Golden Eagle [2004] QBCCMCmr 15 (9 January 2004)

TAKE NOTICE that pursuant to an application made under the abovementioned Act by Sujit Ranjan Das GUPTA, as the owner of Lot 1,

I hereby order that within one (1) month of the date of this order, Michael Quinn and Maree Perronnet-Quinn, must submit a motion to the body corporate secretary for seeking the authority of the body corporate by way of special resolution under section 114 of the Body Corporate and Community Management (Standard Module) Regulation 1997 for the air-conditioning unit attached to the external wall of the lot overhanging common property to remain in position, and the body corporate in general meeting must consider the motion within three (3) months of its receipt, but if the owner fails to submit the motion within time then the owner must remove the air-conditioning unit from the common property.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0376-2003

"Golden Eagle" CTS 21198

The applicant also made application for a number of interim orders (see below) and on 23 June 2003 I issued the following Interim Order 376-2003 dismissing the application –

On 17 November 2003 I issued the following further interim order, Interim Order 376-2003A –

I further order that the annual general meeting held on 14 February 2003 is void.

I further order that Sujit Ranjan Das Gupta, the owner of Lot 1, must immediately deliver or cause to be delivered by registered or certified mail to the secretary, Kristin Butler, the common seal of the body corporate.

JURISDICTION:
In my Reasons to the interim order, I found jurisdiction existed to proceed to a determination in the following terms –

Section 279 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. An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 284 of the Act).

General powers of an Adjudicator in making an order:
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 –

In my Interim Order 376-2003A (see above) all of the above matters were dismissed, except for Item 4 concerning air-conditioning for which no order was made, and Item 10 for which a specific order was made declaring the relevant meeting void.

Accordingly, only item 4 of the applicant’s disputed matters remains to be resolved. There is one additional matter that arose from submissions, namely that of the applicant’s $6,109 insurance claim, which I have stated will also be dealt with in my final order. The applicant was invited to search the submissions and make a further reply to the submissions but with the proviso that, "Any reply to submissions must be limited to the matters not finally determined in the further interim order (Interim Order 0376-2003A) namely, the air-conditioners and the insurance matter"

However the applicant’s response to submissions, and to my Interim Order 376-2003A ("Order 376A"), has included an expansion of detail in regard to almost all of the matters that were dismissed in my second order as well as those matters still "live", for example, photographs and sketches relating to water penetration, business being carried on, dog. The material may be quite relevant to the disputes they concern, however it is information that should have been originally put by the applicant in his application so that other owners could properly address the totality of his claims, otherwise the process becomes a revolving door. The law is quite clearly stated in the principle of "functus officio" which prohibits a decided matter being revisited except in certain circumstances which are not present here.

I shall therefore only be dealing with two matters in this final order, namely that concerning the air conditioners installed in Lots 2 and 3 and the insurance claim.

DETERMINATION:
As set out in my previous order –

I shall now address the two outstanding items.

Removal of air-conditioners installed on Lots 2 and 3 without authorisation.
At page 7 of my Statement of Reasons ("Reasons") to Order 376A, I stated the law concerning the installation of improvements on common property for the benefit of a lot owner (section 114 of the Standard Module requires authorisation by special resolution). I also reported that the Quinns had submitted that the air-conditioner in Lot 2 does not encroach onto common property, nor does one of the two installed in Lot 3. The remaining unit overhangs the grassed common property area outside Lot 3. Although Gupta has issues with all of the installed units, he appears to accept that only this one unit overhangs common property.

The photograph of this unit shows it to be installed high on the outside wall, projecting out some 60 cms. I made two errors in referring to information supplied by the Quinns: firstly stating that the subject unit was installed in November 2002 instead of November 2001; and secondly that it was inspected by Gupta on 1 December 2003 instead of 1 December 2001. The Quinns also asserted that Gupta had himself installed air conditioning without authorisation.

Gupta states that he has no air conditioning and the Quinns are plainly wrong in this allegation. Secondly, if the inspection took place, he asks what documentation exists to support the claim and what agreement was reached.

I do not intend to go further into the arguments of the parties as it is unnecessary and will likely only serve to exacerbate the issue. I say unnecessary as in my previous Reasons I stated at page 7 –

I also said later in those Reasons that there was nothing to prevent the owner of Lot 3 from submitting a motion to a general meeting seeking ratification for the installation. I have no information that this has happened and as I have no power to approve of the installation without the body corporate having first considered the matter, then I must order that the Quinns do this within a stated reasonable time. I have already pointed out the avenues open to the Quinns if Gupta votes against the motion, however I hope that the parties may reach an accommodation on this matter as the unit has now been in place for over 2 years without, to my knowledge, previous complaint.

