Kapalua Sun Court [2002] QBCCMCmr 172 (3 April 2002)

C G YOUNGREFERENCE: 0673-2001

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	11592
Name of Scheme:	Kapalua Sun Court
Address of Scheme:	2 T.E.Peters Drive BROADBEACH WATERS QLD 4218

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

Gerhard KRASA and June Rose KRASA, as the co-owners of Lot 1,


C G YOUNGI hereby order that Gerhard and June Krasa, the co-owners of Lot 1, must submit written motions to the body corporate secretary seeking the approval of the body corporate, by special resolution, for the improvements of landscaping, tree removal, and shed installation, carried out to that area of common property over which they have exclusive use as their courtyard.

I further order that, unless the body corporate has already determined to hold a general meeting within the stated period, –

(a)	within three (3) months of the date of this order, but no sooner than two (2) months, the body corporate must call an extraordinary general meeting to consider the above ordered motions; and

(b)	the cost of the meeting ordered to be held shall be at the sole cost of Gerhard and June Krasa.

I further order that the body corporate secretary is to forward a copy of this order and the accompanying reasons to each lot owner as shown on the roll.
2y
STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0673-2001

“Kapalua Sun Court” CTS 11592

The applicants, Gerhard and June Krasa of Lot 1, have sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (“the Act”), quote -

1. “That we, the applicants, be permitted to keep the garden shed and not have to demolish the terracing in our courtyard.

2. That we not be obliged to have a general meeting for these purposes or pay any costs towards a general meeting for reasons as attached with this application.

3. That until an order is received from your department, that the body corporate or committee not hold any meeting for the above purposes or make any attempts to enforce us to demolish any work carried out in our courtyard or to enforce us to remove our garden shed or take any other action which they may seem fit.

4. That no action be taken relating to removal of the trees in our courtyard.”

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).

“Kapalua Sun Court” was registered as a building unit plan (termed a “building format plan” under the new Act) on 23 February 1979. By-law 42 granting exclusive over adjacent areas of common property (hereafter “courtyards”) to the owners of Lots 1 to 11, was recorded by the Registrar of Titles on 26 March 1979. An amendment to the by-law was recorded on 6 November 1997. By-law 42 now reads –

“42. The proprietors of Lots 1 to 11 inclusive (ie of the eleven ground floor units) shall each be entitled to the exclusive use and occupation for themselves and their guests and invitees for ever of that part of the common property as comprises the fenced-off yard in front of their respective units as the same is presently delineated by the present fencing, subject to –

(a)	Each proprietor keeping and maintaining such yard and the gardens and shrubs therein in good, clean, presentable order and condition, and keeping the grass therein neat and mown, at all times.

(b)

No trees planted therein being allowed to grow above the horizontal plane of the floor level of the unit immediately above without the prior written approval of the proprietor of such unit and without the approval of the Body Corporate Committee which may refuse or impose conditions where the height of the plant is likely to grow into Body Corporate areas or the root system is likely to interfere with drains or Body Corporate property.”

Section 114 of the Body Corporate and Community Management (Standard Module) Regulation 1997 (“the Standard Module”) provides that where an owner makes an improvement for the benefit of the lot which lies wholly or partly on common property, if the improvement has an installed value of over $200 then prior authorisation of the body corporate by way of a special resolution passed at a general meeting, is necessary. For improvements made to a part of common property which is subject to a grant of exclusive use to the owner, section 124(3) and (4) of the Standard Module imposes a similar authorisation requirement on the owner –

Improvements – Act s 136

124 (3) If the exclusive use by-law does not authorise the lot owner to make an improvement, the lot owner may make the improvement only if the body corporate authorises it to be made.

(4) However, if the value of the improvement mentioned in subsection (3) is more than $200, the making of the improvement must be authorised by a special resolution of the body corporate.

By-law 42 (set out above) does not contain any provisions concerning improvements. Therefore, under section 124 an owner wishing to make an improvement to their exclusive use courtyard must first obtain the permission of the committee if the installed value is $200 or less, or obtain authorisation by a special resolution of the body corporate in general meeting if it is over $200.

