Admiralty Towers II [2008] QBCCMCmr 473 (19 December 2008)

Last Updated: 7 January 2009

REFERENCE: 1067-2008

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	15344
Name of Scheme:	Admiralty Towers II
Address of Scheme:	501 Queen Street, Brisbane QLD 4000

TAKE NOTICE that pursuant to an application made under the abovementioned Act by `Mabel Hall, the owner of Lot 85

I hereby order that the application for an interim order by Mabel Hall, the owner of Lot 85 that the body corporate for Admiralty Towers II community titles scheme 15344 not act on the resolution of the committee outside a committee meeting dated 21 November 2008 for painting of external foyers and not act on the resolution of the committee outside a committee meeting dated 3 December 2008 for refurbishment of foyer areas, is dismissed.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 1067-2008

“Admiralty Towers II” CTS 15344

The scheme
“Admiralty Towers II” community titles scheme 15344 is subject to the Body Corporate and Community Management Act 1997 (Act) and the Body Corporate and Community Management (Standard Module) Regulation 2008 (Standard Module).

Application
This application dated 9 December 2008 is by Mabel Hall, the owner of Lot 85 (Applicant) against the Body Corporate for an order that:

1. The Body Corporate use matching wallpaper to maintain common areas in the high rise foyer, the low rise foyer, the high rise entrance, the low rise entrance and all 37 foyers in the building to retain a common theme throughout all common areas.
2. The Body Corporate supply and install matching wallpaper to the Level 37 gymnasium and the Level 1 gymnasium to replace the wallpaper that was removed without proper authorisation in August and September 2008.
3. The Body Corporate paint the trim on Level 1 Foyer white to match all other common areas in the building, to restore the Level 1 Foyer to a common appearance.
4. The Body Corporate survey the owners to determine:
   • (i) If they want to refurbish the building.
   • (ii) What basic theme they want: modern, classic, or other?
   • (iii) The extent of the refurbishment: carpets, curtains, wallpaper, paint, inside lifts, light fittings, tiles external, tiles internal, furniture, paintings, mirrors, flower arrangements, extent of specification, i.e. colour, grade, material, specification, manufacturer, supplier etc.
   • (iv) Based on the owners survey, obtain at least three competitive quotes to obtain the expected budget, work specification (research, choose theme, specify, supply, install, project manage, provide warranty, assist owners in choosing scheme), timing and full cost of the complete project for the low rise and high rise external foyers, the low rise and high rise internal foyers, the Level 1 Function Room, the Level 1 Gymnasium, and the Level 37 Gymnasium, inside low side lifts, inside high side lifts.
5. The motions passed outside the committee meetings on 21 November 2008 and 3 December 2008 be declared invalid.
   

The Applicant has sought an interim order that:

1. That the Body Corporate not act on the motion voted on outside committee meeting on Friday 21 November 2008 for the removal of the wallpaper and painting of both mail box foyers. The Applicant provided a copy of a ‘Resolution Passed Outside A Committee Meeting’ dated 21 November 2008 where it was (in part) resolved by 5 votes to 1 “That the Committee...accept the attached quotation from Higgins Coatings totalling $2,236.00 plus GST, for the removal of the wall paper and painting of both mail box foyers” (November resolution).
2. That the Body Corporate not retain a consultant as resolved by voting outside committee meeting on Monday 1 December 2008. The Applicant provided a copy of a ‘Resolution Passed Outside A Committee Meeting’ dated 3 December 2008 where it was resolved by 5 votes to 2 “That the Committee...agrees to obtain at least two quotations from interior designers/architects for the provision of a theme and relevant specifications for the refurbishment of both foyer areas, with the cost not to exceed $27,500.00 inclusive of GST, and further, select and accept the most suitable quotation. Note: This ... Committee has always known the need for refurbishment “plan” ... has waited until now, when the painting of the building and the replacement of the sails is underway to introduce the next step, being the interior refurbishment of the building. The passing of this motion will enable the incoming Committee ... to proceed immediately with the many steps required for the much needed foyers refurbishment” (December resolution).
   

The Applicant states she doesn’t want a “hotch-potch” job of the foyers and mail box areas. The Applicant refers to: a change in the Level 1 foyer trim that does not match with the 37 levels in the building; an October 2007 survey where owners nominated the entrances to the apartments as being a satisfactory area of the building; and the removal of wallpaper in the Level 37 gymnasium.