Given the manner of self-administration of the body corporate, it is likely that this improvement is not the only one without proper authorisation. In that regard, I note Gupta’s submission regarding installation of a rangehood vent through an external wall. While he was prudent in obtaining the written consent of the (then) other owners, it should properly have been obtained in the required manner and I suggest that now be done. This will then allow it to be entered into the Register of Authorisations Affecting the Common Property required to be kept by the body corporate under section 146(3) and (4) of the Standard Module.

As I have said, I would prefer not to see any future applications from owners seeking orders to overturn unreasonable refusals by the body corporate to what are common domestic services except where they cause a demonstrable and significant nuisance or significantly detract from the appearance and overall presentation of the scheme.

Insurance claim:
In my previous reasons, at page 12, I raised two legislative issues of concern with regard to Gupta’s claim: firstly that Gupta took out a building policy with CGU Insurance without consulting other owners; and secondly that improvements by Gupta to his lot ("non-standard fittings") could have resulted in a larger premium than would otherwise have been the case. In the latter case, the legislation provides that any such improvements or risk premium must be wholly met by the relevant owner.

Gupta states that he merely renewed the CGU insurance policy by paying the premium when it fell due, and that the Elders quote only came to his notice almost a month after the renewal due date. Further, there has been a history of the annual general meeting not being held within time and for the insurance to be renewed by a committee member for a number of years.

It seems to me that the most sensible course is to allow the current policy with CGU to continue until its current expiry date of 20 July 2004, and that owners should, in general meeting, decide whether it wishes to continue with this insurer or insure with another. There is no need for me to make an order in this matter as obviously Gupta is happy with CGU and it will be a matter for the Butlers and Quinns to decide whether they wish to find alternative, comparable quotes and put forward the relevant motion.

In regard to the second concern, Gupta states that he does not believe the increased premium was attributable to his improvements (non-standard sliding doors). He believes that the increase was due to market pricing and the scheme’s claim history (8 claims since 1996).

The only party that can answer this question is of course the insurer and none of the owners have obtained that information to allow either: the matter to stand; Gupta to pay the improvement premium; or for me to make an appropriate order. I suggest that the body corporate obtain from CGU the facts as to the reason for the increase, specifically whether the non-standard improvements was a reason and if so the amount attributable to it, and for it to then seek reimbursement of the amount from Gupta.

In summary, this application has seen considerable time spent by owners in preparing their submissions, and by me in the making of three orders. It is obvious from the documentation that the body corporate has not been operating in accordance with the legislation in regard to committee and general meetings, proper authorisation for improvements or insurance selection, and in a number of other ways. Inevitably when there is ill-feeling between owners, all suddenly become very aware of the requirements of the legislation and how others have breached them. This can be an unproductive exercise at a time when owners should be more focused on how the body corporate should operate in the future. Owners need only respect each others rights and abide by the legislation for a scheme to operate satisfactorily, despite continuing ill-feeling.

Finally, it has been brought to my attention that a further application was lodged by Gupta on 14 October 2003, being Application 678-2003, which will not be addressed by an adjudicator for perhaps another two months. I have briefly read through the application and submissions and there is nothing that cannot be resolved between the owners on a proper understanding of the legislation. This office provides an Information Service on Freecall 1800 060 119 where owners can seek assistance regarding the legislation.

TAKE NOTICE that pursuant to an application made under the abovementioned Act by Sujit Ranjan Das GUPTA, as the owner of Lot 1,

I hereby order that the application for the following orders –

• Suspension of business trading from U2 (no council or BC permission).
• Remove unauthorised pets from Unit 2 & Unit 3."
• Discontinue U3 practice of having newspaper delivered to top of driveway.
• Removal of soil & pavers from common property (U3).
• Reimbursement to body corporate of cheques with non-compliant signature.
• U2 to take steps to prevent water run-off into U1 upper garage due to excessive watering.
• Discontinuation of the continual and repeated non-compliance with correct and proper body corporate procedures in accordance with the Act, Regulations and prevailing by-laws.
• Appointment of independent professional body corp. mgr & gardener,

is dismissed.

I further order that the annual general meeting held on 14 February 2003 is void.

I further order that Sujit Ranjan Das Gupta, the owner of Lot 1, must immediately deliver or cause to be delivered by registered or certified mail to the secretary, Kristin Butler, the common seal of the body corporate.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0376-2003A

"Golden Eagle" CTS 21198

This is a further interim order to an application by Sujit Gupta of Lot 1 who has sought the following orders of an adjudicator under the Body Corporate and Community Management Act 1997 ("the Act") -

The applicant also made application for a number of interim orders (see below) and on 23 June 2003 I issued the following Interim Order 376-2003 dismissing the application –

In my Statement of Reasons (hereafter "Reasons") to the above order, I commented that only two of the interims orders sought, namely 1 and 3, could properly be the subject of an interim measure as all of the remaining orders sought were final in their determination of the various matters.

