Wainui (1) [2007] QBCCMCmr 667 (30 November 2007)

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

Peter and Marta Krygger, Gordon Ramsay and Alan Davies the Owner(s) of lots 5, 8 and 6 respectively

I hereby order that the application for an order that the Body Corporate:

1. install a roof hatch based on the design set out in "E" at the cost of the Body Corporate to be paid for as a special levy; and

2. approve the installation of airconditioning by the applicants as set out in "F" in each applicant’s lot

is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0564-2007

"Wainui (1)" CTS 11019

Application

An application has been made by the Peter and Marta Krygger, Gordon Ramsay and Alan Davies the Owner(s) of lots 5, 8 and 6 respectively (the applicants) seeking the following orders of an adjudicator against the Body Corporate:

The Scheme

Wanui (1) is an 8 lot scheme registered under the Body Corporate and Community Management Act 1997 (the Act) and operating under the Body Corporate and Community Management (Standard Module) Regulation 1997(the Standard Module). It is registered in accordance with a building format plan.

Ownership and lot entitlements for the scheme are as follows:

Lot	Name	Entitlement	Position on application
1	Kenny	1	Interested Party
2	Doyle	1	Interested Party
3	Moloney	1	Interested Party
4	Philippides	1	Opposed
5	Krygger	1	Applicant
6	Davies	1	Applicant
7	Philippides	2	Opposed
8	Ramsay	2	Applicant
		10

The building is a 3 storey walk-up, with lots 7 and 8 being penthouse apartments.

Jurisdiction

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-

(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)).

The Motions

The relevant motions of the meeting of 30 March 2007 were worded as follows:

Air-conditioning has become a widely accepted amenity throughout the warmer parts of Australia and with world temperatures increasing is clearly the way of the future. It is often a required Feature today by tenants in high quality apartments that provides a more comfortable lifestyle during the hot humid periods and enhances rental attractiveness.

Over the last S years new inverter technologies have been introduced into air conditioning systems that have dramatically reduced external noise to a minimum level that cannot be heard more than 2--3 meters away. These new low noise levels have been incorporated into the Australian Standards regulations now used by local authorities including the Noosa Shire Council and which apply throughout the life of the air-conditioning installation.

Extensive investigations have been conducted into how air conditioning can best be fitted at Wainui should any owners wish to proceed. Expert advice has been sought from air-conditioning, noise, and electrical consultants. The recommended installation method for optimum efficiency, building appearance, low noise, and enhanced property value incorporates split-systems with the external condensers mounted on the roof common area. This method is widely used in high quality apartment buildings throughout Queensland. These consultants have also advised that although out-of-date, the electrical supply system of Wainui will not require further upgrading until at least 4 apartments install air-conditioning.

The installation of air-conditioning will be optional and all associated costs will be paid by those owners who opt to proceed. It is proposed that the Body Corporate have an overall air-conditioning policy that standardises the quality and installation method to ensure the building value and lifestyle of all apartment tenants are maintained.

Your support is sought to allow owners the option of installing air-conditioning in accordance with the strict installation guidelines recommended and developed by the consultants commissioned by consultants commissioned by the Body Corporate.

THAT Body Corporate acknowledge a report entitled "Investigation into Air Conditioning’ circulated with this motion; and

(c) a non-structural change, including, for example, the installation of air-conditioning; and

(1) The body corporate may, if asked by the owner of a lot, authorize the owner to make an improvement to the common property for the benefit of the owner’s lot.

(2) The improvement must he authorized by special resolution of the body corporate unless--

(a) the improvement is a minor improvement (Le. has an installed value of under $250); and

(b) the improvement does not detract from the appearance of any lot included in, or common properly for, the scheme; and

(c) the body corporate is satisfied that use and enjoyment of the authorized improvement is not likely to promote a breach of the owner’s duties as an occupier.

(3) An authorization may be given under this section on conditions the body corporate considers appropriate.

(b) must maintain the improvement made under the authority in good condition, unless excused by the body corporate ; and

AGREE that lot owners shall be permitted to install air-conditioning systems to their lots in accordance with the following recommendations of Committee:

1. That air-conditioning systems shall not be fixed to the building façade or located in garage spaces.

2. That air-conditioning systems shall be located on rooftop Common Property in locations identified on plan number 11019/001 circulated with this motion.

3. That any air-conditioning component mounted on the roof shall be fitted with pads or supports that will not damage the roof membrane and that lot owners shall be responsible for the cost of rectification of any damage caused to the roof membrane as a result of their air conditioning system.

4. That air-conditioning systems shall be low noise and low vibration Inverter type systems.

5. That air-conditioning installations conform to "Prohibited Times and Noise Criteria" outlined in Schedule 1 of Noosa Council Subordinate Local Law 12 - Control of Nuisances (circulated with this motion) and that in the event of a continued breach of these criteria Committee be authorized to engage an Acoustic Consultant to monitor noise levels and report their findings to Council.

6. That lot owners make provision for water drainage from air-conditioning units to suitable drains, approved by Committee, and that lot owners be responsible for maintenance of the drainage reticulation to their air conditioning.

7. That lot owners maintain their air-conditioning units in good condition; and

THAT lot owners shall obtain prior permission in writing of the Committee for the installation of air-conditioning systems but such permission shall not be unreasonably withheld and that lot owners shall supply information on type of system proposed, noise and vibration levels and shall confirm with Committee the roof top location of any external condensers and drainage pipes.

