Wyoona 2 [2002] QBCCMCmr 359 (4 June 2002)

M.F.MorganREFERENCE: 0176-2002

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	9532
Name of Scheme:	Wyoona 2
Address of Scheme:	86 Christine Avenue BURLEIGH WATERS QLD 4220

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

Mr Thomas Edward Harding, the owner of lot 1


I hereby order and direct the Body Corporate comprising the owners of lots 1 & 2, to call a general meeting, within 12 months of the date of this order, to meet and consider a motion for the purpose of granting exclusive use to both respective owners and which proposes to adopt a new Community Management Statement, which incorporates a by-law which identifies common property over which exclusive use is to be granted, and which specifically identifies as an exclusive use area, the area currently enclosed by the existing lawful fence, and which may then be lodged with the Registrar of Titles for recording.

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STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0176-2002

“Wyoona 2” CTS 9532

The applicant Mr Thomas Edward Harding, the owner(s) of lot 1, has sought an order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act).

It is uncertain from the application, the specific nature of the order that the applicant is seeking. His application states that he is seeking the following order, quote -

The granddaughter of the above resides at 2 / 86 Christine Avenue who has a friend who has made a lot of alterations to the common land (with regret).

From a reading of the application and submissions, it is apparent that this matter is a dispute about a fence on common property of a duplex, which the applicant claims

• Was erected without permission; and

• Denies him the right to inspect and or repair any defects that may be necessary.

The applicant is concerned about the alienation of part of the common property.

I view this application as seeking a determination about the dividing fence, including whether it was erected legally and for an order for a resolution of the rights of each lot owner to deal with the common property and specifically the common property annexed by the fence.

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)).

Further details are as follows. The applicant purchased lot 1 on building units plan number 5672 and became registered proprietor on 14 July 1997. He states that he did not realise the extent of the common property until he studied the building units plan. He states that the fact that there has been an erection of a fence does not mean, “there has been a gift of the common land”.

The respondent became registered as proprietor of lot 2 on 20 July 1989. His son responded on his behalf and stated that the fence was constructed in 1989, with the permission of a previous owner. The purpose was to contain their dog. When the applicant purchased lot 1, the fence had been in place for a long time.

“Wyoona No 2 ” was registered as a building units plan on 5 August 1983. Immediately upon registration, a body corporate came into existence comprising the owners of the two lots at the relevant time.

The legislation at the time, the Building Units and Group Titles Act 1980 (the former Act) provided that the two owners, and successors in title to the lots, own the common property as tenants in common.

The legislation changed with the introduction of the new Act, the Body Corporate and Community Management Act 1997, on 13 July 1997. However under section 276 of the transitional provisions of the new Act, established building unit plans such as “Wyoona No 2 ” continued as a ‘building format plan’ with the same boundaries and by-laws.

Fence

The determination of whether there has been valid approval for the construction of the fence depends upon an examination of the relevant legislation and body corporate records from the time of the creation of the Building Units Plan 5672.

The respondent claims, and I accept, that the fence was constructed in 1989. At this time, section 37 A of the Building Units and Group Titles Act 1980 (the former Act) relevantly provided:

37A Improvement etc. to common property by proprietor of lot

(1) A body corporate may, upon such terms, as it considers appropriate,

at the request of a proprietor of a lot, by resolution without dissent,

authorise the proprietor of the lot to effect improvements (including erect

or install fixtures and fittings) in or upon the common property for the

benefit of that proprietor.

(2) The proprietor for the time being of a lot in respect of which any

improvement in or upon the common property has been effected pursuant

to an authority granted under subsection (1) shall, unless excused by the

body corporate, be responsible for the performance of the duty of the body

corporate under section 37(1)(c) in respect of the improvement.

This section provides that both lot owners comprising the body corporate can agree upon the construction of a fence on common property, which may benefit a proprietor or lot owner. This is by way of an authorising resolution without dissent of the body corporate.

The body corporate records cannot be located and therefore evidence of compliance with all technical requirements of section 37A of the Building Units and Group Titles Act 1980, cannot be established with certainty.

