L'Colonial Court [2002] QBCCMCmr 355 (3 June 2002)

M.F. MorganREFERENCE: 0096-2002

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	9169
Name of Scheme:	L'Colonial Court
Address of Scheme:	167 Nineteenth Avenue PALM BEACH Q 4221

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

Mr MP and Mrs PJ Ives, Mr D and Mrs B Degiovanni, Mrs C Barker and Mrs P Shaw,

M.F. MorganI hereby order that that the proprietor for the time being of the following respective lots in building units plan number 6045 is entitled to the exclusive use of the car space or spaces which is identified by the number or numbers set out in the table below

Lot	Exclusive use of car park number identified on the sketch plan delineating the parking areas attached to the Notification of Change of By-Laws which was recorded on BUP 6045 on 16 April 1984
1	12 & 14
2	10
3	5
4	2 & 7
5	8
6	6 & 9
7	1 & 4
8	13 & 11
9	3

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STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0096-2002

“L'Colonial Court” CTS 9169

The applicants Mr MP and Mrs PJ Ives, Mr D and Mrs B Degiovanni, Mrs C Barker and Mrs P Shaw have sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), quote -

a) We seek resolution as to the allocation of the 14 garage spaces included in the plan. In particular, the allocation of 2 spaces to each of the 5 units owned by Mrs Phelps whereas the other four unit owners have only one garage space allocated each. Based on our investigations, there is no reference in the bylaws or Community Management Statement giving Mrs Phelps exclusive use of 10 of the garage spaces.

b) Given our belief that there is no exclusive use, then all spaces remain common property and are subject to allocation in terms of Clause 56 of the Bylaws.

c) The right of a person to whom the common spaces are allocated to rent these spaces for personal gain.

Jurisdiction

There are nine lots in L’Colonial Court Community Titles Scheme. Five of these lots are owned by Mrs. Elsie Jennie Phelps (the respondent) who with her husband Mr. Leonard Phelps (now deceased) were the original developers of the scheme. This is a dispute between the four other lots owners (the applicants) who dispute the right to the exclusive use by Mrs. Phelps to two car spaces to each of the five lots owned by her.

The exercise of the right to the exclusive use of the car spaces by Mrs. Phelps and other lot owners is a matter that falls within the dispute resolution provisions of the legislation (see sections 182, 183 and 223 of the Act).

Section 223(1) 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)). An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 230(1)).

Delay and time limitations

The determination of this dispute and whether or not Mrs. Phelps has a valid entitlement to the car spaces depends upon the existence of a exclusive use by-law that attaches to the specific lots. This in turn depends in part upon an examination of the relevant legislation and body corporate records from the time of the creation of the L’Colonial Court Building Units Plan.


There has been considerable passing of time since the creation of the scheme and since applicants became registered as proprietor and the making of the current application.

On 5 March 1984 the L’Colonial Court Body Corporate was established by the registration of building units plan 6045.

The applicants became registered as proprietors of their respective lots as follows:

The owner of lot 2 became registered as proprietor on 21 May 1990.

The owner of lot 3 became registered as proprietor on 18 December 1996.

The owner of lot 5 became registered as proprietor on 23 June 1997.

The owner of lot 9 became registered as proprietor on 2 October 1986.

In the submissions one lot owner stated that there has been apprehension in clarifying this matter with the respondent or Linda Phelps, Solicitor for the respondent who chaired Body Corporate meetings. It was only when the Department held a meeting on the Gold Coast regarding Body Corporate matters that they took the opportunity to raise the matter and found that they could apply to this Office for help to resolve the dispute. Another lot owner claims that there has in the past been some inflexibility and resultant friction between the respondent and other lot owners. Another lot owner indicates that they have felt intimidated in the past and states that they only felt strong enough recently to seek resolution of this matter of ‘unrest’.

The Act specifically imposes a time limitation of three months on the following applications:

193 Time limit on certain applications

(1) This section applies to an application for an order declaring void—

(a) a meeting of the committee for the body corporate, or a general

meeting of the body corporate; or

(b) a resolution of the committee or body corporate; or

(c) the election of an executive or other member of the committee.

(2) The application must be made within 3 months after—

(a) if subsection (1)(a) applies—the meeting; or

(b) if subsection (1)(b) applies—the meeting at which the resolution

was passed or purported to be passed; or

(c) if subsection (1)(c) applies—the meeting at which the executive

or other member was elected.

