Palm Springs Retirement Village [2006] QBCCMCmr 485 (30 August 2006)

Last Updated: 19 December 2006

REFERENCE: 0095-2006

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	30852
Name of Scheme:	Palm Springs Retirement Village
Address of Scheme:	15 Carmichael Court WYNNUM WEST QLD 4178

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

Delma Garrett-Benson, the owner of lot 30 & Jack Knight, the owner of lot 2

I hereby order that the application for the following orders: 1. That the decisions of the committee meeting held on the 2nd of November 2005 and the 31 of January 2006 be declared invalid. 2. That pursuant to section 82 of the Body Corporate and Community Management (Accommodation Module) Regulations that the Scheme Operator apply for consent from the body corporate for the transfer of the business and have the opportunity to consider whether or not to request a transfer fee pursuant to section 83 of the Regulations. 3. That the following nominations for committee positions be declared invald pursuant to sections 11, 14 and 14A of the Body Corporate and Community Management (Accommodation Module) Regulations: a. Michael Issakidis – nominated for Chairperson; b. Donrecka Issakidis – nominated for Treasurer; c. Len Undy – nominated for Secretary. 4. That the sinking fund be reimbursed for a. the costs debited against the account for the purchase of a watercooler for use in the common room; and b. the costs to reinstate / replace the kitchen splash back with stainless steel and a stainless steel bench; and c. the costs to purchase a new dishwasher. 5. That those owners who have been charged to reinstate the locks to the masterkey system be reimbursed. is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0095-2006

"Palm Springs Retirement Village" CTS 30852

THE SCHEME
"Palm Springs Retirement Village" is a subdivision of 82 lots on a Building Format Plan. The regulation module applying to the scheme is the Body Corporate and Community Management
(Accommodation Module) Regulation.

APPLICATION
The applicants, Delma Garrett-Benson of lot 30 & Jack Knight of lot 2, have sought the following orders of an adjudicator under the Body Corporate and Community Management Act 1997 (the Act) quote:

Interim Orders

1.	That an independent person, not related to nor an associate of Jodaway Management Pty Ltd and Jodaway Pty Ltd be appointed as the chairperson for the AGM to be held on the 22nd of February 2006.
2.	That the decisions of the committee meeting held on the 2nd of November 2005 and the 31 of January 2006 be declared invalid.
3.	That the following nominations for committee positions be declared invald pursuant to sections 11, 14 and 14A of the Body Corporate and Community Management (Accommodation Module) Regulations:
a)	Michael Issakidis – nominated for Chairperson;
b)	Donrecka Issakidis – nominated for Treasurer;
c)	Len Undy – nominated for Secretary.
4.	That pursuant to section 82 of the Body Corporate and Community Management (Accommodation Module) Regulations that the Scheme Operator apply for consent from the body corporate for the transfer of the business and have the opportunity to consider whether or not to request a transfer fee pursuant to section 83 of the Regulations.
5.	That the annual general meeting be declared invalid and that a proper notice be produced complying with the legislation.

Final Orders

1.	That the decisions of the committee meeting held on the 2nd of November 2005 and the 31 of January 2006 be declared invalid.
2.	That pursuant to section 82 of the Body Corporate and Community Management (Accommodation Module) Regulations that the Scheme Operator apply for consent from the body corporate for the transfer of the business and have the opportunity to consider whether or not to request a transfer fee pursuant to section 83 of the Regulations.
3.	That the following nominations for committee positions be declared invald pursuant to sections 11, 14 and 14A of the Body Corporate and Community Management (Accommodation Module) Regulations:
a.	Michael Issakidis – nominated for Chairperson;
b.	Donrecka Issakidis – nominated for Treasurer;
c.	Len Undy – nominated for Secretary.

4. That the sinking fund be reimbursed for

- the costs debited against the account for the purchase of a watercooler for use in the common room; and

- the costs to reinstate / replace the kitchen splash back with stainless steel and a stainless steel bench; and

- the costs to purchase a new dishwasher.

