Surfers Palms North [2006] QBCCMCmr 519 (12 October 2006)

Last Updated: 19 December 2006

REFERENCE: 0767-2006

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	20846
Name of Scheme:	Surfers Palms North
Address of Scheme:	2 St Kevins Court BENOWA QLD 4217

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

Mr Dudley Victor Allen, the owner of lot 11

I hereby order that: • the meeting of 13 September 2006 is invalid in its entirety and the motions voted upon are of no effect; • the extraordinary general meeting is to be reconvened by no later than 27 November 2006; • a returning officer is to be retained; • a new agenda is to be established and distributed by 3 weeks before the meeting; • new motions must be invited for the meeting by 16 October 2006 and may be accepted from lot owners until 4 weeks before the meeting; • new nominations for the committee must be invited by 16 October 2006 and may be accepted up to 4 weeks before the meeting; • voting for committee elections and any items that are the same as the 13 September 2006 meeting, will be by secret ballot; • voting papers submitted for the 13 September 2006 meeting are declared void and new votes are required.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0767-2006

"Surfers Palms North" CTS 20846

Application

Dudley Allen, the Owner of lot 11 (the applicant) has sought interim orders that any decisions purportedly made at an extraordinary general meeting claimed to have been held on 13 September 2006 are not to be implemented and to be of no effect until the validity of the meeting is determined.

The final orders sought in relation to this matter are that:

•	The annual general meeting claimed to have been held on 13 September 2006 be declared null and void;
•	Any other orders considered necessary or appropriate.

Jurisdiction

Surfers Palms North CTS 20846 is a 61 lot scheme registered under the Body Corporate and Community Management Act 1997 and is operating under the Body Corporate and Community Management (Accommodation Module) Regulation 1997. Typically, this module is intended for residential arrangements.

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)).

Grounds

Interim Order

On 13 September 2006 a group of 9 persons representing 9 out of 62 lots purported to conduct an Extraordinary General Meeting. The notice of this meeting had been withdrawn by the placement of a notice on both the Body Corporate notice board and the office of the body corporate manager where the meeting was to be held. These notices were erected on the day of the meeting. The applicant alleges that the fact that the meeting notice had been withdrawn was known to all of those 9 owners.

The resolutions purportedly made at the extraordinary general meeting resulted in all committee positions changing.

The persons claiming to have been appointed as the Committee have issued a notice stating that a meeting of that committee is to be held on Monday, 25 September 2006. The Applicant therefore submits that interim relief is warranted.

Final Order

In consequence of a notice received under Section 59 of the Accommodation Module, on 18 August 2006 a Notice of Extraordinary General Meeting was issued to all owners.

In view of considerable turmoil within the complex and its recent disputation history, the Committee decided that all motions on the agenda of the subject EGM should be decided by secret vote, and that Ms Jan Taylor be appointed as Returning Officer for that purpose.

A number of circulars are attached to the grounds which the applicant regards as defamatory of incumbent committee members and designed deliberately mislead voters and influence them to vote in a particular way.

In part due to this campaign and in part because of the serious effect on owners’ expectations as the result of an interim order to cease painting until agreements are made in accordance with Section 118 (made in Application 0691-2006), on 12 September 2006 the Committee, by majority, decided to withdraw the meeting notice. A circular was given to owners on that day and a further single page notice was placed at the complex advising of the cancellation. As well, Mr David Baty, Mr Graeme Beattie and Ms Michele Burley-Jones, were verbally notified of the cancellation at various times during the morning of 13 September.

Mr Attilio Danieletto of Challenge Strata Management placed similar notices advising of cancellation of the meeting at both the entrance of his office building and at the front door of his office on Level 5 of that building. Both of those notices were still in the same places at his office building on the following morning (i.e. 14 September).

It first became known to owners that a meeting was held when a circular under the hand of Ms Burley-Jones dated 15 September 2006 was received.

The applicant submits the meeting is irregular and unlawful for the following reasons:

1.	A person or persons without proper authority under the Act/Regulations has no power to declare whether a cancelled general meeting will take place or not.