(1) Common property for a community titles scheme includes all utility infrastructure forming part of scheme land, except utility infrastructure--

(h) within the boundaries of the lot (according to the way the boundaries of the lot are defined in the plan of subdivision under which the lot is created); and

ACKNOWLEDGE that conduits for electrical cabling and pipe work to air-conditioning systems will require surface mounting to the building façade to ensure the best possible aesthetics for the exterior of the building; and

AGREE that Body Corporate provides wall-colour box cladding (Colourbond or similar) as utility infrastructure and that payment be made from the Sinking Fund as required to meet installation requirements of lot owners.

THAT Body Corporate acknowledge a report entitled "Power Supply System Investigation" prepared by RPG Consulting Engineers circulated with this motion, and

THAT no upgrading of the building main electrical supply system will be required unless a minimum of 4 lot owners install air-conditioning; and

AGREE that the installation of air-conditioning by a 4^th lot owner shall be the trigger for upgrading the building main power supply as per the following:

1. That upgrading the building main supply to a 150A rating is paid for in full by those 4 lot owners who have installed air-conditioning (estimated cost $10,000 at 2007 prices).

2. That due to the age and limitations of the current main switchboard the Body Corporate will upgrade the main switchboard panel with such cost being paid from the Sinking Fund or by way of a Special Levy (estimated cost $7,500 at 2007 prices); and

AGREE that any upgrading of existing cabling from the main switchboard to any individual unit lot for the purposes of installing air-conditioning in that unit will be paid by that lot owner.

THAT Body Corporate acknowledge that existing utility infrastructure including exhaust fans television aerials and distribution boxes are located on the rooftop Common Property ; and

FURTHER acknowledge that access to rooftop Common Property is currently only possible from the balconies of Lots 7 and 8; and

THAT Body Corporate authorizes Committee to engage a professional structural engineer to:

1. Assess the practicality of providing rooftop access from a hatch located in the ceiling of common property located between Lots 7 and 8.

UPON satisfactory completion of the design and quotation stage an amount not exceeding $2,250.00 (incl GST) be paid from the proceeds of a special levy (refer Motion 7); and

FURTHER authorize Committee to engage the engineer to liaise with the contractor during construction, periodically inspect the works as needed, give direction the contractor and review and approve progress claims; and

AUTHORISE Committee to make payment for the services of the engineer from the proceeds of a special levy (refer Motion 7) for an amount not to exceed $750.00 (incl GST).

THAT subject to Motion 5 being resolved in the affirmative Body Corporate authorize Committee to select a preferred contractor for the construction of the roof access hatch and arrange a contract for the works; and

UPON satisfactory completion of the works an amount not exceeding $6,500.00 be paid from the proceeds of a special levy (refer Motion 7).

THAT subject to Motion 5 being resolved in the affirmative Body Corporate acknowledge Section 95(2) of the Body Corporate and Community Management Act (Standard Module) 1997 Regulation which provides follows:

95(2) [Special Contributions] If a liability arises for which no provision, inadequate provision, has been made in the budget, the Body Corporate must, ordinary resolution -

(a) fix a special contribution to be levied on the owner of each lot towards the liability; and

(b) decide whether the contribution is to be paid in a single amount or instalments and, if in instalments, the number of instalments, and

TO FIX A SPECIAL LEVY contribution of $9,500.00 for the purposes of construction of the roof access hatch as per the following estimated costs (incl GST);

	$
Engineering Design	2,250.00
Administration of Construction	750.00
Construction of Access Hatch	6,500.00

Total Project Cost	9,500.00

TO BE levied on the owner of each lot according to the Schedule following: and

THAT the Special Levy Contribution is due and payable in one instalment on 23 April 2007:

	Total Payment
	$
Total Contribution Requirement	9,500.00
Contribution requirement per Lot entitlement	950.00

*Ent*	*Lot Nos*	*Total ($)*	*Instalment ($)*
1	1-6	5,700.00	950.00
2	7-8	3,800.00	1,900.00

Motion	Result	Yes votes	No votes
2	Defeated	5	3
3	Withdrawn
4	Withdrawn
5	Defeated	5	3
6	Withdrawn
7	Withdrawn

The applicants say, that with the benefit of Lot 2’s letter indicating the owner wants "what is best", the only lot owners who object to the application are the owners of lots 4 and 7. Both of these lots are owned or controlled my Mrs Philippides who controls 30% of the lot entitlements.

They say that the investigation phase of the air-conditioning proposal involved commissioning airconditioning and electrical consultants and discussions with acoustic consultants. They say that they made this information available to all lot owners, offered to take Mrs Philippides to other buildings in Noosa and offered to drive to Brisbane to show her a video of consultation with the air-conditioning company. They say Mrs Philippides declined all these offers and they do not know why she voted against the motions.

They say that air-conditioning is necessary in the Sunshine Coast climate because of the heat and humidity, increasing acceptance/expectations in the community, ability to rent and comfort. They say a lack of air-conditioning discourages southern visitors in the summer and Queensland visitors in the winter.

They say the air-conditioning consultants say that split systems are the best option for the scheme. They note that old style window air-conditioners tended to be noisy and aesthetically unattractive. They say the new inverter systems are compact and quiet and can be hidden even though the compressors are much more attractive.

