Cherwood Lodge [2006] QBCCMCmr 149 (24 March 2006)

Last Updated: 19 July 2006

REFERENCE: 0830-2005

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	20711
Name of Scheme:	Cherwood Lodge
Address of Scheme:	71 Olsen Avenue, LABRADOR QLD 4214

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

Talaat Christophi, the Owner(s) of lot 16

I hereby order that the application seeking to invalidate the last annual general meeting of the body corporate is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0830-2005

"Cherwood Lodge" CTS 20711

Application

Cherwood Lodge Community Titles Scheme (Cherwood Lodge) is a 48 lot scheme under the Body Corporate and Community Management Act 1997 (Act) and the Act’s Standard Module Regulation (Standard Module). The scheme is designed for residential purposes.

This application is by Talaat Christophi, owner of lot 16 (applicant) against the body corporate for Cherwood Lodge (respondent). The applicant seeks an order that the annual general meeting held on 26 July 2005 be declared invalid. The applicant says that he and some other owners were not given proper notice of the meeting. The particular issue the applicant raises as important is that he was not given the opportunity to vote against a motion that nearly doubled the administrative fund levy.

Decision

Applicable law

The legislation includes provisions to the effect that:

• Information for body corporate roll must be provided by an owner. Specifically, within two months of a person becoming the owner of a lot, that person must give a written notice to the body corporate containing specified information including the owner’s address (Standard Module, 140);
• Notice of a general meeting must be given to all owners. In particular, written notice of a general meeting must be given to the owner of each lot included in the scheme and, if not given personally, must be sent to the owner at the owner’s address for service (Standard Module, 42).

No proper notice of applicant’s address

Strata Solutions is the body corporate manager for Cherwood Lodge and provides administrative assistance to the committee in calling meetings. Strata Solutions has submitted that the proposed budgets resulting in the increased levy were adopted by the committee, notified to owners, and then adopted at the annual general meeting. However, no notices were able to be given to the applicant because the applicant had not given the body corporate his address. A copy of the notice containing information for the body corporate roll and provided by Johnston Lawyers on behalf of the applicant is included. This notice is incorrectly completed in that it leaves the applicant’s residential address blank and, beneath that, specifies the address for service of notices to be "as above".

Strata Solutions is therefore technically correct in saying it was not properly notified of the applicant’s address in order to be able to send a copy of the notice of meeting to the applicant. As a matter of common sense it may be expected that Strata Solutions would have contacted Johnston Lawyers to find out the address. Alternatively, Strata Solutions may have inferred that the address for service of notices was intended to be the address of the lot in question that was listed on the form. However, it appears that this inference may not have assisted as the lot numbering for lots in Cherwood Lodge is different from the numbering of the actual units.

The applicant should therefore contact Strata Solutions to ensure that his address is properly updated. In the circumstances, the failure by Strata Solutions to give the applicant notice of the annual general meeting on behalf of the body corporate does not justify an order invalidating the meeting.

Other concerns raised

A number of submissions were made by other owners in support of this application. Some of these submissions show a misapprehension about some of the responsibilities of various parties. In particular, there are complaints to the effect that owners should not be paying the fees they are paying to Strata Solutions when the grounds are in poor condition and other schemes with electric gates, security cameras, tennis courts and managed gardens are only paying $35 per week in body corporate fees.

Each owner of a lot in Cherwood Lodge is a member of the body corporate for Cherwood Lodge. Owners are entitled to elect committee members who can make decisions about the management of the scheme on a day to day basis. More significant decisions of the body corporate that are outside the power of the committee, including any decisions on any project involving spending of more than $125 per lot, need to be made by owners in general meeting.

The body corporate operates according to decisions made at committee meetings and decisions made by owners in general meeting. Owners in general meeting can vote to engage a body corporate manager to provide administrative assistance in maintaining records and calling meetings. However, that body corporate manager is not the body corporate and does not make body corporate decisions. Owners can also vote to appoint a caretaking service contractor to provide letting agent services to owners and maintenance services to the body corporate. This caretaker is not the body corporate and is only entitled to act according to the terms of the contract with the body corporate.

Documents provided with this application indicate that Strata Solutions is the body corporate manager appointed to provide administrative assistance in maintaining records and calling meetings. A review of the budget for 2005-6 shows an amount of $6,300 budgeted towards this expense under the headings "Body Corp. Administration" and "Body Corp. Admin. - Additional". This is an average amount of about $2.50 per lot per week.

Documents also indicate that John Sewell and Helen Davies of Unit 1 Cherwood Lodge have been appointed as caretakers for the period from 26 October 2002 to 25 October 2012. Their duties under the agreement include maintaining and caring for the common property and attending to the gardening, cleaning and building maintenance of the common property. A review of the budget for 2005-6 shows an amount of $42,000 budgeted towards this expense under the heading "Management". This is an average amount of about $16.80 per lot per week.

Other significant amounts in the budget include estimates for legal fees of $11,000 and a need to make up a deficit of $13,934 from the budget for the previous year. In respect of legal fees, it is clear that legal fees in the previous year greatly exceeded the budgeted amount but it is submitted that $15,375 has now been received by the body corporate and will be credited towards next year’s budget. It is not clear on the present application whether owners had properly authorised the incurring of these legal fees. In particular, I would expect that owners would have needed to vote in general meeting to authorise this expenditure and to fix a special contribution to pay for this unbudgeted expenditure. However, the present levies do appear appropriate to meet liabilities of the body corporate and the present application does not satisfy me that it would be just or equitable to invalidate the general meeting or the levies agreed at that meeting. The application will therefore be dismissed.

Order

For these reasons, the application is dismissed.