2.	The Chairman only has authority to chair meetings, not to declare whether a general meeting will take place or not. That determination can only be made by the person issuing the meeting notice, in this case the Secretary, or by an order of an adjudicator

3.	The action purports to be a meeting held in consequence of a particular meeting notice. That required all motions to be decided by secret vote and it is not open to persons present at a meeting to change this procedural requirement.

4.	Alternately, if the action is not purported to have been taken in consequence of the meeting notice, then the meeting was unlawful in any event because the prescribed form and time of notice was not given to all owners.

5.	The nominated Returning Officer received more than 20 voting papers from owners after the meeting notice issued. Therefore a substantial number of owners were disenfranchised.

6.

The applicant states he understands that Mr Baty called the body corporate manager twice on 13 September 2006, and that on both occasions Mr Danieletto notified Mr Baty that his instructions were that the general meeting for that day had been cancelled. This is not accurately reported in the "Minutes" circulated by Ms Burley-Jones.

7.	The "Minutes" record a vote for Lot/Unit 61 by voting paper. The owner of that lot is Barbara Segreto of NSW who was not present. It follows the delivery of this voting paper could not have been in accordance with the Regulations.

Submissions

Submissions were sought from the purported new committee and the body corporate manager. An uninvited submission was received from another owner. I will disregard this uninvited submission partly as it was uninvited, but also as its interpretation assumes I know how their vote for the committee has been cast.

As the committee has not made a joint submission as requested, I note the membership of the committees as follows:

"Old" Committee	"New" Committee
Dave Baty - Chairperson	Michelle Burley-Jones – Chairperson
Vic Allen – Secretary (applicant)	Dave Baty – Secretary
Ian Lochlin – Treasurer	Graeme Beattie – Treasurer
Luis Chevalier	Louise Segreto
Young hi-Kim	Mona Hough
Natasha Suskova	Ingrid Luker
Rocco Princi – Resident Manager	Ivan Lovos
Attilio Danieletto – Body corporate manager	Rocco Princi – Resident Manager
	Attilio Danieletto – Body corporate manager

Submissions were received from Burley-Jones, Baty, Beattie, Segreto, Hough and Princi. The points they have made that may go to the validity of the meeting are:

•	While the extraordinary general meeting was requisitioned on 24 July 2006, if was not called until 18 August (outside the 2 weeks required under section 59(3)(a)). Even this was only called after action under Section 59A;
•	The chairperson advised the body corporate manager and the returning officer that the meeting was to proceed;
•	They submit that as the meeting was called by requisition, it could only be cancelled by those who submitting the requisition;
•	Those who came agreed unanimously that the meeting should proceed. This was for the purpose of enforcing their rights to have the extraordinary general meeting, under the Act;
•	One says it is untrue that all 9 members who attended the meeting knew it had been cancelled;

As requested, the body corporate manager has also made a submission. Information contained in this that assist my deliberations are:

•	The decision to cancel the extraordinary general meeting organised for 13 September 2006 was made by flying minute of 5 of the 7 committee members;
•	He understands that the notice cancelling the meeting was placed around midday;
•	He had conversations with 3 of the "new committee", advising that he had been instructed to cancel the meeting by the flying minute;
•	Around 3:30 pm the chairperson rang again and advised he intended to proceed with the meeting;
•	They placed a notices of cancellation at their own doors around 5:15 pm and they were still there the next morning;
•	They suggest the issue to be determined is whether a general meeting notice can be withdrawn by the person issuing the notice;
•	Impact of withdrawal of the meeting on other owners given that votes held by the returning officer have not been taken into account and many owners took the notice of cancellation at face value and did not attend;
•	Notice of meeting required voting by secret ballot, however the votes were counted by a show of hands;
•	Without the role, no consideration was given to eligibility to vote.

Determination

While I am of the view that it was probably unwise of the "Old Committee" to cancel the extraordinary general meeting at the eleventh hour, I regard it as equally unwise for the "Group of 9" to proceed with the meeting.

I have received submissions that I should look to the issue of who may cancel a meeting that has been requisitioned by a number of owners. Further I could delve into issues such as the prohibition of using proxies for electing or appointing members of the committee (Section 72(3)(c)) or on motions decided by secret ballot (Section 79(3)(g)) or the correct order for an agenda (Section 19(1)).

