Acacia Ridge Small Business Centre [2006] QBCCMCmr 260 (24 May 2006)

Number of Scheme:	28593
Name of Scheme:	Acacia Ridge Small Business Centre
Address of Scheme:	19 Miltiadis Street ACACIA RIDGE QLD 4110

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

the Body Corporate of the Acacia Ridge Small Business Centre Community Titles Scheme,

I hereby order that Rembay Pty Ltd must, to the greatest practicable extent, not restrict access to any other lot and to the accessway of the property, through the parking, loading and unloading of trucks and the storage of palletized items; and
Rembay Pty Ltd must remedy any and all damage to common property caused by its staff and its business operations; and
Rembay Pty Ltd must apply to the Body Corporate within two weeks of the date of this order for written permission for the flood lights installed by it on the property.
The application is otherwise dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0902-2005

"Acacia Ridge Small Business Centre" CTS 28593

The Application

The applicant, the Body Corporate of the Acacia Ridge Small Business Centre Community Titles Scheme (Acacia Ridge SBC) has applied for the following orders against the owner and occupier of lots 15, 16 and 17, Keith Edwards, Director and owner of Rembay Pty Ltd (the respondent company):

Section 276(1) of the Body Corporate and Community Management Act 1997 (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)).

I conducted a site inspection of the Acacia Ridge SBC on 18 May 2006.

Acacia Ridge SBC consists of 36 lots of varying sizes located at the end of the spur road - Miltiadis Street. The lots consist of rectangular buildings with metalled exterior cladding. The occupiers of the lots operate a range of small businesses and/or ‘light industries’ and their buildings are fitted out with a corresponding variety of office spaces, workshops and storage areas. The buildings are arranged in two areas - a central cluster and a ring of buildings running around the boundaries of the property. Between the central cluster and the boundary ring is a common driveway which also rings the property.

Each lot has the exclusive use of some or all of the car-parking spaces outside their lot with the spaces invariably being sited perpendicular to the front wall of the building and designated by parallel white painted lines. In the area between the car-parking spaces is a relatively narrow ‘road’ or "accessway". It is the usage of this accessway that is the main subject of this dispute.

Acacia Ridge SBC is not a large complex. The accessway is relatively narrow and consequently it would not take much to block it. On the day of my site inspection the six car parking spaces immediately adjacent to lot 28 were occupied by a single shipping container which not only occupied more than the available car parking spaces but because of its positioning significantly narrowed the accessway at that corner.

The accessway not only provides egress (and exit) to all the lots but also because of its relative narrowness vehicles exiting the car parking spaces to the lots would need to back into the accessway in order to leave thus temporarily blocking it. In part recognition of the limitations of the accessway, Acacia Ridge SBC has instituted a one-way traffic flow and forbidden the driving of truck and trailer combinations on the property.

The respondent company states that it was the first occupier of the complex. The respondent company’s three lots are located in one corner of the complex, which is geographically located furthest away from Miltiadis Street. Because of the positioning of the lots there is a small area between the building on lot 15 and the adjoining buildings of lots 16 and 17 which although it is common property would not in any practical sense be used by any other lot owner. The respondent company has four exclusive use car parks adjoining this area which currently are occupied by a truck trailer. For the purposes of this decision I will term this area – Area A.

The respondent company runs a transport business using a number of trucks. The respondent company’s business necessarily involves the regular loading and unloading of trucks using a forklift. The respondent company states its business has grown markedly in the time that it has been at Acacia Ridge SBC. At the time of my site visit – 11 am - there was only one truck present at Acacia Ridge SBC but the respondent company admits that at times, there can be as many as 11 trucks lined up waiting to load or unload. The respondent company states that it tries as much as possible to do this work after 8.00 pm but it is not disputed that loading and unloading does also occur during the day.