A number of interim orders sought have been repeated by the applicant in the list of final orders, though reworded, while others have not been repeated. I have below compiled a consolidated and renumbered list of all of the matters raised, whether for interim or final order -

JURISDICTION:
In my Reasons to the interim order, I found jurisdiction existed to proceed to a determination in the following terms –

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:
Interim Order 376-2003 was determined without seeking submissions from other owners as it was plain on the face of it that the application did not warrant an interim order in respect of any of the matters raised.

Under section 243 of the Act, a copy of the application was subsequently provided to the respondents, namely: Steven John Butler and Kristin Louise Butler, the co-owners of Lot 2; and Michael Anthony Quinn and Maree Catherine Perronnet-Quinn as the co-owners of Lot 3 (and occupiers of Lot 2), with an invitation to make a written submission to the application. Both parties made submissions to the original application and to the applicant’s amendment.
I have taken the step to issue a further interim order in this matter rather than a final order in determination of all of the matters, for the following reasons.

I have been unable to resolve all of the matters raised by the applicant as I am not in possession of all of the relevant facts. Normally I would have obtained those facts by either a teleconference with the parties or a meeting with the parties. On 7 November last, at my instigation an administrative officer of this Commission contacted both of the respondent parties to arrange a four-way teleconference between them both, the applicant and myself. As the Butlers of Lot 2 live in Maryborough that was considered the better course initially as they were likely unable to attend a face to face meeting of the parties in Brisbane, whether at this office or on-site at the scheme.

When contacted, both the Butlers and the Quinns declined to participate, stating that they were disillusioned with the adjudication process. I also note from the file that back in August 2003, the Butlers also declined to participate in a mediation session with the other parties when offered by the Dispute Resolution Centre of the Department of Justice and Attorney-General, having been referred by this office.

The delay of five months in attention to this file is consistent with the policy of dealing with matters in chronological order and the uneven match of resources with the demand for disputes to be resolved within a reasonable time. That is the unfortunate reality; however I am always concerned where there is a possibility that the delay has been the cause of an outcome that is of considerable disadvantage to one party and may not have occurred had the matter been dealt with earlier.

From the remarks made to the administrative officer by the respondent parties, and from notification to this office by Gupta enclosing a copy of a letter to him from the Brisbane City Council ("the Council") dated 7 October advising that the Quinns could no longer carry on a home business from Lot 2 without further approval, I was concerned that the delay may have caused or contributed to this result and accordingly made certain enquiries. I have addressed this as the first matter raised by Gupta under the heading "Determination" which follows.

Because the respondents have declined to participate in a forum (which they are not compelled to participate in) where I would have the opportunity to question the parties on information presented and gather further and better information, I can either proceed to make orders on the information papers before me or investigate the matters further. From my reading of the file information, there are a number of instances where certain actions have been carried out, or decisions made, in contravention of the legislation. Some of these I am able to deal with at this time, others will be deferred for determination by final order, including one matter concerning insurance which has generally arisen out of the disputes raised in the application. This latter matter has not been viewed or considered by Gupta, and, of course, he must be afforded the opportunity to view the documentation and to make a submission in reply before any order may be made in respect of it. This is also true for any other matters unresolved in this further interim order 376-2003A.

I do not intend to set out the information supplied in the application and submissions here, but rather to refer the relevant information provided by all parties when considering each of the dispute matters separately.

DETERMINATION:
"Golden Eagle" was registered as a group titles plan (now termed a standard format plan) on 8 October 1985 and comprises three lots. The scheme is regulated by the Body Corporate and Community Management (Standard Module) Regulation 1997 ("the Standard Module"), despite the belief of the respondents that it is regulated by the Small Schemes Module.
Under the transitional provisions of the Act, both the Contribution Schedule lot entitlements and the Interest Schedule lot entitlements are: Lot 1 – 25; Lot 2 – 18; and Lot 3 – 22. All owner contributions to both the administrative and sinking funds must be in proportion to their respective lot entitlements (i.e. Lot 1 pays a 25/65^th share, Lot 2 - 18/65, Lot 3 – 22/65).

The applicant Gupta has raised seven dispute which I shall now address in turn -

1. Suspension of business trading from U2 (no council or BC permission).
This is the matter I referred to in the context of whether delay has brought about an outcome that may not have otherwise occurred. The Brisbane City Council’s letter of 7 October addressed to Gupta advises that the Quinns have been informed that they cannot continue to conduct a Home Business from Lot 2 without seeking town planning approval from the Council.

