Moreton Towers [2004] QBCCMCmr 69 (4 February 2004)

Last Updated: 30 September 2005

REFERENCE: 0545-2003

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	5809
Name of Scheme:	Moreton Towers
Address of Scheme:	25 Moreton Parade KINGS BEACH QLD 4551

TAKE NOTICE that pursuant to an application made under the abovementioned Act by Mrs Netta & Mr Jackson Mobbs, the co-owners of lot 11

I hereby declare that the Body Corporate for Moreton Towers is responsible for maintaining the roofing membrane in the roof garden area in good condition.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0545-2003

"Moreton Towers" CTS 5809

APPLICATION

This application was made by Netta and Jackson Mobbs, co-owners of Lot 11 (applicants) on 18 August 2003 under the Body Corporate and Community Management Act 1997 (Act). The applicants sought orders against the Body Corporate for Moreton Towers (respondent) to "clarify who (ie the owner of Lot 11 or the Body Corporate) is responsible for maintaining and/or replacing the roofing membrane on the top floor of the Complex."

Moreton Towers community titles scheme (Moreton Towers) consists of 11 lots and common property. The community management statement for Moreton Towers indicates that the Body Corporate and Community Management (Standard Module) Regulation 1997 (Standard Module) applies to the scheme. Department of Natural Resources and Mines records show that the scheme is registered as Building Units Plan 9514. A building units plan is now referred to as a building format plan.


PROCEDURAL MATTERS

Under section 243 of the Act, a copy of the application was provided to the respondent body corporate and to all owners, with an invitation to the committee and all owners to respond to the matters raised in the application. A written submission was made by the committee chairman, purportedly on behalf of the committee. The applicants inspected the submissions received and made a written reply (see sections 246 and 244 of the Act respectively).

A dispute resolution recommendation was made referring the dispute to departmental adjudication.


JURISDICTION

This is a matter which falls within the dispute resolution provisions of the legislation (see sections 227, 228, 276 and Schedule 5 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)).


Is there a dispute?

Section 276(1) of the Act authorises an adjudicator to make an order to resolve a dispute. The applicants indicate that this is a dispute between an owner and a body corporate (see section 227(1)(b)). But the applicants have provided no evidence that they were in "dispute" with the Body Corporate before lodging the application. This Office sought details of communications with the Body Corporate on the issue from the applicants but was advised that no relevant correspondence existed. I am of the view that the dispute resolution processes provided under the Act should be a last resort mechanism, used only when parties are unable to resolve a dispute between them.

In this instance, however, I am prepared to proceed to determine this application notwithstanding that the applicants have not demonstrated that they were in dispute with the respondent prior to the application or that they attempted to resolve the issue independently. Section 227(2) of the Act provides for an application for a "declaratory order about the operation of this Act" to also fall within the definition of a dispute. I consider that the nature of this application is one that is, in effect, seeking a declaratory order about the operation of the Act.

MATTERS IN DISPUTE

The application relates to the responsibility for maintenance of the roofing membrane on the top floor of the complex. The facts of the dispute, as outlined in the application, submission, and reply to submission, can be summarised as follows.

The applicants indicate that the roofing membrane in question is below the tiled surface of the roof garden. The roof garden is the subject of an exclusive use by-law, being by-law 12, which states:

"The proprietor for the time being and from time to time of Lot 11 shall have the special privilege of the exclusive use and enjoyment for a roof garden facility of that part of the common property as is delineated and which has the number 11 in the plan annexed hereto and marked with the letter "A" with the said proprietor being responsible at his own costs and expense to keep that part of the common property in a neat and tidy condition and to keep all plants thereon properly tended and watered and otherwise being responsible for the performance of the duty of the Body Corporate under and pursuant to Section 37(1) of that Act. The aforesaid grant of exclusive use and enjoyment is made subject to and conditional upon the said proprietor permitting the Body Corporate and its Council and its properly appointed servants and agents, at reasonable times, access to such privileged area through the lot for the purpose of inspecting and maintaining the lift and associated equipment."

The reference in the by-law to "section 37(1) of that Act" is a reference to the Building Units and Group Titles Act 1980. This legislation has been replaced by the Body Corporate and Community Management Act 1997, and the equivalent of section 37 is section 109 of the Standard Module.

The applicants assert that by-law 12 does not apply to the membrane but "refers to the area above the bottom of the tiles and that, therefore, any obligation to perform a duty of the Body Corporate does not extend to below the level of the tiles and does not include the roofing membrane." The applicant further argues that "The object of By-Law 12 with respect to the Body Corporate was to put the owner of Lot 11 in a similar position to that which it would be if the Roof Garden were part of the titles to the Lot." The applicants go on to claim that section 109 of the Standard Module provides that a body corporate must maintain a roofing membrane even if the membrane is part of a lot. On that basis they argue that even if the membrane is part of the exclusive use area (which they dispute) the body corporate has a responsibility to maintain it.

