Rose-Wood Park [2005] QBCCMCmr 129 (3 March 2005)

Last Updated: 5 July 2005

REFERENCE: 0606-2004

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	19820
Name of Scheme:	Rose-Wood Park
Address of Scheme:	15 Vikto Street WOODRIDGE QLD 4114

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

Kevin Francis George SMITH, as the owner of Lots 44 and 45; and Cameron Paul SMITH, as the owner of Lot 47,

I hereby order that the application for the following order – "My father and I are seeking to have the amount of $478.95 reimbursed by the Body Corporate for Rosewood Park", is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0606-2004

"Rose-Wood Park" CTS 19820

The applicants, Kevin and Cameron Smith of Lots 44 and 45, and 47 respectively, have sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 ("the Act") -

"My father and I are seeking to have the amount of $478.95 reimbursed by the Body Corporate for Rosewood Park."


JURISDICTION:
This is a dispute between owners (the applicant Smiths) and the body corporate (the respondent) concerning the action of the body corporate in refusing to allow a discount for timely payment of contributions. This is a matter that falls within the dispute resolution provisions of the legislation (see sections 227, 228 and 276 of the Act) and may be determined by a departmental adjudicator.

General powers of an Adjudicator in making an order:

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 this 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) 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:
In accordance with section 243 of the Act, a copy of the application was served on the respondent body corporate (committee) which was instructed to serve copies on all other lot owners along with a copy of the department’s notice inviting the committee and all owners to make a written submission on the matter of dispute raised in the application.

The body corporate committee declined to make a submission. The Body Corporate Manager at the time the events took place, Mike Golden, made a submission giving the reasons why the discount was not allowed. The following owners made submissions to the application: C & P Thompson; R Leonard/Collins of Unit 67; J Bray; A Bersinic of Unit 33; and E Hempstead.

The applicants did not view the submission and therefore no reply to the submission was made (see sections 244 and 246 of the Act).

The brief facts of the matters are as follows.


The dispute relates to contributions payable to the body corporate that were due on Friday 28 March 2003. Cameron Smith paid two lots of $575.40 in respect of Lots 45 and 47 by an internet bank transfer on the due date, 28 March. On the same day Kevin Smith paid the same contribution amount for Lot 44 by a direct credit to the body corporate’s bank account. The amounts were not received and credited to the body corporate bank account until Monday 31 March. The Body Corporate Manager at the time (Golden) denied the Smiths the discount for timely payment as the amounts for all three lots were not received until 31 March – the loss was $478.95 (3 lots @ $159.65) which is the amount claimed in this application.

The Smiths have unsuccessfully sought relief from the body corporate for the discounted amount to be the amount payable by them.


DETERMINATION:
"Rose-Wood Park" was registered as a group titles plan (now termed a standard format plan) on 4 December 1992 and comprises 78 lots. Under the new Community Management Statement recorded on 23 March 1998, the scheme is regulated by the Body Corporate and Community Management (Accommodation Module) Regulation 1997 ("the Accommodation Module").

The issue here is whether the legislative requirement for payment of a contribution by the due date is satisfied where an owner makes payment on the due date by means of a transfer of moneys by a bank or other financial institution. The transfer may be done personally by internet banking transfer or by passing over funds to a bank or other financial institution for direct credit of the amount to the body corporate bank account.

Section 95(1) of the Accommodation Module states (with my underlining) –

95 Discounts for timely payment [SM, s 97]
(1) The body corporate may, by ordinary resolution, fix a discount to be given to owners of lots if a contribution, or an instalment of a contribution, is received by the body corporate by the date for payment fixed in notices of contribution given to the owners.

Where a discount is involved, as it is here, the body corporate clearly must receive the moneys on or before the due date for the discount to apply. (Although it is not relevant here, I view the requirement that the moneys must be in the hands of the body corporate on or before the due date, also applies where a body corporate has no discount provision).

Where an owner wishes to pay their contribution otherwise than directly into the bank where the body corporate account is kept or at a nominated receiving point (eg office of the Body Corporate Manager, or personally to the committee Treasurer, etc), then to obtain the discount an owner must pay the money in a manner such that the body corporate receives it on or before the due date. That is, whether the amount is sent by internet transfer, by direct credit through another branch or another bank, or by a cheque in the mail, it is the responsibility of the owner to ensure that the method of payment gets the money to the body corporate on time if they want the discount.

On a personal note, I use internet banking for the payment of accounts and both of the financial institutions I use give a warning that the transfer of funds may not be immediate and allowance should be made for this. It is highly likely that a transmitting bank or branch would give a similar warning in respect to direct credits if asked. By opting to make their payment by an indirect means and by not making it until the very last day, the Smiths took the risk (whether known of or not) that the funds would not be received within time - and that is what happened.

Of course the body corporate could have allowed the discount but chose not to and to my mind rightly so – the lateness was not due to illness or an unavoidable absence or some other reasonable excuse justifying a waiver, but was the result of the Smiths deliberately taking their payment to the wire and not prudently allowing for a possible delay in the transmission of the funds.

I do not see that the body corporate was unreasonable in refusing to allow the discount and pay the $478.95 to them. Accordingly my order is to dismiss the application for the above reasons.

Having said that, I note in the grounds to the application the Smiths said the following, "We have been paying these Body Corporate fees since 1993 and have a good history of paying them on time." This statement conflicts with Golden’s statement which reads, "From memory, for most of the late 1990’s Smith senior (K Smith) did not pay his levies on time or at all, and when legal process finally snagged him...RWP received from Smith junior around $15,000 in part payment of Smith senior’s debt." I have not investigated as to the truth of the matter as it is irrelevant to my determination, however it was raised by both parties and I merely present the conflicting statements submitted.