5. That those owners who have been charged to reinstate the locks to the "maste rkey" system be reimbursed.

INTERIM ORDERS

On 21 February 2006, an Interim Order was made by an Adjudicator from this Office, dismissing the application for four interim orders sought by the applicants. The application was dismissed on the basis that the orders sought were more in the nature of Final, rather than Interim Orders, and because there had been no time for investigation of the application, including the obtaining of submissions in response to the application from interested parties. Accordingly, the requirement of procedural fairness (natural justice) could have been afforded to persons who might be affected if the (interim) orders sought had been made.
BACKGROUND

I understand that this scheme was originally established as a retirement village in the late 1980’s with the marketing of leasehold interests by the original developer when the village was subject to a mortgage. The village was subsequently operated by a receiver for a considerable period of time before it was purchased by Jodaway Pty. Ltd.

I understand that until 2002, the village was subdivided by leases over the various units. Palm Springs Retirement Village, Community Titles Scheme 30852 was registered on 2 December 2002 and from 2 December 2002 until 1 April 2003, Jodaway Pty. Ltd. was the owner of all lots.

On 21 January 2003 an Extraordinary General Meeting for the scheme was held, at which, according to the minutes, the following business was conducted:

• It was resolved that the body corporate appoint Jodaway Management Pty. Ltd. to attend to the body corporate management services for a fee of $8,300 plus GST per annum. These services were subcontracted to Body Corporate services Pty. Ltd.;
• It was resolved that an Operations Management Contract be entered into between the Body Corporate and Jodaway Management Pty. Ltd. (the operator) for a period of 25 years under which the operator is responsible for cleaning, maintenance, repairing, refurbishing and replacing common property and other property as set out in the agreement for a fee of $90,000 plus GST per annum;
• It was resolved that until the holding of the First Annual General Meeting ,
- Michael Issakidis be appointed as Chairperson;
- Peter Meade of Body Corporate Services Pty. Ltd. be appointed as Secretary and Treasurer of the Body Corporate.
- Donrecka Issakidis be appointed as an ordinary committee member.

During 2005 an application for various orders was made to this Office, and in response to dispute resolution application 392-2005F I made the following observations:

In addition to being members of the body corporate committee, Mr. and Mrs. Issakidis are also directors and shareholders of Jodaway Management Pty. Ltd. which is a service contractor. In my opinion, Mr. and Mrs. Issakidis are disqualified from being voting members of the body corporate committee by section 11 of the Body Corporate and Community Management (Accommodation Module) Regulation 1997.

Obviously at this point in time there is little point in making orders regarding the composition of the current committee as the financial year for this scheme ends in November and preparations should now be underway for the next AGM. However I will order that prior to the next annual general meeting, individuals are to be nominated for membership of the committee in accordance with sections 11, 14 and 14A of the Accommodation Module Regulation.

The applicants have made the following submissions in support of the application:

• Despite the above order, Mr Issakidis has not stepped down from the position of Chairperson and was to chair the AGM held on 22 February 2006;
• Jodaway Management Pty. Ltd. was appointed as the Body Corporate Manager at the EGM on 21^st January 2003 and the secretarial, administration and treasury functions were subcontracted to Body Corporate Services;
• Jodaway Pty. Ltd. is the licensee of the Food License issued by the Brisbane City Council for provision of on-site catering services;
• Jodaway Management Pty. Ltd. is the lessee of common room/ main amenities room;
• On about 12 January 2006, the applicants became aware that there was an apparent change in the structure of Jodaway Management Pty. Ltd. or that Jodaway Management Pty. Ltd. had sold its interest as "Scheme Operator";
• ASIC searches indicate that Mr. & Mrs. Issakidis have resigned from the positions of Director and Secretary of the company and sold their shares to Mr. Andrew Fleming;
• The operations management agreement was entered into with Jodaway Management Pty. Ltd. for a period of 25 years and section 82 of the Accommodation Module Regulation provides that the engagement "may be transferred only if the Body Corporate.... Approves the transfer";
• The "transfer" was noted in the company register in October 2005 without consulting the body corporate;
• The applicants believe that the "transfer" is a mechanism whereby Mr Issakides and his associates can hold positions on the committee and have control of the village while avoiding the operation of sections 11, 14 and 14A of the Accommodation Module Regulation;
• On 13 January 2006 John O’Connor & Co. as solicitors for the "buyer" wrote, advising that "it is likely that the management rights will be sold by Jodaway Management Pty. Ltd. on 10 February 2006";
• The Body Corporate has not approved the sale, nor has the Body Corporate had the opportunity to decide whether they wish to impose a transfer fee under section 83 of the Accommodation Module.
• It is alleged that the purpose of the "transfer" was to defeat sections 11, 14 & 14A of the Accommodation Module Regulation thereby allowing a "stacked committee" and for Mr Issakidis to hold the position of Chairman;
• At the EGM held on 21 January 2003, it was resolved that the Body Corporate enter into a 75 year lease agreement with Jodaway Management Pty. Ltd. for the main amenities area for $1.00 per annum;
• This area is used by the scheme operator as office space and for provision of meals to residents who wish to partake of the service;
• At a committee meeting on 17 March 2005 it was resolved that a new dishwasher be purchased and the purchase price would be borne by the sinking fund. At a meeting on 23 June 2005, the committee approved expenditure of up to $350 for a water cooler. At the same meeting it was resolved to spend up to $600 from the sinking fund to install a stainless steel splash back and stainless steel bench.
The applicants believe that these costs should be met from the "capital replacement fund" in accordance with the Retirement Villages Act.
• The Scheme operator has advised all occupiers that all locks are body corporate property and owners are prohibited from changing their locks from the "master key" system. However, owners have changed their locks as, on occasions, "onsite caretakers" have entered heir lots uninvited, when lot owners have been absent;

