Palm Beach North [2006] QBCCMCmr 193 (20 April 2006)

Last Updated: 19 December 2006

REFERENCE: 0027-2006

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	31739
Name of Scheme:	Palm Beach North
Address of Scheme:	1444 Gold Coast Highway PALM BEACH QLD 4221

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

Leo & Elaine Kalathas, the Owners of lot 13

I hereby order that the application for the following final orders: 1. to rule, allow and accept the owner’s vote at the 23/2/2006 EGM due to no fault of theirs and allow 60 days after the EGM for the new committee voted at this EGM to work with the B/C manager and owners to quickly sort out levies and the proper collection and banking of such amounts now due. We also ask that all interest immorally charged, be withdrawn... 2. to rule that all legal advice sought and obtained by all committees and their executive since July 2004, be declared invalid never to be used for issues concerning Palm Beach North and those committees responsible in obtaining such advice be made accountable and all monies spent must be paid back in full within 30 days of your ruling in this matter or face prosecution 3. We ask the Commissioner to rule that motions 7-11 of the 23/2/2006 EGM be declared invalid and ruled out of order, as they were only entered by the last remaining committee member and ruled out of order as they were only entered by the last remaining committee member as a "condition" of his in order to call this meeting.... is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0027-2006

"Palm Beach North" CTS 31739

APPLICATION

Palm Beach North is a 28 lot scheme under the Body Corporate and Community Management Act (Act) and the Act’s Accommodation Module Regulation (Accommodation Module).

By application originally dated 9 January 2006 and subsequently amended, the owners of lot 13 sought interim and final orders against the body corporate for Palm Beach North (respondent).

The interim orders sought were as follows:

1. to allow all owners to vote at the next EGM 23/2/2006 for Palm Beach North, without having paid their levies (some are in dispute)and to therefore have the opportunity to democratically vote for a new committee...;

2. that all legal advice sought by the committee since 1 July 2004 cannot be used by the body corporate as we believe all legal advice was obtained and expensed without properly convened committee meetings, no proper notices sent out to owners

3. that motions 7,8,9,10 & 11 inclusive must not be allowed to be voted on at the next EGM on 23/2/2006 as the meeting was called to elect a new committee and vote on motions that were in place for the now late AGM and motions 7-11 were included by the last standing committee member as a condition in order to call this EGM or nothing.

The final Outcomes sought are as follows:

1. to rule, allow and accept the owner’s vote at the 23/2/2006 EGM due to no fault of theirs and allow 60 days after the EGM for the new committee voted at this EGM to work with the B/C manager and owners to quickly sort out levies and the proper collection and banking of such amounts now due. We also ask that all interest immorally charged, be withdrawn...

2. to rule that all legal advice sought and obtained by all committees and their executive since July 2004, be declared invalid never to be used for issues concerning Palm Beach North and those committees responsible in obtaining such advice be made accountable and all monies spent must be paid back in full within 30 days of your ruling in this matter or face prosecution

3. We ask the Commissioner to rule that motions 7-11 of the 23/2/2006 EGM be declared invalid and ruled out of order, as they were only entered by the last remaining committee member and ruled out of order as they were only entered by the last remaining committee member as a "condition" of his in order to call this meeting....

BACKGROUND

On 17 February I declined to make the Interim Orders sought. Part of the reason for my refusal was the importance of the EGM scheduled for 23 February and the limited time available to determine the application.

Secondly, at the time of making the Interim order, I was of the view that given the clear indebtedness of the applicants to the body corporate, and apparent reluctance to clear this debt, I did not believe that the applicants are entitled to vote.



Thirdly, I was of the view that I was not empowered to order that all legal advice sought by the committee since 1 July 2004 cannot be used by the body corporate.

Finally, I did not believe it is appropriate for me to dictate what motions should be considered at an EGM. I expressed the view that if the applicants believe a motion should not be considered at the EGM, they should raise these concerns at the meeting in accordance with the Accommodation Module Regulation .

However, as the applicants also sought final orders, I referred this application back to the Commissioner to be administered in accordance with the Act and the normal processes of this Office. Affected parties were then given an opportunity to make written submissions about the application for final orders.

SUBMISSIONS

Additional submissions made by lot owners reiterated the concerns previously made at the interim stage.

For example submissions reiterated the earlier advice that the applicant owes the body corporate several thousand dollars in unpaid levies and is refusing to pay this amount until the body corporate approves a caretaking/ letting agreement which was purportedly authorised in 2004.

Secondly, it was submitted that expenditure on legal advice was properly incurred and is supported and evidenced by the minutes of the body corporate, particularly minutes of the AGM convened in January 2005.

Thirdly, it was submitted that adequate notice of the meeting had been given.

JURISDICTION

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)).

DETERMINATION

Having considered the application, submissions provided at the interim stage and submissions provided at the final stage, I do not believe that there are any additional issues to be considered at this point in time.

As stated in my earlier Statement of Reasons, I believe that adequate notice of the EGM was given and there was no evidence received by me to indicate that the motions considered at the meeting should be invalidated.

Secondly, there is no doubt that the applicants are indebted to the body corporate and are not entitled to vote.


Thirdly, I am not empowered to make the requested orders regarding legal advice sought by the committee since 1 July 2004. In any event, such legal advice is privileged.

Accordingly the application for final orders must also be dismissed.