Mariner's Village Two [2002] QBCCMCmr 71 (12 February 2002)

C G YOUNGREFERENCE: 0523-2001

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	6072
Name of Scheme:	Mariner's Village Two
Address of Scheme:	1 Lee Road RUNAWAY BAY QLD 4216

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

C G YOUNGI hereby order that, being satisfied the opposition to the passing of a resolution without dissent in respect of Motion 10 (for a new community management statement containing an authority for the body corporate to rent out certain areas of the common property known as Car Space 1, Car Space 78 and the Garage Shed) at the annual general meeting held on 25 July 2001 was in the circumstances unreasonable, the motion be given effect to as proposed.

I further order that the body corporate committee may, on the authority of this order, endorse the consent of the body corporate on the new community management statement and lodge a request with the registrar of titles for it to be recorded. 2n
STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0523-2001

“Mariner's Village Two” CTS 6072

The applicant Body Corporate for Mariner's Village Two has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (“the Act”), quote -

That Motion 10, consenting to the registration of a new CMS which was lost at the recent Annual General Meeting, because it required a Resolution Without Dissent and three votes were cast against it, be given effect, as proposed, or as varied by the adjudicator as it is considered that the opposition to the motion was unreasonable, in the circumstances.

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

The facts of the matter are as follows. Owners have the use of common property car spaces allocated to them by an exclusive use by-law. There are two spaces that are unallocated, described as Car Space 1 and Car Space 78, which the committee considers could be rented out to earn income for the body corporate. There is also a large “garage shed” located on common property which is used: by the body corporate’s contractor to store gardening equipment; by an owner to store a personal jet-ski; and by another owner to store a caravan. No fee is charged to either of the two owners. The committee also considers that space in the shed could be rented out to owners who wish to store large items but remain free for owners storing small items.

Both of the two proposals were incorporated into a new Community Management Statement (“CMS”) by an amended Schedule D, “Authority to Lease Parts of Lettable Area” (“the Authority”). The Authority provides for the “reasonable” rental of the car spaces and shed area “fairly and equitably” amongst owners and occupiers, by written lease for periods not exceeding one year.

The addition of the authority was the only change in the CMS and owners were informed of this in the explanatory notes to the relevant motion (Motion 10) along with a general explanation of the purpose of the proposal. The motion was put as requiring a resolution without dissent to the annual general meeting held on 25 July 2001 and was lost through three dissenting votes by the owners of Lot 7 (Aubrey & Jean Taylor), Lot 34 (Jacqueline Paxton) and Lot 45 (Kenneth Willett). On 7 August 2001 the body corporate secretary wrote to each of the three owners asking their reason for voting against the motion. Each responded as follows.

The Taylor’ (Lot 7) say they are in favour of the proposed rental of the car spaces but thought the shed should remain available to owners for the free storage of items. In their submission to the application, they give notice of selling their lot (this has since occurred) and say that after the sale they would have “no further interest in Mariners Village Two”.

Paxton (Lot 34) has a personal interest in voting against both proposals because for some time, she (and presumably a fellow occupier, John Wallace) has parked a vehicle in one of the relevant car spaces, Car Space 78, and has also parked a caravan in the shed. The body corporate admits that sometime in the past she had been “mistakenly advised that space 78 had been allocated to Lot 34”. In her response to the secretary’s letter of 7 August 2001, Paxton conceded there was no proof that she had the exclusive use of this car space and was therefore prepared to pay rent to retain its use. However in regard to the use of the shed to park the caravan, she says that the shed is for the use of all owners and, as well, apart from the caravan and gardening material, the other half of the shed was always vacant. Additionally, the committee had foreshadowed that it would not be charging the gardener any rental and, since the gardener was also an owner and being paid some $37,000 pa, she did not consider this equitable. Her submission relies on this response.

Willett of Lot 45 says, “I would not have had a problem agreeing to the arrangements proposed for the car spaces”. However in regard to the shed space, he strongly objects on two grounds. Firstly, owners already own the shed and it should continue to be available without cost. Secondly, the proposal gives a power to committees which may or may not be used “fairly and equitably”, and it may “give a future hostile Committee the power to impose charges and leasing arrangements which many owners may find excessive”. Further, an outside entity with thoughts of redevelopment could gain control of the committee to exploit the large garden/pool area for development. Mr Willett did not make a submission to the application.

The voting on Motion 10 is recorded as being: 24 votes in favour; 3 votes against; and 1 abstention, for the 28 votes counted.

Section 223(3)(u) of the “Dispute Resolution” provisions of the Act, provides that an adjudicator may make an order to give effect (either as proposed or with variation) to a resolution without dissent where the adjudicator considers that the dissent responsible for the motion not being passed was unreasonable in the circumstances.

All three of the dissenters have said that they have no objection to the rental of Car Spaces 1 and 78. Accordingly, there are solid grounds for me to give effect to the resolution for the Authority to the extent that it relates to the rental of the car spaces. However, I have determined that the dissent was unreasonable in respect of both the proposal to rent the car spaces and the shed. In respect to the shed my reasons area as follows.

Leaving aside the objection by the Taylor’s which is now irrelevant, the objection by Paxton is an understandably one of self-interest, having parked a caravan in the shed without cost for some years. Coupled with the use of Car Space 78, Paxton has enjoyed a substantial use of common property at no cost. While other owners and occupiers may not have wanted to use the shed, I suspect many would have been happy to have the use of Car Space 78. Obviously all owners cannot do as Paxton has done in storing a caravan, or other large vehicle (eg boat, trailer), in the shed because of size limitations. But for Paxton to say that continued free use of the area is justified because the shed is half empty anyway, is not a valid argument for the storage be without cost – new residents, indeed long-time residents, may be unaware of the opportunity provided by the shed, perhaps even the existence of the shed. It is certainly a large facility that appears to be under utilised for one reason or another.

In any case, it seems to me to be entirely equitable that Paxton be required to pay a fee to the body corporate for the storage of such an oversized item as a caravan. Had the item been some baggage or a box of personal possessions of, say, a cubic metre in volume or less, then I imagine the item would fall within the range of normal storage use for which the committee does not intend to charge owner’s a fee. No owner has a right to a disproportionate share of common property use; not only is it equitable for the body corporate to charge for such disproportionate use, but it is plainly within the body corporate’s duties under section 114(1)(a) of the Act to administer the common property for the benefit of owners.

In regard to the concern by Mr Willett that a rogue committee may use its power to impose excessive storage charges, this would be outside of the “reasonable amount” limitation provided for (which, if breached, could ground a dispute for a future application to an adjudicator). I do not understand Willett’s second concern regarding redevelopment of the scheme’s vacant land – the Authority is limited to the car spaces and the shed areas, and the committee has no authority to deal with vacant or any other scheme land.

For the above reasons, I am satisfied that, for the purposes of Section 223 of the Act, the dissent by the three owners responsible for the motion not being passed, was unreasonable in the circumstances. My order is therefore to give full effect to the motion as proposed.