Hi-Ho Holiday Motel [2002] QBCCMCmr 74 (13 February 2002)

E J SHANNONREFERENCE: 0079-2002

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	14117
Name of Scheme:	Hi-Ho Holiday Motel
Address of Scheme:	2 Queensland Avenue BROADBEACH QLD 4218

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

Kim Douglas YOUNG, the owner of lots 4 & 5

E J SHANNONI hereby order that the application for an interim order be granted in so far as I order that the EGM scheduled for 13 February 2002 must not proceed pending the making of a final order in relation to this matter. I also order the body corporate committee to lodge with the Commissioner’s office by 20 February 2002 a copy of:

• the contract engaging the services of the current body corporate manager; and

• the notice of the EGM called for 13 February 2002 including the agenda.

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STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0079-2002

“Hi-Ho Holiday Motel” CMS 14117

nThe applicantn Kim Douglas Young, 4ownerthe owner of lots 4 and 5, nhas2
sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), quote -

to instruct the body corporate of Hi-Ho Holiday Motel CTS 14117 to cause a letter to be sent to all lot owners advising them that, contrary to an unauthorized letter sent to them by committee chairperson, Karen Schuch, all lot owners have and retain the right to vote in person at general meetings.

The Applicantn, nhas also sought the following interim order of an adjudicator, quote -

to defer the EGM (called for 13 February 2002) until:

1. a letter is sent to owners advising them of their right to vote in person at general meetings contrary to an illegal instruction sent to them by committee chairman, Karen Schuch dated 25 January 2002; and

2. adjudication is passed down by the BCCM Commissioner’s office on an application submitted as a result of the last AGM held in November 2001.

Section 225(1) provides that an adjudicator may make an interim order if satisfied, on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances to which the application relates. An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 230(1)).

Given the urgency (the EGM is called for 13 February 2002) I have decided that an interim order is necessary in the circumstances.

In the supporting grounds, the applicantn nstates that:

1. The committee chairman sent an unauthorized letter dated 25 January 2002 (with unauthorized minutes attached) giving an illegal voting instruction to owners indicating they “cannot vote at the meeting” referring to the scheduled EGM of 13 February 2002.

2. Certain motions proposed for the EGM scheduled for 13 February 2002 concern issues which remain the subject of an awaited decision by the adjudicator following a submission made to the office of the Commission for BCCM by Dominique Chaudet relating to matters raised at the AGM in November 2001.

Section 50(1) of the Body Corporate and Community Management (Accommodation Module) Regulation 1997 (“the Regulation”) provides that:

Voting at a general meeting must be done in the way provided in this section unless the body corporate decides by special resolution that voting is to be done in another way.

I have not been provided with any evidence of a special resolution being passed by the body corporate requiring voting at the EGM of 13 February 2002 to be by secret ballot.

Section 50(2) of the Regulation details how voting is to occur at a general meeting (unless, of course, a special resolution was made in accordance with s 50(1) of the Regulation):

Voting by persons present at a general meeting must be by show of hands, or by giving completed voting papers to the person chairing the meeting not later than the start of the meeting, unless-

(a)	a ballot is required by the Act, this regulation or the by-laws; or
(b)	the person chairing the meeting decides a ballot is necessary to ensure an accurate count of votes.

I cannot see how the secret ballot proposed for the EGM of 13 February 2002 falls within the ambit of s 50(2).

I am not persuaded, therefore, that the requirement for a secret ballot has a lawful basis, and accordingly I have made the interim order that the EGM scheduled for 13 February 2002 must not proceed pending my final order in relation to this matter. I communicated this order by telephone, on the morning of 13 February 2002, to the Secretary of the body corporate, Mr G Grimsey, and subsequently to the Chairperson, Ms K Schuch. Ms Schuch and, in particular, Mr C Lamont, who was with the Chairperson when I telephoned her, admitted to me that the requirement for a secret ballot was not lawfully authorised by the body corporate; that the note at the end of the Chairperson’s letter of 25 January 2002 (indicating that the voting was to be done by secret ballot and advising lot owners that they could not vote at the EGM) was simply a pragmatic solution to a situation in which secret ballot envelopes for this particular EGM were already provided to lot owners by the Secretary. Mr Lamont further submitted that under the terms of the body corporate’s engagement contract with its body corporate manager, the manager’s term of engagement is automatically extended for a further year if no contrary resolution is passed at a general meeting of the body corporate before 28 February 2002. He submitted that one of the main purposes of the EGM scheduled for 13 February 2002 was to determine who should be the body corporate manager.

If the terms of engagement of the body corporate manager are as described by Mr Lamont, then it would seem, at first glance at least, to be just and equitable that the body corporate should be able to meet to discuss the continuation or otherwise of the current manager prior to the end of February. Whether or not I order that the EGM scheduled for 13 February can take place prior to 28 February, however, is a decision for me to take when making the final order in relation to this matter. But before I can make that decision I need to see the contract engaging the services of the body corporate manager. In addition, I need to see the notice of the EGM (as required by s 40 of the Regulation) and the agenda for the meeting (the requirements for which are set out in s 43 of the Regulation). Accordingly, I order the body corporate committee to provide me with copies of:

• the contract engaging the services of the body corporate manager; and

• the notice of the EGM called for 13 February 2002 including the agenda.

Given the apparent pressing urgency of this matter, I order that all submissions in relation to this matter must be filed with the Commissioner’s office by 20 February 2002.

In conclusion, I note that the applicant asserts that certain motions proposed for the EGM scheduled for 13 February 2002 concern issues which remain the subject of an awaited decision by the adjudicator following a submission made to the office of the Commission for BCCM by Dominique Chaudet relating to matters raised at the AGM in November 2001. As I have not seen the notice calling for the 13 February 2002 EGM, or the agenda proposed for the meeting, I am not aware of the motions being put up for discussion at the EGM. I take this opportunity however, to remind the committee for the body corporate that it has made a written undertaking to the Commissioner that it will not implement the motions in dispute from the November 2001 AGM pending the making of an order in that matter.

This matter will now be investigated in accordance with the usual processes undertaken by this office. A final order regarding the application will be made before the end of February 2002.

All parties should note the provisions of section 225(2) of the Act which provides that -

An interim order -

a)	has effect for a period (not longer than 3 months) stated in the order; and
b)	may be extended, renewed or cancelled by the adjudicator until a final order is made; and
c)	may be cancelled by a later order made by the adjudicator; and
d)	if it does not lapse or is not cancelled earlier - lapses when a final order is made by the adjudicator.

All parties should be aware of this section and its effect on this interim order. In particular, the applicant may need to request a renewal of the interim order, before a final order is made. The onus of renewing an interim order rests with the applicant. This office will not automatically renew an interim order.2n