They say that connecting the two components of the split systems will require piping to be run externally. This piping will need to be boxed and painted the same predominant colour as the outside of the building.

They note there are 4 possible locations for the compressors – garages, external walls, balconies or roof.

In relation to the garages, they suggest that the lack of ventilation and heat will require the installation of additional cooling fans and consequently increase the complication and cost of the installation.

They suggest that mounting the compressors on the external walls is visibly unattractive, given that there would be three or four compressors required per lot. They say this would have an impact on sale value of lots.

In considering the balconies, the applicants say that as the balconies face the sea, they are an important lifestyle feature and that some of the balconies are too small to allow air flow or allow the fitting of a compressor. They say installation on balconies would detract from the attractiveness of view, interfere with the usability of balconies and present a climbing hazard with children.

Thee suggest that roof mounted compressors are common in Noosa and the Sunshine Coast and would not be able to be seen from the street in this scheme. They say that piping can be laid so as to not interfere with daily usage of the common property.

They say that the compressors these days are quiet and the only lots that could possibly be affected are 7 and 8.

They say that specifications for modern split systems are 47 decibels when cooling and 48 when heating. They observe normal conversation is 40-60 decibels and a television is approximately 60. They therefore suggest the compressors will not be heard.

They say that as the units are 2 minutes from a surf beach, the noise from the waves raises the ambient background noise to higher than normal suburban levels. They advise they will comply with the Noosa Shire Council nuisance laws and use their best endeavours to ensure that the systems continue to comply with Council requirements.

They say that for noise reasons, the "expert consultant" advice is to mount the compressors on the roof even though this is not the cheapest solution. They say that the proposal is assisted by the passing of a Body Corporate protocol that requires the use of low noise inverter technology and an installation method that is consistent with normal practices.

They say the compressors will be installed so that the roof membrane is not damaged, but if damaged, the lot owner must meet the costs of repairs.

In relation to the roof hatch, they point out it would be common property. They say that there are already fans, TV antennas and distributor boxes on the roof and that from time to time access to the roof is required. However presently the only way to the roof is through lots 7 or 8, and there is no permanent external access.

Apparently during the investigation phase, access to the roof was inadvertently arranged by giving the consultants the keys to one of Mrs Philippides’ lots without specific consent. They say Mrs Philippides has now withdrawn her permission to access the roof through her lot and lot 8 is a holiday rental, making access through that lot problematic.

They say there is sufficient space in the foyer for Lots 7 and 8 to install a hatch through the foyer ceiling. This would make installation and future maintenance easier. They say there is no harm to Lots 7 or 8 and the hatch can be locked for security purposes. They say the costs associated with the hatch are minimal and was an initial design error.

They say the hatch is necessary to provide safe and easy access to common property.

In addition to the Voting Papers Schedule and the Minutes of the meeting, the applicants have provided:

The document goes on to outline Section 114 of the Standard Module and further examine the decision in Warwick Tower and another in "Karri Court" CTS 13439^[2]. The quotes taken from both these decisions emphasise the need for the Body Corporate as a whole to give proper consideration to an air-conditioning proposal, the mover to provide full information in relation to noise and enjoyment within the scheme and a perceived growing need for/acceptance of air-conditioning within the community

Finally, the document goes on to recommend that Daikin inverter systems are acoustically superior and that the compressors should be installed on the roof (rather than in garages or balconies);

As noted earlier, within the original application, the applications have arranged for supporting letters from Lots 1, 2 and 3.

Lot 1 made an additional submission. He points out that he did not join the application as he has no immediate desire to install air-conditioning but reserves his right to do so. He says that the engagement of consultants and choice of location of the compressors was considered to be very important, given the objections currently being raised.

He notes that a motion was included, that once a fourth system was installed then the power would need to be upgraded. He notes the importance of motion 4 in relation to the requirement that the owners of the 4 lots with air-conditioning would need to pay for the power supply upgrade. From this I understand that his continuing support for the application is conditional on the passing of motion 4.

Through their lawyers, the Philippides made a number of submissions, including some that were late. On the condition the applicants were given the opportunity to respond to these late submissions, I determined to consider them.

In relation to accessing the rooftop through their lot, the Philippides say they neither lots 7 or 8 have ever objected to access being legitimately gained through their lots for maintenance purposes and they have no intention of objecting in the future.

The Philippides make reference to the adjudicator’s power under Section 271(3) of the Act to make orders including that at Item 17 Schedule 5 which reads as follows:

They say that the crucial aspect of this is that the opposition to the resolution must be unreasonable for the adjudicator to interfere.

They address the meaning of unreasonable by referring to a decision of the Land and Environment Court of New South Wales (See Dubler Group Pty Ltd v Ku-Ring-Gal Municipal Council [NSWLC 305 at para 47 where they considered the following meanings:

However, they suggest reasonableness does not come into play until the legality of the resolutions is established.

In this regard they refer to Section 180 of the Act and allege that the motions may be void as they are inconsistent with the Act. They refer to Section 104 of the Standard Module in relation to motions with alternatives where the cost exceeds the relevant limit of $2,000. They note that for motions 3, 4, 5, and 6, Body Corporate expenses in excess of $2,000 are proposed. However they say the proposals have failed to provide 2 quotes in terms of Section 104(6) or provide reasons as to why only one quote (or no quote) is offered. Further, without the second quote, the motions have not been proposed in accordance with Section 104(7). They say they should have been ruled out of order.

