Manchester Unity Centre [2007] QBCCMCmr 519 (30 August 2007)

Last Updated: 5 September 2007

REFERENCE: 0118-2007

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	9355
Name of Scheme:	Manchester Unity Centre
Address of Scheme:	621 Coronation Drive Toowong Qld 4066

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

John and Susan Keays atf Keays Family Trust, the Owner(s) of lot 9

I hereby order that the application for an order to extend the time period for the registration of an agreed reallocation of exclusive use car parks, is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0118-2007

"Manchester Unity Centre" CTS 9355

Application

Manchester Unity Centre Community Titles Scheme (Manchester) is a 12 lot scheme under the Body Corporate and Community Management Act (Act) and the Act’s Standard Module Regulation (Standard Module).

This is an application by John and Susan Keays, owners of lot 9 (applicants) against the body corporate for Manchester (body corporate) and Michael and Suzanne Hollis, the owners of lot 12 (respondents).

Decision

Applicable law

The legislation includes provisions to the effect that:

• An exclusive use by-law attaches to a lot and gives the occupier of the lot for the time being exclusive use to the rights and enjoyment of the specified area of common property (Act 170, 171);

• The common property to which an exclusive use by-law applies must be specifically identified in the by-law or allocated by a person authorised under the by-law to make the allocation or allocated by 2 or more lot owners under a reallocation agreement (Act, 171(1));

• If an exclusive use by-law authorises the allocation of common property the by-law may stop applying to the lot only if the lot owner agrees in writing before the allocation is revoked (if the by-law provides for the revocation of an allocation) or the passing of a resolution without dissent consenting to the recording of the new community management statement that does not incorporate the exclusive use by-law or in which the lot owner voted personally (Act, 171(3)(b));

• An authorised or agreed allocation has no effect unless details of the allocation are given to the body corporate (Act, 174); and

• Within 3 months, or a longer time stated in an order of an adjudicator under the dispute resolution provisions, after the taking effect of a further allocation, the body corporate must lodge a request to record a new community management statement showing all allocations currently in place when the body corporate consented to the recording of the new statement. If the body corporate fails to comply the further allocation ceases to have effect (Act, 176).

Despite judicial criticism^[1], the above provisions are largely unaltered since 1997, although some minor amendments were made and the provisions were renumbered in 2003.

Exclusive use by-law

Effective from 22 January 1999, by-law 13 for Manchester Unity Centre provided:

The proprietor for the time being of each lot in the building shall be entitled to the exclusive use for himself/herself and his/her licensees of the car space or spaces and storage space or spaces referred to in Schedule E and as set out on sketch marked "A" PROVIDED THAT in respect of those car spaces allocated pursuant to this By-law, the Council or the Body Corporate is hereby authorised to vary the allocations so made and to transpose car spaces from one lot to another lot at any time and from time to time on the written request of the proprietors of the lots involved. Each proprietor to whom exclusive use of a car space or spaces is given pursuant to this By-law shall use such space or spaces for the purpose of car parking only and shall not litter the same or so use the same as to create a nuisance but otherwise no such proprietor shall be responsible for the performance of the duty of the Body Corporate.

Schedule E identified that car parks "H", "U", "V" and "W" were allocated to Lot 12 and car parks "Y" and "Z" were allocated to lot 9. Effective from 4 August 2006, Schedule E was altered to provide for a reallocation of car parks "V" and "W" from lot 3 to lot 12. No other changes to car park allocations were shown.

Findings

The respondents purchased lot 12 from Manchester Unity Limited (original owner) by transfer dated 27 February 2002.

The applicants purchased lot 9 from Robert Hardie and others (Hardie) by transfer dated 30 June 2003. Hardie had purchased lot 9 from the original owner by transfer dated 30 May 2000.

Based on the submissions and documentation provided, it appears that:

1. Lot 8 was initially allocated car park I;

2. Lot 9 was initially allocated car parks Y and Z;

3. Lot 12 was initially allocated car parks H and U;

4. On 19 November 2001 Bowler Financial Pty Ltd signed a contract to purchase Lot 8 but with car park Y listed on this contract;

a) It may have been intended that lot 9 provide its car park Y be given to lot 8 in return for car park I.

b) It may have also been intended that lot 9 then give the car park I to lot 12 in return for car park U.

9. On 31 January 2002 Hollis signed a contract to purchase lot 12 with car parks H and U listed on this contract;

10. In June 2003 Keays purchased lot 9. No specific car parks were listed in this contract;

11. On 4 August 2006 a new community management statement was recorded;

12. Lot 8 is presently allocated car park I;

13. Lot 9 is presently allocated car parks Y and Z; and

14. Lot 12 is presently allocated car parks H, U, V and W.

The submissions suggest that occupiers of lots 8, 9 and 12 have in fact been using car parks Y, U and I respectively rather than the presently allocated I for lot 8, Y for lot 9 and U for lot 12. However, none of the owners of these lots appeared to be fully aware of the full details of a proposed reallocation. The owners of lot 8 have submitted that they thought there was a reallocation where unit 8 received space Y and unit 9 received space U. The owners of lot 9 submitted that U should be reallocated to lot 9 and Y should be reallocated to lot 12. The owners of lot 12 submitted that the practice of not using your own car park was commonplace within the body corporate and they were told to park in a spot other than there own by the prior body corporate manager as a matter of convenience. Further submissions were to the effect that they only did not insist on using their own car park to avoid making a fuss and Mr Woodgate told them this practice would not affect their right of ownership.

