Trevidia [2005] QBCCMCmr 279 (27 May 2005)

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

Margaret Ellen Donaghue Madden the owner of lot 6 & Florence Westbury, the owner of lot 5

I hereby order that the application for an order that drainage and sewerage problems and trees on the adjacent property be attended to immediately, is dismissed.

I further order that within 2 months of the date of this order the body corporate committee shall obtain at least two quotes from suitably qualified contractors or tradespersons addressing the issue of water entry into the garages.

I further order that if the cost of repair/rectification detailed in the quotes exceeds the limit for committee spending the committee shall within 2 months of the date upon which the quotes are received call a general meeting to consider an appropriate motion relating to the works, and, if necessary, the raising of a special levy to cover the cost of such works.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0744-2003

"Trevidia" CTS 4141

ORDERS SOUGHT

The applicants have sought orders of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act) as follows:

JURISDICTION

The application evidences a dispute between two owners of lots included in a community titles scheme and the body corporate for the scheme (section 227(1)(b) 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

(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)).

BACKGROUND

The applicants stated that the dispute had arisen because the body corporate manager had not attended to certain maintenance matters around the scheme relating to drainage and sewerage, water leaks into their garages, and damage from trees located on a neighbouring property. The applicants explained that most of the issues "may have resulted from the fact that there seems to be no building maintenance carried out, however lawns and gardens are attended to regularly."

The dispute application was lodged in the Commissioner’s office on 13 November 2003. The applicants sought leave to amend the application on 21 November 2003, so that the body corporate was named as a respondent. Following that amendment, submissions were sought from all other owners within the scheme, as well as from the body corporate committee.

The only submission that was received was from the then body corporate manager, who has since resigned.

One of the applicants replied to that submission, and reiterated her concerns about all of the matters in respect of which she and her co-applicant had sought orders. This applicant also confirmed that the previous body corporate manager had resigned, and that a new body corporate manager had been appointed.

Following the submission process the parties were referred to mediation on two separate occasions. No mediation was undertaken.

A dispute resolution recommendation was made on 19 May 2005 to refer the matter to adjudication. In the long intervening period the file was placed on hold at the request of the applicants as they attempted to resolve issues themselves.

SCHEME DETAILS

Trevidia was registered as a building units plan (now described as a building format plan) on 3 December 1991. The scheme comprises 6 lots and common property. It is regulated by the Body Corporate and Community Management (Standard Module) Regulation 1997 (Standard Module).

DETERMINATION

The contents of this file highlight the difficulties faced by many owners in a community titles scheme if they do not realise (as it appears that the applicants do not) that the appointment of a body corporate manager by a body corporate does not relieve owners themselves, as members of the body corporate, of the responsibility of maintaining common property in good condition (section 109 of the Standard Module and section 20 of the Act).

A body corporate manager is required to attend to administrative tasks on behalf of the body corporate. Some of these tasks include sending out levy notices, receiving and banking levy contributions when they are paid by owners, paying accounts authorised by the body corporate committee, keeping the books and records of the body corporate, preparing meeting material at the direction of the committee and advising the body corporate committee and owners generally in relation to the requirements of the Act and the relevant regulation module.

A body corporate manager is not engaged as a maintenance manager, unless the body corporate has specifically included such a role in its agreement with the body corporate manager, which, in the experience of this office, would be most unusual. If such a role were included in the agreement, undoubtedly the body corporate manager would expect to be paid a fee over and above that which it would usually receive for simply performing administrative tasks. It does not appear on the material before me that this body corporate engaged the body corporate manager as a maintenance manager.

The Act requires that owners maintain their own lots in good condition (section 160 and section 120(2) of Standard Module). The maintenance of common property is the responsibility of the body corporate, as stated above.

As far as the common property is concerned, although the body corporate is comprised of all owners, it is the body corporate committee, as the executive arm of the body corporate which is charged with the responsibility of the day to day running of body corporate business. This entails, amongst other things, ensuring that the grounds are kept in good order, and that lawns are mown and gardens watered. I note from the material that the applicants acknowledge that this is the only aspect of maintenance to which attention is being given.

Although the committee is required to give directions to the body corporate manager to enable the manager to perform its administrative tasks under the terms of the engagement, the body corporate manager is expected to advise the committee of the extent of its jurisdiction in relation to spending limits; decision making of a restricted nature (see section 26 of the Standard Module) and any other matter covered by the legislation.

Section 41 of the Standard Module sets out the procedure by which motions may be submitted for consideration by the body corporate at a general meeting. A motion may be submitted at any time by an owner or by the committee. Such motions must be placed on the agenda of the next general meeting to be held by the body corporate, except that in order for a motion to be included on the agenda of the annual general meeting, the motion must have been received by the secretary before the end of the financial year immediately preceding the annual general meeting.

