Cascade Gardens Leisure and Retirement Village [2005] QBCCMCmr 54 (2 February 2005)

Number of Scheme:	24188
Name of Scheme:	Cascade Gardens Leisure and Retirement Village
Address of Scheme:	67 Cascade Street RACEVIEW QLD 4305

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

Sherwood Constructions and Engineering Pty Ltd, the Owner of lot 501 on SP173868.

I hereby order that the opposition to Motion No. 7 put to the annual general meeting held on 28 November 2004 was unreasonable and order that the motion is effective as if authorised by resolution without dissent.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0747-2004

"Cascade Gardens Leisure and Retirement Village" CTS 24188

Application

The applicant is the owner/ developer of lot 501 on SP 173868 in a layered community title scheme. It is proposed that lot 501 be subdivided into lots 106, 107 and 501 on SP 1738800. However dwellings which were constructed on proposed lots 106 and 107 encroach onto common property of the scheme. Following an unsuccessful attempt to seek a resolution without dissent approving the transfer of common property to lots 106 and 107, the applicant seeks an order that the decision of the dissenting voters is unreasonable.

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)).

In particular Schedule 5 to the Act provides that possible orders of Adjudicators include the following:
If satisfied that a motion (other than a motion for reinstatement of scheme land or termination or amalgamation of a scheme) considered by a general meeting of the body corporate and requiring a resolution without dissent was not passed because of opposition that in the circumstances is unreasonable – an order giving effect to the motion as proposed, or a variation of the motion as proposed.

The scheme is a subdivision of 86 lots and is subject to the standard regulation module. At the AGM of the Body Corporate on 28 October 2004, the applicant moved, pursuant to section 111(2)(a) of Body Corporate and Community Management (Standard Module) Regulation 1997, that the body corporate transfer areas of common property which are encroached upon by those dwellings constructed on proposed lots 106 and 107. The areas encroached upon are 52 square metres and 17 square metres respectively and, I am advised, this was caused by an honest mistake of the builder.

Motion 7 read as follows:

That the body corporate transfer part of the common property to proposed lots 106 & 107 on SP1738800 as shown on the attached plan marked "A" and authorises the execution of the transfers and certificates under section 111 in the form attached.

Thirty-four lot owners voted in favour while five owners opposed the motion and consequently, the motion was not carried as a resolution without dissent is required. The applicant submits that the decision of the dissenting voters is unreasonable as they are not in any way adversely affected by the excision of the common property and to remove the improvements built on the common property would cost in the vicinity of $300,000 to $350,000. I am further advised that funds from the sale of lots 106 and 107 are urgently required to repay a mortgage over the balance lot.

Further, the purchasers of proposed lots 106 and 107 have moved into possession, presumably because they had sold their previous residences.

A copy of the "Notice of Application and Invitation to make a Submission" was forwarded to all owners listed on the roll and was either hand delivered or posted on Thursday 2 December 2004.

As at 1 February submissions had been received from the body corporate committee and three individual owners, each of whom supported the application.

The committee supported the application on the following basis:

At the annual general meeting held on 28 November 2004, by far the majority of owners were in agreement that the portions of land should be incorporated into lots 106 and 107. As a committee we agree that the giving of permission for this to be done does not in any way detract from the appearance of the village. It does not infringe or affect any other units and therefore does not affect other residents of the village.
We are however very conscious of the inconvenience and stress that has been placed on the purchasers of those residences (i.e. lots 106 & 107) and would appreciate that this matter be resolved as soon as possible.

Individual submissions included the following:

There are no fences or visible property divisions in the village. Unless owners are familiar with the location of the surveyor’s pegs, they have no idea where one property ends and the other starts....
The visual impact of the development is such that had the matter not been on the agenda for the AGM no owner would have been aware of the error in the placement of the unit.

There were no submissions opposing the application.

Decision

The discretion to overturn a failed resolution without dissent is not exercised lightly and requires a consideration of a number of factors, including the degree of dissent, the effect of the motion on dissenters and owners generally, and the substance and circumstances of the motion.

This application involves a request to excise a relatively small amount of common property in a large retirement village complex. The evidence provided to me indicates that the proposed excision will not adversely affect any individual lot owners and indeed, no lot owner has objected to this application.

In the circumstances, it is difficult to see how opposing the application would benefit any individual lot owner. If I were to refuse the application, the options available to the applicant include demolition of the two subject residences and rebuilding at a cost of $300,000 to $350,000 as well as dislocation of two elderly couples.

While not being fully appraised of the circumstances involving the construction of the dwellings which encroach onto the common property, I am mindful that such situations have the potential to result in lengthy and costly litigation.

Having regard to all the circumstances of this case, including the absence of any opposition to the application, I am satisfied that the opposition to Motion No. 7 put to the annual general meeting held on 28 November 2004 was unreasonable and order that the motion is effective as if authorised by resolution without dissent.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Cascade Gardens Leisure and Retirement Village [2005] QBCCMCmr 54 (2 February 2005)