Aarons [2001] QBCCMCmr 535 (16 October 2001)

RA MeekREFERENCE: 0606-2001

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	11476
Name of Scheme:	Aarons
Address of Scheme:	3355 Gold Coast Highway SURFERS PARADISE QLD 4217

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

Robert Charles James and Kathryn Margaret James, the owners of lot 1



RA MeekI hereby order that the body corporate shall not implement or otherwise act upon motions 15 headed body corporate manager or motion 22 headed motion for alternative approach to rectification purportedly carried at the EGM of the body corporate held on 1 October 2001 until as a final order to this application is made, this application is withdrawn, or this order is of no effect by operation of law.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0606-2001

“Aarons” CMS 11476

The applicants, Robert Charles James and Kathryn Margaret James, the owners of lot 1, have sought the following orders of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), quote -

1.	That the EGM held on the 1st October 2001 be declared invalid and that any motions passed at that meeting be declared null and void.
2.	That pursuant to section 223 ... an administrator be appointed to perform the obligations of the body corporate and its committee under the said Act and pursuant to the community management statement.
3.	That the administrator forthwith implement the recommendation of Buildcheck as specified in their report dated the 4thJune 2001.
4.	In the alternative to paragraph 3 that the administrator satisfy all statutory notices issued regarding rectification of the building and all common property over which the body corporate has control in such a way as he deems necessary.

The Applicants have also sought the following interim orders of an adjudicator, quote -

1.	That the EGM held on the 1st October 2001 be declared invalid and that any motions passed at that meeting be declared null and void.
2.	That pending determination of the final orders sought that the body corporate take no steps inconsistent with the building work recommendations contained in the report of Buildcheck dated 4th June 2001.
3.	That pending the appointment of an administrator that Gold Coast Body Corporate Specialists be retained as body corporate managers.

Section 225(1) provides that an adjudicator may make an interim order if satisfied, on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances to which the application relates. An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 230(1)).

The applicant seeks specific relief in respect of the EGM that was held on 1^st October 2001 (that it be declared invalid) and secondly, more general support for a position regarding certain aspects, namely building work recommended by Buildcheck, and the continued appointment of Gold Coast Body Corporate Specialists as body corporate managers.

After referring to “the need to deal with the urgent rectification matters” the applicants conclude their grounds with –

At the EGM the chairman ... informed people at the meeting that motions 2, 3, 4, 5, 6, 7, 8, 9, 10, 12 and 13 were not submitted by the committee and as such the chairman ruled that these motions were invalid and could not be voted on. These matters inter alia dealt with the body corporate attending to the necessary works to bring the building to a safe standard and in particular deal with the issues raised by the engineers report Buildcheck. As a result of these motions being declared invalid the EGM was left with a very small number of motions to be dealt with which did not include implementation of the Buildcheck recommendations. As such unit owners were not given the opportunity to be able to vote for the implementation of the recommendations made by Buildcheck. ...

It is our honest belief that unless the recommendations contained in the report of Buildcheck Pty Ltd are implemented, Queensland Fire and Safety Authority will seek court orders closing the building. We do not believe that the committee has acted appropriately and unit owners have not been given the opportunity to vote on the recommendations of Buildcheck which we believe are necessary for the proper rectification of the defects at Aarons.

If urgent action is not taken not only will the building be closed there is a high risk of personal injury to the occupant or visitor at the Aarons Building.

I intend to dismiss this application for interim order as sought for several reasons.

Firstly, this application is for several interim orders. However the nature of the interim orders sought are more in the nature of final relief; namely the invalidation of an EGM and the continuation of the appointment of the body corporate manager.

In any consideration of an application which seeks the making of an interim order, it is necessary to determine at the outset whether, because of the nature or urgency of the circumstances relating to the application, an interim order is in fact necessary or appropriate. The examples included in the Act under section 225(1) are suggestive of the usual circumstances where an interim order might be made. Both examples are in the nature of injunctive relief. Whilst the range of matters which might be the subject of an interim order is not capable of definition, the applicant does need to establish that the circumstances of the application warrant the making of an interim order.

An interim order will not be made, or will be refused, in circumstances where the only urgency relates to the applicant’s desire to resolve or expedite the matters in dispute, or where the nature of the circumstances are such that the matter is not capable of being dealt with in the context of an interim order. Again, it is not possible to define these circumstances. However, given that an interim order may be made ex parte (ie. without reference to, or submission from the respondent named in the matter), then as a guide, where the circumstances or matters in dispute include matters or allegations not capable of objective consideration, or ready determination, or relate to issues of credibility or character, for example, where an interim order would be inappropriate, then the request for an interim order will be refused. It is a matter for an adjudicator to determine in respect of each application.