The facts in this matter are not in dispute. The respondent company is unique among the occupiers of the Acacia Ridge SBC in that its business is reliant on the regular use of common property for the loading and unloading of trucks. Acacia Ridge SBC is zoned for and operates as a ‘light-industry’ centre. The industries present do take deliveries and arrange for their products to be delivered. At times, these deliveries do involve trucks loading and unloading on common property but certainly not to the level of that of the respondent company.

The respondent company acknowledges that since it first bought into Acacia Ridge SBC its business has outgrown the complex. The respondent company’s business requires a larger yard with room to have trucks parked as necessary. The respondent company is seeking to move to more appropriate premises and consequently, its lots are currently advertised for sale. It would be in the best interests of all lot owners in the Acacia Ridge SBC if this sale could be facilitated.

My decision

The applicant claims that the respondent company’s business operations breach Acacia Ridge SBC’s By-laws 3 and 4 as set out in its Community Management Statement. These By-laws state:

3.1 Save where an exclusive use by-law authorizes him to do so, the owner or occupier of a Lot must not, without the Body Corporate’s written approval:-

3.2 An approval under by-law 3.1 must state the period for which it is given, with the exception of designated visitor parking.

3.3 However, the Body Corporate may cancel the approval by giving seven (7) days written notice to the owner or occupier, with the exception of designated visitor parking.

4.1 The owner or occupier of a Lot must not obstruct the lawful use of the common property by an person and shall not use the same for any purpose save and except the reasonable ingress and egress to and from their respective Lots.

Under the exclusive use by-law – By-law 25 – each lot’s designated car parking spaces can be used for the parking, manoeuvring, loading and unloading of vehicles only.
The intent behind these By-laws 3 and 4 is both clear and perfectly understandable given the physical constraints of the property. However, a strict application of the By-laws is not practical or helpful. Most, if not all, of the buildings on the lots have a large roller door which is a major accessway to the interior of the building. The space immediately outside of the roller doors is common property. If any vehicle stands in the entranceway of this doorway – for example, to make a delivery to the lot - then that vehicle would technically be in breach of By-law 3. It is not difficult to conceive that at one point or another every lot owner would have breached the by-laws. As just one example, the lot owner who had placed the shipping container on the property would be in breach of By-law 4 and indeed, By-law 25.

As a matter of commonsense there must be some flexibility in the application of By-laws 3 and 4. The applicant’s case is that the respondent company’s business operations go beyond the occasional technical breach to long-standing and regular breaches. The applicant, through its first requested order, is seeking the respondent company strictly comply with By-laws 3 and 4. If I were to grant this order then the respondent company would be unable to operate its business. I consider this would be an unreasonable outcome and accordingly I have declined to grant this order. However, this is not to say that the respondent company can continue to operate its business as usual. Common property is exactly that – common to all lot owners. Just as the respondent company is allowed reasonable use of common property, so too are the other lot owners allowed this use. Just as the respondent company should be permitted to conduct its business operations, so too are the other lot owners.

Until such time as the respondent company effects its sale of its lot, it must operate its business in a manner to minimise, to the greatest reasonable extent, the impact on other lot owners. That is, I consider it reasonable for the respondent company to make all practical efforts to maximise its compliance with By-laws 3 and 4. I consider that the following measures are reasonable and must be complied with to the greatest practicable extent:

The above measures are not exclusive. The respondent company must take any other reasonable step that would minimise its use of the accessway for its business operations. As an example, from my site visit, it appeared to me that Area A is under-utilised. The respondent company has an empty truck trailer parked on its 4 exclusive use car-parks. If that trailer is not being used for the respondent company’s business operations and there is another site on which that trailer can be stored – then its transfer to that site would free up valuable space in this area.

Storage of palletized items

The respondent company’s business operation necessarily involves items on wooden pallets being loaded and unloaded onto trucks using forklifts. The applicant has two issues with the pallets – the first being that their storage on common property has the effect of blocking the accessway. The second issue is that there have been times when, either for reasons of damage or inadequate packaging, items on the pallets have allegedly ended up being distributed over the common property. The first issue I will deal with here; the second issue I will discuss later in this decision under the heading of ‘damage’.

