South Pacific Plaza [2005] QBCCMCmr 25 (14 January 2005)

Number of Scheme:	10922
Name of Scheme:	South Pacific Plaza
Address of Scheme:	157 Old Burleigh Road Broadbeach, Queensland

TAKE NOTICE that pursuant to an application made under the abovementioned Act by John Taylor (a co-owner of Lot 67):

I hereby order that until such time as the Body Corporate properly revokes its resolution of 23 November 2001 regarding question time at general meetings, the Body Corporate shall at all future general meetings allow a reasonable opportunity for members of the Body Corporate (and properly appointed representatives of members of the Body Corporate) to ask questions about the administration and management of the Body Corporate which shall be directed through the person chairing the meeting.

I further order that the application is otherwise dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0141-2004

"South Pacific Plaza" CTS 10922

John Taylor, a co-owner of Lot 67 (the Applicant) has made a dispute resolution application to the Commissioner for Body Corporate and Community Management under the Body Corporate and Community Management Act 1997 (the Act).

The Applicant states that he is seeking the following outcomes, quote:

Department of Natural Resources, Mines and Energy records show that the "South Pacific Plaza" community titles scheme was originally created under a building units plan of subdivision (now known as a building format plan) registered on 15 July 1981. The scheme land for "South Pacific Plaza" consists of 84 lots and common property.

A standard community management statement was recorded for "South Pacific Plaza" on 15 July 2000. The community management statement shows that the Act’s Body Corporate and Community Management (Standard Module) Regulation 1997 (the Standard Module) applies to the scheme.

The Commissioner received the original form of this application on 5 March 2004. On 15 March 2004, a staff member of this Office wrote to the Applicant and identified substantial defects in the application. On 18 March 2004, the Commissioner allowed the Applicant to amend the outcomes sought in the application under section 245(1) of the Act.

On 23 March 2004, the Commissioner issued the Body Corporate with formal notice of the application (section 243(1) of the Act). The Commissioner also invited the Body Corporate Committee, and all owners of a lot included in the scheme, to make written submissions about the application (sections 243(2) and (4) of the Act).

The Body Corporate Committee has provided a submission opposing the application via its solicitors, McDonald Balanda & Associates. The Committee’s submission also argues that the application should be dismissed under section 270(1)(c) of the Act on the basis that the application is "frivolous, vexatious, misconceived or without substance" and that the Applicant should be ordered to pay the Body Corporate’s reasonable costs in relation to this application pursuant to section 270(3) of the Act. Mr Peter Murdoch (the Body Corporate Chairperson) has also provided a separate written submission opposing the application. I note at this point that no other owners have made submissions in response to the application.

In a letter of 23 March 2004, the Commissioner advised the Applicant of his rights to obtain copies of the submissions made about the application and to reply to those submissions. However, at that time, the Applicant did not exercise those rights. On 11 May 2004, the Commissioner made a dispute resolution recommendation under section 248 of the Act that the application should be resolved by departmental adjudication. The Commissioner subsequently referred the application to me for consideration.

After reviewing the material, it appeared to me that the submissions contained important information that was highly likely to influence the ultimate outcome of this application. As a result, on 3 September 2004 I provided the Applicant with copies of the submissions and invited the Applicant to reply to the submissions prior to my final determination of the application. The Applicant provided a written reply to the submissions by way of letter dated 13 September 2004.

Section 227 of the Act limits the disputes that may be resolved under the Act’s dispute resolution provisions to those between particular combinations of parties involved in community titles schemes. This application, which describes a dispute between an owner of a lot included in a community titles scheme and the body corporate for that scheme, falls into the category of dispute contemplated by section 227(1)(b) of the Act.

Section 276(1) of the Act allows adjudicators to make just and equitable orders to resolve disputes in community titles schemes about a range of matters, including claimed or anticipated contraventions of the Act or a scheme’s community management statement. In this case, the Applicant claims that the Body Corporate has contravened the Act by failing to carry out resolutions of previous general meetings of the Body Corporate. Therefore, the matter is one that may be considered by an adjudicator.

I will now turn to the four separate outcomes sought by the Applicant, as well as the Body Corporate’s submission that the application should be dismissed pursuant to section 270(1)(c) of the Act on the basis that the application is "frivolous, vexatious, misconceived or without substance".

