Trieste [2000] QBCCMCmr 12 (17 January 2000)

P G DanielsREFERENCE: 0595-1999

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	388
Name of Scheme:	Trieste
Address of Scheme:	11 Springfield Crescent WHITFIELD NT 4870

TAKE NOTICE that pursuant to an application made under the abovementioned Act by

Ms Robyn Meade, a co-owner of lot 8

P G DanielsI hereby order that the application for the following orders:

1.	A declaration that the Annual General Meeting of the Body Corporate held on 25 August 1999 was void and that all resolutions passed at that meeting were accordingly void;

2.	A declaration which requires the Body Corporate to have its accounts audited by an auditor to be nominated in the Order. The applicant recommends Mr Grant Ellwood, Chartered Accountant, of 185 Mulgrave road, Cairns QLD, 4870;

3.	An Order terminating the engagement of Cairns Strata Management as the Body Corporate Manager;

4.	The appointment of Cairns Body Corporate Management Pty Ltd as interim Body Corporate Managers until such time that a new body corporate manager can be appointed at a general meeting;

5.	An Order that the exclusive use areas previously attaching to lots 1, 2, 3 and 4 remain in force;

6.

An Order that Mr Joseph Stover (Chairman) and Ms Dianne Hooper (Secretary) be removed from the Body Corporate Committee until such time as they can demonstrate knowledge and appreciation of their legal obligations under the provisions of the Body Corporate and Community Management Act 1997 and other appropriate legislation;

7.	A declaration that Robyn Meade be appointed interim Chairman of the Body Corporate Committee and Mr Ruffley as occupier of Lot 7 be appointed interim Secretary of the Body Corporate pending election of officers at a properly constituted general meeting.

is dismissed.1n

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0595-1999

“Trieste” CTS 388

The applicant, Ms Robyn Meade, a co-owner of lot 8, has sought the following orders of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act):

1.	A declaration that the Annual General Meeting of the Body Corporate held on 25 August 1999 was void and that all resolutions passed at that meeting were accordingly void;

2.	A declaration which requires the Body Corporate to have its accounts audited by an auditor to be nominated in the Order. The applicant recommends Mr Grant Ellwood, Chartered Accountant, of 185 Mulgrave Road, Cairns, Qld 4870;

3.	An Order terminating the engagement of Cairns Strata Management as the Body Corporate Manager;

4.	The appointment of Cairns Body Corporate Management Pty Ltd as interim Body Corporate Managers until such time that a new body corporate manager can be appointed at a general meeting;

5.	An Order that the exclusive use areas previously attaching to lots 1, 2, 3 and 4 remain in force;

6.

An Order that Mr Joseph Stover (Chairman) and Ms Dianne Hooper (Secretary) be removed from the Body Corporate Committee until such time as they can demonstrate knowledge and appreciation of their legal obligations under the provisions of the Body Corporate and Community Management Act 1997 and other appropriate legislation;

7.	A declaration that Robyn Meade be appointed interim Chairman of the Body Corporate Committee and Mr Ruffley as occupier of Lot 7 be appointed interim Secretary of the Body Corporate pending election of officers at a properly constituted general meeting.

Section 223(1) provides that an adjudicator may make an order that is just and equitable in the circumstances (including a declaratory order) to resolve a dispute, in the context of a community titles scheme, about –

a) a claimed or anticipated contravention of the Act or the community management statement; or

b) the exercise of rights or powers, or the performance of duties, under this Act or the community management statement; or

c) a claimed or anticipated contravention of the terms, or the termination of, or the exercise of rights or powers under the terms of, or the performance of duties under the terms of an engagement contract or an authorisation contract.

An order may require a person to act, or prohibit a person from acting, in a way stated in the order (section 223(2)). An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 230(1)).

I will separately consider each order sought and the relevant grounds.

1.	A Declaration that the Annual General Meeting of the Body Corporate held on 25 August 1999 was void and that all resolutions passed at that meeting were accordingly void.