They say that even if resolution 2 was valid (which is denied) the adjudicator should order that the motions are void.

They say the installation of 13 compressors is more than a minor improvement to common property and that an extensive upgrade to the electrical system is required with all up costs approaching $40,000. They say that the compressors will significantly detract from the appearance of common property. They say the improvements pose a risk to security of lots 7 and 8, to the integrity of the membrane and the right of the Philippides to quiet enjoyment of their lot. They say the noise and vibration will lead to a breach of the nuisance provisions of section 167 of the Act. They also seek to isolate the hatch motion, by saying that the undertaking to maintain the units will be breached as they cannot presume they will be given access to the roof through lots 7 and 8.

The submission also raises the issue of exclusive use of the common property. They say that placement of the units excludes use of the areas by others. They therefore argue that the requirements of Section 171 of the Act must be met and that the lot owners consent and a resolution without dissent for exclusive use by-laws are required.

They also point out that motion 2 purports to give the committee discretion in relation to matters beyond their authority.

They refer to the fact that the proposals impose the cost of the improvements on all owners, even though only some are the immediate beneficiaries. They cite the matter of 84 The Spit^[6] where Adjudicator Young observed that while the Body Corporate has a specific power to make improvements to the common property, this "must be read in conjunction with its general duty in respect of owners". In this matter involving the installation of automatic openers to some, but not all garage doors, Adjudicator Young expressed the view that each improvement did not benefit all owners and should have been subject to individual application by owners.

They say that the costs of infrastructure required to support the air-conditioners should not be born by other owners who do not want, and may not be able to afford air-conditioning.

The Philippides then discuss reasonableness in the alternative. They provide background information that the problem of fitting air-conditioning to older buildings is becoming common place. They point out that the installation of domestic air-conditioning has nearly doubled to 58% from 2000 to 2005 and is expected to reach two-thirds by 2010.

They re-emphasize the premise that a CTS is meant to operate by majority vote for the benefit of all owners.^[7] They therefore reason that exercise of a vote must be well considered in that context.

They say that the Philippides use the lot as a weekend retreat and sometimes for weeks at a time. They say it receives cooling sea breezes and they deem these fresh enough to not require air-conditioning. They eat on the balconies and leave windows and doors open all day and night. They say they are therefore vulnerable to the noise of the units, whereas those operating units would have their doors and windows closed at the time.

They agree however that the applicants are entitled to install air-conditioning and that a split system is not a contentious issue. They agree that not putting the compressors in garages is also not a contentious issue.

They however object to the rooftop location because 13 condensers near their sleeping areas will be noisy and cause vibration. They are concerned for the integrity of the roof membrane. They regard the hatch as a security risk. It is commonplace to locate compressors on external walls or balconies. They say they should not have noise and vibration imposed upon them when there are such commonplace alternatives. They say how often they are there is irrelevant. They say the condensers will be visibly offensive no matter where they are installed. They say both safety and visual concerns can be cheaply and easily overcome using screening.

They say the applicants are demonstrating a "not in my backyard" attitude in that they don’t want the noise on their own balconies but are willing to inflict it on the penthouse lots. They say if the compressors were on their own lots, then whenever they were operating they would necessarily be inside with their doors closed and blocking the noise. They quote from the matter of Grande Corniche CTS 16288^[8] as follows:

Sounds	dB SPL
Rocket Launching	180
Jet Engine	140
Thunderclap, Air Raid Siren 1 Meter	130
Jet takeoff (200 ft)	120
Rock Concert, Discotheque	110
Firecrackers, Subway Train	100
Heavy Truck (15 Meter), City Traffic	90
Alarm Clock (1 Meter), Hair Dryer	80
Noisy Restaurant, Business Office	70
Air Conditioning Unit, Conversational Speech	60
Light Traffic (50 Meter), Average Home	50
Living Room, Quiet Office	40
Library, Soft Whisper (5 Meter)	30
Broadcasting Studio, Rustling Leaves	20
Hearing Threshold	0

They say if it is good enough for the compressors to be on the rooftop, it is good enough for them to be on the balconies.

They argue that 50 dB is the measure from one compressor and suggest that if 13 are operating it could move into the area of an alarm clock, hair dryer or even a truck. They do not quote the source of this argument.

They refer to the matter of Windsong Terraces CTS 17963^[10] where the adjudicator indicates that a right to install air-conditioning is "always conditional on the installation not causing a nuisance to others, whether by noise or vibration, or that it will markedly detract from the external appearance and presentation of the scheme". And in Yeronga Lodge CTS 12026^[11] the adjudicator said "The importance of a lot owner being able to have quiet enjoyment of her own home may therefore outweigh the convenience of air-conditioning".

They suggest that visually the compressors would not be hidden as the building is at the base of a hill and therefore the roof is visible to those higher up the hill. They go on to refer to a number of extracts from Grande Corniche CTS 16288 (supra), most of which refer to the specifics of that scheme. However, I note the following extract in particular:

They go on to argue that in this day and age, air-conditioners "are a common sight on building balconies"^[12]

They therefore say that it is obvious that lot owners expect air-conditioning will become part of the landscape in the future.