As with the presence of the respondent company’s trucks, it is an integral part of the respondent company’s business operations that pallets will be sitting on common property – at least on a temporary basis. I do not consider it reasonable to order that the respondent company must never store pallets on common property. I do consider it reasonable that this storage be restricted to the immediate loading and unloading of trucks. Beyond this purpose, the respondent company must not store pallets on the common property. Even within this restriction, the respondent company must try, to the greatest practicable extent, to ensure that the storage does not interfere with any other person’s use of the accessway or to their lot. To this end, I again urge the respondent company to maximise its use of Area A for the short-term storage of pallets.

Temporary exchange of exclusive use car-parking spaces.

At the front of the adjoining buildings of lots 14 and 15 are a row of exclusive-use car parking spaces. Immediately to the left of the roller door of the building on lot 15 is a single car-parking space designated to lot 18 – this is identified as "NNN" on the Plan of Exclusive Use. To the left of this space are 4 car-parking spaces designated to lot 15, 9.6 metres wide and next to them car-parking spaces designated to lot 30 and thence to lots 14. I can see why the designations were made this way; NNN is the nearest geographically additional car-parking space available for lot 18’s use.

However, on a practical basis, if lot 18 were to – quite legitimately – use NNN for car-parking, then the effect is that this vehicle is parked closest to the doorway of the building on lot 15. Lot 15 then has 9.6 metres of exclusive use car-parking before being ‘sandwiched’ next to a vehicle legitimately parked by lot 30.

It would make more logistical sense in terms of the respondent company’s business for their 9.6 metres of exclusive-use car parking to be located immediately to the left of the roller door and for lot 18 to utilise the car-parking space next to that of lot 30.

That is, lot 18 and the respondent company could exchange one car-parking space. The advantage to both the respondent company and the Acacia Ridge SBC is that the respondent company would then have an uninterrupted exclusive-use area which could minimise its need to use the accessway. The advantage to lot 18 is to reduce its vulnerability arising from its parked vehicle being in proximity to the doorway of lot 15.

Of course the disadvantage for lot 18 is that there exclusive-use car parking space is now geographically located a further 9.6 metre from their lot.

The exchange of car-parking spaces was not an order sought of me and given its marginal benefit to the owner of lot 18 I have not decided to order that the exchange take place. There is provision for a formal exchange of exclusive use areas through the owners entering into a "re-allocation agreement" – sections 171(1)(b)(ii) and 174 of the Act. Alternatively, it is open for the owner of lot 18 and the respondent company to reach an informal temporary agreement on an exchange. Either way, I would leave this up to lot 18 and the respondent company to consider and if necessary action themselves.

As a general point, the 10 exclusive-use car parking spaces designated to the respondent company are extremely valuable in that they cannot be used by any other lot owner and they are located off the accessway. The respondent company may consider these spaces to be too valuable to be used simply for its staff to park their cars. The respondent company’s staff cannot of course, utilise other lot’s car-parking spaces for their purposes but they may be able to park off-site in the short-term, thus permitting the respondent company to free up these spaces for its business operations. I will leave this possibility for the respondent company to consider and action as necessary.

The role of the Body Corporate is to administer, manage and control common property and other assets for the benefit of all members of the Body Corporate – section 152(1)(a) of the Act. To this end, the Body Corporate is the ‘owner’ of the common property. Section 36(1) of the Act states:

36 Rights and responsibilities for common property

(1) The body corporate for a community titles scheme may sue and be sued for rights and liabilities related to the common property as if the body corporate were the owner of the common property.

Example--
If a person, including the owner of a lot included in the community titles scheme, damages the common property, the body corporate may sue to recover the loss arising from the damage.