As part of the supporting grounds to this application, the Applicant has provided a copy of the minutes of an annual general meeting of the Body Corporate held on 23 November 2001. The minutes of the meeting record the following resolution of the Body Corporate concerning motion 11, quote:

The minutes record that the motion was carried with 33 votes in favour of the motion, 18 votes against the motion, and 7 voters abstaining from voting on the motion. To my knowledge, the Body Corporate has not subsequently amended or revoked the resolution pursuant to section 58 of the Standard Module.

The Applicant claims that the Body Corporate has failed to implement the above resolution in that no provision for question time has been included on the agenda of later general meetings. Further, the Applicant argues that the Committee is obliged to carry out the terms of the above resolution on behalf of the Body Corporate pursuant to section 101(2) of the Act which provides that "the committee must put into effect the lawful decisions of the body corporate".

The Committee’s main submissions regarding this issue are that:

In his reply to submissions, the Applicant argues that the meaning of the resolution is sufficiently clear and that "any reasonable person would expect that 10 minutes or so as the last item on an agenda could be devoted to questions". The Applicant also rejects the Body Corporate’s concerns about time constraints on the meeting venue and suggests that the Committee should simply arrange for the meeting venue to be available for a sufficient time to allow for questions at the meeting. I also note that in his reply to submissions, the Applicant emphatically denies that he (or his so-called associates) acted in an unruly, disruptive, or threatening manner at the 2003 annual general meeting.

It is clear that under the body corporate and community titles legislation, bodies corporate may only make a resolution on a motion before a general meeting (apart from procedural motions and motions to correct minutes) if the substance of the motion was included on the agenda for the meeting (section 47(1)(b) of the Standard Module).

It is generally accepted that it is appropriate for participants in a meeting to discuss and debate the matters set out on the agenda for the meeting, in other words, the business of the meeting. It seems to me that the opportunity for such discussion and debate is one of the main reasons for holding a physical meeting. Of course, for obvious practical reasons, the conduct and control of discussion and debate at a meeting is, at least in the first instance, the responsibility of the person chairing the meeting^[1].

While it is clear that a body corporate may not make a resolution at a meeting about a matter that is not included on the agenda for the meeting (with certain limited exceptions), what is less clear both under the Act and at common law^[2] is whether a meeting is competent to simply discuss matters that are not included on the agenda.

It is certainly common for bodies corporate to allow a period of time for "general business" at general meetings. In some cases, "general business" is included and identified as a separate item on the agenda for the meeting. The purpose of "general business" is usually to discuss matters affecting the scheme, without making any formal decisions on those matters. Often these discussions may result in formal motions being proposed at later general meetings of the body corporate. In this instance, the discussion proposed by the Applicant (and seemingly contemplated by the relevant body corporate resolution described above) is in the form of questions without notice being directed to the chairperson and committee members from the floor of the meeting.

After considering all of the material, I do not agree with the Committee’s submission that there is anything inherently unenforceable or impractical about the Body Corporate’s resolution of 23 November 2001 to allow for "question time" at general meetings.

Broadly speaking, I see no real reason why a person chairing a general meeting of a body corporate could not allow for a period of time for participants in the meeting to ask questions about the administration and operation of the community titles scheme.

As mentioned previously, the person chairing the meeting is responsible for the conduct and progress of the meeting. Therefore the duration and conduct of any period of time allowed for questions would be controlled, at least in the first instance, by the person chairing the meeting. Of course, the person chairing the meeting must act reasonably in making decisions about the duration and conduct of a question time.

In accordance with normal meeting procedures, any questions should be directed through the person chairing the meeting and not directly to other participants in the meeting (including committee members)^[3]. The person chairing the meeting may then invite the relevant person to respond. Of course, there is nothing to require a person who has been asked a question to answer that question, or to answer the question to the satisfaction of the enquirer.

While I am aware that the Corporations Act 2001 does not apply to bodies corporate for community titles schemes, I note that section 250S(1) of the Corporations Act 2001 (Commonwealth) provides that "The chair of an AGM must allow a reasonable opportunity for the members as a whole at the meeting to ask questions about or make comments on the management of the company". While this provision does not apply to bodies corporate for community titles schemes, its presence in the Corporations Act 2001 suggests to me that allowing participants in a meeting an opportunity to ask questions about the ongoing administration or operation of the relevant body, whether it be a company or a body corporate for a community titles scheme, is not inherently unenforceable or impractical.