The applicant seeks this order on the basis that the agenda for the meeting was not prepared by the Committee. She submits that the statement in the agenda that the motions had been proposed by the Committee is untrue and misleading.

Section 45 of the Body Corporate and Community Management (Standard Module) Regulation 1997 (the Regulation) provides that the Committee must prepare an agenda for each general meeting.

The applicant was an ordinary member of the Committee prior to the meeting. It appears she did not participate in any Committee meeting at which the agenda was discussed and approved.

It seems to me from reading the submissions of the Body Corporate Manager, Chairperson and Secretary that some members of the Committee liaised with the Manager about the content of the agenda. It was then forwarded to members of the Body Corporate.

It appears to me that there has been a contravention of section 45 of the Regulation. The Committee did not pass a resolution at a properly convened meeting that approved an agenda which they had prepared.

The issue that needs to be addressed is whether the contravention justifies making the order which the applicant seeks.

I take into account the following factors in determining that issue. There is no suggestion that the agenda omitted motions that were properly submitted or that there is anything improper about the agenda that was forwarded to owners. The applicant informed the meeting of the irregularities that she discovered. The applicant has not detailed anything that she would have wanted added to or removed from the agenda if she had been consulted. A motion before the meeting was whether to consent to the recording of a new Community Management Statement which included a new set of by-laws. A similar motion was considered at an EGM on 18 June 1999. Prior to that meeting the applicant through her solicitors informed the Body Corporate Manager about changes she wanted to the by-laws. The applicant did have the opportunity to give her views on the by-laws.

I am required by section 223 of the Act to make a just and equitable order. I decline to make an order as requested by the applicant. The applicant has not pointed out anything improper about the agenda. Additionally, members of the Body Corporate who were present at the meeting were informed of the irregularities discovered by the applicant. The meeting proceeded.

2.	A declaration which requires the Body Corporate to have its accounts audited by an auditor to be nominated in the Order. The applicant recommends Mr Grant Ellwood, Chartered Accountant, of 185 Mulgrave Road, Cairns, Qld 4870.

The applicant submits that the order should be made on the basis that during the 1998-1999 financial year for this Body Corporate the Chairman, Secretary and Body Corporate Manager have been involved in the calling of two EGMs and one void AGM. She states that owners should be aware of the costs involved in calling the meetings.

In my view if owners want to know the cost of calling and conducting these meetings then they can inspect the Body Corporate records. Alternatively, the applicant or indeed any other owner can submit a motion to the next general meeting that the accounts for 1998-1999 be audited to identify the costs of calling the meetings. The Body Corporate as a whole can vote on the matter.

I decline to make the order sought.

3.	An Order terminating the engagement of Cairns Strata Management as the Body Corporate Manager.

4.	The appointment of Cairns Body Corporate Management Pty Ltd as interim Body Corporate Managers until such time that a new body corporate manager can be appointed at a general meeting.

The applicant seeks these orders on the basis that the Body Corporate Manager has taken no action to remedy alleged irregularities and inadequacies of the Chairman and Secretary that have been brought to its attention. She has gained the impression that the Body Corporate Manager has given tactical support to the Chairman and Secretary. The applicant is of the view that the failure of the Manager to rectify the alleged breaches contravenes its contract.

The applicant has provided two letters from her solicitors, Miller Harris, to the Body Corporate Manager dated 8 January 1999 and 4 June 1999 which detail the alleged irregularities.

The letter of 8 January 1999 deals with matters relating to the AGM on 20 August 1998 and an EGM held on 8 January 1999. The letter of 4 June 1999 focuses on the EGM of 18 June 1999.

I do not have power to terminate the engagement of Body Corporate Manager. The issue of whether I should appoint a new Body Corporate Manager therefore does not arise.

The Body Corporate must determine if it wants to take action to terminate an agreement with a Body Corporate Manager. Grounds for termination are provided by clause 12 of the contract and section 86 of the Regulation. The Body Corporate in general meeting could pass a resolution to terminate an agreement. Of course, a Body Corporate Manager may not agree that there are grounds to terminate. In such a case, a dispute may arise between the Body Corporate and the Manager which will need to be resolved.

