Rydal Mount Court [2008] QBCCMCmr 329 (16 September 2008)

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

I hereby authorise Russell Postle of 84 Carinya Street, Indooroopilly (the appointee) to call, hold and chair a general meeting which shall be deemed to be the annual general meeting for the scheme;

I further order as follows –
1. that the general meeting shall be held within three months of the end of September 2008; 2. that the procedures in the Standard Module governing giving notice for and holding an annual general meeting, including the choosing of a committee, are to be followed as far as practicable. In particular, the notice requesting nominations for committee positions and submission of motions for consideration at the meeting must give owners at least 3 weeks to submit their nominations and motions. However, the appointee is not required to co- ordinate the giving of notices and the holding of the general meeting with the end of financial year date of the body corporate;
2. that the ‘statutory motions’ as set out in the legislation and recited in the reasons for decision be considered at the general meeting;
3. that the appointee may not charge for his services but may be reimbursed by the body corporate for his reasonable expenses in calling, holding and chairing the general meeting, and the Applicant Debra Postle may be reimbursed by the body corporate the fees for making this application.

APPLICATION

This is an application dated 6th March 2008, filed with this Office on 29th March 2008, and amended on 28th May 2008, by Debra Postle (the Applicant) co-owner of Lot 6, against the body corporate for the scheme (the body corporate) for an order that an administrator be appointed to the scheme for the purposes of calling a general meeting, appointing a committee, resolving how to manage the body corporate, applying proper governance and managing the maintenance of the building.

The application for “a suitable person to call a meeting” is supported by owners of Lot 1, Lot 5, Lot 7 and Lot 8, and suggesting that the person who calls the meeting is an owner.

“Rydal Mount Court” CTS 14506 is a community titles scheme governed by the Body Corporate and Community Management Act 1997 (the Act) and the Body Corporate and Community Management (Standard Module) Regulation 2008 (Standard Module). There are eight lots in the scheme created under a Building Unit 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

(i) the engagement of a person as a body corporate manager or service contractor for a community titles scheme; or

(ii) the authorization 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 Applicant says that the last annual general meeting was held on 21st August 2002 at a café in Toowong. At this meeting, the treasurer of more than 10 years retired following the sale of his unit. The treasurer handed the books to volunteering secretary/treasurer Ray Thompson (Mr Thompson), owner of lot 4. The meeting resolved to hold an extraordinary general meeting in six months time when Mr Thompson had familiarised himself with the records.

The extraordinary general meeting was held on 5th February 2003, but no financial statements were presented at that time. The committee “ceased to exist” when no annual general meeting was called “within three months of the end of 30th June 2003.” An application was lodged with this Office to allow the establishment of a new committee out of time. A new committee was elected on 12th November 2004 and Mr Thompson was elected as Treasurer. The aim was to hold a general meeting in early February 2005 to review the accounts. The meeting never took place and the last notices for contributions were sent out in June 2005. The committee again “ceased to exist” because there was no annual general meeting called “within three months of the end of 31st October 2005.”

There is currently no committee, and no-one has authority to call a meeting. The application carries signatures of five lot owners supporting the appointment of an administrator, and suggesting that the appointed administrator be an owner. The application is also signed by Russell Postle (Mr Postle) who is not an owner in the scheme.

In accordance with section 243(2)(b) Act, submissions were invited from all lot owners.

Leigh and Cherie Francis, owners of Lot 2 supported the application that all owners arrange a general meeting.

Russell Postle of 84 Carinya Street, Indooroopilly, consents to being the administrator for the purpose of calling the general meeting, without remuneration, but with reimbursement of expenses upon production of receipts. The only expected outlays are for this application and postage.

I sought further information from the Applicant as to the status of Mr Postle, and as to the date of the scheme’s financial year end. Mr Postle is the husband of the Applicant who co-owns a lot in the scheme. Mr Postle researched body corporate records with the assistance of a former chairman and has found that the first recorded annual general meeting was held in July in 1981. From 1993 until 2001, the AGM was held in September. Annual general meetings have also been held in August (1982, 1986, 1990, 2002), July (1981, 1984, 1985, 1987, 1988) and October (1989, 1992).

A body corporate is required by section 66 Standard Module to hold an annual general meeting within three months of the end its financial year. Schemes established prior to 1997 have a financial year end on the last day of the month in which the first annual general meeting was held.