They go on to state that if compressors are to be located on balconies, it is up to the owners to take appropriate steps to ensure compliance with building safety guidelines so there is no risk to small children. In support of this they again cite Grande Corniche (Supra).

They express the view that a number of lot owners are clearly ambivalent about the installation of the air-conditioning. They suggest the owner of Lot 2 only changed her mind under pressure.

They observe that the roof membrane is some 10 years old and that the hatch will require it to be cut and the compressors will require bolts to be screwed through. They say the membrane is already fragile from weathering. They say that it is lots 7 and 8 that would bear the brunt of any damage to the membrane and therefore those lots stand to lose the most. They suggest that undertakings to fix the membrane will only be precipitated once damage has occurred.

They say the hatch is a security risk for the Philippides who are elderly and live alone. They quote National Police Statistics in relation to unlawful entry with intent in 1998. They say the hatch is in the main stairwell and that people could simply follow others into the building for access. They say there is only a small amount of resident traffic on the top level and that an intruder could easily jump off the roof onto various balconies with access through the hatch.

They say accessing the hatch would require a step ladder to be placed on the landing outside Lots 7 and 8 and this would lead to frequent obstruction of the foyer during maintenance.

In the later submissions, the Philippides supplied pictures and a video to show the incidence of balcony mounted condensers in the area, along with wall mounted units for units facing the scheme.

Despite some of the Philippides’ submissions being made after the due date, I accepted them and gave the applicants the opportunity to respond.

The applicant observes that Section 180(1) of the Act does not apply to the motions as the motions are not creating by-laws.

In relation to Section 104 of the Act, they say that the only work being done by the Body Corporate is the roof hatch and that Motions 5, 6 and 7 clearly contemplate securing two quotes for selection of a contractor. They say motions with alternatives could not be put forward when the quotes had not yet been received. They say the motions could not have been ruled out of order because these challenges were not raised at the meeting.

In relation to the nature of the resolutions required and whether a grant of exclusive use was necessary, they say that many cases have already recognised that the legislators made the two different types of resolutions, with awareness of the occupation of common property where an improvement is made. They cite a total of 10 cases on this point and note they view these as just a sample^[13].

In relation to the precedents provided by the Philippides on what is "unreasonable" they observe jurisdictional differences and interpretation of reasonable as opposed to unreasonable. They observe there is no public interest test in a small scheme and is only a matter of the effect of the decision on others. They say reasonable should be determined in the relevant context. They observe that an adjudicator’s powers to make an order are not limited by Schedule 5 of the Act. They say Body Corporate policy should consider the interests of all owners, not just one.

The applicants argue that it is not the motions that are the subject of the application but rather they are seeking orders that the air-conditioning and roof hatch can be installed. I gather they therefore are suggesting that any objection to the wording of the motions is outside the scope of the application and the Philippides should not now seek to rely on a technicality of form.

They observe that adjudicators have previously said "It has been the practice of the courts not to void meetings on the grounds of minor irregularities in procedures, provided that persons entitled to participate in the meeting have not been disadvantaged."^[14]

They argue that while the motions may not be particularly well drafted, the members were aware of both the purpose and effect. They say there had previously been a consultative process so the motions were not a surprise and no-one was misled.

They say that if the adjudicator rules the motions as being technically insufficient, it will simply delay the same problem until the next general meeting at the expense and inconvenience of the Body Corporate. They say the "Commissioner" should take a "holistic, practical and pragmatic view".

They say they agree it is unreasonable for all owners to bear the cost of air-conditioning if they are not installing air-conditioning. But they say the roof hatch is of benefit to all owners.

In relation to damage to the membrane, they say the method of installation proposed ensures that the roof membrane is not penetrated. They have commissioned a report (supplied) by Stephen Waite Consulting (Engineer) who recommends a number of procedures to protect the membrane. These include bolting by rubber anti-vibration mounts to a 100mm concrete plinth which will accommodate all future installations also. The plinth is affixed by its own weight and will be coated with a roof membrane coating. Water drainage from compressors is directed to the nearest roof outlet. They restate the responsibility of those installing for any damage to the membrane.

They point out that while the roof hatch will necessarily damage the membrane, the membrane is already penetrated from items such as ventilation fans and skylights. They say the risk can be completely mitigated by proper installation. They say in the remote chance of a leak, it would penetrate the foyer, not the lots.

They say that the proposed installation will have no effect of the Philippides in terms of nuisance either now or in the future. They have commissioned a report (supplied) by TTM Consulting, an engineering company with experience and expertise in acoustics and vibrations. This report concludes that provided several recommendations are complied with, the compressors will not cause any noise or vibration to Lot 7. They make observations in relation to ambient noise levels, council requirements, the need for a noise barrier for two sets of compressors (not in the original proposal), ways to reduce existing fan noise to lot 7 and say that wall mounted or balcony compressors are less desirable as they would not meet council noise requirements.

They say that even on a worse case scenario basis, the Philippides will not be affected provided the fan/skylight work is carried out and the barriers are erected.

They say the proposal has now been amended to accommodate these recommendations. However, they say that as a first step they will install the condensers and then do tests to determine whether or not the fans/skylights will need modification or the barriers to be installed.

They say there is no proposal to install a bank of 13 compressors and that the largest bank of compressors is 4.

