Acacia Avenue Apartments [2008] QBCCMCmr 118 (9 April 2008)

Last Updated: 30 April 2008

REFERENCE: 0245-2008

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	0814
Name of Scheme:	Acacia Avenue Apartments
Address of Scheme:	4 - 6 Acacia Avenue SURFERS PARADISE QLD 4217

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

James Clarey, the owner of Lot 3

I hereby order that the application for an order that “no tiles be laid in unit 5, 4 – 6 Acacia Avenue, Surfers Paradise pending adjudicator hearing within three months.” is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0245-2008

“Acacia Avenue Apartments” CTS 30814

APPLICATION

This is an application dated 20th March 2008 by James Clarey, (the Applicant) co-owner of Lot 3, against Emanuel Hirakis, (Mr Hirakis) owner of Lot 5 in the scheme for an order that “no tiles be allowed to be laid above floor level including Unit 5.”

The Applicant is also the chairperson of the scheme and it is clear that the application intends to be an application made by the body corporate. It is signed both by the Applicant and James Archibald (Mr Archibald) who is a committee member. Section 4(b) of the application which asks the status of the applicant, has been completed showing boxes ticked on behalf of “an owner”; “the body corporate”; ”the committee”; “an occupier” and “ a committee member.” The Applicant may in fact wear all those hats. I am therefore treating this application as made both by the body corporate, a legal entity in its own right, and Mr Clarey, as joint Applicants, even though there is no evidence of a committee resolution that this application for adjudication be made by Mr Clarey as chairman.

The application also seeks an interim order that no tiles be laid in unit 5 pending the “adjudicator’s hearing within three months.”

On 4th April 2008, Mr Hirakis made an application for a final order concerning the same matter. In his application he seeks permission to lay tiles with acoustic underlay to the manufacturers’ specifications in Lot 5. These two applications will be cross-referenced and dealt with together as far as administrative processes allow, one application seeking an interim order and the other not doing so.

JURISDICTION

“Acacia Avenue Apartments” CTS 30814 is a community title scheme governed by the Body Corporate and Community Management Act 1997 (the Act) and the Body Corporate and Community Management (Standard Module) Regulation 1997 (Standard Module). There are 12 lots in the scheme created under a Building Format Plan of subdivision.

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)).

Section 247(3) of the Act allows the Commissioner to refer an application to an adjudicator for consideration for an interim order even though proper notice of the application has not been given to the body corporate or other affected persons, and despite the fact that parties to the application have not been given an opportunity to make a submission about the matters in dispute. It seems to me that the Act allows this process because applications for interim orders often relate to emergency or otherwise urgent circumstances, where it is simply impractical or impossible to allow a period for submissions prior to the consideration of the application for interim orders. It is also relevant that generally the purpose of an interim order is simply to maintain the status quo of a situation, and not finally to resolve the matters in dispute.

Section 279(1) of the Act allows an adjudicator to issue an interim order in response to an application “if satisfied, on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances to which the application relates”. Read together with section 247(3), section 279(1) appears to allow an adjudicator to issue an interim order without any reference to other parties to the dispute.

Notwithstanding that the Act allows for interim orders to be issued without reference to other parties, I am of the view that when possible, it is far preferable and more consistent with the principles of natural justice, to allow affected persons to make a submission about an application (even if the time allowed for submissions is necessarily brief) prior to the determination of an application for an interim order.

I therefore sought submissions from Mr Hirakis, and he responded on 1st April 2008. I also sought a copy of the scheme by-laws from Larkin McDonald, the body corporate manager (the body corporate manager) and a copy of minutes of meetings referred to in the application.

SUBMISSIONS

The Applicant states that he has reason to believe that Mr Hirakis is proposing to tile the floor of his first floor unit. There is concern from the noise emanating from Lot 5 that tiles are being laid.

The body corporate has resolved that no tiles be laid in first floor units because of the concern about the increase in noise which might flow from such an action because of the poor construction of the building and the fact that all the units are small and noise from one will impact on others. He says that the developer stipulated “no tiles” although he does not provide any evidence from the developer or in scheme records for this.

Eleven out of twelve owners have agreed that there should be no tiles laid above ground floor level.

The Applicant provides copies of the following documents:

• Minutes of the annual general meeting held on 28th November 2007 (bearing no apparent reference to this matter);
• a copy of a “flying minute” of the committee dated 29th January 2008 which states that “it was agreed back in April 2007 that there was to be no tiles or Timber Flooring laid above ground floor. It was reconfirmed in minutes of 14th January by Unit owners present. We have further discussed this and once again we agree to go with the Body Corporate that Tiling and Wooden Flooring is not to be permitted above ground floor. There is no exception.” This document was signed by 7 persons apparently representing the committee.
• Minutes of an extraordinary general meeting of 14th January 2008 showing two sets of “additional agenda items to be considered” as submitted by Mr Philip Byers, item 8 of the second set of motions being entitled - “ Re: Floor coverings. It was discussed at previous meeting that due to no sound proofing between units that no timber flooring or tiles are to be approved. Only ground floor units.” (sic) (There is no record of the votes on this motion, or if this was a motion put to the meeting);
• A copy of Schedule 2 of the Body Corporate and Community Management Act 1997 stated to be the by-laws for the scheme.
  

