals, and that it was
never acknowledged or counted.
[16] The relevant circumstances surrounding this issue are canvassed in some
detail in the reasons for judgment of the Adjudicator dated 7 August 2012,
particularly at paragraphs [24] to [30], and [37] to [44].
[17] Mr Kildey stated that he personally posted voting papers to the body
corporate manager (Stewart Silver King & Burns) on 7 July 2011. On the
other hand, the body corporate manager provided evidence that no such
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[9]
[10]
[11]
The present appeal is governed by s 146 of the Queensland Civil and
Administrative Tribunal Act 2009 (“the QCAT Act’). Such an appeal,
which is on a question of law only, is confined to the evidence that was
obtained by or presented to the Adjudicator.
The material attached to the application for appeal contains a quantity of
documents, and seeks to raise some issues that were not raised before
the Adjudicator. There was adequate opportunity for the parties to raise
the issues about which they were in dispute, and to present all relevant
material during that procedure. The appeal must of course be confined to
the evidence and issues that were presented to the Adjudicator.
The ultimate issue is whether the Adjudicator has shown to have erred on
a question of law that affected the outcome.
Facts
[12]
[13]
[14]
[15]
[16]
[17]
Until.2011 the air conditioning system for the building was a “water based”
system operated from a cooling tower on the roof, with individual unit
systems in each unit which, upon failure, would be replaced or repaired by
individual owners.
At the Annual General Meeting of 19 April 2011 it was unanimously
resolved to discontinue the current water cooling air-conditioning system
and install an individual system for each lot, with ownership of those
systems to be transferred to each lot owner. The minutes noted that the
work would be conducted on the lower levels as the first measure. Neither
applicant voted on the issue.
Further planning and negotiation with contractors led the management
committee to the view that some variation of the original planning was
necessary. Proposals for the updated changes, including full quotations
and specifications concerning the system upgrade were notified for
consideration at an EGM on 12 July 2011. Notice was sent to all owners
dated 20 June 2011 of the resolutions that were considered necessary in
order for the matter to proceed. The agenda included 8 motions, 4 of
which were listed as motions requiring resolution without dissent.
The applicant Ballada acted at material times through Mr Kildey, an
architect. The initial dispute the subject of his application was his claim
that he cast a valid postal vote against the proposals, and that it was
never acknowledged or counted.
The relevant circumstances surrounding this issue are canvassed in some
detail in the reasons for judgment of the Adjudicator dated 7 August 2012,
particularly at paragraphs [24] to [30], and [37] to [44].
Mr Kildey stated that he personally posted voting papers to the body
corporate manager (Stewart Silver King & Burns) on 7 July 2011. On the
other hand, the body corporate manager provided evidence that no such
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voting paper was ever received, and that Ballada was not represented at
the meeting.
[18] After the EGM the Committee noted that the air conditioning motions had
been carried, and also that one owner had reservations about the project
but had not attended the EGM and no voting paper had been received.
[19] The second applicant (Mr Abasa) attended the EGM, but did not vote. He
appears not to have fully reflected on the implications of the motions until
some time later.
Applicants’ issues and contentions
[20] The system of dispute resolution provided for in the BCCM Act is
exclusive. If other dispute resolution procedures fail there is provision for a
dispute to be determined by the adjudication of a specialist adjudicator.
The procedure is partly inquisitorial and partly adversarial. It does not sit
comfortably with any familiar system of pleading.
[21] Identifying the issues that arise in the determination of disputes is no easy
task for an adjudicator. Issues may be identifiable from information
provided by an applicant in the prescribed application form (see ss 239A,
239B, 239C 240 and 243) which asks “What outcome are you seeking?”
and for the applicant’s “grounds”, with the guiding statement “Please
provide concise and relevant details of background dispute, together with
your arguments supporting the outcome sought”. The issues that an
adjudicator needs to address are those that must be decided in order to
determine whether the “outcome” or relief sought by the applicant is to be
granted in the light of the “relevant details of background dispute” and the
arguments advanced. An adjudicator is not required to prosecute an
applicant’s claim. There remains an onus on a claimant to raise the points
about which the parties are in dispute, and which need to be resolved.
[22] In the absence of any prescribed procedure to define the issues difficulty
is often occasioned both for the Adjudicator and for this Appeal Tribunal in
identifying the issues that were or should have been litigated. This may
require reference to substantial correspondence between the parties and
the Adjudicator in order to see what issues were fairly raised for
adjudication. The present matter raised this difficulty.
[23] It is clear in the present case that the issues that needed to be determined
were those that were raised concerning the matters listed in the
applicants’ Adjudication Application Form (form 15) dated 14 November
2011. This amended earlier applications, and, following correspondence
with the Adjudicator, seems to have crystallised what the applicants were
seeking. In that application, under the caption “What outcome are you
seeking?”, the relief that was sought was particularised. The relevant
issues were subsequently extrapolated and to some extent expanded in
extensive letters from the applicants’ solicitor containing submissions and
factual assertions.
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[18]
[19]
voting paper was ever received, and that Ballada was not represented at
the meeting.
After the EGM the Committee noted that the air conditioning motions had
been carried, and also that one owner had reservations about the project
but had not attended the EGM and no voting paper had been received.
The second applicant (Mr Abasa) attended the EGM, but did not vote. He
appears not to have fully reflected on the implications of the motions until
some time later.
Applicants’ issues and contentions
[20]
[21]
[22]
[23]
The system of dispute resolution provided for in the BCCM Act is
exclusive. If other dispute resolution procedures fail there is provision for a
dispute to be determined by the adjudication of a specialist adjudicator.
The procedure is partly inquisitorial and partly adversarial. It does not sit
comfortably with any familiar system of pleading.
Identifying the issues that arise in the determination of disputes is no easy
task for an adjudicator. Issues may be identifiable from information
provided by an applicant in the prescribed application form (see ss 239A,
239B, 239C 240 and 243) which asks “What outcome are you seeking?”
and for the applicant's “grounds”, with the guiding statement “Please
provide concise and relevant details of background dispute, together wth
your arguments supporting the outcome sought’. The issues that an
adjudicator needs to address are those that must be decided in order to
determine whether the “outcome” or relief sought by the applicant is to be
granted in the light of the “relevant details of background dispute” and the
arguments advanced. An adjudicator is not required to prosecute an
applicant’s claim. There remains an onus on a claimant to raise the points
about which the parties are in dispute, and which need to be resolved.