They also refer to the decision in Grande Corniche (Supra) and say the adjudicator indicated he was not convinced that "it is reasonable to refuse the Applicant’s request for approval for air conditioning simply on the basis that other owners may wish to install air conditioning in the future".

They say mounting the compressors on the rear wall is impractical because there is insufficient space, it would require additional piping, difficult maintenance and would be highly visible from the swimming pool area. They observe the consultants also say wall mounting would not meet the noise requirements.

They say placing compressors on balconies within the scheme would be unsightly as all balconies face the street. They also say that because the balconies are not large the compressors would need to be near the edge and therefore present a danger to children, even if risk is slightly mitigated by barriers. They say some balconies are so small it is impractical to place compressors on them.

They say roof mounting is much more attractive and commissioned a report (supplied) by Bramex Pty Ltd (consulting engineers) for this purpose. They include photos of boxes on the roof to represent the compressors and observe that with one exception, there will be no visual impact from the street. They say the roof is already unattractive and it is not pivotal to be concerned with the view for residences further up the hill.

They say the Philippides are being capricious and that the applicants have taken a reasoned well researched approach.

They note that the scheme has recently installed digital entry codes and special security combination deadlocks and they have difficulties with the Philippides concern with security. They say the hatch will normally be locked. They say that if a stranger is seen carrying a step ladder in the stairwell, it should arose suspicion. They say they are in more danger from the trees around the scheme.

They made some effort to discount the age of the statistics provided by the Philippides. They say they are more secure with access being from outside Lots 7 & 8. They say that they have had trouble gaining access through Lot 7. They say the hatch will not block access to Lot 7 as access will be infrequent.

They say the issue of upgrading to the power system does not need to be determined in this application and therefore the proviso placed on support by the owner of Lot 1 should not come into play. They say that once a fourth owner wishes to install air-conditioning, the practicalities of allocating the infrastructure cost will then come into play. They say the applicants are prepared to present a resolution to the next AGM to ensure an active resolution remains in force that air-conditioning costs will be shared by those owners proceeding with installation.

The Philippides observe in relation to the TTM report, the consultant has not obtained an ambient background noise reading from the roof. They say that despite statements by the applicants, the noise emitted by the compressors will be between 65 and 68dB(A), rather than up to 50dB(A) and therefore will exceed the EPA and Noosa noise level criteria. They say that to have any hope of complying with these criteria, it would be necessary to construct a 1m high acoustic barrier around the entire roof area. They say this would be expensive.

They say at least some of the compressors could be located on balconies. They say the southern and northern walls would be too noisy for adjacent buildings. They say the western wall has problems associated with the location of bedrooms. They describe the work that would need to be done to the fans/skylights and say maybe the work should be paid for by the Body Corporate. They say acoustic results will only be known after installation, and then tests would need to be done.

They say the acoustic readings taken by TTM are not representative because they were taken at ground level. I quote the following statement:

They say erection of a sound barrier does not guarantee success and may not even achieve council approval. They say that buildings behind the scheme could well object to the barrier and that this could lead to further legal expenses while this issue is battled.

They say that it does not make sense to say compressors cannot be located on particular walls because of the impact on next door, when next door has compressors installed on their walls. They say balcony mounted compressors are "the norm" and based on TTM’s report, must also breach noise laws.

They say that locating the compressors on the rooftop may increase costs for future owners wishing to install air-conditioning.

They say the TTM report does not address the issue of vibration, which is one of the Philippides’ pivotal concerns.

They also say that the TTM report does not address compare Sound Pressure (dB) to perceived loudness. They say that if 2 sounds with equal levels are combined, the resulting sound level is about 3 decibels higher. They say that ten similar sound sources are perceived to be twice as loud as a single source.

They also argue that due to this increase in combined noise, the distance over which the compressors would need to be placed away also increases.

It appears the above assertions are based on material the author or Philippides have located on the internet.

The applicant observes that they feel the late submission is largely a repeat of previous submissions, except that it also contains an attack on the consultants with no qualifications of expertise to back them.

They express their frustration that the Philippides continue to disparage expert reports without their own expert evidence. The applicant commissioned a response by TTM to the late submission by the Philippides.

In summary they observe that the higher the background noise, the easier it is to comply with council requirements. Therefore measuring noise at ground level was conservative. They used standard industry practice testing techniques and worst case scenarios.

The applicant protests the fact that, as adjudicator, I gave "permission" to the Philippides to respond to the reports. I must first observe it is unknown to this office how it is that the Philippides came to have a copy of the TTM report. No permission to make a late submission was given, however late submissions were received.
It is within the discretion of an adjudicator to accept late input in the interests of natural justice. As this matter appears to be so fiercely contested, I determined that the probability of finally resolving this matter might be better assisted by accepting the material and allowing the applicant a right of reply.

Determination

The motions

The applicant argues that the only decision asked of the adjudicator is to determine that air-conditioning can be installed on the roof and that the hatch can be installed. I do not consider that the making of an order on such simplistic terms is necessarily in the best interests of the Body Corporate as the form of the resolutions are fundamental as to how the Body Corporate must go about implementing the "central" order.

