Argyle on the Park [2005] QBCCMCmr 81 (14 February 2005)

Last Updated: 5 July 2005

REFERENCE: 0735-2004

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	15936
Name of Scheme:	Argyle on the Park
Address of Scheme:	31 Cotton Tree Parade COTTON TREE QLD 4558

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

Jadah Pty Ltd, the Caretaking Service Contractor.

I hereby order that the votes cast for lots 1 and 20 in respect of motion 11 at the annual general meeting on 21 October 2004 are to be regarded as valid so that the results of the vote are as follows: Votes For the Motion : 15 Votes Against the Motion : 14 Invalid votes: 2

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0735-2004

"Argyle on the Park" CTS 15936

The Application

The applicant, Jadah Pty Ltd, the Caretaking Service Contractor for Argyle on the Park" CTS 15936, has sought the following order of an adjudicator under the Body Corporate and Community Management Act 1997 ("the Act") -

"That the 3 votes in the secret ballot for increase in Caretakers Salary that were not counted due to being deemed invalid be included as these 3 owners voted with the genuine belief that their votes would be counted"

Jurisdiction

This is a dispute between a Caretaking Service Contractor and the body corporate. This is a matter falling within the dispute resolution provisions of the legislation (see sections 227(1)(d) & 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 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)).

Background

This dispute concerns the results of a secret ballot which was held at the annual general meeting in respect of a motion to increase the caretaking salary under the Caretaking Agreement. Under that agreement, dated 17 December 2002, the remuneration of the resident caretaker was set at $26,112.00 (inc. GST) indexed to CPI.

At the AGM held on 21 October it was proposed, by Motion 11 that the remuneration of the resident caretaker be increased. It was decided that voting on this motion would be by way of secret ballot and a returning officer was appointed to oversee the vote. The tally sheet used by the Returning Officer records 13 votes in favour of the motion, and 14 votes against the motion.

Secret ballot voting papers were rejected by the returning officer for the following reasons:

Lot 1 – The registered proprietor of this lot is SMAB Pty. Ltd and the body corporate roll shows Mr Alister Lee as the nominee for SMAB Pty. Ltd. The envelope required to be signed by the voter pursuant to section 53B was signed by MA Lee and consequently this vote was rejected as MA Lee did not appear as a nominee on the roll.

Lot 17 – The registered proprietor of this lot is Trober 75 Pty. Ltd. The committee advise that as no "Company Nominee Declaration" has been received from Trober 75 Pty. Ltd, the vote by Mr Moller, the sole director of the company was held to be invalid.

Lot 20 – The vote submitted in respect of this lot was rejected by the returning officers as the envelope containing the vote was not signed by the voter as required by section 53B Body Corporate and Community Management (Standard Module) Regulation 1997 ("the Standard Module").

A fourth vote was declared invalid as the lot owner was unfinancial.

The applicant submits that the three votes cast for lots 1, 17 and 20 should be counted to "show the true wishes of the majority of voters" and has attached letters from the proprietors of these lots.
In which they confirm that they voted in favour of the motion.

Determination

As an adjudicator I am reluctant to interfere with the results of a vote which has been properly convened in accordance with the legislation, and more so in circumstances where the counting of votes has been conducted by an independent returning officer. I am of the view that the returning officer has acted diligently on the evidence available to him at the time. However, I now have the benefit of additional evidence not available to the returning officer and believe that at least in the case of two votes, this case involves exceptional circumstances. This evidence includes letters from the owners/ nominees of lots 1, 17 and 20 who have not only disclosed how they voted in the secret ballot, but also presented arguments as to why their votes should be regarded as valid.

Lot 1
In relation to the vote cast on behalf of SMAB Pty. Ltd. the applicant submits that
"it has since been found that the signature was on file as alternative company signatory".
I have had the opportunity to peruse relevant body corporate records and note that a signed "Nominee of Corporation" form was submitted by the owner of lot 1 in October 1998 in which Melissa Parkinson-Lee is nominated as alternative nominee.

This form would appear to comply with the requirements of section 49(5) Standard Module which provides as follows:

For subsection (1)(b) or (c) a person is taken to be the nominee of a corporation or corporate owner (the nominating entity) only if the nominating entity gives the secretary written notice of nomination stating-

(a)	the name of the nominee; or
(b)	the names of 2 nominees, I of whom is to act in the absence of the other.

I am of the view that although the owner of the lot has done everything necessary to comply with this provision, the roll was not updated to reflect the nomination of the alternate nominee. Accordingly, I believe that MA Lee was entitled to vote on the relevant motion.

Lot 17
On the other hand, the registered proprietor of lot 17, Trober 75 Pty. Ltd. Has failed to lodge the appropriate notice of nomination as required by section 49(5) Standard Module. The wording of this section very clearly states that a person is taken to be the nominee of a corporation or corporate owner (the nominating entity) only if the nominating entity gives the secretary written notice of nomination.

This case differs from the situation dealt with above in that no nomination has been completed. As a company can only vote by means of a duly appointed nominee, the absence of a nominee means that the voter was not recorded on the roll. In my view, completion of the nominee form and submission with the Secretary is a mandatory precondition to a nominee vote, and failure to do so is fatal to the validity of the vote.

Lot 20
The vote submitted in respect of this lot was rejected by the returning officers as the envelope containing the vote was not signed by the voter as required by section 53B Standard Module.

Section 53B Standard Module provides as follows:

53B Conduct of secret ballot--voting
(1) To cast a written vote on a motion to be decided by secret ballot, a person must--
(a) place a mark on the voting paper indicating the person’s vote; and
(b) place the voting paper in the secret voting paper envelope supplied by the secretary and seal it; and
(c) if a separate particulars envelope is supplied--place the sealed secret voting paper envelope in the separate envelope and seal it; and
(d) complete the separate particulars envelope or particulars tab by signing and dating, and inserting the following information on, the envelope or tab--
(i) the number of the lot for which the vote is exercised;
(ii) the name of the owner of the lot;
(iii) the name of the person having the right to vote;
(iv) the basis on which the person has the right to vote; and
(e) give the completed particulars envelope with the secret voting paper envelope enclosed, or the secret voting paper envelope with the completed particulars tab attached, to the returning
officer, or forward the envelope to the returning officer so that the returning officer receives it before the votes are counted at the general meeting.

Section 53B Standard Module sets out a number of procedural requirements which must be complied with to ensure the validity of a vote cast by way of secret ballot. The evidence provided to me indicates that the owner of lot 20 has complied with all of the above requirements except for placing his signature on the back of the envelope. On balance, I am of the view that this owner has complied with the requirements of section 53B to such an extent that the vote should be regarded as valid.

In a District Court appeal of an adjudicators order (4080 of 2000) Judge Boulton stated (at paragraph 27) that
The very detailed provisions of the standard module regulation ... make it almost inevitable that from time to time there will be non-compliance. Equally though the provisions of the Act make it clear that non-compliance of an insubstantial nature will not be allowed to imperil the actions of bodies corporate or their committees, particularly in the instance of committees where actions are taken bona fide.
In a Magistrates Court appeal of three orders of the Referee under the Building Units and Group Titles Act 1980, the Magistrate stated Non-compliance with a statutory requirement does not necessarily mean that all subsequent procedures are automatically invalid or unlawful.

Conclusion

I therefore propose to order that the votes cast for lots 1 and 20 in respect of motion 11 at the annual general meeting on 21 October 2004 are to be regarded as valid so that the results of the vote are as follows:
Votes For the Motion : 15
Votes Against the Motion : 14
Invalid votes: 2