Collina [2004] QBCCMCmr 60 (30 January 2004)

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

I hereby declare that:

1. There has been no prescribed notice under section 152 of the Body Corporate and Community Management (Standard Module) Regulation 1997 (Standard Module) served on Joan Hoare (applicant) and there is no entitlement for Strata and Body Corporate Services to seek to collect the body corporate records under this section; and
2. For the period pending a final determination of this application the committee is the appropriate body to keep the body corporate records under its control and all committee members must have reasonable access to those records (Standard Module 149, 150); and
3. Notwithstanding the application to declare the annual general meeting and election of committee members’ void, the body corporate committee is entitled to seek return of the body corporate records to a member of the committee (Standard Module, 152).

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0790-2003

"Collina" CTS 11757

Collina Community Titles Scheme (Collina) is a 12 lot scheme under the Body Corporate and Community Management Act (Act) and the Act’s Standard Module Regulation (Standard Module).

This is an application for an interim order. It arises out of an application by Joan Hoare, the owner of lot 2 (applicant) against the body corporate (respondent) seeking to invalidate an annual general meeting held on 11 November 2003 and the election of the body corporate committee at that meeting. Prior to this meeting, the applicant was the secretary of the body corporate and held the books and records of the body corporate. This interim application concerns the validity of demands from Strata and Body Corporate Services (SBCS) that the new committee wants the records delivered to SBCS.

The applicant is seeking to prevent SBCS from collecting and managing the books and accounts of Collina until a final order is made regarding whether the annual general meeting and election of new committee should be invalidated.

It is possible to understand the applicant’s concern about the manner in which Strata and Body Corporate Services (SBCS) demanded she hand over the body corporate’s books and records. In a teleconference with the applicant and Collina’s committee members it became apparent that SBCS was claiming to have been appointed by the committee to collect the body corporate records and threatening the applicant that she may be liable to pay monetary penalties for non-compliance with section 152 of the Standard Module. However, the chairperson admitted that there had been no committee resolution appointing SBCS to collect the records. There was also no resolution by the committee requiring the applicant to deliver the records to a member of the committee. The applicant therefore is not liable for a penalty for non-compliance with section 152 of the Standard Module as claimed by SBCS.

It appears that SBCS is offering Collina’s committee free advice and assistance in administering the scheme in the hope that owners will subsequently recognise this assistance and vote to engage SBCS as a body corporate manager. The committee has no authority to engage a body corporate manager. However, provided it is clear that the committee is responsible for the administration of the body corporate there is nothing in the Act or Standard Module prohibiting the committee obtaining free assistance or providing advisors with access to the body corporate records necessary to gain this assistance. However, the applicant is correct in asserting that SBCS’s demand that she deliver the records to it is not a proper demand in accordance with section 152 of the Standard Module.

All parties need to recognise that the records should be under the control of the body corporate and available to all members of the committee (Standard Module 149, 150). Even in schemes where a body corporate manager has been properly appointed and that manager has the body corporate records in its possession, those records are required to be kept under the direction and control of the body corporate.
When a body corporate manager has possession of body corporate records and the engagement of the manager ceases, the body corporate manager must return those records to the possession of the body corporate. On the other hand, when a body corporate secretary has possession of the body corporate records in their possession an outgoing secretary will normally give those records to the incoming secretary shortly after the new appointment.

The applicant’s reason for failing to give the records to the incoming secretary appears to be that she did not consider the new appointments to be valid and wishes to challenge those appointments. However, in the teleconference, both the applicant and the committee members emphasised the importance of the body corporate moving forward and properly managing its affairs. The committee honestly and reasonably believes it was properly appointed at the annual general meeting, pending any final determination to invalidate that annual general meeting. The committee therefore has the power to make decisions on behalf of the body corporate (Act, 100(4)). In order to undertake its functions effectively, the committee needs access to the body corporate records.

The body corporate is required to keep the records which should be under the control of, and able to be accessed by, the committee (Standard Module 149, 150). The applicant is seeking to invalidate an annual general meeting and the appointment of committee members at that meeting. However, the present committee is entitled to the body corporate records pending a final determination of that application. Further, the committee can pass a resolution requiring the applicant to hand over the records to a named member of the committee within 14 days and serve notice of this resolution on the applicant (Standard Module, 152). Failure to comply with a proper notice could result in the applicant becoming liable to a penalty for non-compliance.

At the teleconference it became apparent that a number of other issues are contributing to the dispute between the parties but are not directly relevant to the dispute.

It is important for the parties to recognise that the legislated role of this office is to provide an information and dispute resolution service rather than oversee the administration of bodies corporate. The Act recognises the responsibility for self management as an inherent aspect of community titles schemes. An adjudicator cannot manage the scheme for the parties but can only decide the issues that are before the adjudicator for determination.

Having said that, at the teleconference some informal discussion took place that showed the parties may be able to resolve some of the contentious issues themselves. The parties stated that budgets and levies had been adopted at a recent extraordinary general meeting. This was agreed to be a positive step in terms of management of the scheme but the applicant expressed concern that she had not yet received a copy of the minutes or a levy notice. The chairperson responded by stating that he expected the minutes and a levy notice to be posted to all owners the following day. The chairperson expressed a concern that the applicant was still retaining the body corporate records when these should be under the control of the committee. The applicant stated that her main concern was about delivering the records to SBCS and it appeared that she might be willing to consider delivering the records to the committee voluntarily rather than being required to deliver the records pursuant to section 152 of the Standard Module. Finally, all parties stated their support for the concept of appointing a body corporate manager and stated that they would be satisfied with whichever body corporate manager was appointed by a vote of all owners carried out in accordance with the legislation.

It would be beneficial to the proper management of Collina if the parties were able to resolve these type of matters cooperatively.

If the body corporate had made an application seeking return of the records from a former body corporate secretary to the current secretary then I would have been prepared to grant that application. However, this is an application by the former body corporate secretary seeking to stop SBCS requesting the records from her when they have not been properly authorised by the committee to do so. Her concern about providing the records to this third party has been validated by an admission that the committee had not properly authorised SBCS to collect the records on behalf of the body corporate and my finding that the applicant has not contravened section 152 of the Standard Module.

However, it has become clear that the committee now wishes the records be delivered to the committee itself and the applicant can be reassured that she has properly discharged her responsibilities if she arranges to deliver the records to the incoming secretary.

In the circumstances, I will make declarations clarifying the outcome of the above reasoning in respect of the return of the body corporate records. At this stage, there is no need to provide any further interim relief.

Number of Scheme:	11757
Name of Scheme:	Collina
Address of Scheme:	20 Rudd Street, BROADBEACH QLD 4218

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Collina [2004] QBCCMCmr 60 (30 January 2004)