Malindi [2002] QBCCMCmr 267 (3 May 2002)

C G YOUNGREFERENCE: 0641-2001

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	11499
Name of Scheme:	Malindi
Address of Scheme:	41 Buderim Avenue MOOLOOLABA QLD 4557

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

Emma Louise Smith-Roberts, as the owner of Lot 3,



C G YOUNGI hereby order that the application for an order that the body corporate, at its cost, rectify the damage caused to the bathroom of Lot 3 by termites, is dismissed.2n
STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0641-2001

“Malindi” CTS 11499

The applicant, Emma Smith-Roberts of Lot 3, has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (“the Act”), quote -

“Body Corporate to pay for damages caused from common property. Quotes have been sent into the body corporate for damage caused by whiteants. These whiteants originally nested in a stump on the common property which wasn’t removed at the time of the tree being cut down.

Therefore I believe it comes under the body corporate’s jurisdiction of ordering the repair. I’m not on the committee to have this request put forward.”

JURISDICTION:
This is a dispute between an owner, as applicant, and the body corporate, as respondent, alleging a breach of duty by the body corporate resulting in damage to the applicant’s lot building. It therefore comes within the dispute resolution provisions of the Act (see sections 182, 183 and 223 of the Act).

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).


APPLICATION AND SUBMISSIONS:
The application is very sparse. The applicant states that the termites originally nested in a stump on common property and latter termites destroyed the, “support beams in the bathroom”. The applicant states that a quote for the repairs had been given to the body corporate but does not provide a copy of the quote or the amount of the quote.

A copy of the application was provided to the committee and all owners with an invitation to respond to the matter raised in the application. A submission was received from one owner and advice from another that the matter was to be dealt with in general meeting.

That meeting, the annual general meeting, took place on 28 March 2002 and a copy of the minutes were sent to this office by the Body Corporate Manager, Abetta Body Corporate Management, on 10 April 2002. Motion 9, relating to the repairs to Lot 3, stated –

“That the quotation from Kalinda Constructions dated 28^th November 2001 for works as described in the quotation for the quoted price of $8,602 be accepted.

Motions 9 and 10 were alternatives quotes for the work, being Coastline Carpentry Co. for $8,869 and MH Tiler for $9,900 respectively.

All three motions failed with no votes in favour and 2 votes against, with the following comments appended to each failed motion –

“Members present discussed the repair quotations for unit 3 at the meeting and do not believe the Malindi Body Corporate to be liable, as the termite infestation occurred approximately 4 years ago and was treated at that time. The present owner purchased the unit approximately 3 years ago and only put forward the liability claim approximately 1 year ago. As the unit was purchased as in state, the members present believe the purchase price would have reflected the repairs required.”

The applicant, who says she was not notified of the meeting, but now having read the minutes of that meeting, states that when she purchased the lot in March 1999 she had a building and pest inspection done. After using it for a holiday home and then renting it, in July 2000 shortly after taking up residence, she discovered termites in the bathroom. She had the termites treated but then says, “we have lived in this situation for 21 months waiting for this dispute to be resolved.” She states that the persons at the meeting were mistaken in referring to the original termite problem of 4 years ago, and not the more recent damage from the untreated stump on common property.

Further explanation of the appendage to the minutes was sought from the committee, which responded that the body corporate should not be liable for the repairs under the following circumstances -

• Termite treatment 16/11/98 after door on Unit 3 was eaten out (East Coast Pest Control)

• Unit 3 treated again July 2000. Shower tub leak from Unit 3 was source of moisture for termites, as advised in report from Bunters Carpet Care & Pest Control (report attached). Building perimeter also treated.

• Previous owner obviously did nothing about repairing bathroom damage (holes in walls). Sold the Unit.

• Purchaser of Unit 3 must have known of damage and maybe purchase price adjusted accordingly. It is not known if the purchaser had a building inspection prior to purchase.

• Purchaser of Unit 3 bought unit May 1999 (approximately), lodged quotes for repairs of damage on 27^th July 2001, after residing in the unit for a period of approximately 2 years.

DETERMINATION:
The applicant is seeking some $8,600 worth of repairs to her bathroom from the body corporate. With all lots having equal lot entitlements (under both schedules), this will require the other 4 owners to contribute $1,720 each for the repairs, or alternatively to take part or all of that sum out of their equity in any existing body corporate funds.

“Malindi” was registered as a building units plan under the previous legislation, the Building Units and Group Titles Act 1980, on 29 April 1980. While the body corporate has a duty to maintain the common property, including taking the necessary steps in attempting to keep it free of termite infestation, owners also have a duty to maintain their own lots. Any termite damage reasonably able to be identified as such should be identified and reported to the body corporate; owners have a duty to mitigate any loss after identification of a termite problem.

It seems to me that here, at the least, the applicant, by her own admission, delayed initiating any legal proceeding against the body corporate for some 16 months, the time between discovery in July 2000 and lodgement of this application in October 2001. A delay of some months when negotiating with the body corporate would be reasonable, but this period is not. Additionally, the termites may well have been present during the earlier time when the unit was being let – this would only add to the period of delay.

The applicant does not say whether after the initial inspection in March 1999 she had regular pest treatment carried out as any prudent owner would. Also, given the history of termite damage to the unit, which would have been evident if not from the unit itself then from the body corporate records, the applicant should have had more rigorous and regular pest treatment and inspections, carried out to deter and detect termites.

There is some conflict in the applicant stating previous termite damage had been remedied, while other owners state that the present damage is part of that which occurred when the previous owner had termite problems. That is, the applicant purchased the unit with the damage existing. The applicant has stated that she had a pest and building inspection carried out when termite presence and building damage should have been discovered and reported to her. I am not prepared to speculate on whether or not the damage existed, or was not discovered, or was accepted; these are matters that may be difficult to establish if at all. Neither the applicant nor the respondent has produced evidence either way.

The applicant closes her grounds to the application with the words, “I am unable to sell this property in the current condition this is in.” It seems that the applicant is contemplating selling the unit and, after having lived with the damage for some years, this may well have triggered her claim against the body corporate.

In all the circumstances, I am not prepared to impose on the body corporate, that is the other owners, a considerable money liability for a repair which the applicant has not supported with proper evidence, has not pursued in a timely manner, and in circumstances where the timing of the damage (pre or post purchase; pre or post residence) is unclear. I have therefore dismissed the application.





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