In the absence of any prescribed procedure to define the issues difficulty
is often occasioned both for the Adjudicator and for this Appeal Tribunal in
identifying the issues that were or should have been litigated. This may
require reference to substantial correspondence between the parties and
the Adjudicator in order to see what issues were fairly raised for
adjudication. The present matter raised this difficulty.
It is clear in the present case that the issues that needed to be determined
were those that were raised concerning the matters listed in the
applicants’ Adjudication Application Form (form 15) dated 14 November
2011. This amended earlier applications, and, following correspondence
with the Adjudicator, seems to have crystallised what the applicants were
seeking. In that application, under the caption “What outcome are you
seeking?”, the relief that was sought was particularised. The relevant
issues were subsequently extrapolated and to some extent expanded in
extensive letters from the applicants’ solicitor containing submissions and
factual assertions.
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[24] The outcome sought by the applicants was:
With regard to the body corporate for North point CT S7575:
All purported resolutions made 12 July 2011 be set aside.
The purported notice of EGM of 21 June be set aside as invalid.
With regard to the Queensland Police Credit Union, QPCU:
That the QPCU pay all the costs of new air-conditioning installed for
its premises at Ground Floor and Level I at North Point.
That the QPCU forthwith account to the body corporate for all monies
received by it in respect of carparks let out by it on common property
on the upper level car park, under an exclusive use basis procured in
its favour.
That the QPCU forthwith account to the body corporate for rental and
compensation for the ATM it has installed in the ground floor lobby in
the amount of $12,580 pa in the first year, increasing by 4% pa every
year thereafter.
That QPCU be required to execute a lease, and be responsible for all
electricity used as well as proper maintenance of the appearance of
the ATM enclosure as well as all reinstatement costs incurred if and
when the ATM is removed.
[25] The applicants provided extensive submissions to the Adjudicator in the
course of the proceedings, and also to this appeal tribunal. Some of the
points now taken were not raised in the original proceedings, and, as will
be indicated, some of them are not open to be relied on in this appeal.
[26] It seems to me that the appeal can be most conveniently dealt with under
seven main headings:
(a) whether the time for notification of the meeting was too short;
(b) whether Ballada cast a valid vote;
(c) other points alleging invalidity of the meeting;
(d) alleged invalidity of resolutions;
(e) claim against QPCU for payment of the cost of the air
conditioning project;
(f) claim against QPCU for payment of its earnings from its
“exclusive use” car park areas;
(g) claim against QPCU concerning its installation and use of an
ATM in the foyer of the common property.
[27] Of these only the issues in (a), (b), (c) and (d) involve claims against the
Body Corporate. They are designed to invalidate the meeting of 11 July
2011 and to negative the body corporate’s authorisation for the air
conditioning scheme to proceed. The remaining three issues are claims
made directly against the QPCU. The legal basis of these claims is difficult
to fathom. They were not made, for example, on the basis of a claim
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[24]
[25]
[26]
[27]
The outcome sought by the applicants was:
With regard to the body corporate for North point CT S7575:
. All purported resolutions made 12 July 2011 be set aside.
. The purported notice of EGM of 21 June be set aside as invalid.
With regard to the Queensland Police Credit Union, QPCU:
. That the QPCU pay all the costs of new air-conditioning installed for
its premises at Ground Floor and Level | at North Point.
. That the QPCU forthwith account to the body corporate for all monies
received by it in respect of carparks let out by it on common property
on the upper level car park, under an exclusive use basis procured in
its favour.
. That the QPCU forthwith account to the body corporate for rental and
compensation for the ATM it has installed in the ground floor lobby in
the amount of $12,580 pa in the first year, increasing by 4% pa every
year thereafter.
. That QPCU be required to execute a lease, and be responsible for all
electricity used as well as proper maintenance of the appearance of
the ATM enclosure as well as all reinstatement costs incurred if and
when the ATM is removed.
The applicants provided extensive submissions to the Adjudicator in the
course of the proceedings, and also to this appeal tribunal. Some of the
points now taken were not raised in the original proceedings, and, as will
be indicated, some of them are not open to be relied on in this appeal.
It seems to me that the appeal can be most conveniently dealt with under
seven main headings:
(a) whether the time for notification of the meeting was too short;
(b) whether Ballada cast a valid vote;
(c) other points alleging invalidity of the meeting;
(d) alleged invalidity of resolutions;
(e) claim against QPCU for payment of the cost of the air
conditioning project;
(f) claim against QPCU for payment of its earnings from its
“exclusive use” car park areas;
(g) claim against QPCU concerning its installation and use of an
ATM in the foyer of the common property.
Of these only the issues in (a), (b), (c) and (d) involve claims against the
Body Corporate. They are designed to invalidate the meeting of 11 July
2011 and to negative the body corporate’s authorisation for the air
conditioning scheme to proceed. The remaining three issues are claims
made directly against the QPCU. The legal basis of these claims is difficult
to fathom. They were not made, for example, on the basis of a claim
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against the body corporate that the body corporate should bring such
claims against the QPCU and enforce them.
[28] The body corporate contends in relation to claim (g) that in the absence of
a claim against the body corporate to invalidate the committee resolution
authorising the installation of the ATM, the claim is not maintainable
against the QPCU. The question whether any of the claims against the
QPCU are in any event viable will be considered in due course.
Whether the Time for Notification of the Meeting was too short
[29] The first ground taken on this appeal concerning “EGM contravention
issues” is that the notice of meeting was not given in accordance with s 41
of the Commercial Module. The EGM notice was dated 21 June 2011, it
was sent by post, a subsequent letter and notice dated 23 June 2011
were sent by post, and the meeting was held on 12 July 2011. This was
said to contravene s 41 of the Commercial Module, which, according to
the submission, requires such a meeting to be held at least 21 days after
giving of the EGM notice to the owners of lots.
[30] The respondent body corporate objects that no such point was raised
before the Adjudicator. It is not a point that one would expect an
adjudicator to deal with unless a party raised it for consideration. It is an
issue which, once raised, might warrant the reception of further evidence,
explanation and clarification of detail.
[31] There may in any event be answers to the point, including that the
meeting in question was an EGM, the time provisions for which are
prescribed in s 34 of the Commercial Module as requiring that it be called
within 14 days after the notice of request, and be held within six weeks
after the notice is given. It may well be that s 34 provides its own system
for EGMs while s 41 deals with general meetings other than EGMs. This
seems to be reinforced by the “note” contained in s 41.
[32] Other possible answers to the point might need full argument and require
evidence to be properly litigated. For example, many of the matters
mentioned in the relevant Module with respect to procedures before,
during and after meetings are relatively trivial in the overall picture of
ensuring fair play in decision-making and body corporate meetings. It
would be surprising if the consequence of “nullity” were to be visited upon
all acts and doings following any irregularity in the process. However, I
leave for another day the question whether short notice of a meeting for
which the relevant module of a body corporate specifies a required
number of days notice means that the meeting is in all respects void, and
that no valid resolutions could result there from.
