One Park Road [2004] QBCCMCmr 416 (30 August 2004)

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

Bentonic Pty Ltd (lot 1), Chung-Ming Su & Shu-Chen Lin Su (lot 2), Nunzio La Rosa (lot 3), Kiara Holdings Pty Ltd (lot 4), I-Ying Wang (lot 7), Lee Li-Chu Chen & Chi-Chang Chen (lot 8), Maxwell Keith Dunstan, Anthea Jean Dunstan & Guy David Dunstan (lot 9), Audax Australia Pty Ltd (lot 16), Jimmy Lok Kee Ma & Verney Mei Kuen Ma (lot 29), and Werner Friedhelm Sauer (lot 41)

I hereby order that, pending a final determination in respect of this dispute, Edith Dindas Pty Ltd, its officers, employees, servants and agents must not carry out the proposal to regulate visitors parking as described in the notice from Edith Dindas Pty Ltd dated 11 August 2004 (or any similar proposal to regulate parking on common property) unless explicitly authorised to do so by a valid resolution of the body corporate made subsequent to the issue of this order.

I further order that Edith Dindas Pty Ltd, its officers, employees, servants and agents, are restrained from implementing any resolution to regulate parking that is passed at the proposed general meeting of 6 September 2004. That resolution will be deemed not to provide any person with authorisation to regulate parking pending a final determination of its validity.

This is an interim order and will remain in effect for a period of not longer than six months. It is the responsibility of the applicants to apply to extend this order if no final determination has been made within that period. This order will automatically lapse upon a final order being made or this application being withdrawn.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0521-2004

"One Park Road" CTS 2114

One Park Road Community Titles Scheme (One Park Road) is an 39 lot scheme under the Body Corporate and Community Management Act (Act) and the Act’s Commercial Module Regulation (Commercial Module).

This is an application for interim orders. It arises out of an application by Bentonic Pty Ltd (lot 1), Chung-Ming Su & Shu-Chen Lin Su (lot 2), Nunzio La Rosa (lot 3), Kiara Holdings Pty Ltd (lot 4), I-Ying Wang (lot 7), Lee Li-Chu Chen & Chi-Chang Chen (lot 8), Maxwell Keith Dunstan, Anthea Jean Dunstan & Guy David Dunstan (lot 9), Audax Australia Pty Ltd (lot 16), Jimmy Lok Kee Ma & Verney Mei Kuen Ma (lot 29), and Werner Friedhelm Sauer (lot 41) (applicants) seeking orders against the majority owner in the scheme, Edith Dindas Pty Ltd (respondent). Edith Dindas Pty Ltd owns lots 5-6, 10-15, 17-26, 28, 30-33, 35-37 and 40.

As well as being the majority owner, the respondent is also engaged by the body corporate as a "Building Manager". Under the Building Management Agreement the body corporate pays the respondent approximately $61,600 per annum (inclusive of GST) to provide various services including supervision of maintenance, holding of keys, issuing of security cards, monitoring observance of the by-laws, supervision of car parking and various other duties.

There are a number of issues in dispute between the owners in One Park Road and there are presently four other applications^[1] before this office involving the scheme. All owners have had the opportunity to, on request, inspect the material for all of the applications concerning One Park Road. All owners have also been given the opportunity to make submissions in respect of these applications and all owners will be given an opportunity to make submissions on this present application before I make final orders disposing of these five applications. Given the common issues and material I therefore intend to make a single final order that deals with all five applications for final orders.

However, the present application for interim orders seeks only to stop the respondent from implementing a proposal to require visitors parking in One Park Road to have their parking tickets validated by the shops they visit and to charge visitors for parking in excess of half an hour. I will therefore issue this order to resolve the interim application and then seek submissions from all owners in relation to the final orders sought.

In their application for interim orders to stop the respondent’s proposal to regulate parking, the applicants have provided submissions to the effect that:

The respondent did not provide written submissions. However, in a teleconference with representatives of the applicants and the respondent, submissions were made to the effect that:

An interim order will not be granted unless is it necessary due to the nature or urgency of the circumstances to which the application relates (Act, 279). Further, any orders granted must be just and equitable in the circumstances (Act, 276).

The applicants are seeking orders of an injunctive nature designed to stop the respondent from implementing its proposal to regulate car parking on the scheme. For it to be just and equitable to grant relief at this stage, before full and final consideration of all the issues raised, I would need to be satisfied that the application raises a serious question to be determined. I would also need to be satisfied that the balance of convenience between the parties justifies the grant of injunctive relief. That is, I would need to balance the inconvenience to the applicants of allowing the respondent to regulate car parking when it may subsequently be shown to be unauthorised against the inconvenience to the respondent of preventing regulation of car parking when it may subsequently be determined that the respondent is entitled to regulate the car parking.

The body corporate must act reasonably to administer the common property and body corporate assets for the benefit of the owners of lots included in the scheme (Act 94, 152). Further, an occupier must not permit use of a lot or the common property in a way that interferes unreasonably with the use or enjoyment of another lot (Act, 167).

