22 Gray Street [2004] QBCCMCmr 57 (29 January 2004)

Last Updated: 30 September 2005

REFERENCE: 0756-2003

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	25274
Name of Scheme:	22 Gray Street
Address of Scheme:	22 Gray Street, SOUTHPORT QLD 4215

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

Leonard Charles Riseley, the co-owner of lot 3

I hereby order that - (1) Dale Armstrong of 601 Pineridge Road, Coombabah Q 4216 is appointed as administrator to call, hold and chair an extraordinary general meeting ("the meeting") of 22 Gray Street within three (3) months of the date of this order for the purpose of the consideration of motions included on the agenda of the meeting and the election of a committee. (2) The administrator shall hold the appointment for the period beginning from the date of this order until the close of the meeting ordered. I further order that within seven (7) days of the date of this order the administrator must give a copy of this order to each person whose name appears on the roll as the owner of a lot in the scheme ("lot owners"). I further order that - (1) For the purpose of calling, holding and chairing the meeting, the administrator shall have all the powers of the chairperson, secretary and treasurer of the body corporate, and of the committee, with the exception of the following powers - • to further delegate any of those powers to another person; or • to incur any expenditure apart from that necessary for the calling and holding of the meeting, except in regard to expenses that must necessarily be met and are capable of being authorised and incurred by a committee under the legislation. (1) The administrator must give at least fourteen (14) days written notice inviting owners to submit motions for inclusion on the agenda of the meeting. (2) The meeting shall be otherwise called and held as an extraordinary general meeting in accordance with the Act, particularly sections 42 and 45 of the Standard Module and all other provisions relating to meetings under Part 4 of the Standard Module. (3) The election of committee members shall be in accordance with sections 14 and 15 of the Body Corporate and Community Management (Standard Module) Regulation 1997. (4) The administrator must not give the notice of meeting to owners earlier than twenty-one (21) days from the date of this order. I further order that the administrator shall renew the body corporate building and public liability insurance currently held with CGU Insurance Limited, which is due for renewal on 31 January 2004. I further order that the administrator is hereby authorised to pay the requisite insurance premium from the body corporate funds currently held in an account with the Bank of Queensland.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0756-2003

"22 Gray Street" CTS 25274

The applicant, Leonard Charles Riseley, has sought an order of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act) as follows:

That an administrator, Mr Dale Armstrong, be appointed to convene a requisitioned extraordinary general meeting following resignation of Mrs Irene Favot of BUGT Management body corporate managers and assist with re-establishing the effective management of the body corporate’s affairs on behalf of all unit owners as soon as possible.

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)).

Specifically, without limiting the power of an adjudicator to make an order under section 276(1), an adjudicator may order the body corporate to call a general meeting of its members to deal with stated business or to change the date of an annual general meeting (Act Schedule 5 section 6). Alternatively, the adjudicator may order the appointment of an administrator, and authorise the administrator to perform obligations of the body corporate, its committee, or a member of its committee under this Act or the community management statement (Act Schedule 5 section 23).

The administrator has the powers given to the administrator under the order (section 301(2)). Section 301(4) provides that the order may –

a)	withdraw all or particular stated powers from the body corporate (and any delegate of the body corporate) or from stated officers of the body corporate until the administrator has taken the necessary action to secure compliance with the obligations; and
b)	require officers or delegates of the body corporate to take stated action to help perform the work the administrator is required to perform; and
c)	fix the administrator’s remuneration.

An order appointing an administrator may be the only order the adjudicator makes for an application (section 276(4)(a)). An adjudicator’s order may contain ancillary or consequential provisions the adjudicator considers necessary or appropriate (section 284(1)).

The applicant stated in his supporting grounds that the former body corporate manager has resigned, and he has collected the books and records of the body corporate from that former manager, and, with the assistance of another owner, opened a body corporate bank account with the Bank of Queensland. The applicant further stated that owners need help to re-establish the effective management of the body corporate’s affairs in order to pay outstanding accounts. By further letter dated 28 January 2004, the applicant advised that the body corporate building insurance is due on 31 January 2004.

All owners were invited to respond to the application. Submissions were received from three owners, two of whom supported the application. One of those owners has since sold his lot, but I do not consider that that diminishes the fact that he specifically supported the appointment of an administrator "to solve the current situation the unit holders find themselves in ...".

The owner who opposed the application claimed that he has been elected secretary of the body corporate, and referred to minutes of a meeting lodged with another application as evidence to support this assertion. I am aware of another application that has been made to this office in which this same owner also asserts that he is the elected secretary. That application purports to have been made by the body corporate, but there is no evidence that there has been a valid committee resolution authorising the application. That application is accompanied by a copy of minutes of a meeting purportedly held on 19 July 2003. That application remains unresolved at this time.

I have not been requested in this application to make a determination in relation to the validity of the meeting purportedly held on 19 July 2003, at which two owners were allegedly elected to committee positions, nor do I intend to do so. Suffice to say, it is apparent from the material before me that the administration of the body corporate is presently in disarray.

The person nominated by the applicant to be appointed as administrator to call a meeting has consented in writing to that nomination. I consider that the interests of all owners will be best served if an extraordinary general meeting is held at which, amongst other things, a committee can be properly elected, and owners can decide if they wish to have the administration of the body corporate placed in the hands of a professional body corporate manager or not. No doubt there will be other matters that owners may wish to have considered at the same time. I also note that several of the proposed motions listed on the agenda of the previously requested extraordinary general meeting have now been overtaken by events, such that further consideration of them would be superfluous.

I have also specifically ordered that the administrator attend to the renewal of the body corporate building and public liability insurance which falls due on 31 January 2004.