[33] As no such point was raised before the Adjudicator, it was a non-issue,
and no error of law occurred on the Adjudicator’s part. This issue cannot
now be raised for the first time on appeal. The same may be said of
further points now raised concerning alleged infringements of ss 37(2),
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against the body corporate that the body corporate should bring such
claims against the QPCU and enforce them.
The body corporate contends in relation to claim (g) that in the absence of
a claim against the body corporate to invalidate the committee resolution
authorising the installation of the ATM, the claim is not maintainable
against the QPCU. The question whether any of the claims against the
QPCU are in any event viable will be considered in due course.
Whether the Time for Notification of the Meeting was too short
[29]
[30]
[31]
[32]
[33]
The first ground taken on this appeal concerning “EGM contravention
issues” is that the notice of meeting was not given in accordance with s 41
of the Commercial Module. The EGM notice was dated 21 June 2011, it
was sent by post, a subsequent letter and notice dated 23 June 2011
were sent by post, and the meeting was held on 12 July 2011. This was
said to contravene s 41 of the Commercial Module, which, according to
the submission, requires such a meeting to be held at least 21 days after
giving of the EGM notice to the owners of lots.
The respondent body corporate objects that no such point was raised
before the Adjudicator. It is not a point that one would expect an
adjudicator to deal with unless a party raised it for consideration. It is an
issue which, once raised, might warrant the reception of further evidence,
explanation and clarification of detail.
There may in any event be answers to the point, including that the
meeting in question was an EGM, the time provisions for which are
prescribed in s 34 of the Commercial Module as requiring that it be called
within 14 days after the notice of request, and be held within six weeks
after the notice is given. It may well be that s 34 provides its own system
for EGMs while s 41 deals with general meetings other than EGMs. This
seems to be reinforced by the “note” contained ins 41.
Other possible answers to the point might need full argument and require
evidence to be properly litigated. For example, many of the matters
mentioned in the relevant Module with respect to procedures before,
during and after meetings are relatively trivial in the overall picture of
ensuring fair play in decision-making and body corporate meetings. It
would be surprising if the consequence of “nullity’ were to be visited upon
all acts and doings following any irregularity in the process. However, |
leave for another day the question whether short notice of a meeting for
which the relevant module of a body corporate specifies a required
number of days notice means that the meeting is in all respects void, and
that no valid resolutions could result there from.
As no such point was raised before the Adjudicator, it was a non-issue,
and no error of law occurred on the Adjudicator’s part. This issue cannot
now be raised for the first time on appeal. The same may be said of
further points now raised concerning alleged infringements of ss 37(2),
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37(3), 38(4)(e), 39(3) and 40(c) of the Commercial Module, and s 320 of
the BCCM Act.
[34] The applicants further argued that the earlier motion at the April AGM
which gave initial approval to the air conditioning scheme should also be
treated as invalid. But once again no relief was sought to invalidate it, and
that issue was not in dispute. The ground now raised concerns the form of
the voting paper distributed before the meeting. The applicants complain
that “motion 14 made no provision to vote at all – only YES”. The
argument seems unpromising when full account is taken of the provisions
of the Commercial Module concerning voting on a motion that offers
alternatives.1 However this is a further issue that the applicants now seek
to raise for the first time on appeal. No legal error occurred, and I have no
jurisdiction to entertain these points.
Whether Ballada cast a valid vote
[35] Ballada claims to have provided a vote by means of the post.
[36] Section 39A of the Acts Interpretation Act 1954 relevantly provides:
(1) If an Act requires or permits a document to be served by post, service –
(a) may be effected by properly addressing, pre-paying and posting the
document as a letter; and
(b) is taken to have been effected at the time at which the letter would be
delivered in the ordinary course of post, unless the contrary is
proved… ..
(3) Subsections (1) and (2) apply whether the expression ‘deliver’, ‘give’, ‘
notify’, ‘send’ or ‘serve’ or another expression is used.
[37] Under s 7 the term “Act” is defined to include statutory instruments under
the Act.
[38] The first question here is whether under the BCCM legislation and
documents that bind the parties under the scheme “an Act requires or
permits a document to be served by post.”2 I am satisfied that the Act and
scheme, including the Commercial Module which this scheme has
adopted, permits a vote to be duly given if it is “given” to the secretary at
or before the start of the meeting.3
[39] The question then is whether on the evidence the applicant gave a vote to
the secretary before the meeting. Under s 39A(1)(b) of the Acts
Interpretation Act 1954 service is taken to have been effected when the
letter would have been delivered in the ordinary course of post “unless the
contrary is proved”.
1
Commercial Module s 39.
2
Ibid 39A(1).
3
Ibid 54(2).
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[34]
37(3), 38(4)(e), 39(3) and 40(c) of the Commercial Module, and s 320 of
the BCCM Act.
The applicants further argued that the earlier motion at the April AGM
which gave initial approval to the air conditioning scheme should also be
treated as invalid. But once again no relief was sought to invalidate it, and
that issue was not in dispute. The ground now raised concerns the form of
the voting paper distributed before the meeting. The applicants complain
that “motion 14 made no provision to vote at all — only YES”. The
argument seems unpromising when full account is taken of the provisions
of the Commercial Module concerning voting on a motion that offers
alternatives.’ However this is a further issue that the applicants now seek
to raise for the first time on appeal. No legal error occurred, and | have no
jurisdiction to entertain these points.
Whether Ballada cast a valid vote
[35]
[36]
[37]
[38]
[39]
Ballada claims to have provided a vote by means of the post.
Section 39A of the Acts Interpretation Act 1954 relevantly provides:
(1) | If an Act requires or permits a document to be served by post, service —
(a) may be effected by properly addressing, pre-paying and posting the
document as a letter; and
(b) is taken to have been effected at the time at which the letter would be
delivered in the ordinary course of post, unless the contrary is
proved... ..
(3) Subsections (1) and (2) apply whether the expression ‘deliver’, ‘give’,
notify’, ‘send’ or ‘serve’ or another expression is used.
Under s 7 the term “Act” is defined to include statutory instruments under
the Act.