I would seem that though Gupta put this matter forward as a dispute for resolution he continued to pursue it privately with the Council. He is not prohibited in doing that, though from correspondence that was not the expectation of the respondents.

The enquiry I made with the Brisbane City Council ("Council") was prompted by a concern that if the Council’s decision was based on any reported disapproval by the body corporate to the Quinns operating an accountancy practice, then that reporting would be wrong. I say that because the combined voting power of Lot 2 and Lot 3 constitutes a majority (whether by lot vote or poll vote) for an ordinary resolution of the body corporate to be passed in favour of the business continuing, and having read the file I have no doubt both votes would have been so cast. I also say that because there are a number of instances apparent in the documentation that show Gupta has acted unilaterally in the name of the body corporate in his capacity as chairperson, and also where he has advised an inappropriate resolution to decide a particular matter (see later). Had either of these been the case, or the respondents were unaware of their voting rights, then I would have intervened promptly to allow the matter to go before the Council.

However, body corporate approval is not relevant to the Council’s decision; the decision relates to the place of business being a lot in a community title scheme and the need for special town planning approval (when body corporate approval by ordinary resolution may be part of that process).

The Council is the appropriate body to decide this matter and I have no power to intervene in its decision. It is now a matter for the Quinns to either cease the practice on site, relocate or seek specific approval. Whatever their decision may be, I have no further jurisdiction in the matter and have therefore made the appropriate order dismissing the order sought.

Having said that, the Quinns have given a history of businesses being conducted from all lots in this scheme at one time or other, as follows –

If this information is correct, then the current action of Gupta appears at odds with what has been accepted or at least tolerated by him previously. However, whereas "acquiescence" by a party to a situation which they later complain of can be a consideration of an adjudicator in matters of dispute involving the legislation, I cannot apply it in a matter that is within the jurisdiction of another agency.

2. Remove unauthorised pets from Unit 2 & Unit 3.
The Quinns, as the owner of Lot 3 and the tenants of Lot 2, state that they have only ever owned one dog and not two as claimed by Gupta. The dog has been on site since March 2002, some 15 months before Gupta lodged this application. In his grounds Gupta makes no complaint against the dog other than that no body corporate permission has been obtained for it to be kept on site, though the Quinns refer to a letter from him dated 30 June 3003 (sent after lodging the application) in which he complains that the dog "is creating a nuisance by whining and howling" and that it is "a barking dog". These are also alleged in his draft letter dated 5 June 2003 enclosed with the application, which may be the same letter re-dated.

I also have before me copies of two "Notice of Continuing Contravention of a Body Corporate By-law" notices, which are dated 19 and 26 August 2003, dates coming after lodging the application and the matter was put in dispute. Both are signed by Gupta over the common seal of the body corporate, and both are directed against the Quinns for breach of By-law 11 by keeping a dog without permission.

Both of these notices are void for two reasons. Firstly the by-law quoted in the notice is not the by-law regulating animals that applies in "Golden Eagle". Being registered in 1985, the applicable by-law at the time which is still its by-law, is that set out in the Building Units and Group Titles Act 1980 at Schedule 3 which reads –

What the by-law provides is that an animal may be brought onto the scheme but it must be removed when and if the committee gives notice for it to be removed. The by-law quoted in the notice is that set out in the current Act that only applies to schemes established after commencement of the Act (13 July 1997) or which has been specifically adopted in a new community management statement by the body corporate. For this reason alone the notices are void.

Secondly, I have not been provided with a valid resolution of the committee instructing Gupta as chairperson to serve such a notice, which would be normally signed by the secretary. Committee members, ordinary or executive, have no unilateral power to make decisions, including deciding on and serving a by-law contravention notice. Nor can the seal be used by a member without proper authorisation. It would appear to me from this incident, and others, that Gupta may be under the misapprehension that the chairperson has some overarching executive or chairman-of-the-board. In that regard, I refer to comments in a letter from him to Michael Quinn and Kristin Butler dated 18 April 2003 (also signed by Gupta over the common seal) that support that view –

Recently, in my reasons to an order for another scheme, I made the following observation that is equally relevant here –

In regard to the use of the seal, I have noted comments in the submissions of the respondents that the seal has been used in a number of instances without their knowledge or approval. Section 139 of the Standard Module regulates the use of the seal in the following manner –

There is no information before me that the body corporate in general meeting has made a specific direction for the use of the seal and unless this has been done (which would be unusual), the default position under subsection (3) must be complied with, requiring two persons be present and sign the document. The seal should be held by the secretary as the executive member responsible for the administration and operation of the body corporate. Although this is not an order sought by the applicant, in my view the common seal must be immediately passed from the chairperson Gupta to the secretary Kristin Butler and I have made the appropriate order to that effect.

