Villa Estoril [2003] QBCCMCmr 232 (19 November 2003)

Last Updated: 17 May 2005

REFERENCE: 0629-2003

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	16553
Name of Scheme:	Villa Estoril
Address of Scheme:	102 Indooroopilly Road TARINGA QLD 4068

TAKE NOTICE that pursuant to an application made under the abovementioned Act by the Body Corporate of Villa Estoril

I further order that within seven (7) days of the date of this order, the treasurer Bronwyn Richards shall fully comply with the section 152 notice given by the committee and addressed to her and dated 26 August 2003 and shall deliver up to the secretary, Robert Douglas, all property belonging to the body corporate in her possession or under her control.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0629-2003

"Villa Estoril" CTS 16553

The applicant, the body corporate for Villa Estoril, has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), quote –

A declaration that Don Richards and Bronwyn Richards are in breach of section 152 of the Standard Module in failing to fully comply with the notices to deliver up the specified body corporate property within 7 days of the demand.

Section 276(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 the Act or the community management statement; or

(c) a claimed or anticipated contractual matter about-

(i) the engagement of a person as a body corporate manager or service contractor for a community titles scheme; or

(ii) the authorisation of a person as a letting agent for a community titles scheme.

An order may require a person to act, or prohibit a person from acting, in a way stated in the order (section 276(2)). An adjudicator's order may contain ancillary and consequential provisions the adjudicator considers necessary or appropriate (section 284(1)).

Two applications

This is one of two applications that I consider are essentially cross applications. The other is application 0611 of 2003, made by Bronwyn Richards in her capacity as a committee member seeking –

1. To have the committee set the date for the AGM.
2. To have the committee members of 26/8/03 excluding Treasurer, bear costs of engaging a solicitor and body corporate manager.
3. To have the notice from committee to treasurer to handover financial records, rescinded.

Meeting of parties

Given the overlapping issues in each application, in my capacity as adjudicator, I convened a meeting of the parties to consider aspects of the dispute on Friday 14 November 2003. At the meeting, Bronwyn Richard was represented by her husband Don Richards. I note that Mr Richards is a named respondent to the application and a former committee member. No objection was taken at the meeting by other owners to Mr Richards representation of his wife. Also at the meeting were –

• Robert James Douglas and Gail Gene Mazur, the owners of lot 2
• Guy Saunders, the co-owner of lot 3
• Catherine Fitzgerald, the owner of lot 5
• Robert Herd and Susan Bathmann of Herdlaw Solicitors

The owners of lot 1, Keith and Richard Leong were absent from the meeting. There are a total of 5 lots in the scheme.

Previous order

A previous order of an adjudicator is relevant to the ongoing dispute between the parties. On 18 June 2003, CG Young made the following order –

I hereby order that the body corporate general meetings held on 9 April, 16 April and 14 May 2003 are invalid and all resolutions passed at those meetings are void. I further order that, as a consequence of the above order, the body corporate committee comprises those same members in office immediately prior to 9 April 2003 and who hold the same committee positions as before. I further order that the body corporate must convene a meeting which shall be deemed to be the annual general meeting required to have been held between 1 December 2002 and 28 February 2003, and that adequate provision is made to meet the various timing requirements for the seeking of committee nominations and motions, the service of the notice of meeting (including agenda and voting paper) and the date of the meeting, such that no owner is disadvantaged in either seeking a position on the committee, submitting a motion for inclusion on the agenda, or from returning their voting paper or attending the meeting. I further order that any owner may be accompanied to the meeting by a person to act as their adviser on the conduct and substance of the meeting, and that person must be allowed to attend throughout the meeting to advise their principal, but cannot take part in the meeting unless the chairperson, or the meeting, agree.

Determination

In my determination of application 0629 of 2003, I stated as follows -

I now turn to the other orders sought by the applicant, namely to have the committee set the date for the AGM. This issue is really at the heart of the dispute. Adjudicator Young ordered that a general meeting be held. The applicant seeks in her application that a date for the meeting be set, and the body corporate in its cross application states that it cannot convene the general meeting since Richards as treasurer has not, and refuses to provide copies of all relevant financial records necessary to convene the general meeting. To overcome this, the committee have issued the section 152 notice seeking return of all body corporate records from Richards, and inturn, Richards has sought an order that the section 152 notice be "rescinded", and to date has not complied with the section 152 notice, arguing that she has provided sufficient and necessary details to the committee to allow it to convene the meeting. The committee deny that this is the case.

