Madison Garden Villas [2001] QBCCMCmr 184 (29 March 2001)

P J HANLYREFERENCE: 0044-2001

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	25920
Name of Scheme:	Madison Garden Villas
Address of Scheme:	83 Heeb Street BENOWA QLD 4217

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

Terrence K Vertigan, the owner of lot 50



I hereby order that committee meetings for this scheme must be held where the committee decides, provided that the committee meetings must not be held more than 15 kilometres from scheme land if members making up at least half of the number of committee members needed for a quorum object by written notice given to the secretary.

I further order that the committee members present in person at the designated place of the committee meetings may conduct a teleconference with the remaining members of the committee, whether to form a quorum or to otherwise conduct the meetings.

I further order that, henceforth, the secretary shall call committee meetings if asked, in writing, to call the meeting by enough members of the committee to form a quorum at a meeting of the committee.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0044-2001

“Madison Garden Villas” CTS 25920

The applicant, Terrence K Vertigan, the owner of lot 50, has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), quote -

The order needs to state that it is legitimate to hold body corporate committee meetings more than 15 kilometres from scheme land. Also it is legitimate to include all committee members by teleconference.

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 applicant states that the current members of the committee reside in various parts of Australia, such that it is difficult for any number of them to have the time and money to travel to committee meetings on scheme land at least four times a year, and to make a quorum. The applicant further states that most committee members agree that committee meetings be held in Echuca, Victoria (as four committee members live in or near Echuca), and that the other members of the committee be included by teleconference. The applicant further states that the secretary will not call a committee meeting to be held away from scheme land, which results in committee members being denied the opportunity to participate in managing the scheme.

The body corporate committee was invited to respond to the application. Responses were received from 5 of the 6 other committee members (the applicant being the chairperson and the 7^th member).

The secretary/treasurer, who is also the resident manager, opposed the application. The sentiments of the manager can be summed up in the concluding paragraph:

“As owners and on-site managers we cannot see how any committee can act in the best interest of all owners to solve on-site matters unless committee members visit the site or have a satisfactory method whereby they can sufficiently inform themselves of on-site matters.”


Four other committee members supported the application. One of the members expressed the view that holding meetings away from scheme land and allowing teleconferencing would be a means of encouraging investors who did not live on the Gold Coast to participate in managing the scheme. Another member stated that the cost of travelling to the scheme for committee meetings would be prohibitive, and teleconferencing was a good compromise. A third member stated that he nominated for the committee so as to show an interest in his investment, but considered that travelling to meetings would be too difficult and costly. It was his view that teleconferencing was a convenient and inexpensive means of conducting meetings. The fourth member stated that she intends to visit the scheme on an annual basis but is not in a financial position to travel to the Gold Coast for further meetings. She further stated that as the regulations allow for off-site meetings, she considers this to be more convenient and cost effective for the majority of committee members.

The Standard Module regulates this scheme. Part 3-Division 7 of the module deals with the administrative arrangements for committee meetings. Section 29 provides as follows:

Place of committee meetings

29.(1) The first meeting of the committee after the committee is formed

must be held where the person calling the meeting decides.

(2) Subject to subsection (1), a committee meeting must be held where

the committee decides.

(3) Despite subsections (1) and (2), a committee meeting must not be

held more than 15 km (measured in a straight line on a horizontal plane)

from scheme land if members making up at least half of the number of

committee members needed for a quorum object by written notice given to

the secretary.

The material before me reveals that the majority of committee members are in favour of the committee meetings being held away from the scheme. It appears that the secretary/treasurer, who is also the resident manager, is the only committee member who opposes the plan.

In a letter dated 21 March 2001 from the resident managers to this office, it was stated that “in our opinion, the current committee members have shown little understanding of the BCCM Act and their obligations to act to benefit all owners. To date they have shown no support of, or faith in, the on-site managers.” It seems to me that it is the resident managers who have shown little understanding of the Act and the module, given their apparently steadfast refusal to call committee meetings off-site. It is patently not beneficial for owners for committee meetings not to be held at all. The body corporate resolved (on a motion proposed by the resident managers) at the annual general meeting held on 9 October 2000 that the elected committee be required to meet at a maximum of 4 monthly intervals and that the on-site managers report to each meeting. The chairperson’s proposal that meetings be held in Echuca, to enable a quorum to be present, and that the remaining members of the committee join in the meeting by teleconference seems to me to be a very sensible solution to the present impasse. There would, of course, be a cost in relation to the teleconference, but it would be a fraction of the cost which would be incurred for the committee to meet at the scheme three times a year. All of the requirements of the module in relation to the calling of the meeting would still have to be met, including the notice of meeting, the agenda for the meeting, and the preparation of minutes of the meeting. In addition, a copy of any resolutions passed at the meeting must be given to all owners (other than those who have instructed that they do not wish to receive such material).

The resident managers’ report will obviously be a standing item on the agenda of the meeting, and any further discussion arising from the report would, in my view, be covered in the teleconference. As most members of the committee have expressed an intention to visit the scheme at least once a year, then personal inspections can take place at that time. For the intervening periods, the resident managers’ report should provide a satisfactory method by which the committee can inform themselves of on-site matters.

I am satisfied that all committee members are endeavouring to discharge their obligations to act as the administrative arm of the body corporate, and to make decisions in the best interests of all owners. It seems a great shame that such good intentions are being thwarted. It is for this reason that I have made the orders sought by the applicant.2n