Broadbeach Towers [2001] QBCCMCmr 45 (1 February 2001)

RA MeekREFERENCE: 0235-2000

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	13573
Name of Scheme:	Broadbeach Towers
Address of Scheme:	4-6 Elizabeth Avenue, Broadbeach QLD

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

Cecare Angelucci, the co-owner of lot 10

RA MeekI hereby order that the community management statement (CMS) registered on 23 June 1999 under dealing number 703323846 in respect of the body corporate for Broadbeach Towers CTS 13573 (the current CMS) is invalid in so far as by-law 12 in Schedule C purports to effect a transposition of exclusive use car parking allocations as between lots 10 and 14.

I further order that, within six (6) weeks of the date of this order and at its expense, the body corporate shall lodge a request with the Registrar of Titles for the recording of a new CMS which effects a re-allocation of exclusive use car parking allocations as between lots 10 and 14 by the amendment of Schedule E of the current CMS to transpose car space 10A on Plan A with car space 14A on plan A and vice versa so that the amended schedule shall read, so far as relevant –

...

Lot 10 in BUP 1534 Car Space 14A on Plan A

...

Lot 14 in BUP 1534 Car Space 10A on Plan A

...

Provided that, in all other respects, the schedule, the by-laws, and the CMS will remain the same as the current CMS.

I further order that, after the expiration of six weeks from the date of this order, the owners of lot 10, or the occupier of lot 10, shall be entitled to the use of the car space numbered 14A on plan A annexed to the current CMS.

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STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0235-2000

“Broadbeach Towers” CTS 13573

The applicant, Cecare Angelucci, the co-owner of lot 10, has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), quote -

1.	That the body corporate be directed to reallocate the car parking spaces in accordance with the original building units allocation dated 31st October 1974;
2.	That the resolution calling for reallocation of the by-laws in accordance with the general request lodged with the Department of Natural Resources dated 7th May 1999 be rescinded;
3.	That the body corporate be directed to pay my costs in relation to pursuing this matter in the sum of $250-00.

Section 223(1) 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 alleges that the exclusive use car parking allocations, as per the original by-law recorded on 23 January 1975, have been re-allocated without his knowledge or consent. The applicant complains that he became aware of the re-allocation after the CMS was recorded on 23 June 1999. The minutes of the AGM held on 25 March 2000 state under the heading “General Business” –

Lots 10 and lot 14. Silvio Angelucci as proxy for lot 10 advised that lots 10 and 14 car parks have been swapped without a change of by-laws being registered. ...

The original by-law, recorded under dealing No. E869980 on 23 January 1975, recorded the allocation of one exclusive use car parking space per lot. The by-law was expressed in the following terms –

The proprietors ... hereby certify that by unanimous resolution ... the by-laws in the First Schedule to the (Building Units Title Act 1965) ... were added to, amended, or repealed as follows:

That the following proprietors of the lots enumerated hereunder shall have the right to the exclusive use and enjoyment of the car spaces allocated hereunder and which car spaces are shown on the plan annexed hereto and marked with the letter “A” and that this resolution may not be altered or rescinded without a unanimous resolution of all the proprietors of BUP No. 1534:

Under the by-law, lot 10 (the applicant’s lot) is allocated car parking space no. 10. The plan annexed to the by-law records that the parking spaces are numbered sequentially, excepting the space for lot 17, from the southern end of the building to the northern end adjacent to Elizabeth Street, and starting on the western side of the car park and finishing on the eastern side. The car space numbered 10, allocated to lot 10 under the by-law, is sequentially the tenth space along, and is located in the north west corner of the building, and is the second space in from Elizabeth Street.

There are two important considerations to note regarding the by-law. Firstly, the by-law itself states that that this resolution may not be altered or rescinded without a unanimous resolution of all the proprietors of BUP No. 1534. Secondly, The by-law further states that ... the by-laws in the First Schedule to the (Building Units Title Act 1965) ... were added to, amended, or repealed as follows:. The reference to the “First Schedule” is significant. Section 13 of The Building Units Titles Act 1965 headed “By-laws” provides at (4) –

No addition to or amendment or repeal of any by-law pursuant to (section 13(2)(a)) shall have effect until the body corporate shall have lodged a notification thereof in the form prescribed by regulation under this Act with the Registrar of Titles and until the Registrar of Titles shall have made reference thereto on the registered building units plan.

For clarification purposes, section 13(2)(a) refers to –

... the by-laws set forth in the First Schedule to this Act which shall not be added to, amended or repealed except by unanimous resolution.

