Wilks Street Apartments [2006] QBCCMCmr 64 (14 February 2006)

Last Updated: 19 December 2006

REFERENCE: 0869-2005

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	294
Name of Scheme:	Wilks Street Apartments
Address of Scheme:	83 Wilks Street BUNGALOW QLD 4870

TAKE NOTICE that pursuant to an application made under the abovementioned Act by Allan Nayda, a co-owner of Lot 5.

I hereby order that the application for an order by Allan Nayda, a co-owner of Lot 5 that, quote: 1. An order validating that the current committee of Messrs Anderson, Nayda & Pils is the Body Corporate Legal Identity and invalidate Messrs Aalbers & Demmit as the committee. 2. An order validating that Mr Aalbers has been removed as Chairperson. 3. Mr Aalbers return all the Body Corporate property to the new Chairperson – Mr Richard Anderson at 1/83 Wilks Street, Bungalow, Qld 4870. is dismissed. I further order that the Extraordinary General Meeting held on 2 November 2005 is void.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0869-2005

"Wilks Street Apartments" CTS 294

APPLICATION

This application is by Allan Nayda of Lot 5 (applicant) against the body corporate and Wilhelmus Aalbers, the owner of Lot 2 (respondents) seeking the following outcomes.

The applicant is seeking a final outcome, quote:

1.	An order validating that the current committee of Messrs Anderson, Nayda & Pils is the Body Corporate Legal Identity and invalidate Messrs Aalbers & Demmit as the committee.
2.	An order validating that Mr Aalbers has been removed as Chairperson.
3.	Mr Aalbers return all the Body Corporate property to the new Chairperson – Mr Richard Anderson at 1/83 Wilks Street, Bungalow, Qld 4870.

JURISDICTION

"Wilks Street Apartments" Community Titles Scheme 294 is a scheme under the Body Corporate and Community Management Act 1997 (Act) and the Body Corporate and Community Management (Standard Module) Regulation 1997 (Standard Module).

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)).

INTERIM ORDER

The applicant had also sought the following interim order, quote:

Mr Aalbers return all the Body Corporate property to the new Chairperson – Mr Richard Anderson at 1/83 Wilks Street, Bungalow, Qld 4870.

On 14 December 2005, I dismissed the interim order.

SUBMISSIONS

In accordance with the Act, submissions were called and a copy of the application was provided to the applicant as body corporate secretary for distribution to the owner of each lot (excluding the applicant and the respondent). A submission was received from Mr Aalbers and a number of lot owners. The applicant made a written reply to submissions under section 244 of the Act.

DETERMINATION

The Statement of Adjudicator’s Reasons for Decision for the interim order stated, quote:

It is evident from the material submitted by the applicant that there dispute concerning the composition of the committee for the body corporate. In determining the interim order, I have considered the detailed chronology of events provided by the applicant which have emerged since the Annual General Meeting dated 24 March 2005 (AGM) which relevantly indicate:

1. The committee elected at the AGM consisted of Willem Aalbers, Allan Nayda, Richard Anderson and Ursula Pils.
2. The applicant resigned as secretary by written notice dated 28 September 2005. The applicant then sought to withdraw the notice of resignation by letter to Mr Aalbers dated 4 October 2005. Richard Anderson resigned as treasurer by notice to Mr Aalbers dated 10 October 2005.
3. On 11 October 2005, the applicant (on behalf of the owners of Lots 1, 4 and 5) gave Mr Aalbers a written request to call an extraordinary general meeting to consider a motion to remove Mr Aalbers from office. On 25 October 2005, the applicant requested committee member, Ursula Pils call the requested extraordinary general meeting under section 61A of the Standard Module.
4. By notice dated 26 October 2005, Ursula Pils gave Notice of an Extraordinary General Meeting to be held on 2 November 2005, the agenda for which included the motion requested by the applicant on behalf of the owners of Lots 1, 4 and 5. The Minutes of this meeting signed by the applicant indicate that the owners of Lots 1, 3, 4 and 5 resolved to remove Mr Aalbers from office and elect Richard Anderson as chairperson and the applicant as secretary and treasurer.
5. By notice dated 26 October 2005, Strataworks gave Notice of an Extraordinary General Meeting to be held on 24 November 2005, the agenda for which included the motion requested by the applicant on behalf of the owners of Lots 1, 4 and 5. The Minutes of this meeting indicate that Lots 2, 3, 6 and 7 were represented and that the motion to remove Mr Aalbers from office was defeated and that Harvie Demmit was elected to the positions of secretary and treasurer.
6. The committee chosen at the 2 November EGM then resolved, at a meeting dated 2 November 2005 to give notice to Mr Aalbers requesting a return of body corporate property. A written notice was given to Mr Aalbers dated 3 November 2005. By letter dated 15 November 2005, Mr Aalbers informed the applicant that he would not return the body corporate property until a proper decision is made.