Following an incident in lot 30, Jodaway Management Pty. Ltd. demanded that lot owners reinstate their locks to his master key system and if lot owners failed to comply, the locks would be reinstated at the owners’ cost.

The applicants state that they are entitled to quiet enjoyment of their lot and in addition, by-law 6 states that an owner may install a locking or safety device to protect the lot against intruders.

SUBMISSIONS

The Commissioner issued the Body Corporate with formal notice of the application in
accordance with section 243 (1) of the Act and in accordance with section 243(2) of the Act, the Commissioner also invited the Body Corporate Committee, and all owners of a lot included in the
scheme, to make written submissions about the application .

Submissions were received from two lot owners and the Chairman of the Body Corporate.

One lot owner made the following submissions:

• Desite the Adjudicator’s Order 392-2005, Mr & Mrs Issakidis have continued to be voting members of the Committee;
• committee meetings were conducted without the quorum required by the Act.

Another lot owner made the following submissions:

• They do not believe that it is in the best interests of the village community to have Mr & Mrs Issakidis and Mr Undy as members of the Committee.
• They would prefer that Committee members were residents in the scheme.

The Chairman of the Body Corporate, Mr Issakidis, made the following submissions:

• He is chairman of the body corporate and a director of Jodaway Pty. Ltd. which is currently the owner of 24 lots;
• Mr & Mrs Issakidis resigned as office holders in Jodaway Management Pty. Ltd. on 31 October 2005 i.e. after the Adjudicator’s Order dated 10 October 2005 and before the meeting referred to by the applicants;
• After approval as the scheme operator, Jodaway Management Pty. Ltd. entered into two agreements with the body corporate;
• An administration agreement was entered into for 2 years 11 months commencing January 2003. These administrative functions were sub-contracted by Jodaway Management Pty. Ltd. to Body Corporate Services Pty. Ltd. At the AGM held on 22 February 2006, the lot owners approved appointment of a new manager following a tender process and Jodaway Management Pty. Ltd. has no further involvement as body corporate manager although it continues as the caretaking service contractor;
• Under an operating agreement entered into for a period of 25 years commencing in January 2003, Jodaway Management Pty. Ltd. was appointed as the caretaking service contractor. This is permitted under the Accommodation Module Regulation and although these obligations were sub-contracted by Jodaway Management Pty. Ltd. to Mr. Andrew Fleming, Jodaway Management Pty. Ltd. has maintained responsibility for the functions and obligations under the agreement entered into with the body corporate;
• There is no obligation under the agreement requiring Jodaway Management Pty. Ltd. to
obtain the approval of the body corporate or any lot owner in the event that there is a change in shareholding of Jodaway Management Pty. Ltd., as this involves a change in the ownership of the corporate entity rather than a transfer of contractual rights and obligations;
• There is a requirement under the Retirement Villages Act to notify the Office of Fair Trading and this has been done;

