O'Quinn Street Apartments [2004] QBCCMCmr 579 (22 November 2004)

Last Updated: 30 September 2005

REFERENCE: 0423-2004

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	30714
Name of Scheme:	O’Quinn Street Apartments
Address of Scheme:	4 O’Quinn Street TOOWOOMBA QLD 4350

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

Wendy Colbran, the Owner of lot 1

I hereby order that the resolution passed in respect of Motion 1 at the annual general meeting held on 8 April 2004, to approve the installation of an air conditioning unit by the proprietors of lot 6, is invalid. I further order that in consequence of the above order, the secretary of the body corporate must include on the agenda of the next general meeting of the body corporate a motion, shown as requiring a special resolution to pass, that the body corporate ratify the installation of the air conditioning by the proprietors of lot 6. I further order that the air conditioning unit may remain in its current location until the above motion has been voted upon.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0423-2004

"O’Quinn Street Apartments" CTS 30714

The scheme

The scheme is a subdivision of 7 lots registered under a building format plan. The plans for the scheme indicate that each lot includes a rear courtyard and small front veranda. The remaining area is common property.

The owners of lot 6 sought permission from the body corporate to install an air conditioner on common property outside their lot. It was submitted that this was the preferable option owing to its proximity to the lounge area of lot 6. The air conditioning unit is now installed outside lot 6 in a corner formed by the juncture of two walls which have been referred to as the "north facing wall" and "west facing wall".

For the purpose of approving this improvement to common property, an extraordinary general meeting was called for 1 April 2004 with the following motion placed on the agenda:

That the proprietors of Unit 6 be granted permission to install an air conditioning unit on the north facing wall of Unit 6 and connecting units 6 & 7.

The meeting scheduled for 1 April 2004 was subsequently adjourned to 8 April 2004 on the grounds that a quorum was not present.

A meeting was subsequently convened on 8 April and attended by Mr. Stephen Davis, the Body Corporate Manager.

The minutes of this meeting include the following information:

Resolved by 4 votes in favour and 1 vote against – That the proprietors of Unit 6 be granted permission to install an air-conditioning unit on the North or West facing wall of Unit 6 and connecting Unit 6&7.

The application and submissions

The applicant has sought the following orders of an adjudicator:

(a) That in counting votes for and against the motion that was amended at the extraordinary general meeting held on 8 April, 2004 that five (5) votes be counted as voting against the amended motion because the proprietors were not present personally or by proxy.
(b) That the proprietors of lot 6 remove the installed condensing fan unit and refrigeration pipes, electrical wiring, drainage (overflow) pipe and cover as well as reinstate the common property to its original condition at their own expense.

Section 227(1)(b) of the Act provides that a dispute between an owner or occupier of a lot and the body corporate for a community titles scheme is a dispute which may be resolved under the dispute resolution provisions of the Act.

This office sought submissions in respect of the application from the committee and all owners.
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)).

The submissions of the applicant are very lengthy. The relevant facts can be summarised as follows:

1.	the owners of lot 6 wished to install an air conditioning system with the external components on common property outside their lot.
2.	For the purpose of approving this improvement to common property, an extraordinary general meeting was called for 1 April 2004 with the following motion placed on the agenda: That the proprietors of Unit 6 be granted permission to install an air conditioning unit on the north facing wall of Unit 6 and connecting units 6 & 7.
3.	As no voters were personally present, a quorum was not achieved and the meeting was adjourned for 7 days to 8 April 2004.
4.	At the subsequent meeting, the body corporate manager purportedly exercising the powers of the chairperson, conducted a EGM where it was resolved, on the voting papers, 4 votes to1– That the proprietors of Unit 6 be granted permission to install an air-conditioning unit on the North or West facing wall of Unit 6 and connecting Unit 6&7.

Four other lot owners lodged submissions, each of which supported the installation of the air conditioning unit. Submissions were received from the owners of lot 6 who provided a significant amount of photographic evidence.

The relevant issues can be summarised as follows:

1. Whether the body corporate manager is entitled to exercising the powers of the chairperson and form a quorum at the EGM held on 8 April 2004.
2. The effect of changing the motion from:
That the proprietors of Unit 6 be granted permission to install an air conditioning unit on the North facing wall of Unit 6 and connecting units 6 & 7
to
That the proprietors of Unit 6 be granted permission to install an air conditioning unit on the North or West facing wall of Unit 6 and connecting units 6 & 7.