The most significant concern I have in relation to this application is resolution 4. My concerns relate to a number of aspects:

I find it problematic that the Body Corporate is seeking to bind the owners of lots to pay for the upgrade to the mains supply, when there is no way to know:

Any attempt by the Body Corporate to try and enforce a resolution of this nature against later owners is extremely vulnerable to challenge. It is a fact of life that no matter where the compressors are installed (be it the garages, walls, balconies or roof) the mains supply, switchboard and supply to relevant units will still need to be upgraded once a critical mass is reached. Secondly, as both the applicant and the respondent acknowledge, air-conditioning is becoming common place and as time goes by the chances increase that air-conditioning will evolve from a luxury to a necessary.

The Philippides’ make reference to a decision by Adjudicator Young in 84 The Spit in 2001. This decision revolved around improvements to garage doors rather than utility infrastructure. They argue that this case indicates that the improvements should not go ahead on the basis that not all owners stood to benefit. However, a case more on point is that of Lin & Anor v The Owners – Strata Plan No. 50276^[15] which was decided in the New South Wales Supreme Court in 2004. That matter involved a decision by a Body Corporate to refuse a lot owner access to an exhaust ventilation system on the basis that it was overloaded. In relation to that refusal Gzell J said:

For those reasons, I find the resolution to attempt to quarantine the cost of infrastructure to the first of the owners to be too unstable to allow to stand. In that case, the cost of upgrading the electrical infrastructure to meet the needs of lot owners is likely to need to be met by all lot owners and would require the sourcing of two quotes for consideration in general meeting.

It should also be born in mind that each of the components of this proposal is captured as the one project, and therefore each proposal is taken to be more than the "relevant limit".^[16] The $750 to be paid to the engineer to supervise the project is therefore also captured by Section 104 of the Standard Module.

The other concern I have with this resolution relates to quotes for cabling from the switchboard to the lots and the switchboard. I have similar concerns in relation to the cost of box-cladding for the cabling, designing the roof hatch and construction of the roof hatch. In my view, each of these services is designed to service multiple lots or will be located within boundary structures and form part of the overall project.

Expenditure in excess of $250 per lot requires that the matter be put to the Body Corporate in general meeting by way of a motion with alternatives^[17]. There is provision for the committee to carry out a proposal above the committee spending limit where they are given specific authorization^[18]. With the possible exception of the motion 5, I am not persuaded that the authorization given in these resolutions is sufficiently specific to overcome the requirements of Section 104 of the Standard Module.

When expenditure is referred to a general meeting on the basis of two quotes, the contract chosen will not always necessarily be chosen on price. Reputation, guarantees, inclusions and the like can all be of significance to those voting. Therefore, the parameters of any delegation to the committee must be very specific to be effective.

In some ways, the resolutions proposed at the meeting are so broad they almost amount to a strategic plan. Deficiencies in the approach taken include:

The also appears that there are changed installation parameters for vibration reduction and membrane protection.

I am mindful of the submission made by the owner of lot 1 and the importance he placed on the standing of motion 4. While I have indicated that I am of the view that motion 4 cannot stand, it does concern me that a reliance on that understanding may have been crucial to the position adopted by him and others when voting. It may also be influential in relation to the letters of support supplied with the application, including Lot 2.

The applicant has pointed out that minor irregularities in procedure should not be void a resolution, provided that persons entitled to participate in the meeting have not been disadvantaged. I do not regard the irregularities I have identified in relation to responsibility for particular expenses or the acceptance of quotes as minor irregularities. This is particularly so where lot owners expectations in relation to the sharing of costs in the future is flawed.

The proposal

I will make some other observations in relation to the matter before me. The issue of whether or not an improvement to common property that is affixed requires exclusive use approval was addressed in a series of applications in relation to Sailfish Point CTS 20973 in June 2006.^[22] In those matters Adjudicator Toohey discussed previous decisions in relation to improvements to common property and concluded that, even where an improvement is to be affixed to the common property, only a special resolution is required.

Given the extent of argument put forward by the Philippides in relation to alternate placement of the compressors and their apparent acceptance of air-conditioning in principle, the question going to reasonableness in this matter is about location, not air-conditioning in itself.

Many of the case extracts put forward by the Philippides are specific to the facts applicable to each of the matters under consideration and in some aspects the point they seek to make can be muddied. I accept that the appearance of compressors on walls and balconies is become more commonplace. I do not accept that the view of the roof from properties higher up the hill is a valid objection for residents of the scheme, unless as suggested, the noise barrier proposed causes planning objections. That would be a matter for council to determine.

To my way of thinking aesthetically, placing the compressors on the roof is a far more appealing approach than balconies or walls. All parties agree garages would be inappropriate. It also appears that on an initial basis, most lot owners have already determined to accept the increased cost of cabling their compressor to their lot from the roof.

I consider that the Philippides’ objections should not be assessed on the basis of whether there are alternate locations but rather whether the Philippides’ objection to the roof location is unreasonable in light of:

In the matter of Ocean Plaza Apartments CTS 5879^[23], Specialist Adjudicator Carrigan discusses the meaning of unreasonable in the context of item 10 in Schedule 5 of the Act. He concluded:

While the Philippides decision not to accept the invitation to be further briefed on the proposal may be indicative of a pre-conceived mindset, the test outlined above makes this state of mind irrelevant. I also take this opportunity to observe that the frequency with which the Philippides are in residence is also irrelevant.