The Applicant provided a copy of emails dated 21, 24 and 27 November 2008 involving Ruth Bonnett and Mike Jones which Ruth Bonnett forwarded to the Applicant on 9 December 2008. On 21 November Ruth Bonnett informed Mike Jones that there is a close match to the wallpaper requesting holding off on the painting until further information is received from a supplier. On 24 November 2008, Mike Jones emailed Ruth Bonnett stating the painting is not a project but interim maintenance, it is expected it will take 12 months before the foyer refurbishment is approved and the committee considers the foyers should be “fresh and inviting” during this period. By email dated 27 November 2008 to Mike Jones, Ruth Bonnett acknowledged that maintenance of the lobbies is required, but questioned the need to remove the wallpaper when matching wallpaper can be sourced and the need to spend $27,500 on a consultant when the owners have not voted whether to refurbish.

The Applicant also provided an email from Ruth Bonnett to John Rae of Body Corporate Services Pty Ltd (Body Corporate Manager) dated 28 November 2008 submitting a motion for inclusion on the agenda of an upcoming annual general meeting to purchase matching wallpaper to maintain wallpaper on common property which shows wear and tear.

The Applicant submits that she would like the owners to vote on whether there should be refurbishment considering the cost of the entire project of refurbishing two lobbies and 37 levels is an improvement which is above the committee spending limit.

The Applicant refers to section 56 of the Standard Module stating there is no time to stop the committee from acting on the resolution. The Applicant says the removal of wallpaper and repainting is not in the current budget and a special contribution is required under section 141 of the Standard Module. The Applicant states all costs associated with a project must be considered as a whole and the entry foyers, lobby foyers, gymnasiums and the basements are all part of the same project. The Applicant says the wallpaper is a prominent and unifying feature of the scheme from the basement foyer to the level 37 foyer. In referring to section 163 of the Standard Module, the Applicant states the committee has no authority to alter common property and the removal of the wallpaper in the gymnasiums is a significant change in appearance and replacement wallpaper can be obtained to maintain the existing scheme.

Jurisdiction
The Applicant has sought an interim order that two resolutions of the committee not be acted upon. A committee resolution is a decision of the body corporate (s 100(1), Act). A dispute includes a dispute between a lot owner and the body corporate (s 227(1)(b), Act).

In accordance with section 247 of the Act, the Commissioner for Body Corporate and Community Management has referred the application to me even though affected persons have not been given notice of the application or afforded an opportunity to make submissions about the application. Section 276(1) of the Act provides that an adjudicator may make an order that is just and equitable in the circumstances to resolve a dispute about a claimed or anticipated contravention of the Act; or the exercise of rights or powers under the Act. Section 279(1) provides that an adjudicator may make an interim order “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”.

Investigation
In accordance with the investigative powers of an adjudicator stated in section 271 of the Act, on 9 December 2008, I invited submissions from the committee regarding the interim order application, and a copy of the application was provided to the Body Corporate Manager for distribution to committee members.

Teys Legal made submissions on behalf of the committee stating the relevant limit for committee spending is $38,600. The committee submits the Level 1 foyer trim was painted several years ago, the survey is almost two years old and is out of date as the common property has deteriorated through wear and tear over that time, and the wallpaper in the gymnasium was removed by the on-site manager and was re-painted at no cost to the Body Corporate. The committee says it could not match the existing wallpaper and that while the wallpaper could be reprinted; it is not possible to match the existing wallpaper which has faded.

The committee states a notice of opposition has not been received by the Body Corporate secretary to the November resolution, the work is maintenance which is within the power of the committee, and even if the work is an improvement, the cost is within the ambit of the committee under section 163 of the Standard Module. The committee says the work is not part of an overall refurbishment of common property and the administration budget provides for general repair and maintenance and the sinking fund budget includes painting and refurbishment.

The committee also states a notice of opposition has not been received by the Body Corporate secretary to the December resolution, the motion relates to obtaining a scoping of works which was explained to owners in the note to the resolution, the scoping exercise will allow various options to be put to owners in relation to the refurbishment contemplated by forecasts in the sinking fund budgets for the past two years, and there is a cost for interior designers or architects to provide a theme and specifications because of the time required.