The first question here is whether under the BCCM legislation and
documents that bind the parties under the scheme “an Act requires or
permits a document to be served by post.” | am satisfied that the Act and
scheme, including the Commercial Module which this scheme has
adopted, permits a vote to be duly given if it is “given” to the secretary at
or before the start of the meeting.°
The question then is whether on the evidence the applicant gave a vote to
the secretary before the meeting. Under s 39A(1)(b) of the Acts
Interpretation Act 1954 service is taken to have been effected when the
letter would have been delivered in the ordinary course of post “unless the
contrary is proved”.
Commercial Module s 39.
Ibid 39A(1).
Ibid 54(2).
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[40] There was evidence upon which the Adjudicator could be satisfied that the
contrary was proved. There was evidence that no such vote was received,
and the Adjudicator was entitled to act upon it. There is no error of law in
the Adjudicator’s approach to the matter. Indeed, she endeavoured to
obtain greater particularity from Ballada concerning the method of postage
and other relevant data, but the applicants provided no further evidence in
support of their claims.4
[41] It is true that Mr Kildey had indicated that he intended to vote no and that
the manager and committee were probably aware of this. But there is a
substantial difference between notification of an intention and the casting
of an actual vote.5 This claim failed on evidence that was reasonably
capable of acceptance, and no error of law is disclosed in the
determination of this issue.
Other points alleging invalidity of the meeting
[42] A variety of further issues were raised, including invalidity based on the
fact that the body corporate does not maintain a mailbox. The
Commercial Module requires the body corporate to either maintain a
mailbox or make suitable alternative arrangements for the receipt of mail.
There was evidence that the body corporate has made suitable alternative
arrangements, namely receipt on its behalf by the body corporate
manager, SSKB.6 It was therefore open to the Adjudicator to hold that the
body corporate did not breach the requirements of the Commercial
Module about which complaint was made, and that the arrangements
made for notices concerning the EGM and voting thereon were compliant
with the relevant procedural requirements of the Commercial Module.
[43] The Adjudicator observed inter alia that it is likely that in fact North Point
has a better standard of tracking incoming correspondence than most
bodies corporate. There is no merit in the applicants’ point, and no legal
error has been shown on the part of the Adjudicator.
[44] The same may be said of a barrage of further points now raised
concerning alleged technical inadequacy of the notice of meeting, and
other documents and procedures connected with the meeting. Overall
there is no reason to think that any reasonable recipient was deprived of
the opportunity of voting as he or she might have wished to vote.
Alleged invalidity of resolutions
[45] It was alleged that the motions were confusing and misleading and
accordingly invalid, and that the information provided to the owners in the
motions and material relating to them was inadequate.
[46] As to this, the Adjudicator observed:
4
See Adjudicator’s reasons for decision, at [57].
5
Ibid [52].
6
Ibid [79].
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[40]
[41]
There was evidence upon which the Adjudicator could be satisfied that the
contrary was proved. There was evidence that no such vote was received,
and the Adjudicator was entitled to act upon it. There is no error of law in
the Adjudicator’s approach to the matter. Indeed, she endeavoured to
obtain greater particularity from Ballada concerning the method of postage
and other relevant data, but the applicants provided no further evidence in
support of their claims.*
It is true that Mr Kildey had indicated that he intended to vote no and that
the manager and committee were probably aware of this. But there is a
substantial difference between notification of an intention and the casting
of an actual vote.° This claim failed on evidence that was reasonably
capable of acceptance, and no error of law is disclosed in the
determination of this issue.
Other points alleging invalidity of the meeting
[42]
[43]
[44]
A variety of further issues were raised, including invalidity based on the
fact that the body corporate does not maintain a mailbox. The
Commercial Module requires the body corporate to either maintain a
mailbox or make suitable alternative arrangements for the receipt of mail.
There was evidence that the body corporate has made suitable alternative
arrangements, namely receipt on its behalf by the body corporate
manager, SSKB.° It was therefore open to the Adjudicator to hold that the
body corporate did not breach the requirements of the Commercial
Module about which complaint was made, and that the arrangements
made for notices concerning the EGM and voting thereon were compliant
with the relevant procedural requirements of the Commercial Module.
The Adjudicator observed inter alia that it is likely that in fact North Point
has a better standard of tracking incoming correspondence than most
bodies corporate. There is no merit in the applicants’ point, and no legal
error has been shown on the part of the Adjudicator.
The same may be said of a barrage of further points now raised
concerning alleged technical inadequacy of the notice of meeting, and
other documents and procedures connected with the meeting. Overall
there is no reason to think that any reasonable recipient was deprived of
the opportunity of voting as he or she might have wished to vote.
Alleged invalidity of resolutions
[45]
[46]
It was alleged that the motions were confusing and misleading and
accordingly invalid, and that the information provided to the owners in the
motions and material relating to them was inadequate.
As to this, the Adjudicator observed:
See Adjudicator’s reasons for decision, at [57].
Ibid [52].
Ibid [79].
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On their face, the motions and the supporting information appear relatively
straight forward. In the absence of any more detail, I am unclear how or
why the applicants consider them confusing or misleading. I am not
satisfied there is sufficient basis to invalidate the motions.
[47] There is nothing in this point and no error is shown.
[48] The Adjudicator then mentioned some further alternative grounds on
which the application must fail even if Ballada’s adverse vote had been
cast, observing:
Even if the second respondent had voted against the motions with more
information, that vote would not have changed the outcome of any of the
resolutions.
[49] That observation is based on the Adjudicator’s conclusion that the motions
listed as requiring a resolution without dissent actually required to be
carried only as ordinary resolutions.7
[50] Motions 2 and 4 sought to rescind previous budget and levy motions
which had been passed by ordinary resolution. A motion may be revoked
by a motion of the same type.8 Motion 6 was for the appointment of a
project manager for the air conditioning works. It was not mentioned in the
adjudication application. It does not dispose of property, and no basis is
advanced in the applicants’ submissions for its requiring a resolution
without dissent. Motion 8 dealt with assignment to the lot owners of the
body corporate of ownership of the new systems within each lot. Under
s 123 of the Commercial Module the body corporate may deal with a body
corporate asset by ordinary resolution. Disposal of common property of
course requires a resolution without dissent. However, the view is open
that acquisition or replacement of air-conditioning units in the individual
lots involved neither acquisition nor disposal of common property, and that
it amounted to dealing with body corporate assets that were not part of the
common property. It is also arguable that the replacement of the systems
in the units was an improvement within the meaning of s 119 of the
Commercial Module, and that an ordinary resolution is sufficient
authorisation for the making of such improvements, though I hold doubts
about this, and would not base my decision on that premise. On either of
these bases a vote by the applicant against motion 8 would not have been
sufficient defeat the motion.
[51] No separate point was made to suggest that the applicants were
prejudiced by the error of describing these motions as “motions by
resolution without dissent”.