(3) However, if the making of the application does not comply with

subsection (2)—

(a) the commissioner must deal with the application (including

making a case management recommendation for the application)

as if the making of the application complied with subsection (2);

and

(b) an adjudicator to whom the application is referred for specialist

or department adjudication may, for good reason, waive the

non-compliance.

The current application does not fall within the above categories.

Also the Limitations of Actions Act 1974 imposes time limits within which actions must be commenced in court in Queensland. If legal proceedings are not commenced they are out of time and cannot proceed unless there are special circumstances. This Act does not apply to adjudications and accordingly it is also not applicable in the current application.

In my view, there is no statutory time limitation, which precludes the determination of this application. However any delay or ‘laches’ as referred to by the Solicitor for the respondent is not an irrelevant consideration. Rather the equitable jurisdiction of a judicator is in my view tempered by this consideration and any order should be fair and equitable in the circumstances.

Application and submissions

In supporting grounds, the applicants state that no written notification of garages has ever been received but that all owners have been told by Mrs. Phelps to use certain garage spaces.

The applicants further claim that their belief is that there is no letter of allocation, no exclusive use clause in the by-laws and no allocation on the Community Management Statement. As such they believe that all garage spaces are common area for the use of all owners with allocations to be agreed upon by the committee from time to time as indicated in the by-laws. They believe that each owner should be allocated one garage space per lot with the allocation of the remaining five units to be decided by the Committee.

In response Linda Phelps and Company, Solicitors for the respondent made multiple submissions in letter dated 11 March 2002.

Each of the applicants has responded separately to the matters raised in the letter dated 11 March 2002.

Validity of exclusive use by - law

As previously noted, the determination of this dispute about the allocation of the fourteen car spaces and whether a lot owner has a valid entitlement to a car space depends upon the existence of a valid exclusive use by-law that attaches to a specific lot. This, in turn, depends in part, upon an examination of the relevant legislation and body corporate records at the time of the creation of the relevant by-law for the L’Colonial Court scheme.

This plan registered on 5 March 1984. At this time, section 30 (7) of the Building Units and Group Titles Act 1980 (the former Act) relevantly provided:

“(7) Without limiting the generality of any other provision of this section, a body corporate may, with the consent in writing of the proprietor of a lot, pursuant to a resolution without dissent make a by- law in respect of that lot conferring on that proprietor the exclusive use and enjoyment of, or special privileges in respect of, the common property or any part thereof upon such terms and conditions (including the proper maintaining and keeping in a state of good and serviceable repair of the common property or that part of the common property, as the case may be, and the payment of money by that proprietor to the body corporate) as may be specified in the by-law and may, in like manner, make a by-law amending, adding to or repealing any by-law made under this sub-section.

(8) A by-law referred to in subsection (7) shall, while it remains in force,

enure as appurtenant to, and for the benefit of, of the lot in respect of which it was made.”

An inspection of the records of the Body Corporate occurred on 22 May 2002.

A copy of the minutes record that on 6 March 1984, a meeting of the Proprietors of L’Colonial Court was held. At this time, all lots were still owned by the original developers and registered proprietors, Leonard Phelps and Elsie Jennie Phelps. At the meeting held on 6 March 1984, the minutes record that L. Phelps and E.J. Phelps were present and it was relevantly resolved as follows:

“3. THAT the By-Laws presently applying to the Building Units Plan be amended by the addition of further By-Laws other than those By-Laws that form the Third Schedule to the Building Units and Group Titles Act, 1980 as amended.

THAT the By-Laws be amended so as that they read as a whole as per the list of By-Laws attached hereto.”

Then, on 16 April 1984, a Notification of a Change in the By-Laws registered. This incorporated by- law 56 as follows:

“THE proprietor for the time being of each unit in the building shall be entitled to the exclusive use for himself and his invitees and licensees of the car space or spaces the identifying number or numbers of which shall be notified in writing by LEONARD PHELPS and ELSIE JENNIE PHELPS to the Council of the Body Corporate within twelve (12) months after the date of registration of the Plan PROVIDED THAT in respect of those car spaces allocated pursuant to this by-law, the Council is hereby authorised to vary the allocations so made and to transpose car spaces from one lot to another unit at any time and from time to time on the written request of the proprietor of the lot involved. Each proprietor to whom exclusive use of a car space or spaces is given pursuant to this By-Law shall use such space or spaces for the purposes of carparking only and shall not litter the same or so use the same as to create a nuisance but otherwise no such proprietor shall be responsible for the performance of the eduty of the Body Corporate under Section 38(1)(b). A Sketch Plan is set out hereunder for the purpose of clearly identifying the said car spaces”.

