Saltwater [2004] QBCCMCmr 187 (6 April 2004)

Last Updated: 30 September 2005

REFERENCE: 0070-2004

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	30139
Name of Scheme:	Saltwater
Address of Scheme:	30 Macrossan Street, Port Douglas QLD 4871

TAKE NOTICE that pursuant to an application made under the abovementioned Act by the Body Corporate for Saltwater

I hereby order that the application body corporate for Saltwater for an order against the owner of lot 25, Juniper Commercial Holdings Pty Ltd, that all core penetrations made be repaired and returned to their original state, and that no piping or wiring be allowed to extend into or on exclusive use areas of other lot owners, is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0070-2004

"Saltwater" CTS 30139

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

All core penetrations made be repaired and returned to their original state. That no piping or wiring be allowed to extend into or on exclusive use areas of other lot owners.

The applicant body corporate also sought an interim order, quote –

Suspend all works associated with the building project in lot 25 that involve exclusive use areas of other lot owners or into common property.

On 19 March, 2004 the following interim order was made, quote

I hereby order that Juniper Commercial Holdings Pty Ltd, the owner of lot 25, or the occupier thereof, shall not undertake or complete any further work to common property associated with lot 25 until such time as body corporate authorisation for such work is obtained.

I further order that in the event that body corporate authorisation is not obtained for the work at the EGM to be held on 31 March 2004, then Juniper Commercial Holdings Pty Ltd, the owner of lot 25, or the occupier thereof, shall not undertake or complete any further work to common property associated with lot 25 until such time as a final order to this application is made, the application is withdrawn, or this order is of no effect through operation of law.

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 reasons for the interim order, I stated as follows -

The application alleges that –

The owner of lot 25 who has leased out their premises has permitted their tenant without any approval from the committee to engage a contractor to drill six (6) core holes through the concrete floor of lot 25 into the car park below and then attempt to permanently install drains and piping from their lot and suspend them on the roof area of the car parks in question which are directly beneath lot 25.

The parties should note that at this stage, I am considering the requested interim relief. I am not considering the final order sought by the applicant body corporate, nor the final resolution of this dispute. The interim order seeks the suspension of "all works associated with the building project in lot 25 ...".

In considering the interim order, this office requested a submission from the owner of the lot in question, lot 25, Juniper Commercial Holdings Pty Ltd (the respondent). The respondent is the owner of several lots in the scheme. The respondent has made a submission which deals with the totality of the application. As I have indicated, I intend at this stage to only consider the interim order sought.

It is clear from the respondent’s submission that the work is proposed or intended; and that it involves areas of common property. It is not clear whether the work has actually commenced and if so, whether it has in fact been completed. However, from the application it appears to have been commenced. It is further clear from the respondent’s submission that body corporate consent or authorisation to the work has not presently been obtained. The respondent’s submission states that it has sought approval of the body corporate by way of authorisation of the body corporate in general meeting. The submission concludes –

We note that a meeting of the body corporate has been called and will be held on 31 March 2004 where no doubt these matters may be discussed in greater (detail) between the parties and then resolved.

It is clear in the circumstances that the respondent has commenced work to common property for which body corporate authorisation has not been obtained. Given this, I intend to order that Juniper Commercial Holdings Pty Ltd, the owner of lot 25, or the occupier thereof, shall not undertake or complete any further work to common property associated with lot 25 until such time as body corporate authorisation for such work is obtained. Further, that in the event that body corporate authorisation is not obtained for the work at the EGM to be held on 31 March 2004, then that Juniper Commercial Holdings Pty Ltd, the owner of lot 25, or the occupier thereof, shall not undertake or complete any further work to common property associated with lot 25 until such time as a final order to this application is made, the application is withdrawn, or this order is of no effect through operation of law.

An EGM of the body corporate was held on 31 March 2004, at which the following motion, proposed by the respondent, was considered, quote –

That the plumbing and incidental work on the ceiling of the carpark and elsewhere – which are required to provide utility infrastructure / plumbing services to the lot/s above the carpark – be undertaken / ratified by the body corporate.

The minutes record that the motion was ruled out of order by the chairperson for the stated reason that the motion, if carried, would conflict with the by-laws in place for the scheme. The reasons further state that the legislation requires a special resolution and not an ordinary resolution. The minutes then record that a motion was moved to reverse the chairperson’s ruling. This motion was resolved to be carried by a vote of 30 in favour, with 1 against. Further, the original motion was then resolved to be carried, this time by a vote of 32 in favour, and 1 against.

In its submission in response to the application, the respondent states that –

The occupier seeks to make improvements to the plumbing and drainage works to facilitate its occupancy. ... The occupier seeks to install additional "utility infrastructure" associate with the provision of utility services to lot 25. ... The improvements proposed are minor in nature and are simply an addition to the existing utility infrastructure of the Scheme. ...