[52] The applicants’ main case is that Ballada cast a valid vote, and that the
resolutions which were required to be carried without dissent were
therefore not appropriately carried. That has been totally undermined by
7
Ibid [64] and [65].
8
Commercial Module s 62.
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[47]
[48]
[49]
[50]
[51]
[52]
10
On their face, the motions and the supporting information appear relatively
straight forward. In the absence of any more detail, | am unclear how or
why the applicants consider them confusing or misleading. | am not
satisfied there is sufficient basis to invalidate the motions.
There is nothing in this point and no error is shown.
The Adjudicator then mentioned some further alternative grounds on
which the application must fail even if Ballada’s adverse vote had been
cast, observing:
Even if the second respondent had voted against the motions with more
information, that vote would not have changed the outcome of any of the
resolutions.
That observation is based on the Adjudicator’s conclusion that the motions
listed as requiring a resolution without dissent actually required to be
carried only as ordinary resolutions.”
Motions 2 and 4 sought to rescind previous budget and levy motions
which had been passed by ordinary resolution. A motion may be revoked
by a motion of the same type.® Motion 6 was for the appointment of a
project manager for the air conditioning works. It was not mentioned in the
adjudication application. It does not dispose of property, and no basis is
advanced in the applicants’ submissions for its requiring a resolution
without dissent. Motion 8 dealt with assignment to the lot owners of the
body corporate of ownership of the new systems within each lot. Under
s 123 of the Commercial Module the body corporate may deal with a body
corporate asset by ordinary resolution. Disposal of common property of
course requires a resolution without dissent. However, the view is open
that acquisition or replacement of air-conditioning units in the individual
lots involved neither acquisition nor disposal of common property, and that
it amounted to dealing with body corporate assets that were not part of the
common property. It is also arguable that the replacement of the systems
in the units was an improvement within the meaning of s 119 of the
Commercial Module, and that an ordinary resolution is sufficient
authorisation for the making of such improvements, though | hold doubts
about this, and would not base my decision on that premise. On either of
these bases a vote by the applicant against motion 8 would not have been
sufficient defeat the motion.
No separate point was made to suggest that the applicants were
prejudiced by the error of describing these motions as “motions by
resolution without dissent”.
The applicants’ main case is that Ballada cast a valid vote, and that the
resolutions which were required to be carried without dissent were
therefore not appropriately carried. That has been totally undermined by
Ibid [64] and [65].
Commercial Module s 62.
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the finding that no such vote was in fact cast. It would be additionally
undermined if the resolutions did not need to be carried without dissent.
[53] In my view the Adjudicator was probably correct in considering that in the
circumstances none of the motions were of a kind that the relevant
module and rules would require to be carried without dissent, although I
have reservations about motion 8. But it is not necessary to express
concluded views on these points, as in fact no adverse vote was cast by
Ballada, and all the motions were carried without dissent.
[54] The resolutions were said to be invalid on other grounds also. The basis
of these submissions is not entirely clear, but they seem to be founded on
unreasonableness and possibly on bad faith. Underlying these complaints
are challenges to the wisdom or need of any change of the air
conditioning service at all.
[55] The applicants asserted that the air conditioning upgrade was “completely
inappropriate” for funding by a body corporate. No comprehensible case
was made out to satisfy that assertion. It is also alleged that the
resolutions were invalid because they had the effect of creating
insolvency, but that allegation was not made out by any acceptable
evidence.
[56] Reference was made to oppression and to the perception that certain
decisions unduly favoured one sector or group of unit owners over others.
In a scheme that serves a mixed commercial and residential community,
there is considerable scope for difference of view as to the overall needs
of the scheme. The applicants here are apparently in a minority position in
the relevant decision making. In this situation a complainant seeking the
intervention of an adjudicator in a dispute with the body corporate needs
to show a telling case of unreasonableness or breach of some identifiable
duty. There also needs to be a situation where the Adjudicator possesses
the power to correct the inappropriate conduct.
[57] In the present case I have searched in vain for evidence that makes good
the above assertions. There is nothing whatever that offers engineering,
structural or economic insights. That the applicants disagree with various
decisions that have been made is not in doubt. But no attempt was made
to provide objective evidence of the alleged vice of the scheme, and no
serious case was presented of oppression or unreasonableness. Nor is
there any clear picture of the views of the rest of the community.
[58] The body corporate’s duty to maintain the common property included the
utility infrastructure. This includes the whole structure that takes the
system to the individual lots. The body corporate had the right to upgrade
or replace the utility infrastructure if that course was considered
appropriate.9 The carrying of the motions at the meetings of April and July
shows that that course was considered appropriate, and no objective
basis has been shown for interference with such decisions.
9
See Adjudicator’s reasons for decision, at [85] to [95].
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[53]
[54]
[55]
[56]
[57]
[58]
11
the finding that no such vote was in fact cast. It would be additionally
undermined ifthe resolutions did not need to be carried without dissent.
In my view the Adjudicator was probably correct in considering that in the
circumstances none of the motions were of a kind that the relevant
module and rules would require to be carried without dissent, although |
have reservations about motion 8. But it is not necessary to express
concluded views on these points, as in fact no adverse vote was cast by
Ballada, and all the motions were carried without dissent.
The resolutions were said to be invalid on other grounds also. The basis
of these submissions is not entirely clear, but they seem to be founded on
unreasonableness and possibly on bad faith. Underlying these complaints
are challenges to the wisdom or need of any change of the air
conditioning service at all.
The applicants asserted that the air conditioning upgrade was “completely
inappropriate” for funding by a body corporate. No comprehensible case
was made out to satisfy that assertion. It is also alleged that the
resolutions were invalid because they had the effect of creating
insolvency, but that allegation was not made out by any acceptable
evidence.
Reference was made to oppression and to the perception that certain
decisions unduly favoured one sector or group of unit owners over others.
In a scheme that serves a mixed commercial and residential community,
there is considerable scope for difference of view as to the overall needs
of the scheme. The applicants here are apparently in a minority position in
the relevant decision making. In this situation a complainant seeking the
intervention of an adjudicator in a dispute with the body corporate needs
to show a telling case of unreasonableness or breach of some identifiable
duty. There also needs to be a situation where the Adjudicator possesses
the power to correct the inappropriate conduct.
In the present case | have searched in vain for evidence that makes good
the above assertions. There is nothing whatever that offers engineering,
structural or economic insights. That the applicants disagree with various
decisions that have been made is not in doubt. But no attempt was made
to provide objective evidence of the alleged vice of the scheme, and no
serious case was presented of oppression or unreasonableness. Nor is
there any clear picture of the views of the rest of the community.