In this instance, there is a serious question to be determined. Firstly, the applicants have a strong argument to the effect that regulating car parking is a matter for the body corporate to determine rather than any individual owner. This question is complicated by the respondent’s argument that the Building Management Agreement places the respondent under a duty to regulate parking. This Building Management Agreement is itself currently being challenged with an argument that the respondent improperly used its majority vote in the body corporate to secure for itself monetary gain by being appointed under the Building Management Agreement. There are serious questions to be determined in this regard given the claims that this was the least commercially favourable agreement of four agreements tendered to the body corporate.

Secondly, the respondent has said that the body corporate will determine appropriate parking regulation at an upcoming extraordinary general meeting. In this respect, the applicants expressed concern that the respondent is, as majority owner, simply making decisions for the body corporate without any input from the committee or other owners. I consider there to be a serious question to be determined in relation to whether it is unreasonable for the body corporate to vote on this type of matter without initial consideration by the committee.
There must be a committee for a body corporate (Commercial Module, 8), which committee is the body ordinarily responsible for management of the scheme (Act 100). Particularly as this type of decision would ordinarily require discussion between owners, it may well be unreasonable to have a majority owner act unilaterally to call and hold a general meeting without prior discussion by the committee. If this is the case then it supports the claim that decisions of the body corporate in general meeting are unreasonable to the extent that they prejudice minority owners and effectively deprive the committee of its function. On the other hand, it is difficult for minority owners or committee members to argue that decisions of the body corporate about parking are unreasonable if there is an obvious problem that the committee has not taken steps to address. This issue will need to be considered further in terms of the final orders sought.

There are also questions regarding whether proper procedures have been followed in the calling of the general meeting for 6 September 2004. Specifically, the legislation only provides for a general meeting to be called by the secretary, another person authorised by the committee, or a person authorised by an adjudicator (Commercial Module, 29). The exception is that owners who have a combined holding of at least 25% of lots can give a notice to the secretary requiring the calling of a requested extraordinary general meeting (Commercial Module, 47). However, there is no indication that the upcoming meeting is a requested extraordinary general meeting.

Related to the above is a claim that the committee is being deprived of its function by a resolution which limits its spending to $500 on any contract or engagement (excluding emergency repair of utility infrastructure) and a resolution preventing the committee from carrying out any resolution if a notice of opposition is signed by the owners of at least half the lots in the scheme.^[2] The validity of these resolutions can be determined when final orders are made.

Finally, it has transpired that the committee is not meeting regularly and that the appointed secretary is no longer acting in that capacity. It is concerning if committee meetings are not being called sufficiently frequently to allow the committee to fulfil its role, or if committee vacancies are not being filled. The legislation states who may call a committee meeting and places an obligation on the committee to take action to fill a committee vacancy (Commercial Module 16, 14(3)).

While there is evidence that the respondent has taken action to regulate car parking in the past, the present dispute concerns a new initiative by the respondent. I therefore consider that the balance of convenience supports maintenance of the status quo by restraining the respondent from regulating parking on the common property, pending a final determination of the dispute.

The second question is whether the body corporate itself should be restrained from implementing any proposal to regulate car parking. In particular, one of the minority owners expressed the concern that the respondent has acted unilaterally in calling a general meeting to vote on a proposal to regulate car parking.

It is not, of itself, unreasonable for a majority owner to vote in their own interest at a general meeting. However, it is arguable that it is unreasonable for a majority owner to deprive the committee of its function by deciding all matters itself in general meeting. It is also arguable that the upcoming general meeting has not been properly called pursuant to the legislation (Commercial Module 29, 47). I am therefore satisfied that the balance of convenience favours maintaining the status quo by preventing implementation of any resolution regarding parking made at the disputed general meeting of 6 September 2004.

However, it may be important for the body corporate to consider, and to take, some form of action to regulate car parking pending a final determination of this dispute. I will therefore not make any order preventing the body corporate from regulating car parking apart from the order preventing the implementation of the motion listed for the disputed general meeting of 6 September 2004. This allows the body corporate to regulate parking according to any future resolutions it may make, although subject to the qualification that an affected person may make a further application to this office challenging any resolution made.

If the body corporate is to regulate parking then there are obviously a number of issues requiring consideration including pricing, hours of operation, appropriate service contractors, signage informing visitors of conditions, and arrangements for occupiers who desire more than one parking space. It would be prudent for owners to seek to avoid further disputes by engaging in discussion of these issues and seeking some level of consensus prior to issues being put to a vote.

For these reasons, I make the interim order above.

The application will be allowed to proceed to submissions and final determination in the normal course.

Number of Scheme:	2114
Name of Scheme:	One Park Road
Address of Scheme:	1 Park Road MILTON QLD 4064

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

One Park Road [2004] QBCCMCmr 416 (30 August 2004)