Kitmar [2004] QBCCMCmr 479 (13 October 2004)

Number of Scheme:	12893
Name of Scheme:	Kitmar
Address of Scheme:	60 Walkers Way NUNDAH QLD 4012

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

I hereby declare that the body corporate is responsible for payment for repairs to the roof performed pursuant to the quotation of 27 October 2003 that was provided to the body corporate by J & JM Egerton, Roof Repair Contractors.

I further order that, within 30 days, the body corporate is to reimburse Ian Gordon Tong, the owner of lot 4 (applicant), the amount of $850 that the applicant paid to J & JM Egerton for work done pursuant to the quotation of 27 October 2003.

I further order that the application is otherwise dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0196-2004

"Kitmar" CTS 12893

Kitmar Community Titles Scheme (Kitmar) is a 4 lot scheme under the Body Corporate and Community Management Act 1997 (Act) and the Act’s Small Schemes Module Regulation (Small Schemes Module). The scheme is designed for residential purposes. Lot boundaries are designated under a building units plan (now known as a building format plan).

This application is by Ian Gordon Tong (applicant) seeking orders against the body corporate (respondent). The applicant is seeking to require the body corporate to reimburse him for an amount of $850 that he paid a contractor for roof repairs.

Kitmar is a small scheme with only four lots. Minutes of meetings indicate that administration of the body corporate’s affairs has not been proceeding effectively for some time. These minutes indicate that there has been a stalemate on a number of issues. It appears that the two owner occupiers have been voting against motions put forward by the two absentee owners and vice versa. A large number of motions therefore fail because of a tied vote.

All owners agreed at a meeting that the roof needed maintenance. However, owners have not passed any resolution authorising the engagement of a roofing contractor to maintain the roof.

The applicant’s main submissions were to the effect that the repairs were necessary due to the onset of the storm season and that he sent a letter to all owners giving them an opportunity to consider the quote for roof repairs. He says that he gave the tradesperson authority to proceed because two of the owners wanted to proceed and only one owner objected (the fourth owner not providing any response).

A second owner has supported the applicant’s claim. However, another owner has submitted that he opposed the engagement and that the proper procedures were not followed.

The legislation requires the body corporate to maintain common property in good condition (Small Schemes Module, 70). However, decisions of the body corporate that involve spending of more than $200 normally require the support of a resolution passed in general meeting (Small Schemes Module, 64). Also, two quotes must ordinarily be provided for spending of more than $200 per lot (Small Schemes Module, 65).

Further, the legislation provides that a motion is passed by ordinary resolution only if the votes counted for the motion are more than the votes counted against the motion (Small Schemes Module, 108). This means that a motion fails if there are two votes recorded in favour of the motion and two votes recorded against the motion. The chairperson does not have any casting vote.

The minutes of a general meeting on 9 September 2003 indicate that the applicant obtained two quotes for repair of the roof but none of the quotes were accepted as owners decided that there should be a complete inspection of the roof including ridge capping, flashings, roof tiles, gutters and downpipes.

The applicant says that he subsequently sought quotes based on a complete inspection of the roof by the person providing the quotation. He says that he sought five quotations but only one quotation was provided. This quotation included a re-bed and re-point of all ridge capping, replacement of faulty tiles, and new lead flashings. The quotation stated that the gutters and downpipes appeared to be in good condition.

The applicant says that this quotation met all requirements and was consistent with a quotation he had received a few years earlier. He also says that he was concerned about the imminent approach of the storm season. Therefore, on 11 November 2003, the applicant sent a letter to all owners asking them to tell him by 17 November 2003 whether they were willing to accept the quotation. A copy of this letter is provided. In this letter, the applicant states that a majority decision will apply and that he anticipates the repair work would be completed by early December.

Two of the owners supported accepting the quotation and one owner objected to the quotation. The applicant claims that the fourth owner did not respond so he proceeded to engage the contractor on a majority of two to one. A copy of a letter from the fourth owner dated 14 December 2003 was provided but the applicant says that the roofing work was completed on 26 November 2003. Therefore, the applicant did not receive a copy of this letter until after the work was completed.

To comply with proper procedures, the applicant should have sought the calling of a general meeting at which the owners could have been given an opportunity to vote on whether to accept the quotation. Also, two quotations should have been provided to give owners the opportunity to select their preferred quotation.

On the other hand, the contractors who provided the quotation inspected the roof and the quotation indicates that it was necessary to perform the repairs to the roof. No owner has provided any evidence to show that the work was overpriced or unnecessary.

I am required to make an order that is just and equitable in the circumstances to resolve the dispute (Act, 276). Kitmar is registered under a building format plan and the body corporate has a legal responsibility to maintain the roof in good condition (Small Schemes Module, 70). None of the owners have submitted evidence showing the work was overpriced or unnecessary. I am therefore willing to order that it was the body corporate’s responsibility to maintain the roof and to pay for the work performed.

A matter of ongoing concern is the evidence that proper procedures are not always being followed and, even if they are followed, a significant number of motions have failed due to a tied vote. I wish to emphasise to owners that they must be careful not to engage any tradespersons or otherwise incur any liability without a proper resolution being passed authorising the engagement. If two owners oppose any motion then that motion will fail, even if the other owners consider, for example, that urgent expenditure is necessary for the body corporate to comply with its obligation to maintain the common property in good condition. If no resolution is passed authorising the engagement of a contractor then an individual owner engaging that contractor risks being personally liable for payment of that contractor. If the work were urgent or clearly necessary then it would be appropriate for an application to be made to this office seeking authorisation for performance of the work.

Finally, I caution all owners that they should seek to improve lines of communication among themselves and work together in the management of their body corporate. If management of the body corporate does not improve then it may become necessary for this office to appoint an administrator to conduct the affairs of the body corporate. Any appointment of this nature will involve additional costs that owners will need to pay through contributions to the body corporate’s administrative fund.

The applicant has also queried the location of the body corporate’s chequebooks and deposit books. Some of these books have gone missing and cannot be located. Given there is no satisfactory evidence regarding the location of these missing books, I will not make any order regarding the books. Rather, this seems to be a matter that owners can resolve themselves by obtaining new books and copies of any relevant records from the body corporate’s bank.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Kitmar [2004] QBCCMCmr 479 (13 October 2004)