Surfers International [2000] QBCCMCmr 30 (25 January 2000)

P G DanielsREFERENCE: 0770-1999

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	12247
Name of Scheme:	Surfers International
Address of Scheme:	7 Trickett Street SURFERS PARADISE QLD 4217

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

Accommodation Unlimited Pty Ltd the owner of lot 137,

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

1.

An Administrator, namely Ian Willis of Body Corporate Consultants Pty Ltd be appointed to administer the affairs of the Body Corporate for Surfers International until such time as the buildings maintenance, its finances, including administration and sinking funds and 10 year plan are brought to a level deemed satisfactory to comply with the requirements of the Body Corporate and Community Management Act.

2.

The refurbishment of the Surfers International Arcade as approved at the December 1999 AGM be deferred until such time as the buildings Lifts, Fire safety equipment, water pumps, generators, and other utility infrastructure be brought up to the current code and have satisfactory agreements in place for the continued maintenance and repairs of same.

3.	An order by the Commissioner (ref 99-98) dated 15 July 1998 concerning air-conditioning within the building be complied with forthwith.

4.	Rectify current problems with the elevators by engaging City Elevators to repair, replace and maintain the lifts as per Audit and Inspection Report of EMF Griffiths dated May 1999 forthwith.

5.	Rectify faults in Fire Safety equipment and Emergency Lighting by engaging Dayshelf Pty Ltd to carry out required repairs and replacements and servicing forthwith.

6.	Rectify current security concerns by engaging API Security and Frank O’Neill Locksmith to carry out required repairs and replacements forthwith.

is dismissed.1n

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0770-1999

“Surfers International” CMS 12247

The applicant, Accommodation Unlimited Pty Ltd, has sought orders of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act) that:

1.

An Administrator, namely Ian Willis of Body Corporate Consultants Pty Ltd be appointed to administer the affairs of the Body Corporate for Surfers International until such time as the buildings maintenance, its finances, including administration and sinking funds and 10 year plan are brought to a level deemed satisfactory to comply with the requirements of the Body Corporate and Community Management Act.

2.

The refurbishment of the Surfers International Arcade as approved at the December 1999 AGM be deferred until such time as the buildings Lifts, Fire safety equipment, water pumps, generators and other utility infrastructure be brought up to the current code and have satisfactory agreements in place for the continued maintenance and repairs of same.

3.	An order by the Commissioner (ref 99-98) dated 15 July 1998 concerning air-conditioning within the building be complied with forthwith.

4.	Rectify current problems with the elevators by engaging City Elevators to repair, replace and maintain the lifts as per Audit and Inspection report of EMF Griffiths dated May 1999, forthwith.

5.	Rectify faults in Fire Safety Equipment and Emergency Lighting by engaging Dayshelf Pty Ltd to carry out required repairs and replacements and servicing forthwith.

6.	Rectify current security concerns by engaging API Security and Frank O’Neill Locksmith to carry out required repairs and replacements forthwith.

The applicant has sought interim and final orders for all of the above except order 1. The applicant only seeks a final order in respect of order 1. The applicant has been represented by a director named, Graeme John Beattie. The applicant is an owner of a lot and the manager and letting agent. A submission has been received from the Body Corporate Manager, Challenge Strata Management. The submission was sent on behalf of the Committee.

I am initially dealing with the application for interim orders. The application for final orders will be dealt with at a later stage. Section 225(1) provides that an adjudicator may make an interim order if satisfied, on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances to which the application relates. An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 230(1)).

I will deal with orders 3 to 6 separately and then order 2. I have decided on this course as any decision on order 2 will depend on what I decide in respect of orders 3 to 6.

Order 3 – Air-conditioning

The applicant seeks an order that the Body Corporate comply with an order 99-1998 that was made in respect of air-conditioning.

An adjudicator has no power to compel compliance with orders. An order may be enforced through the Magistrates Court pursuant to sections 234 and 235 of the Act.

I will not make the interim order sought. No submissions need to be given in respect of whether I should make a final order in respect of Order 3. I have no power to make such an order. Consequently, the order will not be made.

Order 4 – Elevators

This is the most serious part of the application. I am particularly concerned about this matter due to the potential for personal injury or loss of life.

The applicant has presented evidence that the lifts in this building are in need of repair. The need has persisted for some time. I have been provided with a letter from City Elevator Services Pty Ltd dated 19 January 1998 that relevantly states:

“... we are very concerned in regard to the level of rust throughout the lift installation.

The rust in certain areas such as the landing doors and frames is getting to a point where it could be considered dangerous to allow the lift installation to operate. This was addressed in our letter QG/PP/533A dated 10^th July, 1997 where we offered to repair and reskin the ground floor landing doors, one of the reasons for our offer was because of the rust that was evident at that time.

It has also been brought to our attention that the fans in the lift cars do not offer the ventilation required of them, once again the fans used are of a metal construction and have been effected by rust.

In our opinion the lift steel work is in URGENT need of rust treatment and repainting.”

The applicant obtained a report from consulting engineers, Griffiths Pty Ltd about the work that needed to be done to the lifts. The applicant obtained four quotes from contractors to complete work detailed in the report. The applicant supplied the engineers’ report and four quotes to the Committee in June 1999. The applicant states that no action has been taken in respect of the report and quotes and the matter was not considered at the annual general meeting in December 1999.

The consulting engineers’ report makes recommendations at pages 8 and 9. Mention is made of maintenance items, the corrosion problem and damaged lift buttons. The report also addresses how the lifts can be upgraded.

A further letter dated 9 December 1999 was forwarded from City Elevator Services Pty Ltd that states:

“City Elevator Services (QLD) Pty Ltd wish to advise the owners/Body Corporate Members of Surfers International of our concerns in regard to the rust that is now effecting the reliability of the lift installation.