From a look at the records of this scheme in the Land Titles Registry, this scheme was established on 15th March 1971 when it was registered by Morton and Hilda Lanham as Building Unit Plan no. 568. There is no record of when the first annual general meeting was held, but it would seem more than likely that the first annual general meeting was held before 1981 which is the first recorded annual general meeting which can be found by Mr Postle.

In 2004, certain lot owners made an application to this Office to hold an annual general meeting out of time. The adjudicator appointed Dimitrios Koulouris, the then owner of lot 1, to hold an annual general meeting but made no findings as to the date of the financial year end. I have some difficulty in knowing when the scheme financial year end is since the Applicant says that there was no annual general meeting called within three months of the end of June (2003) and then refers to a period of time within three months of the end of October (2005). Since the Adjudicator in 2004 did not change the financial year, the financial year would have remained the same in 2004 even if the annual general meeting was held out of time. In fact, I note that in the adjudicator’s order, the meeting held by Mr Koulouris was deemed to be an annual general meeting and the conditions concerning the holding of the annual general meeting within three months of the end of the financial year did not have to be adhered to.

Section 283 Act allows an adjudicator to change the financial year of a scheme with the consent of the body corporate. I have not broached the subject of changing the date, and therefore do not have the consent of the body corporate. I advise that the body corporate should try to satisfy itself about its financial year, so that future annual general meetings may be called and held in time. If this is not possible, then the body corporate may need to make an application to this Office in due course to change the date of the financial year for the sake of certainty.

I note that there is no objection to the appointment of Mr Postle as the person who convenes the general meeting, although he is not a lot owner, and the accompanying material suggested that a lot owner would be preferred as the “suitable person.” It seems that Mr Postle is more than willing to get involved and that this scheme should call an annual general meeting to consider, at least the “statutory motions.” I therefore appoint Mr Postle as requested, with the reservation that he may not charge for his services, but may be reimbursed his reasonable expenses. The general meeting shall be held within three months of the end of September 2008.

At an annual general meeting, the scheme must consider at least the following “statutory motions” (Section 76(3) Standard Module) defined as follows in the Schedule to the Standard Module.

Statutory motion, for an annual general meeting, means a motion about a following matter—
(a) presenting the body corporate’s accounts for the financial year;

(b) appointing an auditor of the body corporate’s accounts for the next financial year, or not auditing the accounts;
(c) adopting administrative fund and sinking fund budgets for the financial year;
(d) fixing contributions to be paid by the owners of lots for the next financial year;
(e) reviewing each insurance policy held by the body corporate.

It appears that the financial records of the scheme are not up to date and that no notice of contributions payable has been sent out since 2005. Section 141 Standard Module requires the body corporate (committee) to fix contributions on the basis of budgets, and for the committee to send out notices of contributions payable at least 30 days in advance of the payment date. (Section 142 Standard Module.)

In a scheme of 8 lots, there can be seven members of the committee. This means that not only can all lot owners can have a real input into the running of the scheme, but nearly all owners can be on the committee. The committee should hold regular meetings but many small schemes also keep in regular contact with each other by email and by telephone. Committee members should be elected each year at the annual general meeting, and a committee member’s term of office ends when another person is chosen for the position. (Section 33 Standard Module)

Each year, the body corporate should budget for its sinking fund by looking nine years ahead, so that it can save for whatever major items of expenditure need to be tackled in the next 10 years (including the year ahead of the AGM at which the sinking fund budget is decided.) The amount is entirely up to the body corporate and any lot owner can propose a budget although it is usually the committee which does so. In particular it is vital that the body corporate insures the buildings, fixtures and fittings in a Building Unit Plan of subdivision, in accordance with section 176 Standard Module.

There are Fact Sheets about many subjects, eg “Maintenance” and “Forming a Committee” available from the Office’s website www.bccm.qld.gov.au and also an “on-line training” facility for any interested person to learn about body corporate management and test their own skills. The Office also has an information service available by telephoning 1800 060 119.

Number of Scheme:	14506
Name of Scheme:	Rydal Mount Court
Address of Scheme:	16 Booth Street TOOWONG QLD 4066

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Rydal Mount Court [2008] QBCCMCmr 329 (16 September 2008)