However I believe that in this matter, these issues are displaced by the impact on other members of the Body Corporate by the late cancellation notice followed by attendance of a small number.

I have had a significant amount of input from both of the current factions within the scheme, seeking to justify their actions and, one assumes, influence my belief as to what is just and equitable in relation to their positions.

However, the reality is that my consideration is directed to the interests of lot owners, be it in relation to animal by-laws, committee elections, maintenance or Section 118 agreements. In addition, my function needs to be immune to the presentation of information which is irrelevant.

In this matter, the confusion that has surrounded the late cancellation of the meeting has disenfranchised a significant portion of the body corporate. Issues such as animal by-laws tend to attract a great deal of emotional commitment and those who have missed an opportunity to be heard through no fault of their own, should be afforded the opportunity to be heard.

Clearly also, the current committee membership is a burning issue within the scheme and the scheme will continue to struggle under disharmony at least until both factions become convinced that lot owners have made their choice on an informed and fair basis. An election where all owners are given the opportunity to express their wishes will assist this.

I am concerned to allow lot owners the opportunity to express their views with recent events in mind. I will order that the meeting of 13 September 2006 is invalid in its entirety, that the extraordinary general meeting be reconvened and that:

•	The returning officer be retained;
•	A new agenda be established;
•	New motions may be accepted from lot owners;
•	New nominations for the committee may be accepted;
•	The committee elections and any items that are the same as the 13 September 2006 meeting, will be by secret ballot;
•	Voting papers submitted for the 13 September 2006 meeting are declared void and new votes are required.

While I will not make this an order, I also suggest that the factions could consider each putting forward one preferred colour scheme and have it voted upon as a motion with alternatives.

I have allowed the final orders sought. In the circumstances, it is not intended to invite further submissions regarding this matter, or to make a further order, since this decision, is final in its determination of this matter. If any party considers that an appeal of this decision is warranted, then they should appeal the order.

REFERENCE: 0767-2006A

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	20846
Name of Scheme:	Surfers Palms North
Address of Scheme:	2 St Kevins Court BENOWA QLD 4217

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

Mr Dudley Victor Allen, the owner of lot 11

I hereby order that: • the meeting of 13 September 2006 is invalid in its entirety and the motions voted upon are of no effect; • the extraordinary general meeting is to be reconvened by no later than 27 November 2006; • a returning officer is to be retained; • a new agenda is to be established and distributed by 3 weeks before the meeting; • new motions must be invited for the meeting by 16 October 2006 and may be accepted from lot owners until 4 weeks before the meeting; • new nominations for the committee must be invited by 16 October 2006 and may be accepted up to 4 weeks before the meeting; • voting for committee elections and any items that are the same as the 13 September 2006 meeting, will be by secret ballot; • voting papers submitted for the 13 September 2006 meeting are declared void and new votes are required.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0767-2006

"Surfers Palms North" CTS 20846

Purpose of order

The purpose of this order is to:

•	replace an earlier order made 5 October 2006, which erroneously described the decision as an interim order; and
•	identify Michelle Burley-Jones as member of the "Old" Committee.

Application

Dudley Allen, the Owner of lot 11 (the applicant) has sought interim orders that any decisions purportedly made at an extraordinary general meeting claimed to have been held on 13 September 2006 are not to be implemented and to be of no effect until the validity of the meeting is determined.

The final orders sought in relation to this matter are that:

•	The annual general meeting claimed to have been held on 13 September 2006 be declared null and void;
•	Any other orders considered necessary or appropriate.

Jurisdiction

Surfers Palms North CTS 20846 is a 61 lot scheme registered under the Body Corporate and Community Management Act 1997 and is operating under the Body Corporate and Community Management (Accommodation Module) Regulation 1997. Typically, this module is intended for residential arrangements.

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)).

Grounds

Interim Order

On 13 September 2006 a group of 9 persons representing 9 out of 62 lots purported to conduct an Extraordinary General Meeting. The notice of this meeting had been withdrawn by the placement of a notice on both the Body Corporate notice board and the office of the body corporate manager where the meeting was to be held. These notices were erected on the day of the meeting. The applicant alleges that the fact that the meeting notice had been withdrawn was known to all of those 9 owners.