• Mr & Mrs Issakidis and Mr. Undy were nominated for election to the committee by Jodaway Pty. Ltd. which owned some 25 lots at the time. Mr & Mrs Issakidis and Mr. Undy were re-elected to the committee at the AGM held on 22 February 2006. The other 4 members of the committee are residents;
• As this is a Retirement Village, there are 4 separate funds, three of which (General Services Fund, Sinking Fund and Maintenance Reserve Fund) are levied against all lot owners pursuant to their lot entitlements;
• The fourth fund is the Capital Replacement Fund which is contributed to only by the Scheme Operator, Jodaway Management Pty. Ltd.;
• The 4 funds are set up and levies struck in accordance with a Quantity Surveyor’s Report;
• The Capital Replacement Fund is established for the purpose of funding replacement of property, and the Maintenance Reserve Fund is established for the purpose of funding the repair of items existing at the commencement of the scheme operation and used for the running of the village but not including sinking fund items that relate more closely to the body corporate;
• The applicant advises that there are 2 dishwashers in the kitchen, one of which was paid for in November 2004 from the capital replacement fund. The second dishwasher, referred to at the committee meeting of March 2005, required either replacement or repair and after investigation it was decided to repair, rather than replace it. Monies for this purpose came from the Maintenance Reserve Fund. The reference to payment from the sinking fund was a bookkeeping error and the amount will be transferred to the Maintenance Reserve Fund now that the error has been discovered.
• The cost of leasing the water cooler was previously met from the general services fund. It was decided to purchase it to avoid further lease payments. Neither the capital replacement nor the maintenance reserve funds are suitable for this expense.
• The stainless steel splashback has not been installed but in any event, this is a maintenance reserve item rather than a capital replacement item.
• The applicant attended the November 2005 committee meeting but failed to raise any concerns at the meeting or subsequently with members of the committee;
• No owners have been charged to reinstate the locks to the masterkey system.
• As a retirement village, it is necessary for management to have access to units to check check on the well-being of residents. For example there was an incident in the applicant’s unit which could have resulted in a fire if others were not able to gain access.

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)).


For the purposes of the Act, the term "dispute" is defined in section 227 of the Act in the following terms:
(1) A dispute is a dispute between--

(a) the owner or occupier of a lot included in a community titles scheme and the owner or occupier of another lot included in the scheme; or

(b) the body corporate for a community titles scheme and the owner or occupier of a lot included in the scheme; or

(c) the body corporate for a community titles scheme and a body corporate manager for the scheme; or

(d) the body corporate for a community titles scheme and a caretaking service contractor for the scheme; or

(e) the body corporate for a community titles scheme and a service contractor for the scheme, if the dispute arises out of a review carried out, or required to be carried out, under chapter 3, part 2, division 7;37 or
(f) the body corporate for a community titles scheme and a letting agent for the scheme; or

(g) the body corporate for a community titles scheme and a member of the committee for the body corporate; or

(h) the committee for the body corporate for a community titles scheme and a member of the committee; or

DETERMINATION

The applicants have sought the following final orders of an adjudicator:

1. That the decisions of the committee meeting held on the 2^nd of November 2005 and the 31 of January 2006 be declared invalid.

2. That pursuant to section 82 of the Body Corporate and Community Management (Accommodation Module) Regulations that the Scheme Operator apply for consent from the body corporate for the transfer of the business and have the opportunity to consider whether or not to request a transfer fee pursuant to section 83 of the Regulations.

3. That the following nominations for committee positions be declared invald pursuant to sections 11, 14 and 14A of the Body Corporate and Community Management (Accommodation Module) Regulations:

Michael Issakidis – nominated for Chairperson;

Donrecka Issakidis – nominated for Treasurer;

Len Undy – nominated for Secretary.

4. That the sinking fund be reimbursed for

- the costs debited against the account for the purchase of a watercooler for use in the common room; and

- the costs to reinstate / replace the kitchen splash back with stainless steel and a stainless steel bench; and

- the costs to purchase a new dishwasher.

5. That those owners who have been charged to reinstate the locks to the masterkey system be reimbursed.

Membership of the Body Corporate Committee
As outlined in my previous order, at the AGM for the body corporate held on 22 February 2005, Mr. Issakidis was elected as Chairperson and Mrs. Donrecka Issakidis was elected as an ordinary member of the Committee.

At the time Mr. and Mrs. Issakidis were also directors and shareholders of Jodaway Management Pty. Ltd. which is the "scheme manager" and scheme operator. Accordingly, at that time, it was my opinion that section 11 of the Body Corporate and Community Management (Accommodation Module) Regulation 1997, applied to disqualify Mr. and Mrs. Issakidis from being voting members of the body corporate committee.

