Admiralty Gardens [2000] QBCCMCmr 588 (17 November 2000)

P J HANLYREFERENCE: 0403-2000

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	15228
Name of Scheme:	Admiralty Gardens
Address of Scheme:	5 Thornely Close BELLARA QLD 4507

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

Barry John Lee and Carol Ann Caldwell, the owners of lot 1



I hereby order that motion 3 entitled “Management Agreement” considered by the body corporate at the extraordinary general meeting held on 13 June 2000 shall be deemed to have been passed, except to the extent that clause 16 of the said management agreement shall be deleted from the agreement.

I further order that the commencement date of the amended management agreement shall be 7 days from the date of this order.

I further order that any two lot owners shall be authorised to sign the amended management agreement on behalf of the body corporate.

I further order that Clifford Crittenden (under power of attorney for Susan Belfanti Crittenden) and/or Susan Belfanti Crittenden shall, within 7 days of the date of this order, hand over all and any books and records of the body corporate presently in their possession or power to R Jackson Pty Ltd.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0403-2000

“Admiralty Gardens” CTS 15228

The applicants Barry John Lee and Carol Ann Caldwell, the owners of lot 1, have sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), quote -

We request the commissioner to appoint a body corporate management firm, namely R. Jackson Pty Ltd as body corporate managers for our property.

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, as a result of the owner of lots 2 and 4 withdrawing from involvement in body corporate matters, the applicants consider that a body corporate manager must be appointed so as to allow for the proper functioning of the body corporate. The applicants provided some background to the dispute, including copies of relevant correspondence.

Submissions were invited from all owners.

Mr and Mrs Hall, the owners of lot 3, supported the application, confirming the background information provided by the applicants. They also provided copies of four letters written by Mr Crittenden, the husband of the owner of lots 2 and 4, during July 2000. The Halls stated that the letters appear to have been intended for their daughter, who was living in their lot at the time.

Several responses were also received from Mr and Mrs Crittenden, who opposed the application.

On 30 October 2000, I spoke with Mr Lee, Mr Hall and Mr Crittenden by conference telephone. I explained to the parties that the question of a change of contribution schedule lot entitlements (the underlying concern for the Crittendens) was a matter which could only be resolved by the District Court, if all owners were unable to reach agreement. I further explained that unless the lot entitlements were changed by the Court, the payment of contributions to the body corporate must be made in accordance with the existing lot entitlements.
It is evident to me that the administration of the body corporate has reached a stalemate, because the Crittendens refuse to pay contributions on any basis other than that each lot pays equal contributions, and the applicants and the Halls consider that contributions should be paid in accordance with the Act and the Standard Module. The order that is being sought relates to the appointment of a body corporate manager. Whilst I do not believe that the appointment of a body corporate manager will break the stalemate, I am satisfied that the day-to-day administration of the body corporate cannot be allowed to disintegrate. Issues such as maintenance of the grounds and the common property have to be addressed, as well as the possible establishment of body corporate bank accounts (I have no information as to the status of the body corporate bank accounts, or even if any exist), and the collection of levies. The relationship between the Crittendens and the other owners appears to have completely broken down, given the inflammatory remarks made by the Crittendens in the correspondence before me. I am of the view that a body corporate manager may be able to defuse some of the issues, although the central issue of lot entitlements will remain unless one or other side gives ground.

I note that the Crittendens proposed the appointment of the body corporate management company to which motion 3, considered at the extraordinary general meeting held on 13 June 2000, related. It was only after the motion to amend the contribution schedule lot entitlements was defeated, that the Crittendens voted against the appointment of the body corporate manager proposed by them. The other lot owners voted in favour of the appointment. I therefore consider that, apart from the question of the lot entitlements, which I am powerless to change, all owners in this scheme support the appointment of the nominated body corporate manager.

I have perused the management agreement, which was forwarded with the meeting notice. The only concern that I have with the agreement is that clause 16 allows an option to renew for three years exercisable by either the body corporate or the body corporate manager provided that the manager has performed satisfactorily during the initial term. This scheme comprises of 4 lots, and the limit for major spending is therefore $800.00. If the agreement were to be renewed for three years, that would be a total cost in excess of $1,200.00, since the management fee quoted in motion 3 is $100.00 per lot per annum, plus G.S.T. In these circumstances, the provisions of section 104 of the Standard Module would apply, and the body corporate must consider at least two quotes, incorporated into alternative motions, for the appointment of a body corporate manager. I have therefore decided to order that motion 3 considered by the body corporate at the extraordinary general meeting held on 13 June 2000 shall be deemed to have been passed, except to the extent that clause 16 of the management agreement shall be deleted from the agreement. I have also decided to make ancillary orders to allow for the execution of the agreement. Finally I have ordered that the Crittendens shall, within 7 days of the date of this order, hand over all and any body corporate books and records in their respective possession to R Jackson Pty Ltd.

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