Campari [2001] QBCCMCmr 554 (6 November 2001)

C G YOUNGREFERENCE: 0379-2001

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	5636
Name of Scheme:	Campari
Address of Scheme:	45 Galloway Drive ASHMORE QLD 4214

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

C G YOUNGI hereby order that Elaine Charlotte CROFT, the owner of Lot 6, is not liable to reimburse the body corporate the sum of $4,004 (Four thousand and Four dollars) claimed by the body corporate relating to secretarial and treasury services provided by her to the body corporate for the period of seven years from 1992 to 1999. 2n
STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0379-2001

“Campari” CTS 5636

The applicant body corporate has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (“the Act”), quote -

“To confirm that, according to the BCCM Act 1980 and 1997, the appointment of Mrs Croft as Manager was both “lawful and official” and that the management fee she received in lieu of payment of Body Corporate fees for Lot 6 was valid, thus accounting for an apparent discrepancy in the available financial records.”

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) of the Act). An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 230(1) of the Act).

While the order sought above is cast in a positive manner so far as Croft is concerned, the supporting grounds submitted by the body corporate (through its committee) show that the order could have been more accurately put as requiring an order that Croft reimburse the body corporate the amount of $4,004, representing 7 years of unpaid contributions at $527 a year.

I have carefully read the minutes of the annual general meetings of the body corporate for the relevant period, the body corporate final year periods between 1992 and 1999. I agree with the presumption of the body corporate that Croft took as her payment for her services as Body Corporate Manager, relief from having to pay her contribution to the body corporate funds. This is confirmed by there being only 10 contribution payments received each year and no cheque being drawn in favour of Croft though there is an expenditure item for the contribution amount shown as “Management Fees” in the annual financial statements.

I also agree with the body corporate that Croft has not been properly appointed as Body Corporate Manager in accordance with either the present Act for the meetings of 1998 and 1999, or the then governing Building Units and Group Titles Act 1980 (“BUGT Act”) for the prior five years. The requirements under both section 50 of the BUGT Act and sections 78 and 87 of the Standard Module regulations (see also section 106 of the Act), are that the engagement must be in writing, must specify the delegations of power, the term of engagement, amongst other things. The engagement of Croft appears to have been by default after her initial engagement in 1992.

I have dismissed the application on the grounds that I do not believe Croft should have to reimburse the body corporate for past fees received for the reasons that follow.

Firstly, there is precedent in the history of the body corporate for the employment of an owner as the Body Corporate Manager. In the minutes of the First AGM held on 6 March 1990 there is the decision, “Mrs Sheppard was appointed as Body Corporate Manager”. In the relative financial statement for the year ending December 1990, there is a also line item of $286 for “Strata Title Management”. Accounts for 1991 also show a similarly named fee. Although it is not specifically stated in the minutes, from the fees levied it appears that Sheppard carried out the secretarial and treasury duties of the body corporate in return for the waiver of her contribution.

The minutes for the third AGM held on 8 March 1992 shows that, “Mrs Jenny Sheppard resigned as Manager. Mrs Elaine Croft voted in as Body Corporate Manager.” The financial statement ending March 1993 shows a payment of $572 for “Management Fees”. The minutes and financial statements for the following years continue the pattern established for Sheppard, that is, no contribution being paid by Croft in return for carrying out “Body Corporate Manager” secretarial and treasury duties.

The fact that the payment was disclosed in the financial statement shows that Croft did not act in any underhand manner in taking payment for the work she did. The fact that the body corporate, that is the owners, continued each year to allow the arrangement to continue by adopting the previous year’s financial statement and making no move to relieve Croft of her duties, must be taken to mean the body corporate approved the arrangement and the payment made. Whether the payment was by cheque or by Croft not paying her contribution, as it was, is of no real account as the amounts are the same so the result is the same.

Having been a party to this arrangement of performance and payment for that performance, which constitutes, in my opinion, an implied contract, the body corporate now wishes to recover moneys paid because the contract was not in proper form, that is, in accordance with the Act. The body corporate was equally to blame for the contravention of form, but of course Croft cannot recover her labour from the body corporate. Nor can the body corporate recover the payments, or more correctly the contributions foregone, from Croft.

I have therefore dismissed the claim for reimbursement. If the body corporate wishes to pursue the matter in the civil courts as a debt then it may do so, however I would suggest that it first seek legal advice as to the likelihood of success before embarking on such an action.



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