20181085-ASC11 - North Point Brisbane [2012] QBCCMCmr 355

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                    d. Full quotations and specifications were about the air-conditioning system upgrade were
                       provided to owners with the EGM notice. The Committee had been discussing this
                       issue for about a year before the EGM and these discussions were minuted.
                    e. When Kildey requested further information prior to the EGM he was given a quote to
                       provide the records and for more detail of his request. He did not respond.
         [35]   The submission from the one lot owner supports the application. It argues:
                    a. Comments in the interim order decision are disputed. The applicant only needed to
                       demonstrate the voting paper was addressed with prepaid postage and sent. It is clear
                       this occurred. The Body Corporate should prove the voting paper was not received in
                       the ordinary course of post.
                    b. With ‘uncontradicted’ evidence of a no vote, Motion 2, 4 and 8 should be defeated.
                    c. Motions 2, 4 and 8 required a resolution without dissent as they have a significant
                       material impact on the rights of lot owners, including substantial increases to levies.
                    d. Given the importance of the motions and the requirement for them to be resolutions
                       without dissent, the Body Corporate was bound by the substance of the negative vote
                       which was communicated to it by email rather than the form for the vote.
                    e. The Body Corporate had a strict duty to obtain an independent engineer’s assessment
                       on the air-conditioning system before engaging any contractor. The replacement of the
                       system was not based on sound engineering principles. There was no attempt to
                       provide relevant information to lot owners. This is contrary to section 152 of the Act.
                    f. The full cost of the air-conditioning works is not known to owners.
                    g. The use of the sinking fund for utility infrastructure that solely benefits the majority lot
                       owner is contrary to the regulations. Sections 115(3), 120, 125(2) and 126(4) of the
                       Commercial Module oblige lot owners to pay for their own utility infrastructure.
         [36]   The applicants’ reply to submissions includes:
                    a. Each lot has an individual fan coil unit that has been maintained by each owner. They
                       are not Body Corporate assets. Lots are separately metered for after hours air-
                       conditioning. The central tower provides air to each unit and is a Body Corporate asset.
                    b. QPCU has replaced its fan coil units. The water cooling tower was not replaced.
                    c. A resolution which purports to use Body Corporate funds for non-Body Corporate
                       purposes is not valid regardless of the vote. The Body Corporate cannot use its funds
                       for the private financial benefit of QPCU.
                QPCU issues
         [37]   QPCU owns 35 of the 76 lots in the scheme. It operates its credit union business from the
                ground and first floors of the building, and owns several other lots in the scheme.
         [38]   The applicants seek orders against QPCU in regard to three issues: the air-conditioning
                project; the rental of exclusive use car spaces; and the installation of an automatic teller
                machine (ATM) on common property. The applicants wrote to QPCU on 20 February 2012
                referring to the outcomes against QPCU in its amended application and that it believed there
                was a dispute on those matters. The applicants claim QPCU did not respond.
         [39]   In regard to the air-conditioning project, the applicants claim QPCU had decided to refurbish its
                premises, including installing new air-conditioning. Individual air-conditioning within lots has
                been maintained by individual owners. However, the applicants claim QPCU decided the Body
                Corporate should pay for its new air-conditioning and then transfer it free of charge. The
                applicants assert there was no authorisation of the Body Corporate expenditure of $385,800
                plus GST for QPCU’s new air-conditioning so the money should be repaid by QPCU.
         [40]   The applicants claim no information was given on the upgrade of the remainder of the building
                or the cost of that work. Further, they say the Body Corporate has insufficient assets or
                budgetary provision to meet the required expenditure for the EGM resolutions, which will make
                North Point insolvent. Comments are made about the Committee meeting following the EGM.


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4GVTKGXGFHTQO#WUV.++QP/CTEJCV                                                            8GTKH[XGTUKQP


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d. Full quotations and specifications were about the air-conditioning system upgrade were
provided to owners with the EGM notice. The Committee had been discussing this
issue for about a year before the EGM and these discussions were minuted.

e. When Kildey requested further information prior to the EGM he was given a quote to
provide the records and for more detail of his request. He did not respond.

[35] The submission from the one lot owner supports the application. It argues:

a. Comments in the interim order decision are disputed. The applicant only needed to
demonstrate the voting paper was addressed with prepaid postage and sent. It is clear
this occurred. The Body Corporate should prove the voting paper was not received in
the ordinary course of post.

b. With ‘uncontradicted’ evidence of a no vote, Motion 2, 4 and 8 should be defeated.

c. Motions 2, 4 and 8 required a resolution without dissent as they have a significant
material impact on the rights of lot owners, including substantial increases to levies.

d. Given the importance of the motions and the requirement for them to be resolutions
without dissent, the Body Corporate was bound by the substance of the negative vote
which was communicated to it by email rather than the form for the vote.

e. The Body Corporate had a strict duty to obtain an independent engineer’s assessment
on the air-conditioning system before engaging any contractor. The replacement of the
system was not based on sound engineering principles. There was no attempt to
provide relevant information to lot owners. This is contrary to section 152 of the Act.

f. The full cost of the air-conditioning works is not known to owners.

g. The use of the sinking fund for utility infrastructure that solely benefits the majority lot
owner is contrary to the regulations. Sections 115(3), 120, 125(2) and 126(4) of the
Commercial Module oblige lot owners to pay for their own utility infrastructure.

{36} The applicants’ reply to submissions includes:

a. Each lot has an individual fan coil unit that has been maintained by each owner. They
are not Body Corporate assets. Lots are separately metered for after hours air-
conditioning. The central tower provides air to each unit and is a Body Corporate asset.

b. QPCU has replaced its fan coil units. The water cooling tower was not replaced.

c. A resolution which purports to use Body Corporate funds for non-Body Corporate
purposes is not valid regardless of the vote. The Body Corporate cannot use its funds
for the private financial benefit of QPCU.

QPCU issues

(377 QPCU owns 35 of the 76 lots in the scheme. It operates its credit union business from the
ground and first floors of the building, and owns several other lots in the scheme.

133] The applicants seek orders against QPCU in regard to three issues: the air-conditioning
project; the rental of exclusive use car spaces; and the installation of an automatic teller
machine (ATM) on common property. The applicants wrote to QPCU on 20 February 2012
referring to the outcomes against QPCU in its amended application and that it believed there
was a dispute on those matters. The applicants claim QPCU did not respond.

139] In regard to the air-conditioning project, the applicants claim QPCU had decided to refurbish its
premises, including installing new air-conditioning. Individual air-conditioning within lots has
been maintained by individual owners. However, the applicants claim QPCU decided the Body
Corporate should pay for its new air-conditioning and then transfer it free of charge. The
applicants assert there was no authorisation of the Body Corporate expenditure of $385,800
plus GST for QPCU’s new air-conditioning so the money should be repaid by QPCU.

(40) The applicants claim no information was given on the upgrade of the remainder of the building
or the cost of that work. Further, they say the Body Corporate has insufficient assets or
budgetary provision to meet the required expenditure for the EGM resolutions, which will make
North Point insolvent. Comments are made about the Committee meeting following the EGM.

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