Section 11 relevantly provides as follows:

11 Eligibility for committee membership
(1) A person is eligible to be a voting member of the committee if the person is an individual nominated for membership of the committee by a member of the body corporate and is also--
(a) a member of the body corporate; or
(b) a person of a following category--
(i) if the nominating entity is an individual--
(A) a member of the individual’s family; or
(B) a person acting under the authority of a power of attorney given by the individual;
(ii) if the nominating entity is a corporation--a director, secretary or other nominee of the corporation;
(iii) if the nominating entity is the body corporate for a subsidiary scheme in a layered arrangement of community titles schemes--a representative of the subsidiary scheme.
(2) However, a person who is otherwise eligible under subsection (1) to be a voting member of the committee is not eligible to be a voting member of the committee if the person is--
(a) a body corporate manager, service contractor or letting agent; or
(b) an associate of a body corporate manager, service contractor or letting agent, other than a lot owner who is the associate of a letting agent only because the letting agent, in conducting the agent’s letting agent business, acts for the lot owner; or
(c) a person, other than a letting agent for the scheme, who conducts a letting agent business for the scheme.

The term "associate" is defined in section 309 of the Act in the following terms:

309 Associates
(1) For this Act, a person is associated with someone else if--
(a) a relationship of a type to which this section applies exists between them; or
(b) a series of relationships of a type to which this section applies can be traced between them through another person or other persons.
(2) This section applies to relationships of the following types--
(a) marriage or de facto relationship;
(b) the relationship of ascendant and descendant (including the relationship of parent and child) or the relationship of persons who have a parent or grandparent in common;
(c) partnership;
(d) the relationship of employer and employee;
(e) a fiduciary relationship;
(f) the relationship of persons, 1 of whom is accustomed, or under an obligation (whether formal or informal), to act in accordance with the directions, instructions or wishes of the other;
(g) the relationship of a corporation and executive officer of the corporation;
(h) the relationship of a corporation and a person who is in a position to control or substantially influence the corporation’s conduct.

Accordingly, I was of the view that Mr. and Mrs. Issakidis were not eligible to be voting members of the body corporate committee while they were in control of Jodaway Management Pty. Ltd.
Mr. and Mrs. Issakidis advise that since that time, they have sold their interest in Jodaway Management Pty. Ltd. and resigned as Directors/ office holders in Jodaway Management Pty. Ltd. on 31 October 2005 i.e. after the Adjudicator’s Order dated 10 October 2005 and before the meeting referred to by the applicants.

This advice is supported by the application and the ASIC searches showing that Mr. & Mrs. Issakidis have resigned from the positions of Director and Secretary of Jodaway Management Pty. Ltd. and sold their shares in Jodaway Management Pty. Ltd. As Mr. & Mrs. Issakidis are no longer service contractors or "associates" of a service contractor, they are no longer disqualified from being voting members of the committee on that basis. Therefore, there is no basis for me to make orders invalidating decisions of the committee meetings held on the 2^nd of November 2005 and the 31 of January 2006, or to order that the appointments of Mr & Mrs Issakidis and Mr. Undy as voting members of the body corporate committee, are invalid.

Transfer of Shares in Jodaway Management Pty. Ltd.

The next matter for consideration is whether, pursuant to section 82 of the Body Corporate and Community Management (Accommodation Module) Regulation, there was a requirement for anyone to apply for body corporate consent to the transfer of the business, and thereby give the body corporate the opportunity to request a transfer fee pursuant to section 83 of the Regulations.
Again, I do not believe that there is any basis upon which I am able to make the requested order.
An operations management agreement was entered into with Jodaway Management Pty. Ltd. for a period of 25 years commencing in January, and it would seem clear that Jodaway Management Pty. Ltd. remains responsible for the functions and obligations under the agreement.

While the ASIC search provided by the applicants, and also the submission from the body corporate confirm that the shareholding of Jodaway Management Pty. Ltd. has changed, Jodaway Management Pty. Ltd. is a corporate entity and continues to be the service contractor. I also note the advice from the body corporate that there is no obligation under the agreement requiring Jodaway Management Pty. Ltd. to obtain the approval of the body corporate or any lot owner in the event that there is a change in shareholders of that company.

