Lumeah [2001] QBCCMCmr 199 (3 April 2001)

P J HANLYREFERENCE: 0617-2000

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	13660
Name of Scheme:	Lumeah
Address of Scheme:	26 Windsor Street NUNDAH QLD 4012

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

Damien John Bohane, the owner of lot 5



I hereby order that within 3 months of the date of this order the body corporate shall reimburse the applicant, Damien John Bohane, the sum of $3,281.39, being the sum paid by the applicant to D.W. Grout Plumbing and Drainage for the replacement of the damaged stormwater pipe on scheme land.

I further order that the body corporate shall within 3 months of the date of this order fix a special contribution to be levied on the owner of each lot towards the liability of $3,281.39.


STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0617-2000

“Lumeah” CTS 13660

The applicant, Damien John Bohane, the owner of lot 5, has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), quote -

That Lumeah body corporate reimburse me for my expenditure in paying D.W. Grout for the replacement of damaged and blocked common property stormwater drain.

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 work carried out on the stormwater drain at the scheme was necessary and urgent and was in the best interests of the body corporate. The applicant provides background information and supporting documentation in relation to the claim.

The body corporate committee, the body corporate manager and all owners were invited to respond to the application. A submission was received from one owner, who admitted that he knows “little or almost nothing” about the applicant’s decision to engage a plumber to carry out stormwater repairs at the scheme without reference to other owners or reference to the body corporate manager. Notwithstanding this admission, the owner opposed the application, based not only on the applicant’s perceived failure to consult owners on this occasion, but also on this owner’s view of the applicant’s past history in relation to the scheme.

In investigating this application, I have exercised my powers under section 221 of the Act. I have ascertained the identity of the owners of the block of flats adjacent to the scheme. On 30 March 2001, I spoke by telephone with one of the owners, Mr Malcolm John Savage. Mr Savage confirmed that he had made a complaint about water ponding on his property from the scheme. Mr Savage was unable to recall the exact date on which he made the complaint, nor to whom he spoke, but stated that it was approximately in the middle of the year 2000. Mr Savage explained to me that his first telephone contact had been with a real estate agent, whose name he had obtained from a “For Sale” sign outside the scheme. Mr Savage further explained that he had made a couple of calls, and could recall that he had spoken with one of the owners at the scheme, but could not recall this person’s name. Mr Savage then noted that certain work was carried out at the scheme.

On 30 March 2000, I also inspected the body corporate books and records at the office of the new body corporate manager, A.D Body Corporate Managers and Consultants. I noted that D.W. Grout Plumbing and Drainage had forwarded an invoice dated 19 July 2000 to the body corporate, which had been paid by the body corporate on 21 July 2000. The work covered by the invoice was carried out at the scheme, and was described as follows:

Inspected stormwater and sewer main with video camera. Stormwater will need replacing and sewer main is in good order. Video and report given to Mr Bohane.

The plumber then carried out the repair work on 24 July 2000, after he received payment of this first invoice.

This scheme comprises 6 lots, and is regulated by the Standard Module. The committee, when it resolves to do so, is entitled to spend up to the relevant limit for committee spending, namely $600.00. Any expenditure over that amount must be authorised by the body corporate in general meeting. However, when expenditure exceeds the relevant limit for major spending, namely $1,200.00, section 104 of the Standard Module requires that owners must be given copies of at least two quotations for consideration. It is clear that in this case, the expenditure involved exceeded the limit for major spending. It is also clear that two quotations were not obtained.

Notwithstanding the fact that the plumbing costs exceeded the relevant limit for major spending, I am satisfied that the plumbing work was carried out on utility infrastructure forming part of the common property of the scheme. I am also satisfied that the stormwater drain in question was damaged and required replacement (vide plumber’s invoice dated 19 July 2000), and that the Brisbane City Council was not responsible for the cost involved in replacing the pipe (vide letter dated 11 August 2000 from Councillor Kim Flesser to the applicant).

Section 109(1) of the Standard Module provides as follows:
ú

Duties of body corporate about common property—Act, s 114

109.(1) The body corporate must maintain common property in good

condition, including, to the extent that common property is structural in

nature, in a structurally sound condition.

The definition of common property is extended by section 21 of the Act, which provides as follows:

Utility infrastructure as common property

21.(1) Common property for a community titles scheme includes all

utility infrastructure forming part of scheme land, except utility

infrastructure—

(a) solely related to supplying utility services to a lot; and

(b) within the boundaries of the lot (according to the way the

boundaries of the lot are defined in the plan of subdivision under

which the lot is created); and

(c) located other than within a boundary structure for the lot.