The minutes do not evidence compliance with all technical requirements of section 30(7) of the Building Units and Group Titles Act 1980.

However, although not expressly noted in the minutes as being a resolution without dissent and that no vote was cast against the motion, in the circumstances, I accept that resolution 3 of the meeting held on 6 March 1984 was a resolution without dissent.

I also accept that the by-law was made with the written consent of the proprietor of each lot because at the relevant time all lots were still owned by the original developers, Leonard Phelps and Elsie Jennie Phelps who were both present at the meeting.

It is also my view that the by-laws referred to in resolution 3 of the meeting held on 6 March 1984, were referable to the amending by-laws which registered on 16 April 1984 and which contained by-law 56. This by-law conditionally conferred exclusive use of the car spaces in favour of a proprietor for the time being of each unit in the building subject to notification in writing within 12 months after the date of registration of the Plan.

It is noted that the legislation and specifically section 30(7) as it was at the time of the creation of by-law 56, did not expressly allow common property to be allocated by a person after the general meeting, at which the resolution without dissent was passed. However, the High Court held in Dainford v. Smith [1985] HCA 23; (1985) 155 CLR 342 that such a process could validly take place in accordance with sub-section (7) as it was at the time.

Hence in my view section 30(7) has been complied with and by-law 56 is a valid by–law.

However for the subsequent exclusive use allocation to be valid, it will be necessary to establish that Leonard Phelps and Elsie Jennie Phelps notified the Council of the Body Corporate of the allocations within twelve (12) months after the date of registration of the Plan in accordance with the requirements of by-law 56. That is, the notification should have been given before 5 March 1985.

An undated notice signed by Leonard Phelps and Elsie Jennie Phelps and addressed to “the Proprietors, L’Colonial Court”, which is contained with the Body Corporate records, provides as follows:

“LEONARD PHELPS and ELSIE JENNIE PHELPS as proprietors hereby notify you pursuant to the Third Schedule By-Law No.56 that they have allocated the car spaces set out in the attached Schedule of the exclusive use of the Proprietors of the appropriate lots also set out in the said Schedule.”

The respondent relies upon this notice for the purpose of satisfying the notification requirements of by-law 56.

I accept that this notice addressed to “the Proprietors, L’Colonial Court ” satisfies the requirement for a notice to the “Council of the Body Corporate”.

However, the notice is undated and it is uncertain, from the notice itself, when it was given and the car spaces allocated to the various lots.

Both Linda Phelps (Solicitor) and Elsie Jennie Phelps have provided specific and persuasive statutory declarations that this notification was signed within 12 months of registration of the plan. In her statutory declaration, Linda Phelps declares that she is the Solicitor for and daughter of the respondent and acted for her parents who were the proponents of the scheme from its conception.

Having regard to these statutory declarations, I accept that the notice was given within 12 months after the date of the registration of the plan.

In my view, Leonard Phelps and Elsie Jennie Phelps notified the Council of the Body Corporate in writing of the allocation of car spaces within twelve months of the registration of the building units plan in compliance with by-law 56.

However, subsequently section 30(7) of the former Act was amended, and the view has also been expressed that the notification of original allocations is of no effect unless it was recorded on the building units plan for the scheme. Section 30(7D) of the former Act provided as follows:

“(7D) Neither the allocation of identified or defined common property nor any variation or transposition in relation thereto (which occurs after the commencement of the Building Units and Group Titles Act Amendment Act 1990, other than sections 1 and 2) has any force or effect until the registrar of titles has, pursuant to a notification in the prescribed form lodged in the land registry by the body corporate, recorded the notification on the registered plan.”

Section 30(7E) then provided that a notification must be lodged within three months of an allocation, variation or transposition.

Originally, section 30(7C), (7D) and (7E) were part of section 30(7B). The Act was subsequently renumbered to separate sub-sections 30(7C), (7D) and (7E).

The above legislation was inserted into the former Act by the Building Units and Group Titles Act Amendment Act 1990 (the amending Act). The amending Act commenced on various dates. The section of the amending Act that introduced the above amendments commenced on 1 April 1992. On that day the Building Units and Group Titles Amendment Regulation 1991 also commenced operation. It introduced Form 17A which provided a format for notification.