The body corporate’s duty to maintain the common property included the
utility infrastructure. This includes the whole structure that takes the
system to the individual lots. The body corporate had the right to upgrade
or replace the utility infrastructure if that course was considered
appropriate.° The carrying of the motions at the meetings of April and July
shows that that course was considered appropriate, and no objective
basis has been shown for interference with such decisions.
See Adjudicator’s reasons for decision, at [85] to [95].
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[59] The applicants have expressed concern that the promoter and principal
beneficiary of the change of system is the QPCU. While that may so far
appear to be the case because of the sequence in which the work has so
far been performed, the Adjudicator observed:
If the body corporate fails to proceed with the remainder of the air
conditioning upgrade within a reasonable time, or fails to pass a motion
submitted by either the committee or an owner to proceed with the
remainder of the upgrade, any concerned owner could challenge the body
corporate as unreasonable or failing to properly maintain common property
infrastructure. On its face it would certainly seem unreasonable if the body
corporate were not to complete the air conditioning upgrade to the
remainder of the building within the foreseeable future.10
[60] I agree with the Adjudicator’s conclusion that there is insufficient evidence
to determine that the body corporate’s decision to upgrade was
unreasonable.
[61] In the light of the earlier unanimous decision made at the Annual General
Meeting, the upgrading of the air conditioning was prima facie a matter for
the relevant community to determine, and no case has been made out of
oppression or of any other basis for external interference.
[62] The finding that the upgrade was properly authorised and paid for by the
body corporate11 is in accordance with the evidence.
[63] No error of law is apparent in the refusal by the Adjudicator to treat the
motions as inherently invalid, or as invalid on any of the grounds litigated.
Claim against QPCU for payment of cost of air conditioning project
[64] The applicants’ claim is that QPCU must reimburse the body corporate for
the cost of the air-conditioning project. The legal basis of such an
obligation enforceable against the QPCU by the applicants is obscure.
The assumption underlying such a claim seems to be that the whole air
conditioning project was never properly authorised by the body corporate,
and that the QPCU somehow wrongfully caused it to be installed, or
wrongfully induced the body corporate to install it and pay for it, and must
therefore repay the body corporate’s expenditure. But no evidence was
produced to support these assumptions.
[65] Unless the EGM resolutions are set aside as invalid, the first assumption
(that there was no authorisation to spend body corporate funds on such a
project) is clearly incorrect. The Adjudicator has found that the air
conditioning upgrade was properly authorised and paid for by the body
corporate and no error of law is shown that can invalidate such findings.
10
Ibid [92].
11
Ibid [97].
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[59]
[60]
[61]
[62]
[63]
12
The applicants have expressed concern that the promoter and principal
beneficiary of the change of system is the QPCU. While that may so far
appear to be the case because of the sequence in which the work has so
far been performed, the Adjudicator observed:
If the body corporate fails to proceed with the remainder of the air
conditioning upgrade within a reasonable time, or fails to pass a motion
submitted by either the committee or an owner to proceed with the
remainder of the upgrade, any concerned owner could challenge the body
corporate as unreasonable or failing to properly maintain common property
infrastructure. On its face it would certainly seem unreasonable if the body
corporate were not to complete the air conditioning upgrade to the
remainder of the building within the foreseeable future."
| agree with the Adjudicator’s conclusion that there is insufficient evidence
to determine that the body corporate’s decision to upgrade was
unreasonable.
In the light of the earlier unanimous decision made at the Annual General
Meeting, the upgrading of the air conditioning was prima facie a matter for
the relevant community to determine, and no case has been made out of
oppression or of any other basis for external interference.
The finding that the upgrade was properly authorised and paid for by the
body corporate"" is in accordance with the evidence.
No error of law is apparent in the refusal by the Adjudicator to treat the
motions as inherently invalid, or as invalid on any of the grounds litigated.
Claim against QPCU for payment of cost of air conditioning project
[64]
[65]
10
The applicants’ claim is that QPCU must reimburse the body corporate for
the cost of the air-conditioning project. The legal basis of such an
obligation enforceable against the QPCU by the applicants is obscure.
The assumption underlying such a claim seems to be that the whole air
conditioning project was never properly authorised by the body corporate;
and that the QPCU somehow wrongfully caused it to be installed, or
wrongfully induced the body corporate to install it and pay for it, and must
therefore repay the body corporate’s expenditure. But no evidence was
produced to support these assumptions.
Unless the EGM resolutions are set aside as invalid, the first assumption
(that there was no authorisation to spend body corporate funds on such a
project) is clearly incorrect. The Adjudicator has found that the air
conditioning upgrade was properly authorised and paid for by the body
corporate and no error of law is shown that can invalidate such findings.
Ibid [92].
Ibid [97].
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[66] In the absence of any established basis for determining that the EGM
notice or resolutions should be invalidated, there is no basis for such costs
to be paid by another party such as the QPCU.
[67] The applicants have not articulated any comprehensible cause of action
that they have against the QPCU. Neither have they articulated any claim
against the body corporate requiring it to bring such action.
QPCU Earnings from rental of Car-Spaces
[68] A raft of issues were raised in relation to the claim that the QPCU must
pay the body corporate any income it has earned from renting out its
exclusive use car spaces.
[69] The history of the allocation of exclusive use car parking areas in this
scheme dating back to 1987 has been to some extent canvassed by the
Adjudicator in paragraphs [101] – [102] of the reasons for judgment. The
area of concern to the applicants is lot 3 from which QPCU carries on a
business of a credit union with customers coming and going via the upper
level car park. The applicants assert that the charging of fees or rent by
the QPCU with respect to the use of such areas is unauthorised and
unlawful, and interferes with private property rights of lot owners.
[70] Exclusive use areas are a familiar feature of lot ownership. Sections 170
to 177 of the BCCM Act deal with the subject of exclusive use by-laws and
authorise the adoption of such by-laws. Grants of exclusive use to areas
of common property are normally made through exclusive use by-laws
recorded in the CMS.
[71] Section 170(1) provides:
An exclusive use by-law, for a community titles scheme, is a by-law that
attaches to a lot included in the scheme, and gives the occupier of the lot
for the time being exclusive use to the rights and enjoyment of, or other
special rights about –
(a) common property; or
(b) a body corporate asset.
[72] The relevant by-law for present purposes is number 30. It is duly
registered. It recognises the entitlement of each owner of a lot identified
in a schedule as “entitled to the exclusive use and enjoyment for
themselves and their licensees of their respective car parking spaces.” It
imposes a duty on the owner to keep the spaces clean and tidy, to use
them only for the purposes of car parking, and not to use them so as to
create a nuisance.
