Terrace Place [2001] QBCCMCmr 503 (17 September 2001)

P J HANLYREFERENCE: 0356-2001

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	3061
Name of Scheme:	Terrace Place
Address of Scheme:	252 Brisbane Terrace GOODNA QLD 4300

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

Robert Jeffrey Browning & Jennifer Denise Browning, the owners of lot 1



I hereby order that the owner of lot 2, Osama Maher Bastawros, shall within 1 month of the date of this order pay to the applicants Robert Jeffrey Browning & Jennifer Denise Browning, the owners of lot 1, the sum of $188.45 being a half share of the insurance premium paid by the applicants to effect the statutory body corporate insurance.



STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0356-2001

“Terrace Place” CTS 3061

The applicants, Robert Jeffrey Browning & Jennifer Denise Browning, 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 -

Owner of lot 2 has not paid his share of insurance on the building. We would like this money paid. We have paid our ½ of the insurance.

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 the owner of lot 2 refuses to pay his half share of the insurance, and also refuses to allow his agent to deduct that amount from rental monies received by the agent from the tenant of lot 2. The applicants further state that as they have paid half of the premium, the insurer has only renewed the insurance for 6 months, expiring on 7 August 2001. The applicants further state that they have contacted the owner of lot 2 by telephone, and he informed them that he is not interested in effecting insurance, and is currently in dispute with his accountant.

The owner of lot 2 was invited to respond to the application. No response was received from him.

The lots included in this scheme are created under a building format plan of subdivision (previously referred to as a building unit plan). Section 128 of the Body Corporate and Community Management (Standard Module) Regulation 1997 (Standard Module) provides as follows:

Insurance of building including lots

128.(1) This section applies if 1 or more of the lots included in the

scheme are created under a building format plan of subdivision or a

volumetric format plan of subdivision.

(2) The body corporate must insure, to full replacement value, each

building in which is located a lot included in the scheme, to the extent that

the building is scheme land.

(3) A policy of insurance taken out under this section—

(a) must cover—

(i) damage; and

(ii) costs incidental to the reinstatement or replacement of

insured buildings, including the cost of taking away debris

and the fees of architects and other professional advisers;

and

(b) must provide for the reinstatement of property to its condition

when new.

(4) If the body corporate cannot comply with subsection (3), the

commissioner, on application in writing by the body corporate, may

authorise the body corporate to put in place an alternative insurance in a

form approved by the commissioner if the commissioner is satisfied that

the insurance approved gives cover that is as close as practicable to the

cover given by insurance under subsection (3).

Example of alternative insurance that might be approved by the commissioner—

Insurance giving cover up to an agreed value.

(5) The body corporate is liable to pay any contribution that has to be

made to the cost of reinstatement or repair because the reinstatement

insurance is not for the full replacement value of the insured property.

(6) The body corporate need not insure a building or a part of a building

under subsection (2) if—

(a) the scheme is a subsidiary scheme for another community titles

scheme (the “other scheme”); and

(b) under subsection (2) or an equivalent provision of another

regulation module, the body corporate for the other scheme is

required to insure the building or the part of the building.

(7) Also, the body corporate need not insure a building or a part of a

building under subsection (2) if—

(a) the building or the part of the building is scheme land; and

(b) the whole of the building is the subject of a building management

statement registered under the Land Title Act 1994; and

(c) the building management statement provides for insurance for the

building to a level comparable with insurance otherwise required

under this division; and

(d) the insurance is in place.

(8) This section applies subject to provisions of this division about

insurance of buildings mutually dependent for support on a common wall.

The body corporate is also required to effect insurance of the common property and the body corporate assets (section 127 of the Standard Module) and to effect public risk insurance (section 136 of the Standard Module). The policy held in the name of the body corporate, for which the applicant has already paid, covers both of these aspects of insurance as well.

The owner of lot 2 is not at liberty to exclude himself from the insurance which the body corporate is required by law to take out. I note that the owners of lot 1 have subsequently paid the additional premium to renew the insurance to 7 February 2002. I further note that on 31 July 2001 the mortgagee of lot 2, Citibank Limited, has issued a Notice to Occupant Requiring Vacant Possession. This follows a Notice of Default having been given by Citibank Limited to the owner of lot 2.



I have ordered that the owner of lot 2 shall reimburse the applicants the sum of $188.45 within 1 month of the date of this order. I also intend to have a copy of the order forwarded to Citibank Limited, care of its solicitors, Clayton Utz.
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