Focus [2004] QBCCMCmr 523 (2 November 2004)

Last Updated: 30 September 2005

REFERENCE: 0374-2004

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	12996
Name of Scheme:	Focus
Address of Scheme:	114 The Esplanade, SURFERS PARADISE Q 4217

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

Lois Albert, the Owner of lot 21.

I hereby order that the application for the following order To refund Lois Gail Albert the special legal levy that was paid to the body corporate for Focus Is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0374-2004

"Focus" CTS 12996

The Application

The applicant lot owner, Ms Lois Albert, is seeking an order that the body corporate for Focus refund to her moneys collected by way of a special levy to cover the anticipated legal fees involved in defending a Supreme Court action, brought against the body corporate by the owners of lot 1.

The scheme

The scheme is a subdivision of 125 lots registered as a building unit plan (now known as a building format plan). The regulation module applying to the scheme is the Accommodation Module.

Jurisdiction

Section 227(1)(b) of the Act provides that a dispute between an occupier of a lot and the body corporate is a dispute which may be resolved under the dispute resolution provisions of the Act.
As this is a dispute between a lot owner and the body corporate, it is a dispute which may be resolved under the dispute resolution provisions of the Act.

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)).

Procedural Matters

Under section 243 of the Body Corporate and Community Management Act 1997 (the Act), a copy of the application was provided to the respondent body corporate and to all owners, with an invitation to respond to the matters raised in the application. Written submissions were made by two owners and the body corporate.

Background

The owners of lot 1, which is occupied by a restaurant, claim that they are entitled to exclusive use of part of the common property. This claim has been disputed by the body corporate with the result that the owners of lot 1 have instituted proceedings in the Supreme Court. At an extraordinary general meeting of the body corporate held on 2 September 2003, it was resolved that the body corporate raise the sum of $176,400 by way of special levy of $1,128.96 per lot to meet the anticipated legal fees involved in defending the action against the body corporate.

The applicant signed a contract to purchase unit 21 on or about 8 August 2003 with a settlement date of 5 September 2003. The contract contained a disclosure statement as required by section 206 of the Act, but this statement made no reference to a proposed general meeting of the body corporate or a proposed special levy.

On 27 August 2003 the applicant’s solicitor obtained from the body corporate a Body Corporate Information Certificate containing the information required under section 205(4). The certificate makes no reference to a proposed special levy.

On 17 September 2003 the applicant received an invoice for $1,128.96 from the body corporate to cover the anticipated legal fees . The applicant believes that the body corporate should have informed her of the proposed special levy and is seeking an order that the body corporate refund these moneys to her.

The body corporate has confirmed that it provided an Information Certificate to the applicant’s solicitors. However, as the certificate was prepared prior to the EGM vote for the special levy, there was no provision in the Certificate for the inclusion of information regarding proposed meetings. The body corporate also advised that the applicant or her solicitor could have undertaken a search of body corporate records prior to settlement.

Decision

As this is a dispute between a lot owner and the body corporate, it is a dispute which may be resolved under the dispute resolution provisions of the Act. However there would not appear to be any basis upon which the body corporate is liable to refund the amount of the special levy to the applicant.

Under section 205(4) of the Act, the body corporate is required to issue a body corporate information certificate in the prescribed form within 7 days of receiving a request from an interested person. From the documentary evidence provided to me including a copy of the certificate, I am of the view that the body corporate has met its obligations under that section.

Under section 205(2), the body corporate is also obliged to make its records available for inspection within 7 days of receiving a written request from an interested person. However the body corporate has advised that no such request was received.

The applicant has advised that the "Disclosure Statement" forming part of the Contract for Sale, does not refer to the special levy or a proposal to impose a special levy. However, the parties to this document are the buyer and seller of the unit. Clause 8.4 of the standard Contract for Sale imposes duties of disclosure on the seller, and under section 223 of the Act, certain warranties are implied in the contract. As the body corporate is not a party to the contract, it cannot be held liable for any alleged non-disclosure or non-compliance with the Act by the seller or an agent for the seller.

Accordingly I am unable to make the order requested against the body corporate and dismiss the application.