The resolutions purportedly made at the extraordinary general meeting resulted in all committee positions changing.

The persons claiming to have been appointed as the Committee have issued a notice stating that a meeting of that committee is to be held on Monday, 25 September 2006. The Applicant therefore submits that interim relief is warranted.

Final Order

In consequence of a notice received under Section 59 of the Accommodation Module, on 18 August 2006 a Notice of Extraordinary General Meeting was issued to all owners.

In view of considerable turmoil within the complex and its recent disputation history, the Committee decided that all motions on the agenda of the subject EGM should be decided by secret vote, and that Ms Jan Taylor be appointed as Returning Officer for that purpose.

A number of circulars are attached to the grounds which the applicant regards as defamatory of incumbent committee members and designed deliberately mislead voters and influence them to vote in a particular way.

In part due to this campaign and in part because of the serious effect on owners’ expectations as the result of an interim order to cease painting until agreements are made in accordance with Section 118 (made in Application 0691-2006), on 12 September 2006 the Committee, by majority, decided to withdraw the meeting notice. A circular was given to owners on that day and a further single page notice was placed at the complex advising of the cancellation. As well, Mr David Baty, Mr Graeme Beattie and Ms Michele Burley-Jones, were verbally notified of the cancellation at various times during the morning of 13 September.

Mr Attilio Danieletto of Challenge Strata Management placed similar notices advising of cancellation of the meeting at both the entrance of his office building and at the front door of his office on Level 5 of that building. Both of those notices were still in the same places at his office building on the following morning (i.e. 14 September).

It first became known to owners that a meeting was held when a circular under the hand of Ms Burley-Jones dated 15 September 2006 was received.

The applicant submits the meeting is irregular and unlawful for the following reasons:

8.	A person or persons without proper authority under the Act/Regulations has no power to declare whether a cancelled general meeting will take place or not.

9.	The Chairman only has authority to chair meetings, not to declare whether a general meeting will take place or not. That determination can only be made by the person issuing the meeting notice, in this case the Secretary, or by an order of an adjudicator

10.	The action purports to be a meeting held in consequence of a particular meeting notice. That required all motions to be decided by secret vote and it is not open to persons present at a meeting to change this procedural requirement.

11.	Alternately, if the action is not purported to have been taken in consequence of the meeting notice, then the meeting was unlawful in any event because the prescribed form and time of notice was not given to all owners.

12.	The nominated Returning Officer received more than 20 voting papers from owners after the meeting notice issued. Therefore a substantial number of owners were disenfranchised.

13.

The applicant states he understands that Mr Baty called the body corporate manager twice on 13 September 2006, and that on both occasions Mr Danieletto notified Mr Baty that his instructions were that the general meeting for that day had been cancelled. This is not accurately reported in the "Minutes" circulated by Ms Burley-Jones.

14.	The "Minutes" record a vote for Lot/Unit 61 by voting paper. The owner of that lot is Barbara Segreto of NSW who was not present. It follows the delivery of this voting paper could not have been in accordance with the Regulations.

Submissions

Submissions were sought from the purported new committee and the body corporate manager. An uninvited submission was received from another owner. I will disregard this uninvited submission partly as it was uninvited, but also as its interpretation assumes I know how their vote for the committee has been cast.

As the committee has not made a joint submission as requested, I note the membership of the committees as follows:

"Old" Committee	"New" Committee
Dave Baty - Chairperson	Michelle Burley-Jones – Chairperson
Vic Allen – Secretary (applicant)	Dave Baty – Secretary
Ian Lochlin – Treasurer	Graeme Beattie – Treasurer
Luis Chevalier	Louise Segreto
Young Hi-Kim	Mona Hough
Natasha Suskova	Ingrid Luker
Michelle Burley-Jones	Ivan Lovos
Rocco Princi – Resident Manager	Rocco Princi – Resident Manager
Attilio Danieletto – Body corporate manager	Attilio Danieletto – Body corporate manager