The chairman’s submission does not comment on these issues but focuses on the nature of the membrane, the original construction, and the work required to rectify the current damage. A report by Roof and Building Service (Qld) Pty Ltd is included in the submission. It suggests that the structural roof slab has been coated with a "thin acrylic paint" and covered with tiles, many of which are loose or have come off, which has damaged the "acrylic coating". They recommend removing the tiles and adhesive, and waterproofing the roof slab. The chairman also asserts that that the applicants were the developers of the Moreton Towers and "as such were responsible for the integrity of the building". He argues that the level of repairs required arises because the membrane was not installed in an approved manner and that incorrect tile adhesive was used.

The applicants have responded that they can provide proof, if required, that they were not the developers of Moreton Tower. They also assert they did not install the membrane or the tiles. They advise that the builder of the Moreton Towers, who was engaged by the developer, has advised them that the membrane is polyurethane, which was the appropriate material at the time of construction (1989) and was competently applied. Moreover they assert that the builder laid the tiles which have enhanced the life-span of the membrane rather than adversely affecting it.

Issues relating to maintenance in the exclusive use roof garden area, particularly responsibility for repairs to the roof tiles, were considered in an earlier application, reference 0368-1997. As this is a separate issue to the responsibility for the membrane beneath the tiles, I am satisfied that this Office is not functus officio in regard to the subject matter of this application.

DETERMINATION

Since this application was lodged the Body Corporate and Community Management Legislation Amendment Regulation (No. 1) 2003 SL No. 26 was passed. This enactment amended many of the provisions of the Standard Module, with effect from 1 December 2003. As the application has sought clarification of the ongoing responsibility for the roofing membrane rather than, for example, a specific past event, I have applied the new provisions in determining this matter.

General responsibility for maintenance of roofing membranes

Section 109 of the Standard Module requires a body corporate to maintain common property:

109 Duties of body corporate about common property--Act, s 152

(1) The body corporate must maintain common property in good condition, including, to the extent that common property is structural in nature, in a structurally sound condition.

(2) To the extent that lots included in the scheme are created under a building format plan of subdivision, the body corporate must--

(a) maintain in good condition--

(i) railings, parapets and balustrades on (whether precisely, or for all practical purposes) the boundary of a lot and common property; and

(ii) doors, windows and associated fittings situated in a boundary wall separating a lot from common property; and

(iii) roofing membranes that are not common property but that provide protection for lots or common property; and

(b) maintain the following elements of scheme land that are not common property in a structurally sound condition--

(i) foundation structures;

(ii) roofing structures providing protection;

(iii) essential supporting framework, including load-bearing walls.

(3) Despite anything in subsections (1) and (2)--

(a) the body corporate is not responsible for maintaining fixtures or fittings installed by the occupier of a lot if they were installed for the occupier’s own benefit; and

(b) the owner of the lot is responsible for maintaining utility infrastructure, including utility infrastructure situated on common property, in good order and condition, to the extent that the utility infrastructure--

(i) relates only to supplying utility services to a particular lot; and

(ii) is 1 of the following types--

• hot-water systems

• washing machines

• clothes dryers

• another device providing a utility service to a lot.

Examples for subsection (3)(b)--

1. An airconditioning plant is installed on the common property, but relates only to supplying utility services to a particular lot. The owner of the lot would be responsible for maintaining the airconditioning equipment.

2. A hot-water system is installed on the common property, but supplies water only to a particular lot. The owner of the lot would be responsible for maintaining the hot-water system and the associated pipes and wiring.

(c) the owner of the lot is responsible for maintaining the tray of a shower that services the lot, whether or not the tray forms part of the lot.

(4) To avoid doubt, it is declared that, despite an obligation the body corporate may have under subsection (2) to maintain a part of a lot in good condition or in a structurally sound condition, the body corporate may recover the prescribed costs, as a debt, from a person (whether or not the owner of the lot) whose actions cause or contribute to damage or deterioration of the part of the lot.

(5) In this section –

"prescribed costs" means the proportion of the reasonable cost to the body corporate of carrying out the maintenance that can, in the body corporate’s reasonably opinion, be fairly attributed to the person’s action.

In a building format scheme such as Moreton Towers, section 109(2)(a)(iii) would require the body corporate to maintain the roof membrane "in good condition" if the roof garden was part of a lot. Alternatively, if the roof formed part of the common property (as is the case here), the body corporate would normally be responsible for maintenance, under section 109(1). However, as an exclusive use by-law exists in this circumstance, it is necessary to consider whether the by-law alters the responsibilities of the body corporate in regard to the membrane.

Responsibility for roofing membranes in an exclusive use area

In regard to exclusive use areas, section 170 of the Act provides that an exclusive use by-law attaches to a lot and gives the occupier of the lot exclusive rights and enjoyment, or other special rights, to a part of the common property identified in the by-law. Section 173 of the Act provides that the applicable regulation module can make provision about matters such as imposing obligations on the owner of a lot to which the by-law attaches.

