Banyandah Court [2000] QBCCMCmr 397 (3 August 2000)

CG YoungREFERENCE: 0316-2000

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	13852
Name of Scheme:	Banyandah Court
Address of Scheme:	2A Moffatt Street SCARBOROUGH QLD 4020

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

Donald Anthony REAY and Dolores Dawn REAY, the co-owners of Lot 7,



CG YoungI hereby order that the application by Donald Anthony REAY and Dolores Dawn REAY for an order that the Extraordinary General Meeting dated 5 June 2000 be declared void, is dismissed.2y
STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0316-2000

“Banyandah Court” CTS 13852

The applicants, Donald and Dolores of Lot 7, have sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (“the Act”), quote -

That the Extraordinary General Meeting held on Monday 5 June 2000 be declared null and void.

Section 223(1) of the Act 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)).

In the supporting grounds the applicants state that written notice of the Extraordinary General Meeting (hereafter “EGM”) was not served on the owners of all lots, a time for the meeting was not given on the notice, the meeting was held by voting paper, and there was no provision for the correction of errors in the proposed motions. The applicants have included a copy of a notice of the EGM dated 9 May 2000 which indicates that the meeting was proposed to be held on Monday 15 May 2000. The applicants state that contact was made with the Body Corporate Manager, Ms Marie Thurley of Redcliffe Body Corporate Management, regarding their concerns over the notice of the meeting. The applicants contend that Ms Thurley said that she would contact the other owners regarding the meeting date and that she would verify the information on the meeting notice given to the other owners.

A copy of the application was forwarded to the body corporate secretary for distribution to all owners, excluding the applicants, to the committee, and to the body corporate manager. The Body Corporate Manager, Marie Thurley from Redcliffe Body Corporate Management responded that a notice of the EGM was given to the owner of each lot, and that the office copy of the notice showed the date of the meeting as 5 June 2000. Ms Thurley acknowledges that a time for the meeting was not given, as owners were being encouraged to vote by voting paper. She states that owners were encouraged to return voting papers as the committee felt that there would be a better response using this voting method. I will comment on this practice later in these reasons.

Ms Thurley has provided copies of the notice and minutes of the EGM dated 5 April 2000 and the EGM dated 5 June 2000. Motion 16 on the agenda of the April EGM proposed the adoption of new by-laws regulating vehicles, rubbish, carports, and the use of the swimming pool, the barbeque area and common property. The minutes of this meeting indicate that:

1.	Three owners (including the applicants) were present at the meeting, four owners voted by voting paper, and a proxy represented one owner.
2.	Motion 16 was proposed by the committee and required an ordinary resolution.
3.	The resolution was passed in respect of motion 16 with five votes in favour, one against and two abstentions.

By letter dated 10 April 2000, the body corporate manager provided each owner with a copy of the minutes of the EGM dated 5 April 2000 and the by-laws. The body corporate manager informed lot owners that the by-laws could only be recorded as part of a new Community Management Statement (“CMS”) which can only be consented to at a general meeting. She invited lot owners to comment on the by-laws by 24 April 2000, after which time a general meeting would be called for the consideration of the necessary motions.

The copy of the notice of the EGM provided by Ms Thurley shows the date of the meeting as 5 June 2000. This document would appear to only differ from the copy of the notice provided by the applicants in regards to the date of the meeting. The agenda for this EGM contains three motions, the first to confirm the minutes of the previous general meeting, and two motions concerning the making of additional by-laws. The minutes of the EGM indicate the following:

1.	Ms Thurley from Redcliffe Body Corporate Management was the only person present at the meeting.
2.	The owners of five lots voted by voting paper. No lot owners were present at the meeting.
3.	All votes received were in favour of each of the three motions.

In the grounds to their application, the applicants have referred to a number of procedural deficiencies in the convening and holding of the EGM dated 5 June 2000. Firstly, they have stated that written notice was not served on the owners of all lots and that insufficient notice was given to each owner. However, there has been no substantiation or corroboration of the difficulties experienced by the applicants, and the body corporate manager has submitted that a notice of the EGM was given to the owner of each lot. Secondly, a time for the EGM was not included in the notice of meeting which is contrary to the provisions of section 42(2) of the Body Corporate and Community Management (Standard Module) Regulation 1997 ("the Standard Module"). Thirdly, the meeting was held by voting paper which is not in accordance with sections 48 and 51 of the Standard Module.

It is clear that the above procedural legislative requirements for convening and holding a general meeting have not been complied with by the body corporate. I would point out however, that in respect to meetings generally, the courts have consistently held that where there have been procedural errors or omissions in the calling of a meeting, or other lesser irregularities, the meeting and decisions made at the meeting should nevertheless be preserved unless it can be shown that there has been some fundamental disadvantage to voters (owners). For example, where all or a significant number of owners have been given no, or insufficient, notice of a meeting.

For the following reasons, I consider that the lot owners have not been disadvantaged by the errors or omissions in calling and holding the EGM dated 5 June 2000:

1.	The secretary was required to provide each lot owner with a copy of the application and an invitation to make a written submission on the matters raised in the application. Other than the response from the Body Corporate Manager, only two owners made submissions, both opposing the application. Therefore, I am not satisfied that owners generally have been disadvantaged by the irregularities in the convening and holding of this meeting.
2.	The applicants have not provided clear evidence that all lot owners did not receive written notice of the meeting. There is disagreement as to the date of the meeting given to the applicants, however the applicants had sufficient notice to at least give the body corporate a voting paper indicating their vote in respect of the motions on the agenda for the meeting. Five lot owners did respond to the notice of the EGM and did vote in favour of all the motions on the agenda. Even if the applicants did vote against the motions on the agenda, the required resolutions would still have been passed.
3.	The purpose of the EGM dated 5 June 2000 was to formally consider making additional by-laws and consenting to a new CMS. The body corporate had been considering these by-laws for some time and the motions to be considered should not have surprised the lot owners as they had been given the opportunity to participate in the formulation of the by-laws. At the EGM dated 5 April 2000 the body corporate, by ordinary resolution, decided to make new by-laws regarding vehicles, rubbish, car ports, and the use of the swimming pool, barbeque area and common property. Lot owners were subsequently invited to comment on these by-laws. The body corporate then convened the EGM dated 5 June 2000 to formalise the adoption of a new CMS incorporating the additional by-laws.
4.	I have perused the minutes of the EGM dated 5 April 2000, the minutes of the EGM dated 5 June 2000 and the accompanying “Schedule C By-Laws” contained in the proposed CMS. There have been largely immaterial changes made to the wording of the by-laws from the April EGM to the June EGM. The most significant alteration relates to the swimming pool by-law where the closure time was changed from 9pm to 10pm. This change was both in the by-law motion numbered 2 submitted to the June EGM and in the by-laws contained in the proposed CMS.

For these reasons, I have dismissed the application to declare the EGM dated 5 June 2000 void.

However, the body corporate and the Body Corporate Manager must be aware of the proper procedural requirements for convening and holding an EGM. The June EGM was convened to decide on new by-laws and if lot owners had not previously considered these by-laws, I would have been inclined to void the motions passed. The body corporate has an obligation to act reasonably and for the benefit of lot owners, and it must ensure that the requirements of the legislation are complied with, even if there is some conflict between lot owners. The body corporate must also be aware that section 50(3) of the Act provides that the CMS must be lodged with the Registrar for recording in the form consented to at the EGM dated 5 June 2000. The wording of the by-laws contained in motion 2 at the June EGM is irrelevant.

2y