In the present application, I consider that the issues are not capable of being dealt with in the context of an interim order. The applicants are seeking the invalidation of a meeting. This matter requires further investigation, and in particular, submission from other parties, prior to any determination being made. Such a determination cannot be made on an interim basis.

A secondary consideration is that the first interim order sought, if made, will not actually assist the applicant’s position. It seems to me that the applicants want the motions which were ruled out of order by the chairperson to be considered by the body corporate in general meeting. This will not be achieved if an interim order as sought by the applicants is made. Rather, such an interim order will result in the process of calling and convening, then holding a meeting, being recommenced. It seems to me that what the applicants are really seeking is a determination of the validity of the chairperson’s ruling, and if that ruling is determined to have been invalid, then a consequential order that the body corporate consider the motions ruled out of order.

As to the second of the interim order sought, to make such an order would commit the body corporate to a particular course of action. It is not the role of an adjudicator to require a body corporate to adopt a particular approach to any matter including rectification work, which would be a consequence of the making of such an order. Rather, it is for a body corporate in general meeting, following correct procedure, to determine how, for example, building rectification work should be undertaken, and by whom.

Finally I am asked to confirm the position of Gold Coast Body Corporate Specialists (GCBCS) pending the proposed appointment of an administrator. I note that GCBCS were the body corporate managers for the scheme. I say “were” as it seems that the body corporate resolved at the meeting to appoint Body Corporate Services Pty Ltd (BCS) (see motion 15). I note that this motion was submitted by the company nominee for lot 35 Mr G Pearsall.

A similar motion seeking to appoint GCBCS (motion 12) was one of the motions ruled out of order by the chairperson on the basis that it was not submitted by the committee. On this reasoning, one wonders why motion 15 was not similarly ruled out of order, having been submitted by a person other than the committee.

In the circumstances, I do intend to order that the body corporate shall not implement or otherwise act upon motion 15 until such time as a final order to this application is made. To this end, as the manager previously engaged, GCBCS such continue in that role. In this regard I have significant concerns regarding the fairness of a motion proceeding and being carried, when a seemingly equivalent motion is ruled out of order by a chairperson. I will consider this aspect further in my final order. I invite the body corporate to address this aspect in its submission in response to this application.

I have considered the content of the motions which were considered at the meeting. It seems to me that, excepting motion 15 which I have referred to above, the only other contentious motion is motion 22 which is headed motion for alternative approach to rectification at Aarons. Again, this motion was not submitted by the committee raising the same question which I posed above; namely should the motion similarly have been ruled out of order by the chairperson. Interestingly, the person submitting the motion in this instance was in fact the then chairperson. The motion provides that a grand scale rectification program is not undertaken at this time, but instead we use a program which is able to be paid for out of available funds. The motion then refers to expenditure marginally in excess of $100,000. The motion was purportedly carried by a vote of 25 “yes” to 9 “no” with one abstention.

It seems to me that this motion, though purportedly carried, is not capable of immediate implementation in any event. In particular, based on the draft minutes of meeting, the motion fails to comply with the requirements of section 104 which deals with “major spending” and requires a minimum of two quotes to be included with the motion. Consequently, it seems to me that the resolution, even if valid (and I will consider its validity in my final order) could be considered nothing more than an agreement in principle in any event.

In the circumstances, I intend to order that motion 22 of the meeting also not be implemented pending the final determination of this application. I consider that this order will at least preserve the status quo, pending the making of a final order. This does not prevent the body corporate from convening a final meeting to consider aspects associated with the proposed rectification work. However it is not my intention to prevent this.

This matter will now be investigated in accordance with the usual processes undertaken by this office. A final order regarding the application will be made in due course.

All parties should note the provisions of section 225(2) of the Act which provides that -

An interim order -

a)	has effect for a period (not longer than 3 months) stated in the order; and
b)	may be extended, renewed or cancelled by the adjudicator until a final order is made; and
c)	may be cancelled by a later order made by the adjudicator; and
d)	if it does not lapse or is not cancelled earlier - lapses when a final order is made by the adjudicator.

All parties should be aware of this section and its effect on this interim order. In particular, the applicant may need to request a renewal of the interim order, before a final order is made. The onus of renewing an interim order rests with the applicant. This office will not automatically renew an interim order. n