The Law

1. The Adjourned General Meeting

Section 114 of the Body Corporate and Community Management (Standard Module) Regulation deals with Improvements to common property by lot owners and provides as follows-

(1) The body corporate may, if asked by the owner of a lot, authorise the owner to make an improvement to the common property for the benefit of the owner’s lot.
(2) The improvement must be authorised by special resolution of the body corporate unless--

(a) the improvement is a minor improvement; and
(b) the improvement does not detract from the appearance of any lot included in, or common property for, the scheme; and
(c) the body corporate is satisfied that use and enjoyment of the authorised improvement is not likely to promote a breach of the owner’s duties as an occupier.

(3) An authorisation may be given under this section on conditions the body corporate considers appropriate.
(4) The owner of a lot who is given an authority under this section 42--

(a) must comply with conditions of the authority; and

(b) must maintain the improvement made under the authority in good condition, unless excused by the body corporate

As noted above, an extraordinary general meeting was scheduled for 1 April 2004 but was subsequently adjourned to 8 April 2004 on the grounds that a quorum was not present.
In this regard section 48 of the Body Corporate and Community Management (Standard Module) Regulation provides as follows-

(1) A voter is taken to be present at a general meeting if the voter is present at the meeting personally, by proxy or by written or electronic voting paper.
(2) A quorum at a general meeting is at least 25% of the number of voters for the meeting, except that--
(a) if the number of voters for the meeting is 3 or more, 2 voters must be present personally; and
(b) if the number of voters for the meeting is less than 3, there is a quorum if at least 1 voter is present personally.
(3) If there is not a quorum within 30 minutes of the time scheduled to start the meeting, the meeting must be adjourned to be held at the same place, on the same day and at the same time, in the next week.

Further, section 48 (4) provides that -
If at the adjourned meeting a quorum is again not present within 30 minutes of the time scheduled to start the adjourned meeting, the persons present (whether personally or otherwise) form a quorum if--
(a) the chairperson is present personally; or
(b) the chairperson is not present personally, but a body corporate manager, exercising the powers of the chairperson under an authorisation given by the body corporate, is present personally.

There is no evidence that the body corporate manager has been authorised by the body corporate to exercise the powers of the chairperson. While, such a delegation of power is contained in the management agreement, no such power is conferred by the management agreement entered into between the Body Corporate for O’Quinn Street Apartments and David W Swan & Associates Pty. Ltd. On this basis, I am of the view that the resolution passed in respect of Motion 1 at the adjourned general meeting held on 8 April 2004, to approve the installation of the air conditioning by the proprietors of lot 6 is invalid.

2. Change of motion

The next issue for consideration is the effect the of changing the motion from:

That the proprietors of Unit 6 be granted permission to install an air conditioning unit on the North facing wall of Unit 6 and connecting units 6 & 7.
to
That the proprietors of Unit 6 be granted permission to install an air conditioning unit on the North or West facing wall of Unit 6 and connecting units 6 & 7.

In this regard section 57 of the Body Corporate and Community Management (Standard Module) Regulation relevantly provides as follows:

Amendment of motions at general meetings
(1) A motion may be amended at a general meeting by the persons present, and having the right to vote, at the meeting.
(2) However, an amendment cannot be made that changes the subject matter of the motion.
(3) In counting the votes cast for and against a motion to amend a motion, or an amended motion, a person who is not present at the meeting personally or by proxy, but would, if present, have the right to vote--
(a) if the person has not cast a written or electronic vote on the motion--must not be counted as voting for or against the motion;
or
(b) if the person has cast a written or electronic vote on the motion--must be counted as voting against the motion.

Accordingly, even if the body corporate manager was authorised to exercise the powers of the chairman, the change in motion should have resulted in written votes being counted as against the motion.

In any event, the air conditioning unit is now installed on the floor rather than on a wall, albeit in a corner formed by the juncture of the "north facing wall" and "west facing wall".

Decision

I am of the view that due to the procedural irregularities outlined above, the resolution passed in respect of Motion 1 at the adjourned general meeting held on 8 April 2004, to approve the installation of the air conditioning by the proprietors of lot 6, is invalid.

I therefore order that in consequence of the above, the secretary of the body corporate must include on the agenda of the next general meeting a motion, shown as requiring a special resolution to pass, that the body corporate ratify the installation of the air conditioning by the proprietors of lot 6. In doing so, the body corporate is obliged to act reasonably.

As the resolution is invalid due to procedural irregularities, and only one proprietor has raised objections, I order that the air conditioning unit may remain in its current location until the above motion has been voted upon.

If it is intended that the body corporate manager should exercise the powers of the chairman in the future, the body corporate should ensure that a formal authorisation is given to the body corporate manager.