I indicated at the meeting what I consider should have occurred after the initial order issued to the effect that a meeting be convened. At that point, the committee should have met to comply with the terms of that order. As the then secretary, Bronwyn Richards had a pivotal role to play in compliance with the terms of the original order, and convening the meeting, which she is now seeking that the body corporate set a date for.

I consider that after receiving a copy of the original order, Richards should have contacted other committee members to discuss a date for a committee meeting at which the committee could then discuss what was necessary to be done to comply with the original order. Richards failed to do this, but remained as secretary until her resignation on 12 August, some two months almost after the original order issued. In her submission to 0629 of 2003, Richards states –

... At not time had I planned to call another committee meeting as ... In my letter of resignation I stated I would stay on as Treasurer until the AGM so that they bills could be paid, and I believed the meeting would be held without delay as both Saunders and Douglas had enquired as to when I was going to set a date.

Richards subsequently did not attend the committee meeting held on 26 August 2003.

I consider that Richards failed in her role as secretary. What was required of her was what had been indicated to her by Saunders and Douglas; that she (as secretary) set a date for a committee meeting so as to consider compliance with the order of the adjudicator. Richards can’t simply leave this to others. She was the appointed secretary.

Moreover, in refusing to provide documents to the committee in compliance with the section 152 notice, I consider that Richards has contributed further to the body corporate committee’s inability to convene the meeting. Richards states in her submission that –

For the reasons stated above I would ask that an interim order for me to hand over the financial records not be granted, and that my application (0611 – 2003) be read and considered before a decision is reached. I do not believe these committee members have the ability to act in a reasonable manner with the funds of the body corporate whilst I have proven myself as a capable Treasurer for the past five years and still hold the position. ... I will be happy to transfer all funds to a properly appointed body corporate manager after the AGM.

I have some significant concerns with the attitude of Richards towards other owners in the scheme. Other statements by Richards in her submission further confirm this. Following the meeting, I had similar concerns regarding the attitude of Don Richards towards other owners. I consider that it is not appropriate for one owner to impugn the ability of others owners in their role as committee members in this way. I consider the above statements to be patronising and offensive.

In any event, the applicant’s believe about the ability of others is not a basis of an adjudicator to order that a section 152 notice be rescinded. Section 152 provides –

152 Return of body corporate property--Act, s 268
(1) This section applies if--
(a) a person has possession or control of a body corporate asset for a community titles scheme (other than a body corporate asset in the lawful possession or control of the person under a body
corporate manager or service contractor engagement); and
(b) the person took possession or control of the body corporate asset in the person’s capacity, or purportedly in the person’s capacity, as--
(i) a member, or an associate of a member, of the body corporate or of the committee; or
(ii) a body corporate manager or service contractor; and
(c) the person is served with a notice of a resolution of the committee requiring the person to deliver the body corporate asset to a committee member named in the notice within 7 days after the person is served with the notice.
(2) The person must comply with the notice.
Maximum penalty for subsection (2)--20 penalty units.

I consider that the terms of the section apply to Bronwyn Richards in her capacity as treasurer. It does not matter that Richards is still the treasurer and has not resigned. The section requires that a person served with a notice under section 152 "must comply with the notice". Richards has not challenged the validity of the notice on any technical basis, and as I have already stated, I consider that the committee meeting which resolved that the notice be issued was valid. I further consider that the notice itself is valid and should have been complied with.

I therefore intend to dismiss Richard’s application to have the section 152 notice to handover financial records, rescinded. Instead, I conclude that Richard’s should comply with the notice, and intend to order to this effect. ...

I adopt these reasons as my reasons for now ordering that within seven (7) days of the date of this order, the treasurer Bronwyn Richards shall fully comply with the section 152 notice given by the committee and addressed to her and dated 26 August 2003 and shall deliver up to the secretary, Robert Douglas, all property belonging to the body corporate in her possession or under her control.
I have specifically not extended the terms of this order to Don Richards since he is no longer a member of the committee and presumably should not be holding or retaining any body corporate books, records or other assets. If this is not the case, then Mr Richards should immediate return these to the secretary as he has no right to retain these in any event following his resignation from the committee.