[73] The submission of the applicants is that there is no provision in by-law 30
about the rents to accrue to QPCU. That is true: the subject is simply not
mentioned.
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[66]
[67]
13
In the absence of any established basis for determining that the EGM
notice or resolutions should be invalidated, there is no basis for such costs
to be paid by another party such as the QPCU.
The applicants have not articulated any comprehensible cause of action
that they have against the QPCU. Neither have they articulated any claim
against the body corporate requiring it to bring such action.
QPCU Earnings from rental of Car-Spaces
[68]
[69]
[70]
[71]
[72]
[73]
A raft of issues were raised in relation to the claim that the QPCU must
pay the body corporate any income it has earned from renting out its
exclusive use Car spaces.
The history of the allocation of exclusive use car parking areas in this
scheme dating back to 1987 has been to some extent canvassed by the
Adjudicator in paragraphs [101] — [102] of the reasons for judgment. The
area. of concern to the applicants is lot 3 from which QPCU carries ona
business of a credit union with customers coming and going via the upper
level car park. The applicants assert that the charging of fees or rent by
the QPCU with respect to the use of such areas is unauthorised and
unlawful, and interferes with private property rights of lot owners.
Exclusive use areas are a familiar feature of lot ownership. Sections 170
to 177 of the BCCM Act deal with the subject of exclusive use by-laws and
authorise the adoption of such by-laws. Grants of exclusive use to areas
of common property are normally made through exclusive use by-laws
recorded in the CMS.
Section 170(1) provides:
An exclusive use by-law, for a community titles scheme, is a by-law that
attaches to a lot included in the scheme, and gives the occupier of the lot
for the time being exclusive use to the rights and enjoyment of, or other
special rights about —
(a) common property; or
(b) a body corporate asset.
The relevant by-law for present purposes is number 30. It is duly
registered. It recognises the entitlement of each owner of a lot identified
in a schedule as “entitled to the exclusive use and enjoyment for
themselves and their licensees of their respective car parking spaces.” It
imposes a duty on the owner to keep the spaces clean and tidy, to use
them only for the purposes of car parking, and not to use them so as to
create a nuisance.
The submission of the applicants is that there is no provision in by-law 30
about the rents to accrue to QPCU. That is true: the subject is simply not
mentioned.
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[74] The submission continues that exclusive use is not the equivalent of an
estate in fee simple, and again this seems correct. It is a statutory right in
the nature of the contract involving multiple parties:12
Once it is registered, the community management statement takes effect
as a statutory contract between the body corporate, each member of the
body corporate, each registered proprietor and each occupier of a lot or
common property.13
[75] Section 129 of the Commercial Module provides that an exclusive use by-
law may impose conditions, including conditions regarding payments to
the body corporate or lot owners.
[76] By-law 30 imposes no special limitations or conditions upon the grant of
exclusive use to the QPCU of the designated areas. The fact that the body
corporate has not at any stage chosen to fetter the grant or to impose
special conditions by requiring recompense to itself for any activity in the
relevant areas may be itself illuminating. It did not choose to exercise any
such power or impose any such condition.
[77] In my view a party who has the exclusive right to use and possess
property prima facie has the right to its fruits and profits. Unless particular
types of dealing are prohibited with respect to the subject spaces, or some
special limitation is imposed, persons with the right of exclusive use are
entitled to retain such profits as they can make from lawful use of the
property, provided of course they do not create a nuisance or permit it to
be used for some purpose other than car parking. It is significant that by-
law 30 contemplates the exclusive use and enjoyment not only of lot
owners, but also “their licensees”. “Licensees” is not limited in any way
such as to bare licensees, and would include licensees who pay for the
privilege. It is likely that many lot owners who do not personally need to
use their exclusive use car places make arrangements for reward with
third parties to use those spaces. It would be surprising if any lot owner
holding the benefit of an exclusive use car space were obliged to account
to the body corporate for any benefits received in respect of it.
[78] In the absence of some special limitation in an exclusive use by-law, I
consider that the grant of the exclusive use of a car parking space permits
the grantee to grant a license to others and to retain the profits of lawful
use of the space. There is no obligation to account to the body corporate
for any such profits, at least under an exclusive use by-law such as by-law
30.
[79] A number of other points were raised both before the Adjudicator and on
appeal in relation to the car park area, including a suggestion of invalidity
of the original body corporate decisions granting the exclusive use,
although no clear legal objection was formulated.
12
North Wind Pty Ltd v Proprietors – Strata Plan 3143 [1981] 2 NSWLR 809, 814;
Independent Finance Group Pty Ltd v Mytan Pty Ltd & Anor [2001 QCA 306 at [88] per
Atkinson J, with whom the other members of the court agreed (“Mytan”).
13
Mytan at [88].
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[74]
[75]
[76]
[77]
[78]
[79]
14
The submission continues that exclusive use is not the equivalent of an
estate in fee simple, and again this seems correct. It is a statutory right in
the nature of the contract involving multiple parties: '
Once it is registered, the community management statement takes effect
as a statutory contract between the body corporate, each member of the
body corporate, each registered proprietor and each occupier of a lot or
common property."
Section 129 of the Commercial Module provides that an exclusive use by-
law may impose conditions, including conditions regarding payments to
the body corporate or lot owners.
By-law 30 imposes no special limitations or conditions upon the grant of
exclusive use to the QPCU of the designated areas. The fact that the body
corporate has not at any stage chosen to fetter the grant or to impose
special conditions by requiring recompense to itself for any activity in the
relevant areas may be itself illuminating. It did not choose to exercise any
such power or impose any such condition.
In my view a party who has the exclusive right to use and possess
property prima facie has the right to its fruits and profits. Unless particular
types of dealing are prohibited with respect to the subject spaces, or some
special limitation is imposed, persons with the right of exclusive use are
entitled to retain such profits as they can make from lawful use of the
property, provided of course they do not create a nuisance or permit it to
be used for some purpose other than car parking. It is significant that by-
law 30 contemplates the exclusive use and enjoyment not only of lot
owners, but also “their licensees”. “Licensees” is not limited in any way
such as to bare licensees, and would include licensees who pay for the
privilege. It is likely that many lot owners who do not personally need to
use their exclusive use car places make arrangements for reward with
third parties to use those spaces. It would be surprising if any lot owner
holding the benefit of an exclusive use car space were obliged to account
to the body corporate for any benefits received in respect of it.