Accordingly, comments by the applicants that, “there is no by-law restricting any item from being placed in your private courtyard”, and “we request evidence be shown that we have committed any breach or that there is any by-law restricting our actions”, show that they do not understand the above relationship between by-law and the legislation.

The improvements carried out by the applicants to their courtyard are, broadly, landscaping of the area with pavers, and the erection of a modular garden shed, following the removal of some seven palm trees.

In a number of submissions, owners have stated that they –

• object to the presence of the garden shed because, being higher than the perimeter fence, the top of the shed can be seen from the street which detracts from the overall presentation of the scheme.

• do not object to the laying of pavers, retaining wall, steps, pot plants, and gardens, none of which are visible from outside, but contend that the applicants should still have informed and sought permission of the body corporate.

• are annoyed that mature palm trees, which complemented similar palms in other parts of the scheme, were removed to make room for the landscaping.

In regard to the third point above, the applicant’s comment that, “no by-laws disallow the removal of trees in our yards”, is incorrect as the trees were a substantial part of the land which is common property. The further comment, “Also it would have been impossible to pave the courtyards without the removal of the trees” is a meaningless circular argument in that the landscaping should itself have be put forward for permission; it provides no excuse for removing the trees. In any case, one owner also states that the trees (reportedly seven palms all around 7 metres high) were sited close to the fence and their removal only facilitated the installation of the shed and not the paving. Whether that was in fact the case or not, is irrelevant to my determination of the dispute.

There is conflicting evidence as to whether the chairperson or secretary, or any committee member, was aware of the progress of the improvements and failed to take steps to halt it. The committee also submits that at the annual general meeting of 11 August 2001, the Body Corporate Manager made the statement that, “improvements to exclusive use areas of greater value than $200 was to be approved by the body corporate in general meeting”, and the applicants were in attendance at that meeting.

In these reasons I have gone beyond the extent necessary to resolve the application for certain relief sought by the Krasa’s of Lot 1. From my foregoing comments there can obviously be only one outcome, namely that they should have sought permission for the improvements and didn’t, and now should remove the improvements unless the body corporate in general meeting (by special resolution) agrees to their retention in whole or in part, with or without conditions. The purpose in my setting out comprehensive reasons is to provide a guide to owners as to their responsibilities for proposed future improvements to their exclusive use areas.

I do not intend to comment on the three areas of improvement involved here – owners should express their own opinion on these matters by voting in general meeting. The applicants and a number of owners in their submissions have commented on past body corporate practices. Apparently a number of improvements have been made to various courtyards without approval being obtained. In fact the immediate past-chairperson has stated that landscaping, the removal of trees, and other alterations, have been carried out in courtyards over many years without permission ever having been obtained. It is apparent that, at least in respect to the control of improvements, the body corporate has been poorly managed, and the failure to adhere to the legislation has created the potential problem that owners, claiming ignorance of the law, will claim discrimination if they are now required to follow a law that was previously ignored seemingly as a body corporate policy.

I am not saying that owners could now successfully claim discrimination, that will be a matter for an adjudicator to determine in a particular instance if a dispute is brought, however in order that current owners cannot in future claim to be ignorant of requirements, I have included in my order that a copy of this order be sent to each owner.

In regard to the situation of the Krasa’s, I have read a “character reference” submitted by them, written by the previous Body Corporate Manager to the scheme, Mariki Maselli of AM Strata Administration Queensland Unit Administration Pty Ltd. In that reference, Maselli reveals that Mr Krasa is the chairperson of four buildings (community title schemes) managed by her company. In that case, it must be assumed that he has more than a general understanding of the legislation, and is not really in a position to claim ignorance of the legislative requirement concerning improvements as he has.



The committee has required of the Krasa’s that they pay the cost of convening a meeting for considering a request to retain their improvements. My order is that they must submit relevant motions for the improvements, and that the body corporate convene a meeting for that purpose within three months (but no sooner that 2 months) at the Krasa’s cost unless a general meeting is scheduled to be held within the 3 months for other purposes. The Krasa’s cannot complain of having to meet the cost when the need for the meeting is of their own making through having failed to comply with the legislation.