Accordingly, at any time since they purchased their respective lots, either of the applicants could have submitted motions providing for repair of the drainage and sewerage pipes and the garage water leaks or the removal of the neighbouring trees, accompanied by appropriate quotations, so that firm decisions could be made after owners had given proper consideration to the issues. The discussion that took place at the annual general meeting held on 13 February 2003 was just that. No resolutions were made in respect of the matters discussed, so the body corporate was not obliged to take any definitive action until resolutions were made.

Since this application was originally lodged, the body corporate manager against whom the applicants made complaints has resigned and a new body corporate manager has been appointed. The body corporate has also held several general meetings.

At an extraordinary general meeting held on 11 October 2004, various motions relating to the drainage system were considered by owners. Some motions were passed, and others were held over pending further consultation between owners and the plumbing contractor, Mr Powell.

The most recent meeting was the annual general meeting, held on 31 March 2005.

At that annual general meeting one of the applicants was also elected to the committee.

In addition, the minutes of that meeting reveal that owners considered two motions relating to maintenance of common property (the third motion relating to that subject, being the boundary fence, having been withdrawn to enable the chairperson to write to the adjoining owner under the Dividing Fences Act.)

The first motion relating to maintenance was that no expenditure should be incurred on maintenance except with the approval of all committee members and that at least three owners should be consulted.

In this regard, owners should note that the requirements for committee spending are set out in section 103 of the Standard Module and, further, that the relevant limit for committee spending is currently $750.00 (Schedule – Dictionary Standard Module).

Owners should further note that spending in excess of $750.00 must be approved by the body corporate in general meeting, and if the amount involved is greater than $1500.00 (the relevant limit for major spending) then owners must be provided with at least two quotations, and the motion proposed for approval of the expenditure must be a motion with alternatives (section 42B of the Standard Module).

The second motion relating to maintenance was more in the nature of a general overview of maintenance issues. In my view the motion really did not advance matters because the preamble to the motion was that "the body corporate consider" the various matters listed, with the concluding statement being that "this matter be referred to the committee". However, it would appear that owners are attempting to take steps to address maintenance issues, rather than assuming, as seemed to be the case when this application was lodged in 2003, that the body corporate manager was required to take such steps.

I also note that some repairs have been carried out to the drainage and sewerage pipes. It is unclear if the problems have been completely rectified, but the engineer’s report dated 8 December 2004 to the body corporate on the adequacy of the building footings makes reference to the pipes having been repaired. The final paragraph of the report states "It is also possible that now the pipework has been repaired that the quantity of water entry (into the garages) will be significantly reduced. The condition of both the cracking and the water entry should be the subject of ongoing monitoring."

If any further work on the pipes is necessary the committee must of course be mindful of its spending limit.

I further note that some trees have been cut down, although one of the applicants complained that the stumps are showing signs of regrowth. That is an issue which should be able to be addressed quite quickly, perhaps by having the stumps ground out, or by the application of appropriate (approved) poisons.

Finally, the issue of water entry into the garages was briefly discussed in the engineering report dated 8 December 2004. Two methods of rectification were suggested. Although no specific costings were provided, waterproofing the retaining wall was noted to be a difficult and expensive project. Topping the garage slab and constructing an intercepting drain appeared to be proffered by the engineer as a viable alternative.

Although one of the applicants still expressed concern (in her undated letter received in the Commissioner’s office on 12 April 2005) that the problem is "unresolved", with "costs for repairs ... rising", she continued to misapprehend the role of the body corporate manager. As stated above, it is not the role of the body corporate manager to attend to maintenance issues. That is the role of the body corporate.

This applicant expressed further concern that there will not be any repairs carried out as she claims that "4 of the owners and the body corporate manager consider there is no problem". I have taken this to be a reference to the water entry into the garages. I am uncertain why owners would have taken such a view, as the engineer certainly considered it to be a problem, describing it in his report as "significant".

Accordingly, to ensure that the issue of water entry into the garages is addressed I have ordered that the committee shall obtain quotes from appropriately qualified contractors or tradespersons within 3 months of the date of this order. The quotes should then be provided to all owners, and if the cost of repair or rectification exceeds the limit for committee spending, a general meeting will be required to approve the work and if necessary raise a special levy to cover the cost of it (if it does not fall within the amount (if any) budgeted and approved by the body corporate at the last annual general meeting for general repairs and maintenance).

Number of Scheme:	4141
Name of Scheme:	Trevidia
Address of Scheme:	12 Reilly Road NAMBOUR QLD 4560

1)	Drainage and sewerage problems – as mentioned at AGM held on 13/2/03 – as "other matters"
2)	Problem of water leaking into garages 5 and 6 - as mentioned at AGM held on 13/2/03 – as "other matters"
3)	Trees on adjacent property – Item "C" building and grounds in AGM minutes. To be attended to due to damage being caused.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Trevidia [2005] QBCCMCmr 279 (27 May 2005)