Returning to the matter of the dog, it is apparent that if a proper meeting of either the body corporate or the committee is held that the vote as to whether the dogs may remain or be removed, which requires only an ordinary resolution, would be in favour of the former on a vote of 2:1 or a poll, if demanded, of 40:25. In his draft letter of 5 June referred to earlier, Gupta states, mistakenly, that there is no unanimous permission for keeping such a pet; the legislation only requires an ordinary resolution to determine this matter, not a resolution without dissent.

Of course if the dog is a nuisance, and there is no evidence of that, then an application could succeed in having the dog removed despite the majority support. The Quinns suggest that Gupta may be mistaking a dog in "Challinor Villas" for theirs – this dog has regularly created a noise nuisance which has been of concern to a number of neighbours. The Quinns have also submitted statements by nearby neighbours that their dog does not cause a nuisance. However, noise nuisance was not relied upon in the order sought by Gupta nor has been provided evidence in support of such a complaint. Accordingly, my order is to dismiss this matter.

3. Discontinue U3 practice of having newspaper delivered to top of driveway.
Gupta has complained that the Quinns have their newspaper delivered to Lot 3 and this involves a delivery vehicle driving to the top of the driveway at around 4:45am up to 7 times a week, sometimes with music blaring, which noise wakens Gupta and his family.
In response, the Quinns state that the newspaper delivery has been taking place for over 3 years without previous complaint. Additionally, the windows of Lot 1 are double glazed and there is a nearby train line that sees freight and passenger trains starting around the same time making just as much noise. They also state that they cancelled delivery of the newspapers on 1 July 2003.

I think a differentiation can be made between background train noise and the alternating intensity and length of the much closer noise of a car within the scheme, especially with added music. Section 167 of the Act provides that, amongst other things, an occupier of a lot... must not... permit the use of... the common property in a way that causes a nuisance. In my view, the entry of a delivery vehicle onto the scheme driveway in such a hurried fashion and at such an hour, is unreasonable and constitutes a nuisance. Again, as with the presence of the dogs and the carrying on of a business, I am concerned that the event is now unacceptable after some years of prior acceptance. As the Quinns have voluntarily resolved the issue by removing the noise, I will not make an order in the matter in the understanding that the situation remains as it is now.

4. Removal of illegally placed air cond. Units to bldg (U2 & U3).
The applicant Gupta states, I approached the Body Corporate for approval and permission to install a kitchen extractor vent, yet Unit 2 & Unit 3 have both installed air conditioners without seeking Body Corporate permission.

This is a matter that will have to be deferred until the final order as there is an insufficiency of facts on which to decide the matter. The law on the matter is quite clear, and I shall explain that, but it is the position of the air conditioners that decides the matter and I do not have that precise information.

This scheme is a standard format scheme and therefore, unlike in a building format plan (eg a high-rise building) where owners only own their lots to the centre of the boundary floors, walls and ceilings, owners own the land under their lot building and any vacant land within their lot boundaries.

If an air-conditioner is sited in a window and overhangs common property, or the compressor in a split-system is sited on common property, then in both cases the installation is an improvement within the meaning of section 114 of the Standard Module. For improvements with an installed value above $200, as with the subject air-conditioners, the improvement has to be authorised by a special resolution of the body corporate. As defined by section 106 of the Act, the owner of Lot 1 by voting against a special resolution will cause it to fail.

The Quinns have submitted that the air conditioner in Lot 2 does not encroach onto common property, nor does one of the two air conditioners installed in Lot 3. This leaves, they say, one air conditioner that overhangs the common property (grassed area). They have included photographs of these items but better proof of their siting is needed (or agreement by Gupta that indeed only one overhangs common property).

If the Quinns are correct in their assessment of the position of the air-conditioners in relation to the common property (as shown on the registered plan), then only the one needs to be proposed to a general meeting for authorisation by the owners of Lot 3. If the resolution is voted down, then that owner may make application to an adjudicator that the refusal of the body corporate is unreasonable and for it to be overturned. Of course I cannot say what the result of such an application may be, or indeed whether I would even adjudicate the matter.

Again the respondent Quinns state that the subject air conditioner was installed in November 2002 with the knowledge of Gupta, who it is claimed inspected it on 1 December 2003, and he has not previously complained of its presence. Additionally, they state that Gupta has himself installed air conditioning though they do not elaborate on its position or whether it was properly approved.

I shall return to these matters of improvements after Gupta has had the opportunity of viewing the submissions and making a response to them. If necessary I shall visit the scheme but given the state of our resources that should not be necessary if the parties properly identify the position of the air conditioners in question (including that of Gupta, if any) by sketch or photograph.

There is nothing to prevent the owner of the offending air conditioner submitting a motion to a general meeting seeking ratification of its installation under section 114 of the Standard Module.