I have also found the Committee’s other objections to the provision of a period of time for participants in a general meeting to ask questions to be unpersuasive. Firstly, by carrying the above motion proposing that sufficient time be allocated for questions from the floor of meetings, it seems clear that owners do want the opportunity to present questions at general meetings. As a result, I consider that the Committee can and should take reasonable steps regarding venue arrangements for general meetings to facilitate a period of time for participants in the meeting to ask questions.

I am mindful of the concerns of the Committee about the potential for unruly and disruptive conduct to result from a question time at general meetings. I accept that there is a risk of some participants in a meeting attempting to use a question time to create a nuisance to other participants, or to harass and annoy committee members. However, in my opinion, there is also the potential for participants in a meeting to become disruptive at any point of the meeting. The potential for unruly and improper conduct is not eliminated by prohibiting owners from asking questions at the meeting.

It is clear that one of the primary duties of the person chairing a meeting is to preserve order at the meeting.^[4] This duty includes dealing with disruptive participants so that the business of the meeting may be addressed. In my view, the duty is the same whether the disruptive and unruly conduct arises in the debate of a particular motion, during a period allowed for questions from the floor of the meeting, or at any other point of the meeting. I am not satisfied that allowing questions at a meeting will necessarily fetter the ability of the meeting to properly conduct its business.

Of course, I hasten to add that the fact that the person chairing a general meeting has a responsibility to preserve order at the meeting does not mean that participants are absolved of responsibility for their own behaviour at the meeting. It should go without saying that participants in meetings should conduct themselves in a reasonable and rational manner at any meetings, and furthermore should not unreasonably interfere with the ability of the chairperson to conduct an orderly meeting.

Furthermore, I do not think that it can be fairly assumed that owners will use a question time in an unreasonable, disruptive or unruly manner, or for improper motives. There is no reason that owners could not use such an opportunity to ask reasonable and relevant questions of the committee in a perfectly rational and calm manner.

As a result, I am not satisfied that the risk of inappropriate behaviour by a minority of participants means that that the Body Corporate’s resolution to allow a period of time for questions at general meetings is unreasonable, unlawful or unenforceable.

For all of the above reasons, I am satisfied that the Body Corporate should implement its resolution regarding questions at general meetings, as carried at the annual general meeting held on 23 November 2001, and I have ordered accordingly. Of course, this order does not prevent the Body Corporate from considering a motion to revoke the earlier resolution (section 58 of the Standard Module).

Finally, while I have required the Body Corporate to implement its resolution of 23 November 2001 by providing a reasonable opportunity for participants to ask questions from the floor of future general meetings, I do not consider that is necessary for "question time" to appear on the agenda of those future general meetings.

The agenda for a general meeting sets out the business to be conducted at the meeting. The main purposes of distributing an agenda prior to a general meeting are to provide members with proper notice of the business to be transacted at the meeting and to ensure that members have an opportunity to properly participate in the decision making process of the body corporate, even if for example, they are unable to personally attend the meeting.

It seems to me that discussions resulting from questions without notice from the floor of a meeting are somewhat similar in nature to "general business" discussions at general meetings. By their nature, these types of discussions tend to evolve at the meeting itself, and the substance of these discussions cannot be properly described in an agenda or written voting paper issued prior to the general meeting. In addition, neither type of discussion can result in specific decisions or outcomes from the meeting because owners have not been given proper notice of the potential of those decisions or outcomes. It is difficult to see how general discussions, or questions without notice, which do not result in a positive outcome or decision from the meeting, can properly be described as business to be transacted at the meeting which must necessarily be identified as a separate item on the agenda for the meeting.

Rather, it seems to me that a decision to allow questions without notice from the floor of general meetings is more in the nature of a procedural matter for the conduct of future meetings. While there are some procedural matters for general meetings that clearly cannot and should not be considered or determined outside of the meeting itself, I am not convinced by the material that a decision to allow for question time at future general meetings is inherently unlawful, impractical or unenforceable.

For these reasons, I do not consider that it is strictly necessary for either "general business" or "question time" to appear on the agenda for a general meeting before such discussions can take place at the meeting. However, I hasten to add that I also do not consider that the inclusion of "general business" or "question time" as separate agenda items for a general meeting would of itself detract from the validity of the meeting.

In any event, I do not consider that the implementation of the Body Corporate’s resolution of 23 November 2001 (or the terms of this order requiring that the resolution be implemented) require the inclusion of "question time" as a specific item on the agenda for future general meetings. Rather, the relevant resolution of the Body Corporate, as well as the terms of this order, simply require that as a procedural matter at future general meetings, the Body Corporate must allow a reasonable opportunity for questions from the floor of the meeting.

