Banksia Gardens [2003] QBCCMCmr 506 (13 May 2003)

Last Updated: 10 September 2007

REFERENCE: 0290-2003

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	22450
Name of Scheme:	Banksia Gardens
Address of Scheme:	1 Lowry Street, PEREGIAN BEACH QLD, 4573

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

Larry Richards, the Body Corporate Manager for Banksia Gardens, and the Body Corporate for Banksia Gardens community titles scheme 22450


I hereby order that the application for the following interim and final adjudicator’s orders:

"THAT individual Owners shall be responsible for repairs, maintenance and replacement of their timber balconies; and

THAT the Committee be authorised to select and engage contractors, supervise the works and approve payment from the current Sinking Fund Balance subject to:

(i)	each Owner be liable for the replacement or repair costs for their respective balconies as arranged by the Committee and
(ii)	each Owner shall be liable to pay such replacement or repair costs within one month of receipt of a contribution notice for the amount equal to the respective costs based on the contractor’s invoice per lot for completed work."

is dismissed.


STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0290-2003

"Banksia Gardens" CTS 22450

1.	Orders sought

The Applicants, the Body Corporate Manager and the Body Corporate, have sought the following orders of an adjudicator under the Body Corporate and Community Management Act 1997 ("the Act"), quote-

"THAT individual Owners shall be responsible for repairs, maintenance and replacement of their timber balconies; and

THAT the Committee be authorised to select and engage contractors, supervise the works and approve payment from the current Sinking Fund Balance subject to:

(i)	each Owner be liable for the replacement or repair costs for their respective balconies as arranged by the Committee and
(ii)	each Owner shall be liable to pay such replacement or repair costs within one month of receipt of a contribution notice for the amount equal to the respective costs based on the contractor’s invoice per lot for completed work."

The Applicants have also sought the above as interim adjudicator’s orders.

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)).

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 necessary because of the nature or urgency of the circumstances to which the application relates.

2.	Scheme details

The "Banksia Gardens" community titles scheme was originally created under a group titles plan of subdivision (now known as a standard format plan), registered on 4 May 1976. The scheme consists of 15 lots and common property. A new community management statement was recorded for "Banksia Gardens" on 3 September 1998, and indicates that the Body Corporate and Community Management (Standard Module) Regulation 1997 ("the Standard Module") applies to the scheme.

3.	Application details

This dispute resolution application was made on 2 May 2003. On 6 May 2003, a staff member of this Office contacted the Body Corporate Manager on behalf of the Commissioner for Body Corporate and Community Management ("the Commissioner") and requested further information and materials regarding the application. Specifically, the Body Corporate Manager was requested to provide the minutes of the meeting at which the Body Corporate authorised the application, full particulars of the repair work described in the application including reports and photos, and details of any approaches made by the Body Corporate to individual owners requesting owners to repair their balconies.

The Body Corporate Manager responded to this request under cover of letters dated 6 May 2003, and 9 May 2003.
The Commissioner has referred the application to me under section 247 of the Act to consider whether an interim order should be made, notwithstanding that affected persons have not been given notice of the application, or invited to make a written submission about the application.

4.	Interim Orders

In any consideration of an application that seeks the making of an interim order, it is necessary to determine whether, because of the nature or urgency of the circumstances relating to the application, an interim order is in fact necessary or appropriate.

The examples included in the Act under section 279(1) are suggestive of the usual circumstances where an interim order might be made. Both examples are in the nature of injunctive relief. Whilst the range of matters that might be the subject of an interim order is not capable of definition, the applicant does need to establish that the circumstances of the application warrant the making of an interim order.

An interim order will not be made, or will be refused, in circumstances where the only urgency relates to the applicant’s desire to resolve or expedite the matters in dispute, or where the nature of the circumstances are such that the matter is not capable of being dealt with in the context of an interim order. Again, it is not possible to define these circumstances.

However, given that an interim order may be made ex parte (ie. without reference to, or submission from the respondent named in the matter), then as a guide, where the circumstances or matters in dispute include matters or allegations not capable of expeditious, and objective consideration, then the request for an interim order may be refused. It is a matter for an adjudicator to determine in respect of each application.

In the supporting grounds to the application, the Applicants argue that timber balconies, which are the subject of the application, are in need of urgent repair. Presumably, it is on this basis that the Applicants have sought interim orders. In my view, matters potentially affecting health and safety of people using lots or common property in a community titles scheme can be sufficiently urgent to warrant consideration for an interim order. I would note in this case however, that there is no suggestion that the deterioration of the balconies has occurred suddenly. Rather, it appears that the balconies have deteriorated over time. This aspect of the application significantly detracts from an argument that an interim order should be considered in the circumstances, particularly when the interim order sought by the Applicants is effectively a final resolution of the application. As mentioned previously, interim orders are not intended to be a means of simply expediting resolution of an issue. However, notwithstanding my reservation in this regard, I will accept that the application should at least be considered for an interim order on the basis of the health and safety issues.

5.	Matters in dispute

It seems to me that there are two key aspects to this application. Firstly, the Applicants are seeking a declaration that individual owners are responsible for the maintenance of timber balconies located within the boundaries of their lot.

Secondly, the Applicants are seeking an adjudicator’s authority for the Body Corporate Committee to arrange for repairs to be carried out to these balconies, on the condition that individual owners are liable to reimburse the Body Corporate the cost of repairing their balcony.

