Admiralty Towers II [2002] QBCCMCmr 199 (16 April 2002)

C G YOUNGREFERENCE: 0723-2001

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	15344
Name of Scheme:	Admiralty Towers II
Address of Scheme:	PO Box 731 SPRING HILL QLD 4004

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

C G YOUNGI hereby order that, under the current relevant provisions of the Body Corporate and Community Management (Standard Module) Regulation 1997, the owner of Lots 1 and 2, Nambagowrie Pty Ltd, is not responsible for the cost of repairs and maintenance of the building grease trap. 1n
STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0723-2001

“Admiralty Towers II” CTS 15344

The applicant, the Body Corporate for “Admiralty Towers II”, has sought an order of an adjudicator under the Body Corporate and Community Management Act 1997 (“the Act”) declaring whether the owner of Lot 2, being the sole user of the scheme building’s grease trap, is responsible for its maintenance, or whether the body corporate is responsible.

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).

In the grounds to the application, the body corporate states that the building grease trap is only used by Nambagowrie Pty Ltd (“Nambagowrie”) for disposing of wastage from its restaurant which it operates in Lot 2. The grease trap is located on common property in the basement of the building.

The body corporate states that around $10,000 in repair costs to the grease trap has been paid by the body corporate in recent times. It considers that, as the restaurant is the sole user of the trap, it is unfair that the repair cost should be borne by owners generally. However, although the restaurant is the sole user, section 109(3)(b)(ii) of the Standard Module also requires that the utility service being provided is of a “1ndomestic nature” when the restaurant use of the facility is a commercial one. The body corporate has always interpreted this provision to mean that the body corporate meets the repair costs but seeks an order confirming that it is unable to charge the repairs to Nambagowrie.

In response, Michael Shafferman for Nambagowrie relies on the commercial nature of its use of the trap in escaping the application of section 109(3). He says that the restaurant pays for the periodic emptying and cleaning of the trap. Also, it pays full body corporate contributions although it, “makes no use of the elevator services and the gyms and pools provided to other owners.”

It is my opinion that the body corporate retains responsibility for the maintenance of the grease trap for the following reasons.

The body corporate is generally responsible for the maintenance of common property, including utility infrastructure (see sections 21(1) of the Act and section 109(1) of the Standard Module). Section 109(3) provides that there are two situations where this general duty of maintenance passes from the body corporate to the relevant owner –

Duties of body corporate about common property—Act, s 114

109.(3) Despite anything in subsections (1) and (2)—

(a)	the body corporate is not responsible for maintaining fixtures or fittings installed by the occupier of a lot if they were installed for the occupier’s own benefit; and
(b)	the owner of the lot is responsible for maintaining utility infrastructure in good order and condition, to the extent that the utility infrastructure—

(i) relates only to supplying utility services to a particular lot; and

(ii) is 1 of the following types—

• washing machines

• clothes dryers

• hot-water systems

• another device providing a utility service of a domestic nature to a lot.

Examples for subsection (3)(b)—

1. An airconditioning plant is installed on the common property, but relates only

to supplying utility services to a particular lot. The owner of the lot would be

responsible for maintaining the airconditioning equipment.

2. A hot-water system is installed on the common property, but supplies water

only to a particular lot. The owner of the lot would be responsible for maintaining

the hot-water system and the associated pipes and wiring.

(NOTE: Adjudicator’s Underlining)

Paragraph 3(a) is not relevant as, from the information supplied, the grease trap was part of the original development.

Under paragraph 3(b), the duty only passes if two conditions are met: firstly that the utility infrastructure only supplies utility services to the particular lot; and secondly, that there is a device providing a utility service of a domestic nature.

The term “utility infrastructure” is defined in the Schedule 4 Dictionary to the Act and includes “drains” and any “plant and equipment by which lots or common property are supplied with utility services”. The term “utility services” is also defined in the Dictionary and includes, “(i) a system for the removal or disposal of garbage or waste” - this accurately describes the purpose of the grease trap. Therefore, both the trap (drain) itself and the “plant and equipment” associated with it (pump; sensors; switching equipment) define the whole of the grease trap system as being utility infrastructure.

However, 3(b) does not apply to utility infrastructure providing all utility services, only domestic utility services. The definition of “utility services” does not differentiate between domestic and commercial services and obviously all of those itemised could be used for either purpose. The meaning of the domestic qualification therefore must relate to the purpose to which the service is put. In this instance Nambagowrie uses the grease trap for commercial purposes, and in fact the grease trap is designed for commercial and not domestic use. It is apparent that the grease trap was purposely installed by the developer for use by the restaurant operator.

Accordingly, Nabagowrie is not caught by the provisions of section 109(3) of the Standard Module and therefore the maintenance responsibility remains with the body corporate.

I might mention that I understand amendments to section 109 are being contemplated in the current major amendments being considered.