5.	An Order that the exclusive use areas previously attaching to lots 1, 2, 3 and 4 remain in force.

It appears that the Body Corporate approved exclusive-use By-laws for lots 1-4 at its first annual general meeting in 1992. The By-laws were never registered. The By-laws have never attached to lots 1-4. There is no basis on which to make the order sought. I note that the applicant is not an owner of lots 1-4. It seems to me that she does not have an interest in order that is sought: section 192(1)(a) of the Act. I would also decline to make an order on that basis.

6.	An Order that Mr Joseph Stover (Chairman) and Ms Dianne Hooper (Secretary) be removed from the Body Corporate Committee until such time as they can demonstrate knowledge and appreciation of their legal obligations under the provisions of the Body Corporate and Community Management Act 1997 and other appropriate legislation.
7.	A declaration that Robyn Meade be appointed interim Chairman of the Body Corporate Committee and Mr Ruffley as occupier of Lot 7 be appointed interim Secretary of the Body Corporate pending election of officers at a properly constituted general meeting.

Once again, I do not have power to make the order sought. A Body Corporate is free to determine whom it will elect as its Chairman and Secretary. A process is provided by section 25(2)(f) and (3) of the Regulation whereby a Committee member may be removed from office and the vacancy filled. The applicant can invoke that process if she believes there are grounds for their removal. Section 25(2)(f) and (3) provide as follows:

(2) However, a member’s position becomes vacant if the member—

(a) dies; or

(b) becomes ineligible to hold the position; or

(c) resigns by written notice given to the chairperson or secretary; or

(d) is absent from 2 consecutive meetings of the committee without the committee’s leave; or

(e) is convicted (whether or not a conviction is recorded) of an indictable offence; or

(f) is removed from office by ordinary resolution of the body corporate.

(3) The committee must (even though the number of its members may have fallen below a quorum) appoint a person who is eligible to be a member of the committee to fill a vacancy in the position of an executive or ordinary member of the committee, or call a general meeting of the body corporate to fill the vacancy.

It seems the main complaint of the applicant about the current Committee is the absence of formally held Committee meetings. I draw to the attention of the applicant sections 27(2) and 32 of the Regulation which empower a Committee member to require that a Committee meeting take place provided certain conditions are met. Sections 27 and 32 provide as follows:

ú

Who may call committee meetings

27.(1) A meeting of the committee may be called by—

(a) the secretary or, in the secretary’s absence, the chairperson; or

(b) in the absence of both the secretary and the chairperson—another

member of the committee acting with the agreement of enough

members to form a quorum at a meeting of the committee.

(2) The secretary or, in the secretary’s absence, the chairperson, must call

a meeting if asked, in writing, to call the meeting by enough members of

the committee to form a quorum at a meeting of the committee.

(3) The meeting must be held within 21 days after the secretary or

chairperson receives the request to call it.

(4) The secretary and chairperson may both be presumed to be absent if

the request for the meeting, addressed to the secretary and chairperson, is

given at the address for service of the body corporate, and no reply is

received within 7 days.

ú

Quorum at committee meetings

32.(1) At a meeting of the committee a quorum is at least half the

number of voting members of the committee.

Examples of subsection (1)—

1. If there are 6 voting members of the committee, a quorum is 3.

2. If there are 7 voting members of the committee, a quorum is 4.

(2) For deciding whether there is a quorum—

(a) a voting member who is present—

(i) is counted as 1; or

(ii) if the voting member also has the proxies of 1 or more

absent voting members—is counted as 2; and

(b) a non-voting member who is present is not counted, whether or

not the non-voting member also has the proxy of an absent voting

member.

I suggest that the applicant invoke the process provided by section 27(2) in future if she believes that the Committee needs to meet to pass resolutions on Body Corporate matters.

I dismiss the application.