On Wednesday 8^th December 1999, we received a call in regard to lift number 3 malfunctioning, our technicians investigated the problem and found that due to the rust on the ground floor doors the lift had stopped and trapped passengers inside.

The rust throughout the lift installation is now effecting the reliability of the lift service and if not addressed could be become hazardous to people using the lifts. We will continue to monitor the condition of the doors and the level of rust within the lift shaft and if it is not addressed we will have no alternative but to advise the owners/Body Corporate Members to shut the lifts down due to their condition.”

The important point I take from the letter is that City Elevators is not advising that the lifts should be closed down at that time. Rather, it states that the situation will be monitored.

I have been provided with minutes of a Committee meeting on 14 January 2000 in which the issue of the lifts is addressed in two places as follows:

“City Elevators – Lifts

A schedule received this morning from City Elevators listing details of all service calls made since November 1999 was tabled and considered. It was noted that a number of calls were made either because internal staff had isolated lifts manually and neglected to restore it to automatic operation or to re-set control board switches.

RESOLVED that the Building Manager be directed to inspect non-working lifts and associated operating facilities before calling out City Elevators to determine if they can be made operational without the need for the service contractor to be called out.” Page 4

“9. LIFTS

It was noted that in December 1999 Mr Crisci had completed his assessment of the long term lifts maintenance contract tenders obtained by the Building Manager earlier that year.

Mr McGillivray advised that a site meeting was held on Saturday 8/1/00 between himself, Peter Ladhams, Peter Massimino and Roy Yensch representing the body corporate and Jim O’Keefe representing City Elevators at which it had been reported the building’s lifts were not in a dangerous condition, and that previous estimates given to the Building Manager included a degree of improvement, some of which was already proposed in the arcade/reception office refurbishment approved at the last AGM. Mr McGillivray reported further that the City Elevators representative had indicated some relatively minor repairs were needed.

RESOLVED that City Elevators be requested to provide an urgent and detailed quotation for repairs necessary to maintain the building’s lifts in reasonable working order.

RESOLVED that the next general meeting include a motion giving owners the opportunity of approving a long term lifts maintenance agreement with City Elevators or the next best tenderer.” Page 5

These minutes present a different picture to that presented by the applicant. There is an indication that the lifts are not in a dangerous condition and that only relatively minor repairs are required. Importantly, it is intended to seek Body Corporate approval in general meeting for repair work and a maintenance agreement.

The Body Corporate is in the process of arranging for work to be done that the applicant seeks as an order. In these circumstances, I would refrain from making an interim order that requires the work to be done. The matter will be reconsidered when a final order is made. At that time, I will examine the progress of the Body Corporate in respect of the matter.

I wish to inform the applicant that should the lifts ever develop to the point where they are in a dangerous state such that there could be personal injury or loss of life then it can reapply for orders that the lifts be closed down until they are repaired. It would be appropriate for the applicant to provide a report from an engineer to support such an allegation. The Body Corporate would of course be given the opportunity to respond.

Order 5- Fire Safety Equipment and Emergency Lighting

The applicant has provided a copy of a letter he sent to Challenge Strata Management dated 9 October 1999 in which he attached quotes from three contractors to undertake inspection testing, correct defects in fire equipment and overtake a three year overhaul of hydrant and sprinkler valves.

The applicant states that it has been refused authorisation to do the work.

The Body Corporate Manager has not addressed this matter in his submission. I am unaware if the Body Corporate agrees that the work needs to be done or contests the need for the work or part of it.

I refrain from making an interim order at this stage. The letter I refer to above is already over three months old. I would prefer to give the Body Corporate a proper opportunity to address the matter prior to making an order.

Order 6 – Security

The applicant states that former management gave keys to many outside people giving access to basement parking within the building. Some keys confiscated have also been found to be master keys to the whole building.

This seems to be a long standing problem according to information supplied by the applicant. I have been provided with two letters from the applicant to the Body Corporate dated 24 March 1999 and 21 June 1999 wherein the issue is raised. The issue has also been raised in a building manager’s report dated 7 June 1999.

The applicant has not presented any reasons to indicate that there is a need to address this problem by way of an interim order. In my view it is preferable to give the Body Corporate a full opportunity to respond to this matter. I will address the merits of the matter and whether an order should be made in my final order.

Order 2 – Refurbishment

It seems the Body Corporate voted at its annual general meeting on 10 December 1999 to refurbish the arcade/reception area. The applicant seeks an order deferring the implementation of that project until such time as other maintenance problems are addressed.

At the stage of an interim order I do not propose to make such an order. I have declined to make interim orders on the specific maintenance issues raised in separate orders. The Body Corporate Manager has also raised other reasons why I should not make the interim order. The Body Corporate wants to complete the project by 1 July 2000 saving owners more than $30,000 in GST. A large proportion of owners have already paid the special levy struck to fund the project. If I should make final orders on any of the maintenance issues raised by the applicant, then the Body Corporate has other sufficient cash reserves.

Conclusion

This matter will now be investigated in accordance with the usual processes undertaken by this office. Submissions will be invited from all owners, the Committee and Body Corporate Manager. I think this is appropriate as the matters raised in the application relate to maintenance of important parts of the utility infrastructure. If the Committee makes a submission on the final orders, then it would be useful if it addressed each maintenance issue raised in the application (orders 4 to 6) and provide me with their views on whether there is a problem and if so, what action they have taken or intend taking, if any. Of course, the Committee should consider the whole application and can provide their views on all aspects of the application. A final order regarding the application will be made in due course.