The second part of the application relates to common property shower and toilet facilities located on the basement level of the building. This level of the building is identified as "Level A" on the registered building units plan and is primarily used for car parking.

I understand that previously lot owners and occupiers (including short term holiday guests) were able to access these facilities relatively freely. I understand that lot owners and occupiers were individually issued with a key which enabled them to access these areas of the common property.

However, following at least one incident of substantial vandalism to the toilet, a decision was made by the Chairperson (or Committee) that to avoid further damage to the facilities, the relevant area should remain locked at all times and that owners and occupiers should only be able to access the areas by requesting and obtaining a key from the office of the resident managers. I understand that owners and occupiers are required to return the key to the resident managers after use of the facilities.

The Applicant objects to this arrangement and argues that the arrangement is impractical and onerous for children, elderly people and anyone else who may need to use the toilet facilities urgently. The Applicant also points out that the office of the resident manager is ordinarily only open during normal business hours, meaning that there are significant periods of time that owners and occupiers are unable to obtain a key to the facilities from the resident manager.

The Applicant has provided a copy of the minutes of an annual general meeting of the Body Corporate held on 19 November 2003 as part of the supporting grounds to this application. The minutes of that meeting record the following resolution of the Body Corporate with respect to motion 17, quote:

The minutes record that the motion was carried with 33 votes in favour of the motion, 22 votes against the motion and 3 voters abstaining from voting on the motion.

The Applicant claims that the Committee has failed to implement the above resolution on behalf of the Body Corporate. Consequently, the Applicant argues that the Committee has contravened section 101(2) of the Act which provides that "the committee must put into effect the lawful decisions of the body corporate". The Applicant has sought an order requiring the Body Corporate to implement the above resolution.

The Committee’s main submissions about this part of the application are that:

In his reply to submissions, the Applicant reiterates his argument that the resolution has not been carried out to date in that owners and occupiers are still required to obtain a key from the office of the resident manager in order to use the common property toilet and shower facilities. The Applicant also states that "the simple and cheap solution would be to return the lock to its original state where both residents and guests by use of the supplied common area key could access this area".

In my opinion, the broad outcome contemplated by the Body Corporate’s resolution concerning the provision of a "key or card system" for access to the common property toilet and shower facilities is clear. To my mind, it is perfectly apparent that by making the above resolution, the Body Corporate was expressing a desire that some system be put into place that would enable lot owners and occupiers to access the shower and toilet facilities without the need to approach the office of the resident manager for a key on each occasion.

However, I also of the opinion that the resolution is seriously deficient in articulating in any meaningful way the Body Corporate’s preferences regarding the particulars of the system that should be put into place. It seems fair to say that a very wide range of actions and systems could potentially satisfy the broad objective of the above resolution. This is reflected by the two widely differing approaches taken by the Committee and the Applicant regarding the resolution.

On the one hand, the Committee has looked at the issue as part of a broad, comprehensive security system for the scheme. I agree that the cost of this approach necessitates the matter being again presented to the Body Corporate in general meeting. On the other hand, the Applicant has argued that the resolution should be satisfied by simply returning to the previous arrangement whereby owners and occupiers would all be individually supplied with a key to access the area. Presumably, this could be as simple as arranging for a sufficient number of keys to be cut and issued to owners and occupiers.

The difficulty is that either approach, or any number of other approaches, could satisfy the broad objective of the Body Corporate’s resolution to provide a "key or card system to gain access to toilet and shower facilities on car park floor for unit owners without having to go through managers office". I see no way of objectively determining from the terms of the motion whether or not the body corporate was of a collective mind in terms of what type of system should be implemented to satisfy this resolution. Indeed, given the broad terms of the motion, I consider that it is unlikely that there was a common understanding between owners regarding the nature or particulars of the system that should be in place. I am not assisted by the fact that despite the Commissioner’s invitation, no individual owner (apart from the Chairperson and Applicant) have made a written submission in response to this application expressing any view whatsoever about what they consider was intended by the terms of the resolution in dispute.

I have considered issuing an order requiring the Committee, within a prescribed time period, to present owners with particular options for access to the toilet and shower facilities for consideration at a general meeting. I have decided against issuing an order in these terms at this time.