5. Removal of soil & pavers from common property (U3).
Gupta complains of soil being dumped onto the common property from the courtyard of Lot 3, and of pavers being left on the common driveway without consultation or permission.

This is a quite insignificant matter that could surely have been dealt with between the parties. As it is, the Quinns have submitted that these items were only on the common property for a short period during and after maintenance work to the Lot 3 courtyard. They state that the driveway was never blocked, and the excess dirt was used to top-dress the common property. Again Gupta never complained at the time, though he now says the soil is sub-standard though the respondents reject this.

I do not intend to waste my time any further on such a triviality.

Further, in the course of my determination of matters raised so far in this application I am increasingly forming the view that most disputed matters were not complained of at the time they occurred, if the information given is true, but he has now raised them for some reason unknown to me. The fact that such a trivial matter as the temporary location of maintenance materials (soil and pavers) on common property is included as a dispute, goes to strengthening a forming belief that the applicant is attempting to use the dispute resolution process more to discredit fellow owners than to obtain relief for some genuine grievance. I may be wrong in this, but the information presented by the respondents and supported by some documentary and photographic evidence, points to the applicant having to provide persuasive evidence to rebut this conclusion.

I have dismissed this matter.

6. Reimbursement to body corporate of cheques with non-compliant signature.
In the supporting grounds, Gupta states that two cheques were drawn (in payment for a fence and termite inspection respectively) without his consultation or signature, even though we have now required all three parties on the Executive to sign for Body Corporate cheques for over the past year. He has enclosed a draft letter to the bank which identifies the cheques and states that as the basis of the account is for all three signatories to sign, the bank should refund the moneys.

Gupta suggests that if the cheques were drawn fraudulently then I recommend that they be pursued to the full extent of the law. Presumably Gupta is here referring to the secretary Kristin Butler or the treasurer Michael Quinn. If he is recommending that they be prosecuted by the adjudicator then I say that adjudicators only have jurisdiction to resolve disputes within the context of the legislation – prosecution of fraud is a police matter.
In their submission, the Quinns state that they have confirmed with Westpac that the account authority is any two of the three executive committee members to sign, and they did not know of there ever being a requirement for all three to sign. Because of Gupta’s claim of possible fraud, which they strenuously deny, Michael Quinn ("Quinn") in his capacity as treasurer has investigated the matter of signatures with the Westpac bank and submitted copies of relevant documents.

The bank signature authority provides boxes for either: Joint authorisation (all persons authorised must act and sign together); Severally (each person authorised acts or signs alone on my/our behalf); and Other (eg "any two directors", or "the director and secretary/treasurer") provide details below.

In the copy provided, the third box was ticked, by-passing the first option where all three would be required to sign as claimed by Gupta to be the case. Further, the details provided in conjunction with the third box option shows two written words crossed out and the words "All three to sign jointly". The alteration is not initialled by the signatories as proof of their adoption of the alteration. Quinn states that when he signed the authority as treasurer before returning it to Gupta, the words "any two" were provided and he believes it is these words that have been crossed out. He has also submitted copies of two letters from Gupta that confirm his asking for the signature authority be returned to him, presumably to deliver to the bank. Kristin Butler who signed the authority as secretary has also submitted that the authority showed the words "any two" when she signed it. The words crossed out are consistent in length to those two words though only an expert will be able to determine that.

I do not intend to take this matter further than this, at least at this time. Quinn states that the legal opinion obtained by the bank regarding the altered and conflicting words of the authority document is that any two of the three members may sign. Of course if any of the parties wish to take the matter further, they may seek private legal advice on any private prosecution open to them or report the matter to the police.

In the circumstances of the evidence given, my order is to dismiss this order sought.

As a final comment here, the draft letter by Gupta to Westpac is as "chairman" and is another example of acting unilaterally and outside of his role.

7. U2 to take steps to prevent water run-off into U1 upper garage due to excessive watering.
This is another minor matter that should have been able to be resolved between the parties without resort to adjudication. Gupta complains that over-sprinkling by the Quinns of Lot 2 results in excess water seeping down into his converted garage which is furnished with carpet and timber furniture.

As an initial comment I would point out that, in my understanding, the conversion of a garage into a habitable room requires local government approval. I mention this because if the applicant is claiming damage to furnishings that should not be there, he then stands in a problematical position. If the damage is to the walls and floor then he may well have grounds to complain.

However, apart from the general statement that the hose water runs into my rumpus room the applicant provides no details (or sketch or photographic evidence) as to whether the water enters the room or not, whether it causes damage and if so where and to what extent, and what steps he has taken to have the Quinns cease or modify their alleged over-watering. It is not my role to establish an applicant’s case for them and a bald general statement such as the above requires no determination.