My understanding of the effect of both the actions of the body corporate and the operation of the (then) applicable legislation is as follows. The body corporate recorded the exclusive use by-law allocation as part of the first schedule by-laws. The by-law itself provided that the by-law could only be altered or rescinded by subsequent unanimous resolution of the body corporate. Section 13(4) of the legislation then provided that no amendment of the by-law, given that it was a first schedule by-law, was valid until notification of the same had been lodged with, and recorded on the plan, by the Registrar of Titles. This to my mind very clearly establishes the basis for amendment of the by-law.

At an AGM held on 27 March 1999, the body corporate resolved by resolution without dissent to consent to the recording of a new CMS which adopted a new set of by-laws. The motion was carried by 8 in favour, nil against, and one abstention. The voting summary sheet indicates that the owners of lot 10 were not in attendance at the meeting and did not vote. By-law 12 contained in schedule C of the new CMS provided for a varied exclusive use allocation for car parking spaces. Though not the only change, but the one relevant to this application is that the car parking space allocated for lot 10 has been transposed with the car parking space allocated for lot 14. The CMS, which contained the relevant by-law, was recorded on 23 June 1999.

The requirement of the Building Units Title Act 1965 continued under the currency of the Building Units and Group Titles Act 1980 (BUGTA) (03/11/80 to 13/07/97). Section 30(3) of that Act provided that –

An amendment of, addition to or repeal of the by-laws has no force or effect until the Registrar of Titles has, pursuant to a notification in the prescribed form lodged in his office by the body corporate, recorded the notification on the registered plan.

There were specific amendments regarding the transposition of common property exclusive use allocations between owners introduced with the 1988 amendments to BUGTA. However these amendments did not affect the requirement to give notification to the Registrar of Titles, or the fact that the variation or transposition was not valid until the Registrar had recorded the notification on the plan (see section 30(7D) of BUGTA)).

The current Act provides that -

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Making and notifying further allocations

138.(1) Within 3 months, or a longer time stated in an order of an adjudicator under the dispute resolution provisions, after the taking effect of an authorised or agreed allocation (a “further allocation”) (other than an allocation included in a subsequent statement), the body corporate must lodge with the registrar a request to record a new community management statement showing all allocations currently in place when the body corporate consented to the recording of the new statement.

(2) If the body corporate fails to comply with subsection (1), the further allocation ceases to have effect.

(3) An order mentioned in subsection (1) may be sought or made before or after the 3 months mentioned in the subsection end, and if the order is made after the 3 months end, the allocation is taken to have remained in effect despite the 3 months having ended.

This section repeats the requirement that if there has been a reallocation of exclusive use areas between owners, then the body corporate must, within three (3) months of an “agreed allocation” (essentially, a transposition between owners) lodge with the registrar of titles a request to record a new CMS showing all allocations currently in place when the body corporate consented to the recording of the new statement. If the body corporate fails to do this then the agreed allocation ceases to have effect.

So the position under all applicable legislation since the original exclusive use by-law commenced in 1975 was, in addition to any other requirement, notification of the variation of the by-law to the registrar of titles, and recording thereof.

This leads me to the current dispute. The applicant alleges that he is of the “understanding that the car parking space previously allocated to our unit was reallocation to the proprietor of lot 14 who is the current chairperson of the body corporate”. This understanding is confirmed by the terms of the CMS, recorded on 23 June 1999.

Neither the body corporate, nor the manager (except to forward on owner’s submissions) have responded to the application.

The owner of lot 14, Portsea Nominees Pty Ltd, has written to the body corporate manager, stating in part as follows –

1.	...
2.	Owners of unit 14 purchased their units in 1984 and car park 14 on CTS was included in that purchase.
3.	Owners of unit 10 purchased in 20/08/1996 and car park 10 on CTS 13573 was included in that purchase.
4.	Units 10 and 14 were owned by Peter Gordon & Nellie Gordon during 1980 and we understand they reallocated the car parks at that time.
5.	It would appear that body corporate records were poorly maintained during these years as neither the ownership of unit 10 by Peter Gordon nor the reallocation of the car parks were recorded. The committee was instructed in 1995 to get their records in order.
6.	All subsequent owners of units 10 and 14 have utilized these reallocated car parks since 1980 without any dispute. ...

