Village Square [2006] QBCCMCmr 599 (16 November 2006)

Number of Scheme:	24715
Name of Scheme:	Village Square
Address of Scheme:	2 Sickle Avenue HOPE ISLAND QLD 4212

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

I hereby order that the Body Corporate for Village Square shall provide the applicant, Lastelle Investments Pty Ltd, with a copy of the current list of owners who owe the Body Corporate a debt within seven (7) days of the date of this order.

I further order that the document is to be mailed to the applicant at the address for service recorded in the body corporate roll, at the cost of the Body Corporate.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0628-2006

"Village Square" CTS 24715

The Village Square community titles scheme (Village Square) consists of 293 lots and common property. The community management statement for Village Square indicates the Body Corporate and Community Management (Commercial Module) Regulation 1997 (Commercial Module) applies to the scheme. Department of Natural Resources and Water records register the scheme as Building Units Plan 106927.

APPLICATION

Pursuant to the Body Corporate and Community Management Act 1997 (Act), this application was made by Lastelle Investments Pty Ltd, owner of Lots 93 and 106 (applicant), on 7 August 2006. The application sought an order against the Body Corporate for Village Square (respondent) in the following terms:

I have requested to inspect the records, particularly the ‘arrears list’. I have paid a fee of $11.85 for the privilege. Request denied as per attached correspondence. Section 42 of Commercial Module refers. Section 131 of the Module states my entitlement to view. I wish to inspect the records as requested.

PROCEDURAL MATTERS

In August 2006 the Commissioner’s Office attempted to organise conciliation to assist in resolving this dispute, however the applicant declined conciliation.

Under section 243 of the Act, a copy of the application was provided to the Body Corporate and to all owners, with an invitation to the committee and all owners to respond to the matters raised in the application. Submissions were received by the Committee and four owners. The applicant inspected the submissions received and made a written reply (see Act, sections 246 and 244).

A dispute resolution recommendation was made referring the dispute to departmental adjudication.

MATTERS IN DISPUTE

This application relates to access to records. The facts of the dispute, as outlined in the application, submission and reply to submissions, can be summarised as follows.

The applicant says he requested a copy of the Body Corporate Roll at the Annual General Meeting on 30 January 2006. He says this request was refused and he was advised the Roll was not available. He has since repeatedly requested a copy of the arrears list to see who is financial and able to vote at meetings. He says this was refused for various reasons including that he is not entitled, that it breaches the Privacy Act, and that the committee or chairman will not allow it.

Apparently on 28 June 2006 the Body Corporate agreed to disclose the document. The applicant paid $11.85 on 30 June 2006 and an inspection of the records was scheduled for 7 July 2006. On 6 July 2006 the body corporate manager informed the applicant the arrears list would not be available during this search because the Committee had legal advice stating that it could not be provided to non-committee members. They offered to refund the search fee if he no longer wished to search the records. The applicant cancelled the inspection and requested the refund and a copy of the legal advice referred to, but he says neither was provided.

The submissions from owners support the applicant. One notes that, aside from it being a right of owners, the applicant has a paid the appropriate fee and has a valid reason for the request. Another submission comments on the possibility that committee members are not financial.
The submission from the Committee states that:

JURISDICTION

I am satisfied that this is a matter which falls within the dispute resolution provisions of the legislation (see sections 227, 228, 276 and Schedule 5 of the Act).

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

(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

The issue in this application is whether an owner who is not a member of the Committee is entitled to information about the financial status of other owners in relation to body corporate contributions.

The legal advice presented by the Committee bases the claim on two grounds. Firstly, it argues the information contains personal or private information which is not able to be disclosed under the Privacy Act. Secondly, it claims that section 130(3) of the Commercial Module applies in that litigation is threatened unless arrears are paid and so the records are privileged from disclosure. I respectfully disagree with the legal advice obtained by the Committee, for the following reasons.

Section 205 of the Act provides as follows in regard to access to records:

(1) This section provides for the giving of information by the body corporate for a community titles scheme from the body corporate’s records.

(2) Within 7 days after receiving a written request from an interested person accompanied by the fee prescribed under the regulation module applying to the scheme, the body corporate must--

(3) However, the body corporate is not required to allow a person to inspect or obtain a copy of a part of a record under subsection (2) if the body corporate reasonably believes the part contains defamatory material.

(c) another person who satisfies the body corporate of a proper interest in the information sought; or

(d) the agent of a person mentioned in paragraph (a), (b) or (c).

Clearly the applicant is within the scope of an interested person. He has made a written request and paid the prescribed fee.^[1] There is not dispute that the arrears list is part of the records of the Body Corporate for Village Square. The sole restriction on the provision of body corporate records to interested persons in section 205 is that the body corporate reasonably believes the information is defamatory. There is no suggestion here that the Body Corporate believes the arrears list is defamatory and I see no reason why it could be perceived as such. All owners are entitled to access all other body corporate records.

Application of section 130 of the Commercial Module

The reference in the Committee’s legal advice to section 130 of the Commercial Module is, I consider, misconceived. This section provides as follows:

(1) The body corporate must allow all members of its committee reasonable access (without payment of a fee) to the body corporate’s records.

(2) Also, the body corporate must, if asked by an adjudicator, allow the adjudicator access (without payment of a fee) to the body corporate’s records within 24 hours after the request is made.

(3) However, the body corporate is not required to allow a person access to records under this section if a legal proceeding between the body corporate and the person has started or is threatened and the records are privileged from disclosure.

