Holiday Village [2004] QBCCMCmr 56 (29 January 2004)

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

I hereby order that –

1. Richard Holmes of Barard Management Pty Ltd, Level One, Technology One Centre, 67 High Street, Toowong Qld 4066 (PO Box 302, Toowong Qld 4066) is appointed Administrator to call, hold and chair a general meeting ("the meeting") within two (2) months of the date of this order, to be deemed to be the annual general meeting required to be held in late 2003, which must consider all of the statutory motions required of an annual general meeting and any other motions properly before it, and the election of committee members (as necessary) from those nominations sought under notice of 29 October 2003.

2. For the purpose of calling, holding and chairing the meeting, the Administrator shall have all of the powers of chairperson, secretary and treasurer, and of the committee, with the exception of further delegating those powers to another person.

3. The meeting shall be otherwise called and held as an annual general meeting in accordance with the legislation, particularly sections 42 and 45 of the Body Corporate and Community Management (Standard Module) Regulation 1997, and all other provisions relating to meetings under Part 4 of the Standard Module.

4. The Administrator shall hold appointment for the period beginning from the date of this order until the close of the meeting.

5. A copy of this order and the accompanying Statement of Reasons must accompany the notice of meeting.

I further order that Dan LUONG and Edward WALTERS, as owners and member of the previous committee, must within two (2) weeks of the date of this order deliver to the Administrator a signed bank authority relinquishing their power as signatories to operate on each of the body corporate bank (or other financial institution) accounts in favour of Richard Holmes as Administrator.

I further order that –

6. The Administrator is restricted by this order to expend body corporate moneys on body corporate matters of a routine or administrative nature, the convening of the meeting as ordered, and implementing lawful resolutions already decided by the committee or the body corporate in general meeting prior to the date of this order which are of an urgent nature or must necessarily be implemented prior to the meeting.

7. At the end of the administration period, the Administrator must relinquish his authority to operate on the body corporate bank accounts in favour of nominees of the newly elected committee or as the committee otherwise directs.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0588-2003

"Holiday Village" CTS 11949

The applicant, Barard Management Pty Ltd, Body Corporate Manager to the body Corporate, has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 ("the Act") -

JURISDICTION:
This application has arisen out a need for the body corporate to convene a general meeting to overcome the trauma of the last 12 months, well documented in the "Statement of Reasons" to each of a series of adjudicators’ orders made during that period (see later). One of the adverse results of this period of internal conflict has been the existence of two committees, both claiming legitimacy but neither able to convene the general meeting which would resolve many of the problems facing the body corporate.

While the applicant is the Body Corporate Manager which role is generally restricted in the range of disputes it may bring, in the peculiar circumstances of this body corporate at this time I am prepared to accept the applicant, Barard Management Pty Ltd ("Barard), as a disputant against the body corporate for the purposes of an order for its principal, Richard Holmes, to be appointed to convene a meeting to be deemed the 2003 annual general meeting. That is, I accept the standing of the applicant and the subject matter of the application as a dispute falling within the dispute resolution provisions of the legislation (see sections 227, 228 and 276 of the act).

General powers of an Adjudicator in making an order:
Section 276(1) 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 –

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:
Under section 243 of the Act, a copy of the application was provided to those persons claiming to be committee members elected on 18 February 2003: Dan Truong; Nathan Teis; Edward Walters; Russell Jackson; and also Ron Dalgliesh as a spokesperson, with an invitation to respond to the matters raised in the application.

A joint submission was received from Messrs Luong, Teis, Walters, Dalgleish and a Phillip Logoinha. The group defines itself as the committee elected on 18 February to distinguish itself from the committee elected at the general meeting on 18 June which meeting it regards as invalid. As a consequence, the "old committee" regards the "new committee" elected at that meeting to also be invalid. On this basis, the old committee refused to release to the new committee the body corporate records and the ability to operate on the body corporate bank accounts, the signatories being Truong and Walters. The joint submission suggested that the committee impasse could perhaps be resolved by a "composite" committee determining the agenda for a general meeting to held, but that financial issues needed also to be resolved.