A body corporate’s responsibility for maintenance of common property can potentially be displaced by the creation of an exclusive use by-law. Section 123(2) of the Standard Module provides that, unless there is a particular provision in the exclusive use by-law to the contrary, the lot owner who has exclusive use is responsible for the maintenance and operating costs for that part of the common property. But section 123(3), introduced in the recent amendments, restricts this general principle as follows:

123(3) However, if the lot was created under a building format plan of subdivision, in the absence of other specific provision in the by-law, the owner of the lot is not responsible for--

(a) maintaining in good condition roofing membranes that--

(i) are on the part of the common property to which the by-law applies; and
(ii) provide protection for lots or common property; or

(b) maintaining in a structurally sound condition any of the following elements of scheme land that are part of a structure that is on the part of the common property to which the by-law applies and is not constructed by or for the lot owner--

(i) foundation structures;
(ii) roofing structures providing protection;
(iii) essential supporting framework, including load-bearing walls. [my emphasis]

The roofing membrane here is part of the common property to which the exclusive use by-law applies, and it provides protection for lots and/or common property. The question is then whether by-law 12 specifically alters the default position that a body corporate is responsible for roofing membranes in an exclusive use area. The only words in the by-law that are potentially relevant are "otherwise being responsible for the performance of the duty of the Body Corporate". On balance, I do not consider that a requirement to take on the general responsibilities of the body corporate, is sufficient to satisfy the requirement of "specific provision" that is mentioned in section 123(3).

In drawing this conclusion, I have had the benefit of the statement of reasons in order 0655-2001. In that order the adjudicator determined that a by-law that required owners to be responsible for the "maintenance and regular cleaning" of their exclusive use areas, did not extent to non-routine, whole of building type maintenance. This view has since been entrenched with the inclusion of section 123(3) in the recent amendments. The adjudicator noted that:

"In the context of section 109 which provides (as described earlier) that the body corporate is responsible for both common property membranes, and membranes that are part of an owner’s lot property, it is in my view absurd that an owner having exclusive use of a common property membrane should be responsible if the by-law imposes a general "maintenance" condition. It is my view that, unless the by-law specifies that the body corporate maintenance responsibilities include membrane maintenance, the term must be read down to refer only to maintenance of a routine nature. Included in this category of non-routine repairs along with roof membranes, would be other major repairs such as structural faults, foundation structure defects and roof repairs. These major, non-routine items can be distinguished by the "whole-of-building" function which they provide."

The adjudicator felt that his view was reinforced in that the maintenance reference was coupled with "regular cleaning". Similarly, the reference here to general responsibilities in is context of a requirement to keep the common property neat and tidy and plants tended and watered, which amounts to routine and minor care and maintenance. Therefore, I do not consider that by-law 12 could be interpreted to intend a specific requirement that Lot 11 maintain the roofing membrane.

Extent of the exclusive use area

The applicants have suggested that the exclusive use area extends only to the bottom of the tiles and does not include the membrane underneath the tiles and tile adhesive. No basis is provided for this assertion and I am not persuaded by the argument. In the case of a building format plan, the boundary of a lot with common property or another lot is the centre of the wall, floor or ceiling. Accordingly, it would seem that the boundary of the exclusive use area for which the applicants have the benefit is the centre of the roofing structure dividing the roof garden and the lots below.

Contribution to damage or deterioration

There is some disagreement between the parties as to what the membrane is or should be comprised of, but I do not consider that this is relevant to the determination of the application. Similarly, I do not consider that it is relevant who installed the membrane. From the information provided by both parties, I am satisfied that the membrane (regardless of what it is made of and who installed it) exists for the protection of the lots and any common property in the levels of the building beneath. As such, it falls within the description of a roofing membrane in sections 109 and 123(3). Any alleged liability of the original builder is a separate issue beyond the jurisdiction of this Office.

While it is unclear, there is some implication that the chairman considers that the applicants’ alleged installation of the tiles has contributed to the damage that now exists. However I have not been provided with any evidence that the applicants installed the tiles or that the installation of the tiles contributed to the current situation. There is no other indication that the applicants contributed to the deterioration of membrane, presumably excepting the wear and tear of reasonable use.

I note that section 109(4) of the Standard Module provides that, if a body corporate has maintenance responsibility over part of a lot, the body corporate can recover maintenance costs from a person (whether the owner or otherwise) whose actions have caused or contributed to the damage or deterioration of the part of the lot. However, this section applies only to maintenance responsibilities over a lot, and does not refer to the body corporate’s responsibilities over common property (including common property that is the subject of an exclusive use by-law).

Conclusion

The committee chairman has requested that an inspection be conducted of the site to "ensure that a true picture is painted." However, this application is not about the nature of the membrane, the damage to the area, the repairs that may or may not be required, or any other matters that can be visibly inspected. The only issue I am required to determine is which party is now responsible for the roof membrane. I am satisfied that this is clear from an analysis of the provisions of the legislation. Accordingly, I do not consider that any inspection of the site is warranted.

The maintenance of a roofing membrane, whether in common property or in a lot, is the responsibility of the body corporate under section 109 of the Standard Module. In light of section 123(3) of the Standard Module, this responsibility has not been displaced by the terms of the exclusive use by-law 12. I have made a declaratory order to this effect.