However, the Quinns have submitted that because all three lot buildings have been built into the slope of the land there is seepage from the common property area which damages the garages which are below ground level; this seepage has in the past also caused damage to furnishings (walls and carpets) in Lot 3 (note: if this is a reference to a furnished converted garage then my remarks to Gupta also apply here). Though the Quinns deny any overwatering, since receiving the application they have restricted sprinkling the courtyard of Lot 2 to a maximum of 10 minutes twice a week.

There is no evidence for me to make an order in this matter. In any case the Quinns have reacted by reducing their watering to a bare minimum. It appears the problem may be a general one caused by seepage of rain water and hose water, onto lot buildings. Owners should investigate the matter (or have an expert assess the problem) to reach a common solution. Accordingly, as the Quinns have voluntarily resolved the matter by restricting their watering, I make no order in this matter.

8. Discontinuation of the continual and repeated non-compliance with correct and proper body corporate procedures in accordance with the Act, Regulations and prevailing by-laws.
This is general statement which does no more than require the body corporate, and members of the committee, to administer the body corporate in accordance with the requirements of the legislation. That is a requirement under the legislation itself and any such order is redundant. Accordingly, as the order sought does not address a particular contravention or omission, I have can only dismiss this order sought.

Though having said that, I wish to make some general comments. I have already commented on some evident contraventions, namely: unilateral decisions and use of the common seal by Gupta as chairperson; requirement for an animal by-law to be decided unanimously; and that the scheme has adopted the Small Schemes Model regulations. There is also comment by the Butlers that voting papers were only a courtesy as "Golden Eagle" is a Small Scheme Module. I do not intend to trawl through the papers for contraventions and omissions by the various parties, but would merely say that as with most small schemes that self-manage, the body corporate does not operate strictly in accordance with the legislation. This leads into the next order sought.

9. Appointment of independent professional body corp. mgr & gardener
I agree with Gupta that the engagement of a professional Body Corporate Manager is desirable. I say this for two main reasons: firstly because errors are being made by all parties which puts decisions in jeopardy; and secondly, because the level of ill-feeling between the parties is both affecting the proper administration of the body corporate and the lifestyle of occupiers.

Engagement of a Body Corporate Manager will, or should, provide a person both competent in the legislation and independent of the interests of individual owners. That is, the conduct of meetings, procedures, selection of the appropriate resolution, compilation of budgets, and other matters relating to the management, administration and control of the body corporate, will be able to be better relied upon as being correct and free of bias. There will be a cost involved for each owner, and to the credit of Gupta he has suggested this course knowing he will contribute more than either of the other owners.

Gupta has also suggested an outside gardener/caretaker be employed rather than use the services of the son of the Butlers who he believes does not do a professional job. It is not stated whether he is paid for this work. Submissions by the respondents state that the gardening work has been carried out by Quinn and Steven Butler but again it is not stated whether it is paid work.

The answer is irrelevant as I do not intend to require the body corporate engage either a Body Corporate Manager or a gardener; it is properly a task of the owners to decide these two engagements in general meeting.

The legislation does empower an adjudicator to appoint an Administrator to a body corporate in substitution of its committee where the operation of the body corporate is so flawed that it is incapable of righting itself. However, this is a serious intervention into the affairs of a body corporate and the power is only exercised in extreme situations. I would say though, that from my reading of this file that the body corporate is on the path to imposed administration unless owners are able to act properly within the law and make decisions in the interests of all owners and not merely for the purpose of opposing a perceived adversary

I have therefore dismissed this matter.

10. Meeting of 14/2/03 be declared invalid due to inappropriate circulation of voting papers.
The first matter to determine in respect of this order is one of jurisdiction. Section 242(2)(a) of the Act provides that an application to invalidate a general meeting must be brought within 3 months of the meeting. In this instance the relevant meeting was held on 14 February 2003 whereas the application was not lodged by Gupta until 10 June, a date almost four weeks out of time.

However, paragraph (3)(b) of the provision allows the time limit to be waived by an adjudicator where the applicant can show "good reason". The applicant has sought such a waiver.

In the appeal of Weeks v. Commissioner for Body Corporate (Maroochydore District Court Appeal 13/99), Judge Dodds made the following statement about this time limitation at pages 4 and 5 of the judgment:

I need only look at two of the four tests set down, namely: the first test, being the length of the delay, which is just short of four weeks and therefore not a lengthy one; and the fourth test, being whether...an applicant will be entitled to the relief sought, and a prima facie assessment of the issue shows that a voting paper was not given until just prior to the meeting and relief is likely. For these reasons I have waived the limitation.