There was subsequent correspondence from a PM Lee & Co, Solicitors, on behalf of Mr Graham Stapleton, the chairperson of the body corporate. Much of that correspondence is irrelevant, excepting where it states –

The applicant seems to imply that the resolution of 7 May 1999 is the operative document to change the car park allocations. Whilst this resolution might have formalised previous transaction it is submitted that the resolution (and the subsequent registration of documentation from the 7 May 1999 meeting) is correct. If the applicant wishes to oppose the reallocation of the car parking spaces then he needs to challenge the transactions which occurred when both units 10 and 14 were owned by Mrs Gordon back in 1980.

Subsequently, this solicitor provided a statutory declaration from a Nellie Gordon, dated 10 November 2000 which provides in part as follows –

... There was a period during 1980 when we owned both unit 10 and unit 14. During our period of ownership around about 1980 we approached the body corporate with a request to swap the car park for lot 10 with the car park for lot 14. The body corporate said it could be done provided both of the owners to the respective units agreed. As we owned both of them we formally agreed with ourselves to change the car parks. We notified the body corporate in writing of the change of ownership and requested the body corporate’s secretary to take whatever formal steps were necessary to record the change. As far as I am aware the body corporate did hold a meeting to approve the change of ownership and that resolution was duly passed and recorded in the body corporate records and registers. I am informed that the minute is no longer in the records and registers. I have no idea why it is not there.

I personally undertook an inspection of body corporate records on Thursday 18, 2001. I could find no record whatsoever, including in correspondence to the body corporate, or resolution of a meeting, committee or general, which refected the reallocation of exclusive use car parking allocations alleged to have occurred between lots 10 and 14. Further, the body corporate manager to whom I spoke at that inspection confirmed that she was unaware of any record to this effect.

In any event, given the requirements of the legislation at all relevant times, mere correspondence addressed to the body corporate or even a resolution by the body corporate committee or in general meeting, would not have been sufficient to validate the re-allocation of exclusive use car parking allocations alleged to have occurred between lots 10 and 14. At all times, notification to the Registrar of Titles, and until 1997, notation of the re-allocation on the relevant plan would have been required. Whatever is alleged to have been done regarding the re-allocation of exclusive use car parking allocation alleged to have occurred between lots 10 and 14, of which there is no evidence excepting the statements of certain owners, and a former owner that it was done, was at all times ineffective to validate the alleged re-allocation.

As a final inquiry, I sought from the applicant a copy of the contract for his purchase of the lot. I did so to check whether there was any statement (in the special conditions or otherwise) which would have at least alerted the purchasers to the alleged re-allocation. I can find no statement in the contract which would have alerted the purchasers to the alleged re-allocation of exclusive use car parking spaces between the lot they were purchasing (lot 10) and lot 14.

This means that the applicant was entitled to rely on the allocations of exclusive use car parking spaces which were recorded under the 1975 by-law. Any inspection by the applicant of the body corporate record prior to purchase would have established nothing contrary to this, since as I have indicated no written record of the alleged re-allocation exists.

In the circumstances, I consider the applicant is entitled to the relief which he is seeking, subject to a determination of whether the recording of the new CMS in 1999, when he was a lot owner, and which for the first time evidences the alleged re-allocation, is (or is not) valid.

Variations or amendments to by-laws no longer require a unanimous resolution. In fact, such form of resolution has not been included in the current Act. The form of resolution required for a variation or amendment of an exclusive use by-law is a resolution without dissent. This form of resolution requires that of those owners who vote, that there is no vote recorded against the motion to record a new CMS which contains the amended or varied exclusive use by-law.

I note from the voting record that the relevant motion was carried without any vote against the motion. I further note that the applicant did not attend the meeting, either in person, by proxy, or by submission of a voting paper. Whilst this might suggest that the new CMS was validly recorded, there is a further requirement in the Act which has effect when the variation or amendment is in respect of an exclusive use. Section 134 of the Act provides as follows –

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Requirements for exclusive use by-law

134.(1) The common property or body corporate asset to which an exclusive use by-law for a community titles scheme applies must be—

(a) specifically identified in the by-law; or

(b) allocated—

(i) by a person (who may be the original owner or the original owner’s agent) authorised under the by-law to make the allocation (an “authorised allocation”); or

(ii) by 2 or more lot owners under a reallocation agreement (an “agreed allocation”).

(2) An exclusive use by-law that specifically identifies the common property or body corporate asset to which it applies, other than an exclusive use by-law contained in the first community management statement for the scheme—

(a) may attach to a lot only if the lot owner agrees in writing before the passing of the resolution without dissent consenting to the recording of the new community management statement to

incorporate the exclusive use by-law; and

(b) may stop applying to the lot only if the lot owner agrees in writing before the passing of the resolution without dissent consenting to the recording of the new community management statement that does not incorporate the exclusive use by-law.