Request that Sinking Fund be Reimbursed
The next matter for consideration is the request for an order that the sinking fund be reimbursed for

- the costs to purchase a new dishwasher;

- the costs debited against the account for the purchase of a watercooler for use in the common room; and

- the costs to reinstate / replace the kitchen splash back with stainless steel and a stainless steel bench.

I am advised that of the 2 dishwashers in the kitchen, one was paid for in November 2004 from the capital replacement fund and the second dishwasher, referred to at the committee meeting of March 2005 was repaired with monies from the Maintenance Reserve Fund instead of being replaced. The Chairman of the Body Corporate has advised that the reference to "payment from the sinking fund" was a bookkeeping error and the relevant amount will be deducted from the Maintenance Reserve Fund now that the error has been discovered.

I am also advised that the stainless steel splashback referred to by the applicant has not been installed but in any event, this is a maintenance reserve item rather than a capital replacement item.

I note that the $350 cost of purchasing the water cooler was met from the sinking fund. Previously the water cooler had been leased and the cost of leasing the water cooler was met from the general services fund. The respondents argue that neither the capital replacement nor the maintenance reserve funds are suitable for this expense and it was appropriate for the expense to be met from the sinking fund.

Two questions arise regarding the correct accounting treatment for the purchase of the water cooler – (1) from which fund the expenditure of $350 should have been met and (2) has the expenditure had been budgeted for?


The Accommodation Module Regulation provides that the body corporate must prepare an administrative and sinking fund budget each financial year. The Regulation provides that the administrative fund budget should contain estimates for recurring expenditure for each financial year such as insurance, administrative costs and maintenance expenses. On the other hand, the sinking fund budget must have regard to anticipated capital or non- recurrent expenditure over a period of at least 10 years.

Although the basic purpose of the sinking fund is to accumulate funds to meet major expenditure at identified time intervals, it is arguable, as a matter of statutory interpretation, that the cost of purchasing the water cooler could be met from the sinking fund. While I am unable to locate evidence that specific provision had been made in the sinking fund budget for this item of expenditure, I also note that having regard to the overall size of the budget, the cost was not substantial. Accordingly, I can see little point in making the requested order regarding expenditure on the water cooler.

Door locks
The final matter for consideration is the applicants’ request for an Order that those owners who have been charged to reinstate the locks to the masterkey system be reimbursed. While the body corporate advises that no owners have been charged to reinstate the locks to the "master key" system, I note that the Scheme operator has advised lot owners that all locks are body corporate property and owners are prohibited from changing their locks from the "master- key" system.
It is argued that as a retirement village, it is necessary for management to have access to check on the well being of residents. For example there was an incident in the applicant’s unit which could have resulted in a fire if others were not able to gain access.

On the other hand, the applicant believes that owners are entitled to quiet enjoyment of their lot and further, by-law 6 states that an owner may install a locking or safety device to protect the lot against intruders

In the case of schemes such as this, created under a building format plan of subdivision, lots are separated by a structural elements such as a walls and the boundaries of the lots are the centre of the wall, floor or ceiling (see Section 48C and 49C(4), Land Title Act 1994). Accordingly, the entry door to each of the lots in this scheme forms part of the boundary with common property and therefore, it is likely that the outer section of the door is common property and the
inner section is part of the lot. Accordingly, I believe that the body corporate is within its rights to require owners to reinstate the locking system which was in place when they moved into their units.
Nevertheless, I believe that by-law 6(b) clearly gives owners the capacity to install additional locking devices on their doors and further, there is no proviso in this by-law that the consent of the Body Corporate is required prior to the installation of additional locking devices.

However, I would point out that Section 163 of the Act provides for a person authorised by the Body Corporate to access a lot when reasonable necessary to inspect the lot to ascertain whether work is necessary or to carry out work that the Body Corporate is required or authorised to carry out. In an emergency the
power of entry can be exercised at anytime. Of course if there were an emergency necessitating access to a lot which was not master keyed, then access would have to be gained by other means, whether by a locksmith or by an emergency service and the cost of gaining access by such alternative means would most likely be payable by the owner question.

If the Applicant chooses to have an individually keyed lock in addition to a commonly keyed locking system, she should give consideration to whether she may have any additional responsibility for the cost of any repairs to the lock which may be caused by forcing the lock or other costs
of gaining access in a genuine emergency.