Prior to the amending Act taking effect, there was no requirement for notification of allocations, variations or transpositions on a building units plan or group titles plan to the Titles Office.

Since the amending Act had not commenced at the relevant time, it is my view that compliance with section 30(7D) of the former Act was not required and the allocation of the car spaces as set out in the original notification is valid in respect of those car spaces allocated pursuant to by-law 56.

Finally, it is noted that by-law 56, which was in force and in my view valid, prior to the commencement of the Body Corporate and Community Management Act 1997, is saved by sections 283 and 286 of this current Act and continues to be the relevant by-law for the scheme. The transitional provisions preserved this right. This operates to save rights of exclusive use even though there is no reference in the Community Management Statement giving Mrs. Phelps or other lot owners, the exclusive use of the specified car spaces.

Hence from the time of the original allocation, the proprietor of the following respective lots was entitled to the exclusive use of the car space or spaces which are identified in the table below subject to any valid variation and transposition pursuant to by-law 56. These spaces are already allocated and cannot be the subject of any future allocation and further cannot be used by all lot owners as suggested by the applicants.

Lot	Exclusive use of car park number identified on the sketch plan delineating the parking areas attached to the Notification of Change of By-Laws which was recorded on BUP 6045 on 16 April 1984
1	12 & 14
2	13
3	5
4	2 & 7
5	8
6	6 & 9
7	1 & 4
8	10 & 11
9	3

Has there been a valid variation and transposition of any of the above allocations?

Lot 2 was originally granted exclusive use of car space 13. Frank Lawson Browne is noted as registered proprietor of lot 2 from 3 November 1987 to 21 May 1990. Mr. Browne sold lot 2 to Mrs. Barker who is one of the applicants. The transfer was produced for registration on 15 May 1990 and registered on 21 May 1990.

The solicitor for the respondent states, in relation to lot 2, that during the ownership of Mr. Browne there was a request to Mrs. Phelps from Mr. Browne as to whether she would be prepared to swap his exclusive use car space, which was 13, for one of her exclusive use car spaces, which would be closer for Mr. Browne to both his stairwell to his unit from the basement and to the hallway entrance into his unit. It is stated that Mrs. Phelps was happy to oblige him and swapped her exclusive use car space 10 to Mr. Browne in exchange for his car space 13. Reference is made to a copy note to Mrs. Phelps dated 10 October 1987, which the respondent states is from Mr. Browne to Mrs. Phelps, thanking her. This note states,

“Monday morning (8.30) is O.K. by me. Thanks for arranging it so promptly. Frank”

It is unclear to me that the note referred to above, dated 10 October 1987, is about the car space. It clearly does not constitute a written request by Mr. Browne as proprietor of the lot involved as required by by-law 56.

In response to a query from Messrs.Attwood Marshall, the Solicitor for Mr. Browne, reference is made to a copy of a file note dated 2 May 1990, about a conversation with Mr. Geoff Garrett, Solicitor of Attwood Marshall that explains about the exchange of the car spaces between Mr. Browne and Mrs. Phelps. This file note states as follows:

“Advised car space 13 is the allocated Bay to Unit 2. But by virtue of a private arrangement with Mrs. Phelps, Mr. Browne swapped with Mrs. Phelps car bay 13 for car bay 10. If necessary, a resolution of the Body Corporate could be made to effect the change.”

The solicitor for the respondent states that Mrs. Barker had her solicitor ensure that she did have exclusive use of car space 10 and that since the purchase of lot 2 by Mrs Barker in 1990 to the present time Mrs. Barker has had the exclusive use of car park 10 as per letter from her solicitors Messrs. Chalmers, O’Neill & Company. This letter dated 23 May 1990 states as follows:

“It would be appreciated if you could forward to us, confirmation of the Body Corporate Minutes wherein car space number then has now been allocated to our client.

Our client wishes to finalise the matter once and for all so that in the event of her selling the unit in the future, this problem will not arise. Unfortunately, Mr. Browne was not aware of the proper position regarding car spaces, and our client wishes to avoid this situation for the future.”

This letter does not appear to me to clarify the matter, was made after settlement of the purchase from Mr. Browne occurred.

Mrs. Barker who is the owner of lot 2, submitted on 24 April 2002,as follows:

“We bought the unit in 1990, our solicitor told us at that time we had car space 13. Mrs. Phelps told us we had to use space 10, on checking with our solicitor we found this was the case; it did not matter to us which space we used, we only checked because the details on the contract was saying space 13.”