(3) If an exclusive use by-law authorises the allocation of common property or a body corporate asset for the purpose of the by-law—

(a) the by-law may attach to a lot on the basis of an authorized allocation only if the lot owner agrees in writing before the allocation of the common property or body corporate asset to

which the by-law applies; and

(b) the by-law may stop applying to the lot only if the lot owner agrees in writing before—

(i) the allocation is revoked under the by-law (if the by-law provides for the revocation of an allocation); or

(ii) the passing of the resolution without dissent consenting to the recording of the new community management statement that does not incorporate the exclusive use by-law.

It is alleged that the new CMS merely reflects the several re-allocations which were formerly advised to the body corporate. I have already indicated that such alleged re-allocations where not done in accordance with the applicable legislation and are of no effect.

I consider that the current scenario is the subject of section 134(2) in that the original and the new exclusive use by-law specifically identifies the common property being allocated. Section 134(2) provides that an exclusive use by-law that specifically identifies the common property to which it applies, may stop applying to the lot only if the lot owner agrees in writing before the passing of the resolution without dissent consenting to the recording of the new community management statement that does not incorporate the exclusive use by-law.

My interpretation of the effect of this subsection is that in order for the original exclusive use allocation of common property for lot 10 (ie. space no. 10) to stop applying is for the current owner of lot 10 to agree in writing before the passing of the resolution without dissent consenting to the recording of the new community management statement that does not incorporate the exclusive use by-law. In effect, the owner of the lot affected by the variation in exclusive use allocations must consent in writing to the loss of that particular allocation. This safeguard was imposed to prevent the loss of exclusive use allocations by lot owners due only to the fact of their non-attendance at a particular meeting.

Although the applicant did not vote against the motion to adopt the new CMS containing the by-law incorporating the re-allocation of exclusive use car parking spaces between lots 10 and 14, in order for the recording of the CMS to be valid, and the re-allocation to be effective, the owner of lot 10 would need to have consented in writing to the recording of the new CMS. I have been provided with no evidence to this effect.

I now return to consider the three orders sought by the applicant. Firstly, the applicant seeks that I order the body corporate to reallocate the car parking spaces in accordance with the original allocation dated 31^st October 1974. I do not intend to make this order as this is beyond the scope of that required to establish the applicant’s position. The second order which the applicant seeks is that the resolution calling for reallocation of the by-laws in accordance with the general request lodged with the Department of Natural Resources dated 7^th May 1999 be rescinded.

For the reasons I have indicated I consider that the exclusive use by-law numbered 12 in the CMS recorded on 23 June 1999 is invalid and of no effect. I originally intended to order that the body corporate lodge with the Registrar of Titles a new CMS which deleted the by-law numbered 12 in the CMS (dealing number 703323846) and headed “Exclusive Use”. However the consequence of doing this would be that there would be no exclusive use by-law in place, since the remaining by-laws contained in the CMS would be exclusive of all other by-laws. Alternatively, I considered invalidating the entire CMS. However the difficulty with this would be that this would include all the by-laws and not simply the exclusive use by-laws, and as well, would mean that the original by-law would be re-activated. Whilst this would suit the applicant, I note that certain of the areas of exclusive use on the original plan don’t even exist on the new plan. For example, car space 20. As well, certain new areas of exclusive use have been created on the new plan which did not exist on the old plan. For example, the area described as 17A has been enlarged, and area 19A has been created.

After all these factors were considered, I determined that the only way I might reverse the re-allocation as between lots 10 and 14 but to preserve the status quo regarding all other allocations and changes which have been made is to order the body corporate to lodge for recording with the Registrar of Titles a new CMS which is in the same terms as the CMS recorded on 23 June 1999, but with amendments to schedule E to transpose car space 10A on Plan A with car space 14A and vice versa so that the amended schedule shall read, so far as relevant –

...

Lot 10 in BUP 1534 Car Space 14A on Plan A

...

Lot 14 in BUP 1534 Car Space 10A on Plan A

...

In all other respects, the schedule, the by-laws, and the CMS will remain the same as the current CMS.

I further intend to order that, after six weeks, the applicant, or the occupier of lot 10, shall be entitled to the use of the car space numbered 14A on plan A annexed to the CMS.

The final order sought by the applicant is that the body corporate be directed to pay his costs in relation to pursuing this matter in the sum of $250-00. It is not the practice of adjudicators to make orders for costs against any party to a dispute for the reason that legislative jurisdiction to make such an order does not exist.
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