However in the circumstances, I accept that section 37A was complied with. This is partly because of the respondent’s statement, which I accept, that both owners at the relevant time contributed to the cost of construction. It is also in my view just and equitable, that I do so, because of the passing of time.

It is my view that the fence was lawfully constructed.

Common Property

The fence effectively annexes common property for the benefit of lot 2 but there is no evidence of a by-law granting exclusive use of the fenced off area in the current scheme.

Therefore, both lot owners continue to “own” all of the common property surrounding the building and have a general right to use all of this area including the enclosed area surrounding lot 2.

The current arrangement is not based on any legal division and in reality both owners retain their general proprietary rights over the whole of the common property as tenants in common. This includes the right to attend to necessary repairs or inspection on behalf of the body corporate even if practically this may be difficult because of the fence.

Both lot owners continue to “own” to the centre of the boundary walls, floor and the ceiling of their individual unit; the rest of the scheme (outer half of the boundary walls, roof and foundations) and scheme land, is owned by the owners as tenants in common and administered through decisions of the body corporate.

Formal alienation of part of the common property can be achieved by either the passing of an appropriate by- law giving exclusive use to the relevant owner (see sections 134, 136, and 137 of the Act) or by a lease of the area (see section 111 of the Standard Module), both requiring resolutions without dissent (where the lease is for longer than 3 years).

However, while it is true that owners have a general right of access to the common property, the legislation does impose restrictions such that the parties can only use it without that use causing a detriment to the other owner. This principle is incorporated in section 129 of the Act, which states:

Nuisances

129. The occupier of a lot included in a community titles scheme must

not use, or permit the use of, the lot or the common property in a way

that

(a) causes a nuisance or hazard; or

(b) interferes unreasonably with the use or enjoyment of another lot

included in the scheme; or

(c) interferes unreasonably with the use or enjoyment of the common

property by a person who is lawfully on the common property.

Section 129 operates to prevent unwelcome behaviour on the grounds that it would create a nuisance.

While the parties have a right to use the common property, they cannot use it in a manner that contravenes the legislation or breaches a by-law.

Both owners of lots 1 and 2 should seriously consider the passing of an exclusive use by-law in respect of both lots. Owners will need professional assistance in the drafting of the by-law and the community management statement incorporating an exclusive use by-law. Perhaps a change to the “Small Schemes Module” regulation could be considered at the same meeting.

Such a by-law could benefit both owners and a mutually benefiting by-law could be agreed upon. The by-law can attach such conditions as to maintenance or improvements as the owners choose to agree upon.

Therefore, I propose to order and direct that the Body Corporate comprising the owners of lots 1 & 2 call a general meeting, to consider a motion that proposes to adopt a new Community Management Statement, which incorporates a by-law which identifies common property over which exclusive use is to be granted to both lot owners, and which specifically identifies as an exclusive use area, the area currently enclosed by the existing lawful fence. This could be dealt with at the next annual general meeting.

As there are potential benefits to both owners from this by-law, they should both be responsible for the cost of preparing the by-law, drafting the new Community Management Statement and registering it with the Registrar of Titles.

Such a motion would need to be passed by resolution without dissent. If the motion is not successfully passed, a dissatisfied owner would be entitled to make application to this Office to seek a review of the refusal. The adjudicator would consider the interests of both owners, including the respective areas and the conditions especially the maintenance ones.

I would also take this opportunity to remind both lot owners that the Act requires a comprehensive form of internal governance and responsibility by the Body Corporate including the requirement for the Body Corporate to hold annual general meetings and to agree on budgets for the administrative and sinking funds for each financial year. Both owners are required to contribute to these funds.

The Body Corporate has the general responsibility to maintain, manage and control the common property for the benefit of both lot owners.

Both owners should inform themselves about the obligations imposed under the Act.

I would take also this opportunity to inform both lot owners that a 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 both parties to engage in the alternative dispute resolution processes provided by this Office so that any future disputes may be resolved.




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