At the inspection of body corporate records on 22 May 2002, Linda Phelps who is the solicitor for the respondent and who holds the Body Corporate records, stated that a copy of a resolution of the Council of the Body Corporate resolving to vary the car parking spaces can not be found.

In relation to the transposition of a car space, by-law 56 provides that,

“the Council is hereby authorised to vary the allocations so made and to transpose car spaces from one lot to another unit at any time and from time to time on the written request of the proprietor of the lot involved.”

In my view there is no evidence that the requirements of by-law 56 have been complied with relating to any variation and transposition of the car park spaces 10 & 13.

However, since 1987, the owner of lot 2 has acted as if they had the exclusive use of car space 10. In this time the respondent has considered that she has the exclusive use of car space 13. Mrs. Barker, who is the current owner of lot 2, in letter dated 24 April 2002, has stated that it does not matter to her which space is used.

Having regard to the duty of an adjudicator to make an order that is just and equitable in the circumstances (see section 223 of the Act) I consider that there was a valid variation and transposition of car space 13 for car space 10 and vice versa during the ownership of Mr. Browne and prior to the commencement of the Building Units and Group Titles Act Amendment Act 1990. At this time, there was no need for notification of the variation or transposition to the Titles Office. Compliance with section 30(7D) was not required.

This finding is consistent with the behaviour and expectation of the respective lot owners over a long period of time and I also consider that it is just and equitable that the status quo is maintained.

In light of this, car space 10 is officially allocated to lot 2 and car space 13 is officially allocated to lot 8 and my order confirms this allocation.

In conclusion, I find that the proprietor for the time being of the following respective lots are entitled to the exclusive use of the car space or spaces the identifying number or numbers as set out in the table below.

Lot	Exclusive use of car park number identified on the sketch plan delineating the parking areas attached to the Notification of Change of By-Laws which was recorded on BUP 6045 on 16 April 1984
1	12 & 14
2	10
3	5
4	2 & 7
5	8
6	6 & 9
7	1 & 4
8	13 & 11
9	3

For administrative reasons, it is noted that the car spaces have been given an alphabetical reference on the building itself. It will be necessary for lot owners to consider the original numerical reference on the sketch plan delineating the parking areas attached to the Notification of Change of By-Laws which was recorded on BUP 6045 on 16 April 1984, to ascertain specific entitlements to exclusive use of a car space.

The right of a person to whom the common spaces are allocated to rent these spaces for personal gain.

The applicants have queried what is the right of a person to whom the common spaces are allocated to rent these spaces for personal gain. They claim that Mrs Phelps claims ten spaces for her personal use and then generates income from these spaces either by rental to her tenants as an additional car space or by renting to other residential owners.

The query appears to be a request for information and no specific order is sought by the applicants.

Section 37(3) of the current Act has application to the applicants’ query and provides as follows:

(3) An owner’s interest in a lot is inseparable from the owner’s interest

in the common property.

Examples—

1. A dealing affecting the lot affects, without express mention, the interest in the

common property.

2. An owner cannot separately deal with or dispose of the owner’s interest in the

common property.

Section 37(3) commenced on 13 July 1997. Since this time, it is clear from section 37(3) of the primary legislation that a person to whom the common spaces are allocated has no right to rent these spaces for personal gain unless this was also coupled with the right to rent the owner’s interest in the lot as well. One of the essential features of section 37 (3) is that it authorises the exclusive use in respect of specified common property only in conjunction with the use of the relevant lot.

This is despite the fact that by-law 56 provides that the exclusive use is for the benefit of the proprietor for the time being of each unit and his invitees and licensees.

Section 142(1) of the current Act provides as follows:

Limitations for by-laws

142.(1) If a by-law is inconsistent with this Act or another Act, the

by-law is invalid to the extent of the inconsistency.

Section 37(3) of the current Act prevails over by-law 56 to the extent of inconsistency. Under the current Act there is no right to separately rent a car space by a lot owner.

I would take this opportunity to inform the applicants that an excellent freecall information service has been established by the Commissioners Office to provide owners with information regarding the provisions of the Act. The service includes the following state-wide 1800 freecall inquiry line accessible during business hours at no cost: Phone: [phone]. The parties may find this service helpful. I would further encourage the parties to take advantage of the alternative dispute resolution processes provided by this Office so that matters of concern or ‘unrest’ may be resolved much sooner than the current matter.



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