Inconsistencies

The documentation shows two inconsistencies in relation to the above car parks. Firstly, the contract to purchase lot 8 with car park Y listed instead of car park I. Secondly, there are two conflicting minutes of purported meetings dated 19 November 2001. One minute indicates that lot 9 gave car park Y to lot 12 in return for car park U with the other minute indicating that lot 9 gave car park Y to lot 8 in return for car park U.

It is obviously not possible for lot 9 to give car park Y to both lots 8 and 12. The most likely scenario is that, on 19 November 2001, the original owner agreed to sell Bowler Financial Pty Ltd car park Y with lot 8 even though lot 8 had originally been allocated car park I. To facilitate this, a minute of meeting was to be prepared to swap car parks I and Y between lots 9 and 8. But presumably the persons who owned lot 9 at the time did not want car park I and only agreed to swap car park Y in return for car park U. Lot 12 was still owned by the original owner and therefore a minute of meeting was to be prepared to do a further swap so that lot 12 was allocated car park I and lot 9 received car park U. The intention therefore appears to have been that Lot 8 would have car park Y, lot 9 have car park U, and lot 12 have car park I.

Failure to record any reallocation within the time limit

A request to record a new community management statement showing a reallocation of car parks should have been lodged within three months of the reallocation taking effect (Act, 176(1)). Failure to lodge this request to record the agreed allocation within the three months, or any longer time stated in the order of an adjudicator, results in the further allocation ceasing to have effect (Act, 176(2)).

The present application requests an extension of this time period to facilitate the registration of a new community management statement allowing car park U to be reallocated to unit 9 and car park Y to be reallocated to unit 12.

Not just and equitable to extend time limit

An adjudicator must make an order that is just and equitable in all the circumstances to resolve a dispute about the exercise of rights or powers under the Act (Act, 276).

The applicant has failed to provide good reason for an extension of this time limit. The period of extension sought is a number of years. The initial alleged agreement was poorly documented and is alleged to have occurred prior to both the present owners of lots 9 and 12 purchasing those lots.

The applicants submit that it is clear that details of the meetings on 19 November 2001 were drawn to the attention of the owner of lot 12. This is based on correspondence dated 28 February 2002 forwarded by the then body corporate secretary, John F. Falcke to the solicitor representing the owner of lot 12, Woodgate Hughes. It is also relevant to look at the practice of using car parks that appear to have been associated with the proposed reallocation rather than the allocation recorded in the community management statement.

However, the owners of lot 12 have provided a submission to the effect that the alleged notice of a three month prior resolution provided with body corporate documents in response to a Woodgate Hughes in February 2001 was not provided in the context of "notice" but was one of many documents provided pursuant to a property search. It is submitted that the document was not referenced in the contract of sale and for all intents this was only a disclosed document of a resolution improperly proposed and seconded by the owner of lot 9 for his own benefit and was superseded at the time of the purchase of lot 12. It is also submitted that the previous owner of lot 9 did not take appropriate steps to change the ownership of car park U based on the purported resolutions of 19 November 2001 and could not have succeeded in that without the consent of the owners of lot 12. Reference also made to the purchase contract for lot 12 that referenced car parks H and U in the property description and it is submitted that there is no evidence that the seller of lot 12 knowingly gave consent to the transfer of car park U.

I consider that there is some evidence that the original owner did intend to transfer car parks so that lot 8 would have car park Y, lot 9 have car park U, and lot 12 have car park I. However, the proposed transfer was not properly documented, was contradicted in the contract of sale for lot 12 that indicated car parks H and U were being sold with lot 12, and was not recorded within the three month time limit.

Further, the applicants have not adequately explained why they did not, when they purchased their lot, review the community management statement and take action to address any deficiencies or inconstancies prior to their purchase in 2003. If the applicants had checked the community management statement it would have been evident that lot 9 was allocated car parks Y and Z. It should also have been evident that any alleged transfer of car parks in November 2001 had not been recorded.

In these circumstances, I do not consider it just and equitable to provide the substantial extension in time period for the registration of the alleged further allocation that has been sought by the applicants. Rather, if owners wish to formally reallocate spaces at this late stage then it is a matter that owners will need to negotiate between themselves. If owners are able to negotiate any further allocations then those owners should ensure that the further allocations are recorded in a timely manner.

Order

For these reasons, the application is dismissed.

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^[1] Body Corporate for Edgewater Gardens v Sylvia Trankalis & Ors [2003] District Court (Brisbane), D4454 of 2000, McGill DCJ, 21 March 2003.