Acacia Ridge SBC has a specific By-law dealing with damage to common property. By-law 6.1 states:

6.1 An owner or occupier of a Lot must not, without the Body Corporate’s written approval, mark, paint, drive nails, screws or other objects into, or otherwise damage or deface any structure that forms part of the common property or common property assets.

Accordingly, an owner or occupier is liable for damage caused by them to common property and if necessary, a body corporate is able to pursue an action in an appropriate court for the costs of remedying that damage. Common property for the Acacia Ridge SBC includes the accessway, the exterior of each building, garden beds and concrete edgings. Damage includes paint overspray, spillages of both liquids and solid material, denting of cladding, breaking of concrete and the marking of concrete.

The respondent company has claimed that it is being unduly targeted by the Body Corporate on the issue of damage to common property. I do not agree with this assertion. Material supplied by the applicant shows that there are a number of lots that were and have been similarly requested to rectify damage to common property caused by themselves or their tenants.

Regardless, the respondent company does not generally disown responsibility for damage caused by it and its staff. The respondent company has lodged a claim with its insurance company concerning the damage caused by its vehicles to building cladding.

Accordingly, I have decided to grant all the orders sought by the applicant concerning damage caused by the respondent company.
Floodlights

It is not in dispute that the respondent company has installed two small floodlights on common property – the exterior walls of the building on lots 15 and 16. The installation benefits the lot owners of Acacia Ridge SBC in that they better enable the respondent company to conduct his business operations during the evenings. Nonetheless, the respondent company’s action is contrary to By-law 8 and to section 113 of the Body Corporate and Community Management (Standard Module) Regulation 1997 (the Standard Module) in that the respondent company did not obtain the written permission of the Body Corporate prior to installing the floodlights.

The applicant has asked for an order that the respondent company formally apply to the Body Corporate for permission for the floodlights. I consider this request is reasonable. Accordingly, I have decided to make this order. I will give the respondent company the period of two weeks from the date of this order to make this application to the Body Corporate. In turn, I would remind the Body Corporate of the advantages, at least while the respondent company continues to operate its business at Acacia Ridge SBC, of having the floodlights.

Summary

It has been put to me that the lot owners of Acacia Ridge SBC should not have to request that they get access to their lots, to their car-parking spaces or to use the accessway; that they have as much right as the respondent company to use the common property. In principle, this is of course, quite correct. On a practical level, in the case of Acacia Ridge SBC, the only means of guaranteeing this would be if the respondent company did not operate its business. I do not consider that to be a reasonable solution.

My decision is in the nature of a compromise. The respondent company can continue to conduct its business but must do so in a way that does not adversely impact on the other lot owners’ abilities to conduct their businesses. The decision is generous to the respondent company and it must not abuse that generosity. Technically, the respondent company is breaching By-laws 3 and 4 on a regular basis. A compromise of this nature is at best, a short-term solution. In proposing it, I am mindful that the respondent company is trying to leave Acacia Ridge SBC for premises more suited to the type and scope of his business operations. As stated earlier, it is everyone’s best interests that the sale of the respondent company’s lots occurs as quickly as possible.

In the interim, the respondent company remains a member of the Body Corporate of the Acacia Ridge SBC. As such, the respondent company bears the same obligations as any owner or occupier to rectify damage to common property that is caused by it.

•	The loading and unloading of trucks should take place outside of the hours 8.00 am to 5.00 pm.
•	If trucks are loaded within the above hours they should not be ‘lined up’ on the common accessway awaiting their turn to load or be unloaded.
•	If this cannot be avoided, then the driver of the truck must remain with the vehicle at all times and must move the truck immediately when requested to do so.
•	If it is unavoidable that trucks are parked on common property without a driver - that parking must only occur within Area A.
•	The respondent company must nominate an employee who:

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Acacia Ridge Small Business Centre [2006] QBCCMCmr 260 (24 May 2006)