Adjudicator Toohey further considered the issue of reasonableness in the matter of Zenith CTS 10343.^[24] In that matter he observed:

In relation to noise, I have to say that the Philippides approach to countering the opinions of both AirRite and TTM has been very weak indeed. Further, they offer no rationale as to why the parameters required by Council are inadequate. It is simply not compelling argument to refer the adjudicator to some web pages. I will refrain from detailing all the aspects in which they have failed to convince me, however their current approach is a long way from demonstrating to me that they will suffer any real detriment in relation to noise.

Again in this matter, the applicant has engaged an expert (Stephen Waite) to address the issue of vibration. However again, the Philippides have not taken any steps to counter this opinion with any expert assessment of their own. I acknowledge that it may be they are not in possession of this report, given that it was supplied to this office as part of a response to submissions. It is worth noting that the Philippides’ objection has resulted in further recommendations in relation to noise and vibration abatement however the Philippides have not offered me a compelling reason to doubt the efficacy of the abatement strategies expressed by the experts.

I sympathise with the Philippides’ concern in relation to membrane damage. They, along with Lot 8, stand to be the first to suffer if the membrane is damaged. However again they have failed to demonstrate to me why the installation method proposed for the compressors is inadequate to address this risk of detriment suffered through damage to the membrane.

In relation to the hatch, it is quite apparent that the Philippides already have areas of disturbed membrane over their lot where the skylight/fan openings are. To argue that another opening which is not even over their lot poses a more sinister risk is not persuasive. This is particularly so when one of the applicants is the other owner of one of the penthouses.

The next objection to the hatch appears to relate to security intrusions. I have some difficulty conceiving how the presence of the hatch will increase the risk of a home invasion. As pointed out, in holiday accommodation there is a higher risk that occupants will allow unauthorized parties to pass through the front door. That there is a hatch in the roof has no influence on this point and break-ins through the front door of each lot remain a constant risk. I also find it difficult to see that making one’s way down from the roof to a balcony is any less daunting to a would be felon than scaling a tree. The Philippides have not demonstrated to me that their concerns in this regard are substantive.

Arguments that the presence of a step ladder in the foyer of the top level will present an unreasonable obstruction/nuisance also strike me as an attempt to clutch at straws.

Conclusion

While the Philippides have not offered me convincing grounds that their objections to the rooftop placement have a reasonable basis, I am of the view that dissent to the motions as proposed can reasonably be based on opposition to their validity.

I agree with the assertion that the form of orders that an adjudicator can make is not limited to those matters identified in Schedule 5. This intention is clearly stated in Section 276(3) where the Act states that Schedule 5 does not limit the orders that may be made under Section 276(1) and (2).

On that basis then if I consider the Philippides dissent to the location to be unreasonable, it is open to me to make the orders sought by the applicants and attach any conditions or logistical parameters as I see fit in order to address the deficiencies in the motions. However, given other misunderstandings that have come to light in the course of this determination, the basis of the decisions made by other lot owners must also be considered.

One of the objectives of the Body Corporate and Community Management Act 1997 is, as an inherent aspect of community titles schemes, to balance the rights of individuals with the responsibility for self management^[26]. It is therefore just and equitable that I give proper regard to the right of owners to cast their vote on a fully informed basis. That information includes:

To my mind these are serious considerations and matters that should be placed into the hands of owners rather than be imposed by an adjudicator without the benefit of knowing the relevance of these issues to each of the owners.

For these reasons, I decline to make the orders sought or to make the orders with ancillary details. The application is therefore dismissed.

Both the applicants and the Philippides should bear in mind the provisions of Section 167 of the Act. If ultimately the air-conditioning goes ahead, the applicants should take care not to cause a nuisance to the Philippides and the Philippides should bear in mind their right of redress under this section should their quiet enjoyment of their lot suffer.

Number of Scheme:	11019
Name of Scheme:	Wainui (1)
Address of Scheme:	QUEENSLAND

•	Impose considerable costs on other lot owners who want to install air-conditioning but can’t afford it;
•	Result in noise and vibration interfering with quiet enjoyment of lot 7;
•	Pose an unacceptable security risk to lot 7;
•	Potentially compromise the integrity of the roof membrane;

•	Each lot wishing to install air-conditioning should make individual applications to be considered by separate special resolutions;
•	The reality is, that wherever the compressors are placed, electrical infrastructure will need to be upgraded;
•	As infrastructure, that cost should be born by the Body Corporate as a whole;
•	Infrastructure costs would extend to the identified issues of mains supply, switchboard and lot supply and, more than likely, conduit cladding;
•	It appears appropriate that the Body Corporate would need to meet the cost of noise abatement through the skylights/fans and sound barrier if necessary;
•	Additional costs may be incurred in seeking planning approvals;
•	Individual installation costs may have increased due to the recommended vibration abatement and membrane protection requirements that have come to light; and
•	The requirement for two quotes in relation to the work and that all aspects of the proposal are captured by the requirement for two quotes.

1.	The possibility of a change in ownership of the first 3 lots to install air-conditioning;
2.	The cost of upgrading the main building supply falling on 4 owners;
3.	Requiring owners to upgrade utility infrastructure from the switchboard to the lot;
4.	Implication that two quotes are not required to be submitted to a general meeting for the purpose of upgrading the switchboard.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Wainui (1) [2007] QBCCMCmr 667 (30 November 2007)