Submissions were received from Burley-Jones, Baty, Beattie, Segreto, Hough and Princi. The points they have made that may go to the validity of the meeting are:

•	While the extraordinary general meeting was requisitioned on 24 July 2006, if was not called until 18 August (outside the 2 weeks required under section 59(3)(a)). Even this was only called after action under Section 59A;
•	The chairperson advised the body corporate manager and the returning officer that the meeting was to proceed;
•	They submit that as the meeting was called by requisition, it could only be cancelled by those who submitting the requisition;
•	Those who came agreed unanimously that the meeting should proceed. This was for the purpose of enforcing their rights to have the extraordinary general meeting, under the Act;
•	One says it is untrue that all 9 members who attended the meeting knew it had been cancelled;

As requested, the body corporate manager has also made a submission. Information contained in this that assist my deliberations are:

•	The decision to cancel the extraordinary general meeting organised for 13 September 2006 was made by flying minute of 5 of the 7 committee members;
•	He understands that the notice cancelling the meeting was placed around midday;
•	He had conversations with 3 of the "new committee", advising that he had been instructed to cancel the meeting by the flying minute;
•	Around 3:30 pm the chairperson rang again and advised he intended to proceed with the meeting;
•	They placed a notices of cancellation at their own doors around 5:15 pm and they were still there the next morning;
•	They suggest the issue to be determined is whether a general meeting notice can be withdrawn by the person issuing the notice;
•	Impact of withdrawal of the meeting on other owners given that votes held by the returning officer have not been taken into account and many owners took the notice of cancellation at face value and did not attend;
•	Notice of meeting required voting by secret ballot, however the votes were counted by a show of hands;
•	Without the role, no consideration was given to eligibility to vote.

Determination

While I am of the view that it was probably unwise of the "Old Committee" to cancel the extraordinary general meeting at the eleventh hour, I regard it as equally unwise for the "Group of 9" to proceed with the meeting.

I have received submissions that I should look to the issue of who may cancel a meeting that has been requisitioned by a number of owners. Further I could delve into issues such as the prohibition of using proxies for electing or appointing members of the committee (Section 72(3)(c)) or on motions decided by secret ballot (Section 79(3)(g)) or the correct order for an agenda (Section 19(1)).

However I believe that in this matter, these issues are displaced by the impact on other members of the Body Corporate by the late cancellation notice followed by attendance of a small number.

I have had a significant amount of input from both of the current factions within the scheme, seeking to justify their actions and, one assumes, influence my belief as to what is just and equitable in relation to their positions.

However, the reality is that my consideration is directed to the interests of lot owners, be it in relation to animal by-laws, committee elections, maintenance or Section 118 agreements. In addition, my function needs to be immune to the presentation of information which is irrelevant.

In this matter, the confusion that has surrounded the late cancellation of the meeting has disenfranchised a significant portion of the body corporate. Issues such as animal by-laws tend to attract a great deal of emotional commitment and those who have missed an opportunity to be heard through no fault of their own, should be afforded the opportunity to be heard.

Clearly also, the current committee membership is a burning issue within the scheme and the scheme will continue to struggle under disharmony at least until both factions become convinced that lot owners have made their choice on an informed and fair basis. An election where all owners are given the opportunity to express their wishes will assist this.

I am concerned to allow lot owners the opportunity to express their views with recent events in mind. I will order that the meeting of 13 September 2006 is invalid in its entirety, that the extraordinary general meeting be reconvened and that:

•	The returning officer be retained;
•	A new agenda be established;
•	New motions may be accepted from lot owners;
•	New nominations for the committee may be accepted;
•	The committee elections and any items that are the same as the 13 September 2006 meeting, will be by secret ballot;
•	Voting papers submitted for the 13 September 2006 meeting are declared void and new votes are required.

While I will not make this an order, I also suggest that the factions could consider each putting forward one preferred colour scheme and have it voted upon as a motion with alternatives.

I have allowed the final orders sought. In the circumstances, it is not intended to invite further submissions regarding this matter, or to make a further order, since this decision, is final in its determination of this matter. If any party considers that an appeal of this decision is warranted, then they should appeal the order.