In the absence of some special limitation in an exclusive use by-law, |
consider that the grant of the exclusive use of a car parking space permits
the grantee to grant a license to others and to retain the profits of lawful
use of the space. There is no obligation to account to the body corporate
for any such profits, at least under an exclusive use by-law such as by-law
30.
A number of other points were raised both before the Adjudicator and on
appeal in relation to the car park area, including a suggestion of invalidity
of the original body corporate decisions granting the exclusive use,
although no clear legal objection was formulated.
North Wind Pty Ltd v Proprietors — Strata Plan 3143 [1981] 2 NSWLR 809, 814;
Independent Finance Group Pty Ltd v Mytan Pty Ltd & Anor [2001 QCA 306 at [88] per
Atkinson J, with whom the other members of the court agreed (“Mytan’).
Mytan at [88].
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[80] In this instance I am prepared to say that these points are adequately
dealt with by the Adjudicator in her carefully prepared reasons for
judgment from paragraphs [99] to [111] and that I agree with those
reasons and conclusions.
[81] Even if a claim had been articulated against the body corporate requiring
it to reverse its grant of exclusive use to the QPCU, and requiring it to
endeavour to recoup any income which QPCU gained from such activities,
no basis is shown upon which success could be expected in relation to
any such claim.
[82] In short no error of law is shown with respect to the Adjudicator’s decision
in this area, and no basis is shown for the relief which the applicants seek.
Claim against QPCU concerning its installation and use of an ATM in the
foyer of the common property
[83] The applicants sought an order that the QPCU must forthwith account for
the body corporate for rental and compensation for the ATM which was
installed in the ground floor lobby. The amount was specified to be
$12,580.00 in the first year, increasing by 4% per annum. There was a
further claim that QPCU be required to execute a lease, be responsible for
all electricity used, and other declaratory relief requiring the payment of all
reinstatement costs if and when the ATM is removed.
[84] There is evidence that the QPCU installed an ATM in the foyer on
common property. The body corporate refers to a resolution “passed
outside a committee meeting” on 17 June 2011 approving the relocation
of the ATM at the expense of QPCU.
[85] No order was sought to set aside the committee resolution and no order
was sought against the body corporate in relation to the validity of the
resolution. The body corporate would be a necessary party if there were to
be a claim that the resolution be set aside.
[86] The applicants have not shown any nexus or entitlement to make a direct
claim against the QPCU for the payment of money. In the absence of
special rights or special loss on the part of an individual lot owner, any
claim for rental and compensation arising out of the use of a machine on
the common property could only be made by the body corporate. If it was
intended that the body corporate should be ordered to bring such a claim
against the QPCU, obviously a specific claim to that effect would have to
be made against the body corporate.
[87] It may well be that the permitting of installation and use of this machine on
the common property amounts to a disposition of common property, and
that such a decision can only be made by a body corporate resolution
without dissent,14 or, depending on the duration of the grant, at least a
14
Katsik alis v Body Corporate for “The Centre” [2009] QCA 77.
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[80]
[81]
[82]
15
In this instance | am prepared to say that these points are adequately
dealt with by the Adjudicator in her carefully prepared reasons for
judgment from paragraphs [99] to [111] and that | agree with those
reasons and conclusions.
Even if a claim had been articulated against the body corporate requiring
it to reverse its grant of exclusive use to the QPCU, and requiring it to
endeavour to recoup any income which QPCU gained from such activities,
no basis is shown upon which success could be expected in relation to
any such claim.
In short no error of law is shown with respect to the Adjudicator’s decision
in this area, and no basis is shown for the relief which the applicants seek.
Claim against QPCU concerning its installation and use of an ATM in the
foyer of the common property
[83]
[84]
[85]
[86]
[87]
14
The applicants sought an order that the QPCU must forthwith account for
the body corporate for rental and compensation for the ATM which was
installed in the ground floor lobby. The amount was specified to be
$12,580.00 in the first year, increasing by 4% per annum. There was a
further claim that QPCU be required to execute a lease, be responsible for
all electricity used, and other declaratory relief requiring the payment of all
reinstatement costs if and when the ATM is removed.
There is evidence that the QPCU installed an ATM in the foyer on
common property. The body corporate refers to a resolution “passed
outside a committee meeting” on 17 June 2011 approving the relocation
of the ATM at the expense of QPCU.
No order was sought to set aside the committee resolution and no order
was sought against the body corporate in relation to the validity of the
resolution. The body corporate would be a necessary party if there were to
be a claim that the resolution be set aside.
The applicants have not shown any nexus or entitlement to make a direct
claim against the QPCU for the payment of money. In the absence of
special rights or special loss on the part of an individual lot owner, any
claim for rental and compensation arising out of the use of a machine on
the common property could only be made by the body corporate. If it was
intended that the body corporate should be ordered to bring such a claim
against the QPCU, obviously a specific claim to that effect would have to
be made against the body corporate.
It may well be that the permitting of installation and use of this machine on
the common property amounts to a disposition of common property, and
that such a decision can only be made by a body corporate resolution
without dissent,’* or, depending on the duration of the grant, at least a
Katsikalis v Body Corporate for “The Centre” [2009] QCA 77.
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special resolution.15 But there was no evidence to justify the making of
any order against the QPCU such as that sought by the applicants. As the
Adjudicator observed, such questions could only be considered in the
context of an application seeking orders against the body corporate. The
applicants may well be able to pursue this grievance in due course, along
lines submitted by the body corporate, namely “the only remedy available
to the appellant… [on this issue].. is to commence a dispute resolution
process against the body corporate, pursuant to s 229 (3)(a) of the
BCCMA”.
Orders
[88] No error of law capable of affecting the outcome has been shown.
[89] The appeal should be dismissed and the decision of the Adjudicator in
North Point Brisbane [2012] QBCCMCmr 355 dated 7 August 2012 should
be confirmed.
15
Commercial Module s 117(2)
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special resolution.'® But there was no evidence to justify the making of
any order against the QPCU such as that sought by the applicants. As the
Adjudicator observed, such questions could only be considered in the
context of an application seeking orders against the body corporate. The
applicants may well be able to pursue this grievance in due course, along
lines submitted by the body corporate, namely “the only remedy available
to the appellant... [on this issue].. is to commence a dispute resolution
process against the body corporate, pursuant to s 229 (3)(a) of the
BCCMA’.
Orders
[88] No error of law capable of affecting the outcome has been shown.
[89] The appeal should be dismissed and the decision of the Adjudicator in
North Point Brisbane [2012] QBCCMCmr 355 dated 7 August 2012 should
be confirmed.
Commercial Module s 117(2)
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