Nepean Centre [2005] QBCCMCmr 650 (22 November 2005)

Last Updated: 16 January 2006

REFERENCE: 0515-2005

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	6782
Name of Scheme:	Nepean Centre
Address of Scheme:	6 Nepean Avenue ARANA HILLS QLD 4054

TAKE NOTICE that pursuant to an application made under the abovementioned Act by the State of Queensland (represented by the Department of Public Works), the occupier of lot 3

I hereby order that Nattin Pty Ltd, the owner of all lots included in the scheme, and therefore the sole member of the body corporate, shall within 14 days of the date of this order comply with its obligations under section 152 of the Body Corporate and Community Management Act 1997 and sections 109 and 120(2) of the Body Corporate and Community Management (Standard Module) Regulation 1997 and in particular, shall attend to the following: 1. Maintain and clean common property toilets 2. Repair damaged toilet door 3. Pay the common property Energex account 4. Repair broken lights on the common property 5. Clean and maintain the common property foyer 6. Remove wasp nests from the common property foyer 7. Remove rubbish from the common property 8. Maintain lawns and gardens on the common property 9. Repair water damaged eaves of the building 10. Repair and maintain blocked guttering 11. Eradicate vermin from the common property I further order that in the event that Nattin Pty Ltd does not comply with the order above within the time allowed, then The State of Queensland shall be authorised to arrange for the completion of the repairs and maintenance as ordered, at the expense of Nattin Pty Ltd.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0515-2005

"Nepean Centre" CTS 6782

ORDERS SOUGHT

The applicant has sought the following orders of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act):

That an administrator be appointed to perform the body corporate’s duties and obligations.

Alternatively, that:

1.	The body corporate be ordered to comply with its obligations provided in section 152 of the Act and section 109 of the Body Corporate and Community Management (Standard Module) Regulation 1997.
2.	The applicant be granted permission to arrange for general maintenance and cleaning of those parts of the common property as set out in this application and which the body corporate has not maintained or cleaned at the date of the order at the body corporate’s cost.

JURISDICTION

The application evidences a dispute between the occupier of a lot 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

(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)).

SCHEME DETAILS

Nepean Centre is a Community Titles Scheme comprising 3 lots and common property. The scheme is regulated by the Body Corporate and Community Management (Standard Module) Regulation 1997 (Standard Module). The building units plan (now described as a building format plan) registered on 15 July 1988.

BACKGROUND

The Titles Office records reveal that lot 3 is leased to The State of Queensland. The lease was executed by the then owners of the lot on 25 November 2003, but was not lodged for registration until 13 May 2005.

Although Titles Office records show that all 3 lots in the scheme are currently registered in the names of Hewglen Pty Ltd, Rawlins Pty Ltd, JF Dunsdon, CA Richardson, BA Richardson and BP Harg, as tenants in common in various shares, correspondence attached to the application reveal that the lots were sold to Nattin Pty Ltd (Nattin) towards the end of 2003.

On 18 November 2005 I spoke by telephone with Mr Matthew Lyons a partner in the firm of McInnes Wilson, Solicitors, who acted for Hewglen Pty Ltd & others in the sale transaction. Mr Lyons confirmed that settlement of the sale had been effected on 14 January 2004. Mr Lyons provided a copy of the executed transfer under cover of a letter dated 21 November 2005. The transfer of lots 1, 2 and 3 to Nattin was executed by all registered owners on 10 November 2003.

On 21 November 2005 I spoke by telephone with Ms Leanne Bourrel, an employee of Porta Lawyers, who informed me that although the firm had acted for Nattin in relation to the purchase, they no longer did so. Ms Bourrel explained that the original transfer document and accompanying leases had not been lodged because of a dispute over fees, and were now in the possession of their former client. This information was confirmed in writing by the principal of the firm on 21 November 2005.

On the basis of this evidence, I am satisfied that Nattin is entitled to be the registered owner of all lots included in the scheme (see the definition of "owner" in Schedule 6 of the Act). As the body corporate is comprised of the owners of all lots included in the scheme, (section 31 of the Act) in this case, Nattin is the sole owner and therefore also the sole member of the body corporate.

On 19 August 2005 Nattin was invited to respond to the application. The letter was addressed to Mr Lino Fiorello, a director of the company. On 12 September 2005 a member of the Commissioner’s staff spoke by telephone with Mr Fiorello, who stated that he had not received the letter. Mr Fiorello provided an alternative address, and two further letters were sent (the first of such letters incorrectly being addressed to the nominated post office box in Chermside West instead of Chermside South). Another member of the Commissioner’s staff spoke briefly by telephone with Mr Fiorello on 7 November 2005. Mr Fiorello stated that he was in a meeting and requested that he be called back. Several attempts to do so have met with no success.

No submission was received from Nattin. I am however satisfied that Mr Fiorello is not only aware of this application but that he has also received a copy of it.

DETERMINATION

All of the matters of which the applicant complains in the application relate to the body corporate’s failure to properly maintain common property. Section 152 of the Act and section 109 of the Standard Module oblige the body corporate to do so.

The applicant included with the application a copy of a letter dated 2 November 2004 from Mr Rod Marsh, Lease Manager, Department of Public Works, to Mr JP Cronin of McGrath Nicol and Partners in which it was noted that as the lease to The State of Queensland is a gross lease, the lessor (now Nattin) is responsible for all repairs and maintenance to the building and common areas including cleaning. Mr Marsh pointed out that air conditioning is also included in the rent.

I accept the facts outlined in the dispute application as these have not been challenged by Nattin. There is ample evidence that the applicant and others have sought to have the matters of which the applicant has complained attended to by Nattin over the past 18 months. It is equally clear that these matters fall within the parameters of responsibility of Nattin, both as the sole member of the body corporate and also as the sole owner of lots within the scheme (section 120(2) of the Standard Module).

I do not propose to appoint an administrator at this stage. In my view Nattin must be given the opportunity to fulfil its obligations in relation to the common property and its own lots. Having said that, I also propose to provide a fallback position for the applicant in the event that the work is not carried out, given Nattin’s studious disregard for its obligations for a sustained period.

I have ordered that Nattin (as the sole member of the body corporate) shall within 14 days of the date of the order attend to the various matters detailed in the application. I have further ordered that in the event that Nattin fails to attend to these matters within the time allowed, the applicant shall be at liberty to do so, at the expense of Nattin. With the protection of this second order, the applicant may not need to have an administrator appointed.

However, Nattin should be aware of two further matters.

Firstly, that failure to comply with an adjudicator’s order is an offence, for which the maximum penalty is 400 penalty units or $30,000.00 (section 288 of the Act).

Secondly, that an adjudicator can order that an administrator be appointed to assist the enforcement of another order made for an application (section 276(4)(b) of the Act).