The body corporate has given notice to Mr Hirakis that it wishes to inspect his unit, but Mr Hirakis has refused entry to the body corporate.

Mr Hirakis submitted that he has not started to lay tiles in his unit but that he would like to do so. He has researched the impacts of tile-laying and sound absorption underlays, and he believes that there is nothing in the scheme by-laws which prevents him from laying tiles. He has removed the carpet, the skirting boards and the old tiles, and currently has a bare concrete floor. He adds that the kitchen, hall and entry floor of all units were tiled by the developer with no provision made for acoustic insulation. He proposes to use approved acoustic underlay to the manufacturer’s specification.

He wrote to the body corporate on 21st January 2008 asking permission to tile but received a reply from the body corporate manager on 23rd January that the body corporate could not approve his proposal. The body corporate manager enclosed a copy of a document bearing a section about “Noise Issues” in community titles schemes. It said that this was a copy of “various questions relating to noise issued under the Body Corporate and Community Management Act.” The body corporate manager also sent Mr Hirakis a copy of the by-laws "setting out rules in regard to noise....” He was told not to proceed with the tiling, and has not done so.

DETERMINATION

This order is made only in respect of the interim application. Applications for adjudication are dealt with by written submissions from all interested parties, and determined “on the papers”, that is, there is no hearing. The adjudicator may seek information from any party who may help resolve the dispute (Section 271 Act)

Law
All lots in a community title scheme are freehold lots with lot owners being bound to comply with the by-laws made for the scheme. As such, lot owners can do what they please within their own homes provided that their actions do not interfere unreasonably with the enjoyment of other lot owners within their lots or when using the common property. The legislation and the by-laws combined provide the body corporate, and to a lesser extent the committee, with the tools for managing the scheme for the benefit of all lot owners.

The body corporate at general meetings may approve improvements to the common property (by the committee or a lot owner - see Sections 113 and 114 Standard Module) or may pass by-laws for the scheme. There is no legislative requirement for an owner to seek permission from anyone to make improvements inside his own Lot unless there is a by-law restricting him or her from doing so. Neither a resolution of the committee nor a resolution of a general meeting may restrict a lot owner from making improvements to his own lot unless those improvements are in breach of a by-law.

The by-laws for this scheme are put forward as being the by-laws set out in Schedule 2 of the Act, sometimes referred to as the ‘standard by-laws’. In fact, the by-laws for this scheme are set out at Schedule C of the scheme’s community management statement lodged in the Land Titles Registry. There are 12 by-laws recorded on the first community management statement for the scheme , and they are ostensibly the same as those set out at Schedule 2 of the Act with the addition of the exclusive use by-law referring to Schedule E of the community management statement.

By-law 1 refers to Noise and states: “The occupier of a lot must not create noise likely to interfere with the peaceful enjoyment of a person lawfully on another lot or the common property.”

Conclusion
There is currently no evidence put forward by the Applicant that this scheme has any by-laws relating to tiling first floor units; nor that any resolutions have been passed about tiles. It is not clear who made the alleged agreement about tiles or when, or how this was voted on. The committee has no power to make such a decision. The body corporate equally cannot pass such a resolution (even if it has done which is not demonstrated) unless it is making a resolution to change or add a by-law to the community management statement for the scheme. Whilst I do not doubt that “eleven out of twelve owners have agreed that no tiles are to be laid above ground level” this is as legally effective as saying that “eleven out of twelve owners have agreed that all lots above the ground floor must (or must not) have pink kitchens.” It is simply unenforceable.

The body corporate may however enforce its by-law about noise. If Mr Hirakis makes a noise which is in the view of the body corporate a breach of By-law 1, then the body corporate may send to him a notice setting out the contravention of the by-law and asking him to desist from making the noise. In the event that the breach is not remedied, the body corporate may make an application to this Office for remedial action to stop the noise from occurring.

An adjudicator has the power to order that excessive sound is abated, which may mean that an order is made that any laid tiles are covered by rugs or carpeting for example. The adjudicator has the power to require the tiles to be removed and/or for baffling or muffling to be laid underneath the tiles, or take whatever steps will be effective in order for the sound not to interfere with the peaceful enjoyment of other lots or the common property in accordance with by-law 1, such steps being always required to meet the test of “reasonableness.”

I therefore dismiss this application for an interim order. This application will now proceed to submissions on the final order sought. It is a matter for the Applicant whether he wishes to proceed with the application in the light of my determination as to the relevant law.