Ebb Tide [2007] QBCCMCmr 492 (17 August 2007)

Last Updated: 3 September 2007

REFERENCE: 0366-2007

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	14632
Name of Scheme:	Ebb Tide
Address of Scheme:	204 Marine Parade Rainbow Bay COOLANGATTA QLD 4225

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

Paul and Maureen Tynan, the Owner(s) of lot 1

I hereby order that, for the next general meeting, Helen Wise, owner of lot 3 (respondent) must submit a motion seeking authorisation for the removal of brickwork and replacement with a powder coated railing that occurred in April 2007. Authorisation for any expenditure of body corporate funds on this work should also be sought. I further order that Paul and Maureen Tynan, owners of lot 1 (applicants) may, for the same meeting, put forward any material supporting a view that the body corporate could have repaired or replaced the railing for a lesser amount and propose that authorisation for any expenditure of body corporate funds on the work should be limited to that lesser amount.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0366-2007

"Ebb Tide" CTS 14632

Application

Ebb Tide Community Titles Scheme (Ebb Tide) is a 3 lot scheme under the Body Corporate and Community Management Act 1997 (Act) and the Act’s Standard Module Regulation (Standard Module). The scheme is designed for residential purposes.

Lot boundaries are designated under a building unit plan (now known as a building format plan).

This is an application by Paul and Maureen Tynan, owners of lot 1 (applicants) against Helen and Edward Wise, owners of lots 2 and 3 (respondents).

The applicant alleged that installation of a new balcony railing was performed without a professional inspection, proper quotations, or the resolution of issues about the owner’s responsibility for the area in question. An interim order was sought to stop the work. However, the work had already been completed by the time the application was lodged. Final orders were sought to determine a number of matters including whether the area in question is an exclusive use area and to determine who is responsible for performing the work.

Submissions

The applicants’ main submissions were to the effect that the applicants were requested by telephone to contribute to the costs of replacing existing brickwork with balustrades for around $4,500. This verbal approval was given but the applicants requested to meet with the respondent to view the area. The applicants said they wanted to determine whether the brickwork required replacement or repairs, and wanted to view two quotations.

Submissions from the respondents are to the effect that the railing was dangerous and needed to be replaced urgently, the respondents were going north for four to five months and wanted the work to be completed before they left, and that one of the applicants said she would get a second quote but this was never provided.

A response from the applicants' solicitor raises a number of additional questions about whether the body corporate is functioning in accordance with the legislation and whether the area in question is part of common property or part of an exclusive use area.

Decision

General functions of the body corporate

The body corporate for a community titles scheme is made up of the owners of the lots within the scheme. The body corporate has, among other things, a general responsibility to maintain, manage and control the common property for the benefit of owners.

There are two ways in which the body corporate can make decisions. Most routine decisions can be made by the committee. More significant decisions of the body corporate need to be made by the lot owners in the scheme voting at a general meeting. For example, an annual general meeting must be held every year to allow owners to vote to adopt budgets for the year and determine the levies payable to fund the operations of the body corporate.

The present application indicates that owners have not been operating the body corporate in accordance with legislative procedures. If desired, owners can engage a body corporate manager to perform the administrative functions associated with operating the body corporate. However, owners themselves will need to retain the primary decision making functions by voting at meetings.

For example, the present dispute concerns an owner wanting to make an improvement to common property by, at a cost of $3,412, replacing a brick wall with a metal powder coated balustrade. In the ordinary course, the owner should have put forward a motion proposing this change along with two quotations. A general meeting should have then been called and a special resolution passed to authorise this change to common property. An order of an adjudicator should only needed to have been sought if there was some dispute about the outcome of the voting or if work needed to be done urgently and there was insufficient time to call a meeting.

It is not appropriate for one owner to make significant changes to the common property after only an informal verbal discussion with other owners. As a result of these actions, there is now a dispute about who should pay for the new balustrade.

Maintenance responsibilities

Maintenance responsibilities in a community titles scheme are generally provided for as follows:

1. The body corporate must generally maintain common property in good condition (Standard Module, 109(1)); and

2. An owner must generally maintain their lot in good condition (Standard Module, 120(2)).

However, there are exceptions to these general rules. For example, owners are generally responsible for maintaining their own exclusive use area or improvements to common property (Standard Module 114, 123). Further, under a building format plan, the body corporate has additional maintenance responsibilities including maintaining railings that are on the boundary of a lot and common property.

No exclusive use area

I have reviewed the title search and community management statement for Ebb Tide. No exclusive use by-laws have been recorded for the scheme. There are therefore presently no exclusive use areas.

Not an improvement made by the owner of lot 3

The photographs provided suggest that the brick wall performed a safety function to stop people falling of the edge of a patio area. Based on these photographs and the submissions it seems more likely than not that the wall would have been built by the developer as a basic safety issue rather than added subsequently by the owner of lot 3.

Order that is just and equitable

Based on the above, the body corporate had the responsibility to maintain the brick wall. However, this dispute has arisen because the correct procedures were not followed in fixing or replacing the brick wall.

In the circumstances, the most appropriate order is to require the respondent to submit a motion seeking authorisation for the removal of brickwork and replacement with a powder coated railing that occurred in April 2007. Authorisation for any expenditure of body corporate funds on this work should also be sought. The applicants should also be given the opportunity to put forward any material supporting a view that the body corporate could have repaired or replaced the railing for a lesser amount and propose that authorisation for any expenditure of body corporate funds on the work should be limited to that lesser amount.

This will give all owners the opportunity to consider the issue properly and vote on the preferred course of action. At the same time, owners may wish to consider putting forward motions to deal with other issues that have arisen out of the application. For example, an owner may wish to propose the appointment of a professional body corporate manager, propose the grant of exclusive use areas for the benefit of each lot, or propose a change in lot entitlements to ensure contributions are just and equitable.

Order

For these reasons, I make the order above. If owners wish to obtain further information on rights and responsibilities under the Act then owners can contact the information service provided by this office on 1800 060 119.