Inwood Manor [2003] QBCCMCmr 6 (3 July 2003)

Last Updated: 17 May 2005

REFERENCE: 0166-2003

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	28704
Name of Scheme:	Inwood Manor
Address of Scheme:	26 Inwood Circuit, MERRIMAC QLD 4226

TAKE NOTICE that pursuant to an application made under the abovementioned Act by the body corporate for Inwood Manor

I hereby order that Budget Body Corporate Management and / or David Midwood of PO Box 8235, Gold Coast MC QLD shall, within three (3) working days of the date of this order, return all body corporate assets, including books and records, and body corporate funds, to the body corporate of Inwood Manor, care of the secretary, Katie Todd of Professional Body Corporate Management of 1/7 Strathaird Road, Bundall.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0166-2003

"Inwood Manor" CTS 28704

The applicant, the body corporate for Inwood Manor, has sought an order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act), for the return of body corporate books and records from the former body corporate manager, Mr David Midwood of Budget Body Corporate.

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)).

In the grounds, the body corporate states that –

Mr David Midwood, Budget Body Corporate was voted out (at his request) and Professional Body Corporate voted in as manager but David Midwood will not hand over the books or bank account to the new body corporate. ...

The applicant outlines the basis of the appointment of Budget Body Corporate (BBC) and its performance as manager. Ultimately, I am informed that Midwood advised that he was too busy and would like to step down as body corporate manager. At an EGM held on 23 December 2002, the body corporate resolved to terminate the services of BBC and to appoint Professional Body Corporate Management in place thereof. Since that time, both the new manager, and the body corporate have sought the return of records and bank account funds from BBC, evidence of which has been provided.

This office sought submissions in respect of the application from BBC as the former manager. Midwood has indicated to this office by phone that he received the notice inviting submissions but does not want to reply. He further indicated that he intended handing the books and records to the new body corporate manager. This conversation occurred on Monday, May 19, 2003 at 2:07 pm.

A body corporate is able to require a former body corporate manager to return body corporate assets (including books, records, and bank accounts) (see section 152 of the standard module). I acknowledge that as part of the body corporate material there is no evidence that the required notice under section 152 was given by the body corporate to BBC. However, given certain circumstances, I am prepared to overlook this requirement and order the return of body corporate books, records and assets from BBC to the body corporate. These circumstances are –

• The fact that the services of BBC were terminated in general meeting in December 2002, at the request of BBC. There is a general meeting resolution to this effect. I consider it implicit in this termination that BBC would return body corporate assets immediately in order to allow the body corporate to continue to function.
• BBC has not chosen to respond to the notice inviting submissions, and has failed to provide any explanation or basis why it should not be ordered to return body corporate assets. In fact, Midwood for BBC has indicated to the contrary, advising this office that he would return body corporate records.
• Finally, a recent facsimile has raised concerns that body corporate funds are unaccounted for. The funds were thought to have been held in a bank account in the name of the body corporate. However the relevant bank has advised that an account in this name was never created, but that there had been accounts personally in the name of Midwood, which had since been closed. The owners are consequently concerned at the possibility of fraud.

Given all this, I intend to order the return of body corporate assets, including books and records, and body corporate funds, by BBC to the body corporate, care of the secretary, Katie Todd of Professional Body Corporate Management of 1/7 Strathaird Road, Bundall, within three (3) working days of the date of this order. For relevant purposes, as this order will be dated 3 July, 2003, I intend that BBC comply with this order and deliver the assets to the secretary by close of business on Tuesday, 8 July 2003.

On the issue of the possible alleged fraud, this is a police matter, and the body corporate should immediately refer its concerns to the police as a matter of urgency. This is not a matter that can be investigated by this office.