Given the conciliatory nature of the submission, on 21 October I conducted a teleconference with Holmes and Dalgleish (representing the old committee). I informed Dalgleish that I could not countenance a composite committee. I also said that the committee impasse would be resolved by the holding of a general meeting and the election of a fresh committee but until such time as the new committee was found to be invalid, it must be regarded as the legitimate committee able to convene such a meeting. However, without access to the body corporate records it did not know owners’ addresses to be able to serve a meeting notice, nor did it know whether owners would be precluded from voting on certain motions because of outstanding contributions levied. Dalgleish said that he agreed that a meeting would resolve the committee issue, but considered that a proper audit of the accounts by an independent auditor needed to be carried out first. It was agreed that Dalgleish would search out an independent auditor and would attempt to persuade the old committee to deliver up the records to the new committee when Barard would bring the financial records up to an auditable form.

A further teleconference was conducted with Dalgleish and Holmes on 28 October 2003. The current situation was discussed and the following was agreed: Dalgleish would write up transactions and then deliver these and all other records to Barard by 9am on 10 November; Barard was to distribute to owners the next day (29 October) a notice seeking nominations for committee which must also include a paragraph explaining that a deemed "financial year-end" date three weeks hence was being adopted because the statutory time for the annual general meeting was past.

The body corporate records were duly received by Barard however the authority to operate on the bank accounts is still being held by the old committee (I note in the minutes of a committee meeting subsequently held on 23 December 2003 that Luong said that he would not sign an authority to release the body corporate’s bank account to the current committee). The notice seeking nominations and explanation were distributed and nominations to form a committee have been received. The accounts have been written up and subsequently audited and I have a copy of that audit report – the audit is qualified in certain respects but these are matters for owners to consider. It is sufficient that with committee nominations and the audit completed a general meeting may now be held.

DETERMINATION:
"Holiday Village" was registered as a building unit plan (now termed a building format plan) on 15 February 1979 and comprises 31 lots. It is regulated by the Body Corporate and Community Management (Standard Module) Regulation 1997 ("Standard Module").

The background to the present circumstances of the body corporate have been related in two previous orders by me, namely Orders 113 and 488 -2002, and those of a fellow adjudicator Mr Richard Meek in Orders 785-2002 and 54-2003.

I do not intend to recount all of the past problems that gave rise to the applications for those orders and those persons interested may read the "Statement of Reasons" to those orders for themselves – they form part of the records of the body corporate and are therefore accessible to owners.

Of relevance is that appeals lodged in the District Court by two members of the "old committee", namely Jack Howard (then no longer an owner) and Dan Luong, against Orders 785-2002 and 54-2003, were both struck out by Judge McGill SC on 9 December 2003. These appeals were apparently never authorised by the body corporate in general meeting as required by (at the relevant time) section 259(2)(c) of the Act and 26(e) of the Standard Module.

My duty in this application is to facilitate the holding of a general meeting to take the place of the 2003 annual general meeting which was never held at the proper time because of the impasse described earlier, to put in place its committee, funds position and projects up to the next annual general meeting to be held later this year.

Had the old committee not failed to release the authority to operate on the body corporate bank accounts to the new committee, I may have resolved this issue by merely ordering the new committee to convene a general meeting to be deemed the 2003 annual general meeting and to deal with all of the matters that must be dealt with at an annual general meeting.

However, it is essential that the bank accounts should be readily available to the new committee and in the interim available to meet at least the necessary expenditure of the body corporate (power accounts, insurance, security, wages and the like). That will be best achieved by my appointing Holmes as Administrator of the body corporate and specifically requiring Luong and Walters to relinquish their authority to operate the body corporate accounts in favour of the Administrator. The Administrator will then pass that authority to the committee upon its election at the ordered meeting or otherwise as the committee directs. It should be noted that the new committee continues to hold office during the period of administration in order to assist the Administrator and to compile the budgets, decide on motions, and the like.

I shall limit the authority of the Administrator to operate on the accounts. In drafting the required order for this, I need look no further than my words of 9 November 2002 in Order 488-20002 when restricting a "caretaker" committee prior to the convening of an ordered meeting. There is the irony that had those words and the balance of the order been complied with then the trauma, and the substantial legal and other costs involved, would likely have been avoided.

Owners might appreciate that I and others of this office has spent considerable time in attempting to resolve the issues put by various owners and I hope that this order and the ensuing meeting will result in doing away with the uncertainties and conflict of the past. Owners should approach the forthcoming meeting with a positive view of the future of their scheme.

Number of Scheme:	11949
Name of Scheme:	Holiday Village
Address of Scheme:	18 Thorn Street KANGAROO POINT Q 4169

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 –

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Holiday Village [2004] QBCCMCmr 56 (29 January 2004)