Paringa Lodge [2003] QBCCMCmr 489 (1 May 2003)

Last Updated: 10 September 2007

C G YOUNGREFERENCE: 0185-2003

ORDER OF AN ADJUDICATOR

MADE UNDER PART 10 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	114
Name of Scheme:	Paringa Lodge
Address of Scheme:	146 Macquarie Street ST LUCIA QLD 4067

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

John ARGUS, as the owner of Lot 11,



C G YOUNGI hereby order that the application for the following order –

(An order as to) The validity (legality) of the following Resolution of the Extraordinary General Meeting of the Body Corporate of "Paringa Lodge" of 18 March 2003,

is dismissed., 2n
STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0185-2003

"Paringa Lodge" CTS 114

The applicant, John Argus of Lot 11, has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 ("the Act") -

"(An order as to) The validity (legality) of the following Resolution of the Extraordinary General Meeting of the Body Corporate of "Paringa Lodge" of 18 March 2003."

The applicant has also made application for the following interim order of an adjudicator –

"That the implementation of the above Resolution be set aside, and that the Body Corporate of "Paringa Lodge" does not give F.K.P. permission to apply for the Devevelopment Approval and sign all forms required to achieve their objectives."

JURISDICTION:
This is a dispute between an owner (the applicant Argus) and the body corporate (the respondent), concerning the validity of a resolution of the body corporate authorising a development company to make a development application to the appropriate local government entity (Brisbane City Council) for development of the scheme land. This is a matter falling within the disputes resolution provisions of the legislation (see sections 227, 228 and 276 of the Act).

While section 279(1) of the Act provides that an adjudicator may make an interim order if satisfied on reasonable grounds that an interim order is warranted because of the nature or urgency of the circumstances, there is nothing in the legislation to prevent an adjudicator, in appropriate circumstances, from making a final determination of the dispute by proceeding directly to a final order.

I consider this course is appropriate in this instance because: the facts of the matter are relatively simple and clear; the appropriate parties have had the opportunity to read and respond to the applicant’s claim (see under heading "Application and Submissions" following); sufficient information is available to determine the matter; and a prompt resolution of the dispute is in the interests of all parties.

Accordingly, this order will be the only order made in respect of the application – the parties, of course, retain their appeal rights against the order made, and my having dispensed with the making of an interim order does not diminish those rights.

General powers of an Adjudicator in making an order:
Section 276(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 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) of the Act). An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 284(1) of the Act).

APPLICATION AND SUBMISSIONS:

Under section 243 of the Act, a copy of the application was provided to the respondent body corporate (committee) and to the other owners, with an invitation to respond to the matter of dispute raised in the application. The committee did not make a submission. Co-owners Ian and Mary Anderson of Lot 6 made a submission supporting the application.

The brief facts of the matter are as follows. A developer, FKP Limited, unsuccessfully sought to purchase all of the lots in the scheme some time last year (3 owners would not sell). At an extraordinary general meeting held on 18 March 2003, the following motion was passed as an ordinary resolution on a vote of 5 votes in favour and 3 votes against the motion –

"That the Body Corporate approve and authorise a Development Application relating to the Paringa Lodge site to be made by a Developer, at no cost to the Body Corporate."

Contracts for FJP Limited to purchase individual lots, subject to certain special conditions, were forwarded to owners by its agent, Property House Toowong Real Estate. The applicant does not want to sell and has not accepted the contract. He believes the body corporate cannot authorise FKP Limited to lodge a development application in expectation of redeveloping the site by demolishing and replacing the existing scheme building.

DETERMINATION:

"Paringa Lodge " was registered as a building units plan (now termed a building format plan) on 20 December 1966, and comprises 12 lots. It is one of the earliest community title schemes and is now over 36 years old.

It seems to me that the overriding concern of the applicant, the Andersons and perhaps the other dissenting owner, is that the mere lodging of the application with the Brisbane City Council will give the developer some rights over scheme land, or some expectation of acquiring rights.

The legislative provision relating to the termination of community title schemes was previously (including at the time the events relating to this dispute took place) contained in sections 72 to 78 of the Act. Since amendments commencing on 4 March 2003, they are now contained in sections 76 to 81 of the Act as constituting Part 9 "Termination of Community Title Schemes" of Chapter 2 to the Act. While certain provisions relating to the role of the Registrar of Titles have been removed from the sections and transferred to the Land Title Act 1994, the core provisions remain the same, namely: under section 78(1) a resolution without dissent is necessary to terminate a scheme; and, under section 78(2) if this resolution cannot be obtained then the District Court may make a termination order if it considers it is just and equitable to do so. The body corporate is dissolved only when the scheme is terminated.

Accordingly, each owner holds a power of veto over the passing of the motion as one dissenting vote means the motion fails. If an owner of the body corporate applies to the Court for termination, then the Court must take into account the views of owners, including of course those dissenting owners (see section 78(4) and (6) of the Act).

In regard to Motion 2, I do not know what level of owner consent the Brisbane City Council requires to accept a development proposal in the name of the body corporate. Nor is it my concern as it is not a matter within my jurisdiction – the applicant if he so wishes, may approach the Council on the matter (I assume the application is to provide owners with a Council-compliant building for their consideration). Regardless, providing the applicant does not vote in favour of the required motion (or sign any contract, allow another to vote on his behalf, or do anything else to allow the motion to pass), then only the Courts can terminate the scheme but only after he (and any other dissenters) have had an opportunity to put a contrary view to the Court.

For the above reasons, I have dismissed the application.