(2) However, common property does not include utility infrastructure

positioned within common property if—

(a) its positioning is the subject of an agreement to which the original

owner or the body corporate is a party; and

(b) under the agreement, ownership of the utility infrastructure does

not pass to the original owner or body corporate.

Example of utility infrastructure for subsection (2)—

Cable television wires positioned in the service shaft of a multistorey building that

is scheme land for a community titles scheme, if the wires remain in the ownership

of a cable television provider.

(3) In this section—

“boundary structure”, for a lot included in a community titles scheme,

means a floor, wall or ceiling in which is located the boundary of the

lot with another lot or common property.

The applicant explains in his application that he tried to contact the body corporate manager on numerous occasions at the time that the plumbing problem was evident. Although there are no telephone records on the body corporate files, I have no reason to doubt the applicant’s statement in this regard. I consider that the fact that the invoice dated 19 July 2000 was paid by the body corporate manager supports the applicant’s evidence that some contact had been made with the body corporate manager over the problem. Otherwise, one would have expected that there would have been a query from the body corporate manager concerning the invoice. I am also of the view that the plumber, having received payment of his invoice dated 19 July 2000, which stated that the stormwater pipe needed replacing, proceeded with the work in the belief that it had been authorized by the body corporate. I further accept that there may have been a misunderstanding, or a breakdown in communication between the plumber and the body corporate manager.

Section 223 of the Act requires me to make an order that “is just and equitable in the circumstances to resolve a dispute”. The plumbing work was carried out on common property, to replace a pipe which an independent expert confirmed required replacement. The work in question did not benefit the applicant, but rather benefited all owners. The body corporate has a responsibility to maintain common property, including utility infrastructure (of which the stormwater pipe forms part) in good condition. Although section 104 of the Standard Module was not complied with, I am satisfied that this occurred through inadvertence, rather than through negligent disregard of the requirements of the module. I have also not been provided with any evidence that the cost of the plumbing work was excessive, and no owner has made such a suggestion.

I do not consider that the other owners should benefit from work having been carried out on common property for which they are all liable, and yet avoid the responsibility of contributing to the cost of that work, simply because of a technical failure to comply with the Standard Module, in circumstances where there appears to have been some misunderstanding or breakdown in communication.

I note that two of the lots have changed ownership in the latter part of last year. The new owners are deriving the on-going benefit of the plumbing work, even though the actual work occurred prior to their purchase of their respective lots. The Act and the Standard Module require continuing maintenance of common property. The stormwater pipe was broken and had to be replaced. The new owners will therefore be required to contribute to the special levy which I propose to order.

I note, incidentally, that the owner who responded to the application was quite scathing in his criticism of the applicant. I do not share his view that the current application “stems more from (the applicant’s) personality difficulties than from stormwater drainage”. There is no doubt that the stormwater pipe was damaged and required replacement; an independent report confirmed that. It seems, however, from a letter dated 2 December 1999 which I found on the body corporate files, that this same owner was prepared to offer “congratulations and approval of Mr D Bohane’s concern and activities for maintenance at Lumeah” during the year of 1999. The owner noted “the garden/mowing/cleaning and site present well with an improved appearance over that of a year ago”. The owner did, however, express the view that “now...is the time to relieve him of his voluntary activities and place them under your (the body corporate manager) care and control”. The passage from this letter confirms my view that the applicant has acted in the best interests of the body corporate as a whole, even if all owners do not always appreciate his actions.

I intend to order that the body corporate shall reimburse the applicant for the cost of the plumbing work, for which he has paid in full. I am making this order because I do not consider that it would be just or equitable for the applicant to bear the cost of work which is so clearly body corporate responsibility, simply because the work proceeded without formal approval of the body corporate. I further intend to order that the body corporate shall fix a special contribution to be levied against all owners to cover the cost of the work, for which the body corporate has not budgeted (section 95(2) of the Standard Module). It will not, however, be necessary for the body corporate to resolve by ordinary resolution to fix the special contribution, in view of my order.

In closing, it should be noted that in making my orders, I have taken into account a variety of special circumstances in this application. The applicant should be aware, however, that, in future, any proposed expenditure of monies at the scheme must be authorized in accordance with the requirements of the Act and the Standard Module.