The applicant is of the view that the committee is comprised of the persons chosen at the Extraordinary General Meeting held on 2 November 2005 and Ursula Pils. It would seem therefore, that the applicant disputes the resolutions made at the Extraordinary General Meeting held on 24 November 2005. There is an obvious conflict in the body corporate with respect to the composition of the committee and the management of the body corporate. However, for the purposes of making the interim order I am not persuaded that the decisions made at the Extraordinary General Meeting held on 2 November 2005 should prevail over decisions made at the later Extraordinary General Meeting, or that the decisions made at either meeting have effect. It is apparent from the material provided by the applicant that there are a number of procedural issues relating to the Extraordinary General Meeting held on 2 November 2005 including the time given for the notice of the meeting^[1]; the information included in the notice of the meeting^[2]; and the consideration of a motion (Motion 4) at the meeting when the motion was not included on the agenda for the meeting^[3]. In addition, the authority for calling the Extraordinary General Meeting held on 24 November 2005 may require consideration. Given the events which have occurred in relation to the composition of the committee, I do not consider that there is an irrefutable basis to support the applicant’s claim that the persons chosen at the Extraordinary General Meeting held on 2 November 2005 constitute the committee of the body corporate.

The committee chosen at the AGM comprised:
Willem Aalbers - chairperson
Allan Nayda - secretary
Richard Anderson – treasurer
Ursula Pils – ordinary committee member

Casual vacancies arose on the committee with the resignations of Mr Nayda and Mr Anderson. In my view, the resignation of both members was effective when each person gave written notice of their resignation to the chairperson in October 2005^[4]. I do not consider that Mr Nayda could subsequently withdraw his resignation. The positions of secretary and treasurer of the body corporate had become vacant and the committee had an obligation pursuant to section 25C of the Standard Module to either choose persons to fill the vacancies or to call a general meeting of the body corporate for this purpose.

The applicant is seeking an outcome validating the action which caused resolutions to be made at an Extraordinary General Meeting dated 2 November 2005. This meeting was convened subsequent to the applicant giving notice to request an extraordinary general meeting dated 11 October 2005 on behalf of the owners of Lots 1, 4 and 5 to Mr Aalbers. While Mr Aalbers has questioned differences in the notice, I do not consider that these differences are of importance to the validity of the notice. The notice was given to Mr Aalbers as the chairperson and included a proposed motion^[5]. However, without express authorisation from the owners of Lots 1 and 4, the applicant could not sign the notice on their behalf. In the absence of the authorisation, the owners of these lots should have signed the notice. While the correctness of the notice can be significant to any requirement to comply with the request, I do not consider that the absence of the authority is relevant in the determination of this dispute as I am satisfied that by their actions, both lot owners demonstrated support to the applicant. However, for the reasons given in the Statement of Adjudicator’s Reasons for Decision for the interim order I consider that the procedures adopted by Ms Pils in convening the Extraordinary General Meeting held on 2 November 2005 were contrary to the Standard Module and constituted procedural irregularities of a nature which significantly impacted on the ability of members to participate in the decision making process. The lack of a proper notice of the meeting is, in my opinion fatal to the validity of the meeting. The proposed motion related to an important issue and all lot owners were entitled to their statutory right of at least 21 days to consider the matter. For this reason, I have ordered that the Extraordinary General Meeting held on 2 November 2005 is void. Consequently, the outcomes sought by the applicant are dismissed.

The applicant and Mr Aalbers have made submissions regarding an Extraordinary General Meeting held on 24 November 2005 which also gave consideration to the motion to remove Mr Aalbers from the office of chairperson and resolved to fill the vacant positions of secretary and treasurer. The validity of a resolution of this meeting, or of the meeting itself is not the subject of this application. Consequently, I do not propose to investigate any matters relating to this meeting.

It is evident that the annual general meeting will soon be held. It is clear from the submissions that there are issues relating to the management of the scheme and the actions of lot owners. It is most important that the body corporate committee and lot owners recognise their obligations under the Act, and that they act in a manner which ensures that the body corporate is able to fulfil its functions and obligations. Therefore, while some owners may have problems dealing with other owners, when it comes to body corporate business all lot owners must ensure that they give reasonable consideration to the particular body corporate issue ensuring that the body corporate satisfies its legislative obligation to act in a reasonable manner and for the benefit of lot owners.

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^[1] Section 43, Standard Module.
^[2] Section 42, section 45, Standard Module.
^[3] Section 52(5), Standard Module.
^[4] Section 25(2)(c), Standard Module.
^[5] Section 61(1),Standard Module.