Grand Mariner [2008] QBCCMCmr 27 (29 January 2008)

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

Maury Wainwright and Laura Gnibus, the Owner(s) of lots 118 and 30 respectively

I hereby order that, pending a further interim order or a final determination, the body corporate for Grand Mariner must not take any action to implement any resolutions passed pursuant to motions 3, 4, 5 or 6 at the extraordinary general meeting proposed for 30 January 2008 or pursuant to motions 2 or 3 at the extraordinary general meeting proposed for 11 February 20078.

This is an interim order and will remain in effect for a period of not longer than one month. It is the responsibility of the applicants to apply to extend this order if no final determination has been made within that period. This order will automatically lapse upon a final order being made or this application being withdrawn.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0057-2008

"Grand Mariner" CTS 4264

Grand Mariner Community Titles Scheme (Grand Mariner) is a 194 lot scheme under the Body Corporate and Community Management Act (Act) and the Act’s Standard Module Regulation (Standard Module).

This is an application for interim orders. It arises out of an application by Mary Wainwright and Laura Gnibus, owners of lots 118 and 30 respectively (applicants) against the body corporate for Grand Mariner (respondent).

The applicants seek to invalidate upcoming meetings of 30 January 2008 and 11 February 2008. Issues to be determined at these meetings include the appointment of service contractors and the applicants say that they have not been provided with the service contracts in full and have not been provided with essential pages of the tenders that would allow them to gauge the difference between the tenders fairly and accurately. It is also submitted that the body corporate is unnecessarily holding a secret ballot on the issues, that secret ballot votes posted in the past have been lost, and that the body corporate is not accepting votes that are hand delivered by persons other than the person casting the vote.

The applicants seek an interim order to stop the body corporate executing service contracts until the full contracts and tender documents have been disclosed in detail. An interim order is also sought to allow hand delivery of secret votes by another person.

An interim order will not be granted unless is it necessary due to the nature or urgency of the circumstances to which the application relates (Act, 279). Further, any orders granted must be just and equitable in the circumstances (Act, 276).

In determining whether it is just and equitable to grant interim relief it is relevant to briefly consider whether the application raises any serious questions for final determination.

It is also relevant to consider whether any inconvenience likely to result from the interim order is outweighed by the potential detriment alleged in the application. Any evidence that an interim order is necessary to prevent serious or irreparable harm will be significant.

The applicants say that they were not given essential details of the tender documents and that the process is confusing and not transparent. It is also submitted that secret votes should be able to be hand delivered by another person or neighbour according to section 53B(1)(e) of the Standard Module as posted votes have been lost in the past.

Submissions by the committee are to the effect that a formal tender process has been engaged in that involved calling for expressions of interest by way of newspaper advertisement, review of expressions of interest, conduct of tenderer site visits, recept of sealed tenders, and an independent review by Rider Levett Bucknell. It is submitted that at no time has the committee sought to withhold any information from the owners and that, because the tenders were voluminous, summaries were supplied with advice about where complete documents could be inspected as allowed by section 104(5) of the Standard Module.

These submissions satisfy me that, if the matter does proceed to final determination, there are serious questions to be determined regarding the issues raised. Firstly, the legislation does allow for summaries of voluminous quotations to be provided (Standard Module, 104(4)). However, it is arguable in this instance that no fair summary was provided. It is also arguable that the tender documentation would form part of the terms of the engagement and arguable that all terms of the engagement of a service contractor should be attached to the notice of meeting (Standard Module, 87(2)(c)). Having said that, an adjudicator must make an order that is just and equitable in the circumstances. Particularly if it appears that formal tender processes have been complied with fully and that all proposed appointments would be on substantially the same terms then it may be just and equitable to allow the appointment to proceed despite any minor irregularity. This is especially the case if the result of the vote taken shows a clear preference for one particularly contractor and if the majority of owners do not subsequently dispute the vote taken.

The other claim by the applicants, that votes should be able to be delivered to the returning officer by another person, also raises a serious legal question for determination (Standard Module 51, 53B).

The applicant has established some justification for an interim order prohibiting entry into any service contracts pending a final determination of the dispute. However, it is possible that the applicant will not succeed in establishing any contravention of the legislation and it would be inconvenient for the body corporate to be subject to an interim order prohibiting the work if owners wanted the work to proceed.

I note that the consequences of the body corporate entering into a service contract that the majority of owners ultimately opposed due to disclosure of additional information from the tender would be significant. It is likely to be impracticable to change the service contractor once the contract is entered into. A delay in allowing entry to a service contract would also be significant. However, this could be mitigated to a large extent by the committee negotiating a short term contract pending a final resolution of the dispute.

In the circumstances, it seems appropriate to grant an interim order preventing entry into any of the disputed service contracts pending a final resolution of the dispute. At this stage, I will make the interim order operative for only one month as the circumstances indicate that a quick resolution of the dispute would be preferable to minimise inconvenience to the body corporate.

Any order requiring the body corporate to instruct the returning officer to accept votes delivered by a person other than the voter is a different matter. The returning officer is required to provide the chairperson with details of the number of votes rejected from the count and the reason for rejection (Standard Module, 53A). The body corporate is then required to keep all votes cast (Standard Module, 149(1)(j)). Given the dispute over the issue of delivery of written votes, it would be preferable if votes are delivered by post or delivered personally by the person casting the vote. It is not appropriate in the circumstances to make an interim order forcing the returning officer to accept votes potentially contrary to the legislation. If necessary, the matter will need to be considered at a later date.

Finally, I note that correspondence from one of the applicants also raises some concerns about motions that would allow for permission for an owner to enclose a balcony. I will not make any interim order in this respect as this concern is not properly part of the present application and the person concerned has not had an opportunity to respond to the concern. The applicants should consider whether they wish to lodge another application to raise this concern formally.

For these reasons, I make the interim order above. The application will be allowed to proceed to submissions and a final determination in the normal course.

Number of Scheme:	4264
Name of Scheme:	Grand Mariner
Address of Scheme:	12 Commodore Drive SURFERS PARADISE QLD 4217

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Grand Mariner [2008] QBCCMCmr 27 (29 January 2008)