6.	Determination

I must admit that I have found it difficult to determine the purpose of this application. In the main, the relief sought by the Applicants appears to be little more than a restatement of provisions of the legislation. Generally, I do not consider that it is the role of an adjudicator to simply restate legislation, or to provide bodies corporate or owners with assurances or advice about their rights under the legislation.

Perhaps more importantly, I do consider that bodies corporate have an obligation to at least attempt to resolve this type of issue internally, including by endeavouring to exercise their statutory rights, before seeking the intervention of an adjudicator in the matter. This is entirely consistent with the secondary objects of the Act, one of which is "to balance the rights of individuals with the responsibility for self management as an inherent aspect of community titles schemes" (see section 4(a) of the Act).

Further, I am not satisfied that this application reflects an actual dispute to be resolved by an adjudicator. Specifically, I am particularly concerned that I have not been provided with any information suggesting that the Body Corporate has requested owners to repair their balconies before seeking adjudicator’s orders eliminating the right of owners to make their own decisions concerning how they will meet their maintenance obligations. To my mind, this is a crucial first step before referring this type of matter to this Office.

I am also concerned that the orders sought in the Application go significantly further than the terms of the Committee resolution of 4 April 2003 authorising the application, which simply provided "that Mr Richards submit an Application to the Commissioner for an Interim Order to clarify whether each owner is liable for replacements, or the Body Corporate". It is not clear that the Body Corporate has resolved to pursue the second part of the application seeking authorisation of the Committee to arrange work on behalf of owners.

For all of the above reasons, I consider that this application is premature, and that an order is unwarranted at this time. As a result, I have dismissed the application in its entirety. However, to assist the Body Corporate address this issue, I have set out some general principles regarding maintenance responsibilities below. This is not intended to be an exhaustive statement. The legislation should be the first point of reference for the Body Corporate, and if necessary, the Body Corporate should seek its own advice on specific issues.

7.	General information on maintenance responsibilities

Section 120(2) of the Standard Module requires owners of lots included in a community titles scheme to maintain their lot in a good condition. In accordance with section 109(1) of the Standard Module, bodies corporate are required to maintain common property in a good condition.
The boundaries of lots in a community titles scheme are determined primarily by reference to the registered plan of subdivision. Generally, standard format plans of subdivision define land horizontally. The boundaries of lots are determined by measurements shown on the survey plan along with marks on the ground at the time of the survey (see section 48B of the Land Title Act 1994). In this case, if the Body Corporate or individual owners are uncertain of the location of lot boundaries, then they should consider engaging a surveyor to assess and advise on the location of the boundaries.

As stated above, lot owners have a responsibility to maintain their lots in a good condition. This obligation can include balconies located within the boundaries of the lot. If an owner unreasonably fails to meet this obligation, a body corporate is entitled to apply for an adjudicator’s order requiring the owner to repair and maintain their lot as necessary. In addition, the body corporate could consider exercising its rights under section 121 of the Standard Module, which allows bodies corporate to carry out work required of owners or occupiers. Specifically, section 121 provides the following:

"121.(1) This section applies if the owner or occupier of a lot included in the

scheme does not carry out work that the owner or occupier has an

obligation to carry out under--

(a) a provision of the Act or this regulation, including a provision

requiring an owner or occupier to maintain a lot included in the

scheme; or

(b) a notice given under another Act or a Commonwealth Act; or

(c) the community management statement, including the by-laws; or

(d) an adjudicator’s order; or

(e) the order of a court.

(2) The body corporate may carry out the work, and may recover the

reasonable cost of carrying out work from the owner of the lot as a debt."

Of course, in carrying out any functions, including exercising powers under section 121, the Body Corporate must act reasonably (see section 94(2) of the Act).

The legislation also provides a facility for bodies corporate to provide services (including maintenance and repair services) for the benefit of, and by agreement with, owners and occupiers of lots included in the community titles scheme. A condition of this arrangement is that individual owners or occupiers obtaining the benefit of the service must reimburse the body corporate the cost attributable to the owner or occupier. Section 119 provides the following:

"119.(1) The body corporate may supply, or engage another person to supply,

utility services and other services for the benefit of owners and occupiers

of lots, if the services consist of 1 or more of the following--

(a) maintenance services, which may include cleaning, repairing,

painting, pest prevention or extermination or mowing;

(b) communication services, which may include the installation and

supply of telephone, intercom, computer data or television;

(c) domestic services, which may include electricity, gas, water,

garbage removal, airconditioning or heating.

(2) The body corporate may, by agreement with a person for whom

services are supplied, charge for the services (including for the installation

of, and the maintenance and other operating costs associated with, utility

infrastructure for the services), but only to the extent necessary for

reimbursing the body corporate for supplying the services.

(3) In acting under subsections (1) and (2), the body corporate must, to

the greatest practicable extent, ensure the total cost to the body corporate

(other than body corporate administrative costs) for supplying a service,

including the cost of a commercial service, and the cost of purchasing,

operating, maintaining and replacing any equipment, is recovered from the

users of the service."

8.	Conclusion

For the reasons outlined above, at this time I do not consider that the orders sought by the Applicants are warranted as either interim or final orders. As a result, I have dismissed the application in its entirety. It is not intended to seek submissions, or to make a further order in relation to this application.

The Body Corporate and owners should now consider and act on their rights and responsibilities regarding the maintenance of the timber balconies. If necessary, parties should seek their own, independent advice regarding the issue. If an actual dispute arises in respect to the maintenance of the balconies, then an interested party could consider making a further dispute resolution application to this Office.