The respondent goes on to address the issue on the basis of improvements to the common property, firstly by a owner, and in the alternative by the body corporate. I consider there are considerable flaws in both arguments. However, it is not necessary to consider these aspects here. I consider that the provisions dealing with statutory easements are relevant.

The Land Titles Act relevantly provides in respect of Statutory Easements, quote -

115M Application of div 5
(1) This division provides for easements for lots included in, and common property for, a community titles scheme.
(2) However, subject to subsection (3), this division applies to the scheme only if the lots included in the scheme are lots on--
(a) a building format plan of subdivision; or
(b) a volumetric format plan of subdivision; or
(c) a standard format plan of subdivision registered under this Act on or after 13 July 1997.
(3) If a lot is a standard format lot in a community titles scheme intended to be developed progressively and there are no buildings on the lot, this division applies for the lot.
(4) This division has effect for the scheme subject to the provisions of an easement established under another part of this Act. ...

115O Easements in favour of lots for utility services and utility infrastructure
(1) An easement exists in favour of a lot and against other lots and common property for supplying utility services to the lot and establishing and maintaining utility infrastructure reasonably necessary for supplying the utility services.
(2) However, the exercise of rights under the easement must not interfere unreasonably with the use or enjoyment of the lot or part of common property against which the easement lies.

115P Easements for utility services and utility infrastructure


(1) An easement exists in favour of common property and against the lots for supplying utility services to the common property and establishing and maintaining utility infrastructure reasonably necessary for supplying utility services to the common property.
(2) However, the exercise of rights under the easement must not interfere unreasonably with the use or enjoyment of the lots against which the easement lies.
...

Section 68 of the Act provides as follows -

68 Exercise of rights under statutory easement
(1) Rights under a statutory easement18 must not be exercised in a way that unreasonably prevents or interferes with the use and enjoyment of a lot or common property.
(2) If a statutory easement19 entitles a lot owner to enter another lot or common property to carry out work, the owner--
(a) must give reasonable written notice--
(i) to the other lot’s owner, and additionally, if the owner is not the occupier, the other lot’s occupier, before entering the lot to carry out work; or
(ii) to the body corporate, before entering the common property to carry out work; and
(b) must comply with the security or other arrangements or requirements ordinarily applying for persons entering the lot or the common property.
(3) If a statutory easement20 entitles the body corporate to enter a lot to carry out work, the body corporate must give reasonable written notice to the lot owner before entering the lot to carry out work.
(4) Subsections (2) and (3) do not apply if the need for the work to be carried out is, or is in the nature of, an emergency.

I consider that given that the works carried out appear to involve the provision of utility services to a lot, then I consider that there exists in favour of the lot, and against the affected common property, notwithstanding that exclusive use of such common property has been granted, a statutory easement entitling the occupier of that lot to undertake the work in question. Specifically, however the exercise of the statutory easement is made provisional on the requirement that the exercise of the right must not interfere unreasonably with the use or enjoyment of the lot or part of common property against which the easement lies.

The applicant is incorrect to suggest or argue that the grant of exclusive use precludes the affixing of utility infrastructure to that part of the common property. The statutory easements which apply and operate are absolute; they are not subject to rights of an owner to exclusive use of part of the common property. They are only subject to the proviso that the exercise of the statutory easements not interfere unreasonably with the use or enjoyment of the lot or part of common property against which the easement lies. Whilst the applicant has sought to argue that there has been such interference, I suggest that this argument is somewhat overblown. The reality appears to be that had the applicant "approached the task in such a way as to ensure that any plans for occupying their space complied and met with the appropriate approvals from the body corporate this entire problem might have been alleviated from the beginning". This statement suggests to me that the applicant body corporate is more concerned at not having been consulted, rather than the work actually undertaken.

The body corporate suggests that "approvals" were required. However, the statutory provisions make it clear that the entitlement to undertake work pursuant to a statutory easement is as of right, subject only to the giving of "reasonable written notice" and not to "interfere unreasonably" (see section 68). Whilst I acknowledge that notice would appear not to have been given, I am not prepared to order in terms as sought by the applicant for what I conclude is a reasonably minor transgression. Moreover, the exercise of the right has been approved by an overwhelming majority of owners who voted, in the context of a general meeting.

The body corporate is further concerned at future similar actions by this respondent. I consider that this is an as of right possibility, but subject to the requirements of section 68 of the Act regarding notice and that the rights under a statutory easement must not be exercised in a way that unreasonably prevents or interferes with the use and enjoyment of a lot or common property. These are the requirements that the respondent will need to address in future scenarios. In the circumstances, I intend to dismiss this application.