Turning to the substance of the matter, Gupta states that while he received proper notice of the meeting (being sent on 23 January 2003, well within the 21 days required by section 43 of the Standard Module), he did not receive a voting paper until less than 24 hours before the meeting was scheduled to start. He also states that he was unable to attend the meeting as it was held during working hours and work commitments did not allow him to be absent from work. Although he does not say it directly, it seems that he would have voted by voting paper and the time provided (less than 24 hours) did not allow sufficient time for due consideration of the motions of the meeting.

The reason section 42(3) of the Standard Module requires that a notice of meeting must include the voting paper (and other documents) is for this very reason; that owners who wish to vote by voting paper have sufficient time to consider their position on the motions, including perhaps seeking the advice of a solicitor or accountant, and lodge the completed voting paper. Less than 24 hours is clearly unacceptable. Having notice of the substance of the motions in the agenda is insufficient.

Accordingly, I agree with Gupta in this matter and have made an order invalidating the meeting. I would point however, that the committee executive members in office at the time continued to hold that office by operation of section 25(1) of the Standard Module (as no successors elected) for at least the period relevant to the disputes.

I have already commented on the error of Kristin Butler in submitting that the voting papers were only forwarded to Gupta as a courtesy under the mistaken belief that the scheme was regulated by the Small Schemes Module. The mere fact that a scheme has 6 lots or less does not bring it under this module; the body corporate must vote on a new community management statement to bring that effect about (see section 54 of the Act). The lack of knowledge of the legislation by all parties evident here and elsewhere in these reasons, all point to the benefit of a professional Body Corporate Manager.

Additional Matter:
While that concludes my determination of the matters put in issue by Gupta, as I foreshadowed in my preliminary comments under "Application and Submissions", there is a matter of insurance that requires comment and (later) resolution. As I included in those comments, as the submission on this matter has not been viewed or considered by Gupta, then under the principles of natural justice he must of course be afforded the opportunity to view the documentation and make a submission in reply before any order or other action is made in the matter.

Accordingly, I do not want to delve too far into the matters now as there is only one side of the story available to me. The allegation is that, unbeknown to other owners, Gupta took out a body corporate building insurance policy with CGU, ignoring a cheaper quote available from Elders Insurance. The legislation provides that for any service with a value above the relevant limit for major spending under section 104 of the Standard Module ($200 times 3 lots = $600) there must be a minimum of two quotes and those quotes must be made available to all owners who will then choose between the alternative tenderers. It appears that here not only were there not two quotes obtained or provided to owners, the matter was not even decided in general meeting but by one owner. That is one matter.

Also it appears from copies of letters provided, that Gupta made a successful claim for $6,109 against the policy in February 2003 for damage caused during a break and enter of his lot building. The other owners have no knowledge of this event or of the claim under the body corporate policy. Claims under a body corporate policy can only be made on the authority of a resolution of the body corporate committee or general meeting, and this appears not to have been done. It is further alleged that the claim included "non-standard fittings (sliding doors)" and it is suggested that the larger premium is because of this factor. The legislation provides that, assuming the circumstances fit, where an owner alters their lot building by fixtures and fittings/improvements such that the premium is higher than it otherwise would be, then that owner must notify the body corporate of the improvements made and is liable for the increase in premium (see the Insurance Provisions in Division 9, Part 8 of the Act). This matter will be considered after Gupta has had the opportunity to respond.

Number of Scheme:	21198
Name of Scheme:	Golden Eagle
Address of Scheme:	71 Eagle Terrace, AUCHENFLOWER QLD 4066

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.

Number of Scheme:	21198
Name of Scheme:	Golden Eagle
Address of Scheme:	71 Eagle Terrace, AUCHENFLOWER QLD 4066

d)	a claimed or anticipated contravention of the Act or the community management statement; or
e)	the exercise of rights or powers, or the performance of duties, under this Act or the community management statement; or
f)	a claimed or anticipated contractual matter about –
(iii)	the engagement of a person as a body corporate manager or service contractor for a community titles scheme; or
(iv)	the authorisation of a person as a letting agent for a community titles scheme.

•	Suspension of business trading from U2 (no council or BC permission).
•	Remove unauthorised pets from Unit 2 & Unit 3."
•	Discontinue U3 practice of having newspaper delivered to top of driveway.
•	Removal of soil & pavers from common property (U3).
•	Reimbursement to body corporate of cheques with non-compliant signature.
•	U2 to take steps to prevent water run-off into U1 upper garage due to excessive watering.
•	Discontinuation of the continual and repeated non-compliance with correct and proper body corporate procedures in accordance with the Act, Regulations and prevailing by-laws.
•	Appointment of independent professional body corp. mgr & gardener,

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Golden Eagle [2004] QBCCMCmr 15 (9 January 2004)