I do not consider this section is relevant to the applicant’s request. The section refers only to access to records without a fee by the committee or an adjudicator. The applicant is neither.

Furthermore, section 130(3) does not say that the body corporate is can prevent access to any record that is relevant to a current or threatened legal action – it only refers to records which are ‘privileged from disclosure’. Therefore even if this section applied to the applicant’s request (and I do not consider it does) the Body Corporate has provided no basis to justify why it claims the arrears list is privileged from disclosure.

There are a range of privileges and immunities that could potentially apply to information related to actual or threatened legal action. This includes^[2]:

On the face of it I fail to see how the arrears list would fall within the scope of these types of privilege. An arrears list would be created in the first instance for monitoring the finances and voting rights in the scheme, not for the purposes of pursuing legal action. However, as section 130 is not relevant to the applicant’s claim it is not necessary for me to finally determine this point.

Moreover, I note that section 130(3) does not even say that a body corporate is prohibited from providing access to any document that related to threatened or commenced legal action and the documents are privileged. It merely says the body corporate is not required to allow access. Accordingly, a body corporate in this circumstance could choose to allow access.

Application of privacy legislation

The other issue is the application of the Privacy Act 1988 (Cwth). Although apparently relying on privacy legislation, neither the Committee nor the legal advice which they rely on provides any real details of how the privacy legislation prohibits the disclosure of this information or any judicial or legislative authority to support their argument.

It is not the role of this Office to administer the Commonwealth privacy legislation and any queries regarding this legislation should properly be directed to the Office of the Federal Privacy Commissioner. Notwithstanding that, I note that section 3 of the Privacy Act 1988 provides that "It is the intention of the Parliament that this Act is not to affect the operation of a law of a State or of a Territory that makes provision with respect to the collection, holding, use, correction, disclosure, or transfer of personal information (including such a law relating to credit reporting or the use of information held in connection with credit reporting) and is capable of operating concurrently with this Act." I also note that Information Privacy Principle 2.1(g) of the National Privacy Principles provides that an organisation must not use or disclose personal information about an individual for a purpose other than the primary purpose of collection "unless the use or disclosure is required or authorised by or under law".

The disclosure of any body corporate records to owners is clearly authorised by law – specifically section 205 of the Act. Accordingly, and in the absence of any specific arguments or authorities from the Committee, I see no reason why the disclosure of the arrears list is inconsistent with the provisions of the Commonwealth privacy legislation.^[3]

Access to records at general meetings

For the information of the parties, and particularly the Committee, I note the provisions of section 42 of the Commercial Module:

42 Secretary to have available for inspection body corporate roll etc. [SM, s 55]

The secretary must have available for inspection by voters for the general meeting--

(c) all proxy forms and voting papers.

Accordingly, all owners are entitled to inspect the roll at each general meeting. Moreover, while this section does not require a body corporate to make available a list of those in arrears, they must provide a list of those who are entitled to vote.
This has the effect, by omission, of identifying all those who are not entitled to vote on motions (other than for resolutions without dissent) or committee elections on the basis that they owe the body corporate a debt.^[4]

Conclusion

It is clear that the applicant is entitled to access to any existing records of the Body Corporate that detail owners who are in arrears. Accordingly I have ordered such information be provided to the applicant. The applicant is similarly entitled to any other Body Corporate records that are not reasonably determined to be defamatory.

I accept that the Committee has, at least since July, been acting in reliance on legal advice that they should not disclose the arrears list. However, the Committee should be aware that is not bound by legal advice and must make its own decision about its rights and responsibilities under the legislation. I note that the applicant had forwarded to the Body Corporate copies of information provided to him by the Information Service of the Commissioner’s Office which outlined the legislative provisions relative to this issue and included the information I have outlined above regarding the application of privacy legislation. The Body Corporate should now be fully informed about its responsibilities regarding requests for access to records, and should action all future requests accordingly.

^[1] Pursuant to section 131(1) of the Commercial Module the prescribed fee referred to in section 205(2) of the Act for an inspection of body corporate records is currently $11 (as a 1 July 2006) and the fee to obtain a copy of a record is 50c for each page supplied.

^[2] Wade, V (Ed.) A Guide to Arbitration Practice in Australia, University of Adelaide & Institute of Arbitrators and Mediators Australia, Adelaide, 2001, p672-3
^[3] The same conclusion was reached for the same reasons in Jadon Place (0216-2003), 6 June 2003
^[4] See section 38(11) of the Commercial Module

	The Roll was available at the 30 January 2006 AGM, but the applicant requested the arrears listing only. The Chairperson declined this request but confirmed the voting papers were checked against this list.
	Pursuant to a Committee meeting on 14 February 2006, all requests for the arrears list were refused for privacy reasons.
	The Committee obtained legal advice from Herdlaw Solicitors, dated 5 July 2006, which says the ledger details lot owners who are in arrears and the amounts of those arrears is not able to be provided to any person other than a committee member.
	There are 10 lots currently in arrears and that these have all been referred to debt collection by current and previous committees.
	None of the current committee members have ever been in arrears.

	The privilege against self-incrimination, which permits a witness (not a corporation) to refuse to divulge information that might increase the risk of a successful prosecution against them.
	Legal professional privilege, which covers confidential communications between a lawyer and the client made for the purpose of seeking and providing professional legal advice, and material created for the primary purpose of pending or reasonably contemplated litigation.
	Some admissions and concessions made in the course of settlement negotiations.
	Public interest immunity, covering claims, often by government agencies, that disclosure is likely to be contrary to the public interest.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Village Square [2006] QBCCMCmr 599 (16 November 2006)