Firstly, it seems to me that it is primarily the responsibility of a person proposing a motion to present the particulars of the motion in adequate detail. For the reasons outlined above, I am not satisfied that this occurred in this case. Secondly, it seems to me that the Committee is well underway in investigating security options for the common property (including the shower and toilet facilities). I expect that the Committee will, if it has not already done so, present those options to owners for consideration at a general meeting in due course. Thirdly, and in the meantime, there is nothing to prevent the Applicant or any other owner from presenting a specific motion (with full and proper particulars) about access to the toilet and shower facilities for consideration at the next general meeting of the Body Corporate.

For the reasons outlined above, I have dismissed the Applicant’s request for an order requiring the Body Corporate to implement its resolution of 19 November 2004 concerning access to the toilet and shower facilities on the basis that the resolution is materially ambiguous and indefinite.

As stated previously, the Applicant has sought an order requiring the Body Corporate to "comply with all motions passed at general meetings and also to comply with the requirements of the current BCCM Act and its regulations and all adjudicator’s orders".

I do not consider that it is either necessary or helpful for me to issue an order in such general terms and which simply restates the broad legal obligations of the Body Corporate. For instance, in this case it is apparent from the material that the Body Corporate considers that it has acted properly and lawfully by not carrying out the resolutions in dispute. While I disagree with the Body Corporate regarding one of those two resolutions, it does not follow that disputes of this nature will necessarily be avoided in the future simply on the basis of general order requiring the Body Corporate to implement lawful resolutions of subsequent general meetings.

In addition, it goes without saying that the legislation is binding on bodies corporate. As the parties are well aware, if a lot owner considers that the Body Corporate has contravened the legislation in a particular instance, the lot owner may be entitled to make a dispute resolution application to this Office seeking an adjudicator’s order to remedy the contravention. If the Body Corporate fails to comply with an adjudicator’s order, then the relevant applicant (or any other interested owner) could consider their rights to have the order enforced through the Magistrate’s Court pursuant to Part 10 of Chapter 6 of the Act. Again, it is not necessary for me to issue an order broadly requiring the Body Corporate to comply with the legislation or future adjudicators’ orders.

For these reasons, I have dismissed this part of the application.

There are no other orders that I consider are necessary in the context of this application.

Given that I have found that this application raises a number of serious questions to be addressed, it follows that I do not consider that the application should be dismissed on the basis of being "frivolous, vexatious, misconceived or without substance" under section 270(1)(c) of the Act. It also follows that I have declined to make a costs order against the Applicant pursuant to section 270(3) of the Act.

^[1] Magner E.S. "Joske’s Law and Procedure at Meetings in Australia" (9^th ed, Lawbook Co 2001) at page 47.
^[2] Magner at page 50
^[3] Magner at page 51
^[4] Magner at page 39

•	The motion is unenforceable because the terms of the motion (particularly the use of the words "sufficient time") are ambiguous and indefinite;
•	Certain members of the Body Corporate (including the Applicant) were unruly and disruptive at the 2003 annual general meeting of the Body Corporate, and engaged in threatening and intimidating conduct towards the Chairperson and members of the Committee. The Chairperson is concerned that a "question time" will result in further heated discussions between the Applicant (and others) and members of the Committee;
•	Question time is impractical for general meetings of the "South Pacific Plaza" Body Corporate due to time constraints on the availability of the venue for the meeting, as well as the need to engage returning officers to be present for the duration of the meeting; and
•	The terms of motion 11 as carried at the 23 November 2001 annual general meeting do not require that "question time" appear as a specific item on the agenda for future general meetings.

•	The motion seeking provision of a "key or card system" to access the toilet and shower facilities was defective in that the motion lacked particulars regarding the expenditure necessary to implement the motion;
•	Notwithstanding this lack of particularity, the Committee has taken steps to implement the resolution by gathering information about implementing a "key or card system". An option identified by the Committee is the implementation of a comprehensive security system for a range of areas of common property including the toilet and shower facilities. The likely cost of the comprehensive security system is in excess of $15,000;
•	Given that the cost of implementing the security system identified by the Committee is above the relevant limit for major spending for the "South Pacific Plaza" Body Corporate, the motion in dispute submitted seeking the provision of a "key or card system" should have been accompanied by at least 2 quotations (obtained by the person presenting the motion) as required by section 104 of the Standard Module;
•	The resolution is unenforceable because it lacks particularity and because the relevant motion was not accompanied by at least two quotations as required by section 104 of the Standard Module.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

South Pacific Plaza [2005] QBCCMCmr 25 (14 January 2005)