The committee submits it should be allowed to make Body Corporate decisions and to carry out its functions under the legislation without interference from a lot owner who does not agree with the decision. The committee argues the interim orders should be dismissed as they are not a serious legal issue.

Determination
Given section 279(1) of the Act, it is necessary to determine whether, because of the nature or urgency of the circumstances relating to the application, an interim order is in fact necessary. The Applicant does need to establish that the circumstances of the application warrant making an interim order. The Applicant has shown that the committee has passed two resolutions, one relating to carrying out work and the second relating to contracting an interior designer/s or architect/s. It would seem the work mentioned in the November resolution has not yet commenced and that an interior designer or architect has not been contracted as a consequence of the December resolution. As the Applicant questions both resolutions, I consider urgent circumstances are demonstrated to warrant consideration of the interim order application.

To assist me in determining whether it is just and equitable to grant relief at this stage, before full and final consideration of all the issues raised, I consider it relevant to briefly consider whether the Applicant raises a serious legal question that will need to be determined. If a serious legal question is raised, it may be appropriate to make an interim order.

The Applicant has referred to section 56 of the Standard Module. She states there was not time to give a notice of opposition to the secretary in relation to either resolution. Section 56 provides a right for owners of at least one-half of the lots in the scheme to oppose a committee resolution by written notice to the secretary within 7 days after the secretary has given a copy of the resolution to owners. If the secretary is given a proper notice of opposition, the committee cannot give effect to the opposed resolution (s 57, Standard Module). It would seem the committee could not give effect to either disputed resolution until owners had notice of each resolution and had opportunity to give a notice of opposition. The Applicant has not claimed that the secretary did not give owners a copy of either disputed resolution in the way prescribed by section 55 of the Standard Module. Neither has the Applicant demonstrated that the committee has acted or will act in a way contrary to section 57. The Applicant has not explained the basis for being concerned there was not time to give a notice of opposition. The committee has submitted that a notice of opposition has not been given to the secretary with respect to either disputed resolution.

In referring to sections 141 and 163 of the Standard Module, it would seem the Applicant is arguing the resolutions were restricted issues for the committee (s 100(2), Act and s 42(1)(d), Standard Module). The Applicant has not substantiated her claim that a special contribution must be fixed pursuant to section 141(2) as the spending authorised by both resolutions is not allocated in a budget adopted by the Body Corporate. The committee claim spending of the nature mentioned in both resolutions is allocated in the budgets. Section 163 relates to improvements to common property by a body corporate. The section contains a tiered authorisation process which is dependent on the proposed cost of the improvements. I am not satisfied from the Applicant’s submissions that the work mentioned in the November resolution necessarily is an improvement. In this regard, I note the committee submissions that the work is maintenance of common property (s 159(1), Standard Module). However, I do not consider this issue requires any further consideration at this time given: that the committee can authorise an improvement where the cost is not more than the ‘basic improvements limit’ (s 163(1) and (5) — $300 multiplied by the number of lots); the work approved in the November resolution is less than this limit; and where for example, it is not apparent that the Body Corporate has not reserved the issue for decision by ordinary resolution (s 42(1)(c), Standard Module).

The Applicant has argued that the spending relates to a project, that all costs associated with a project must be considered as a whole and the entry foyers, lobby foyers, gymnasiums and the basements are all part of the same project. The Applicant has not, however, demonstrated that the resolved spending is associated with another proposal/s either approved or before the Body Corporate and together all the proposals form a single project. Neither has the Applicant substantiated the claim the entire refurbishment project is an improvement and the cost is above the committee spending limit.

The Applicant would appear to be concerned about the effect of work approved by the November resolution. However, I do not consider a difference of opinion between the Applicant and the committee warrants making the interim order sought, particularly when the committee has stated the legislative basis for approving the work and it is not demonstrated that there is a question about the power of the committee to make the decision.

The Applicant is also concerned about the December resolution submitting that she would like the owners to vote on whether there should be refurbishment. The copy of the resolution provided with the application clearly states the intention of the committee. No material has been presented to indicate that the resolution is contrary to the legislation, a Body Corporate decision or that owners oppose the resolution. The resolution authorises obtaining quotations from interior designers or architects at a cost below the relevant limit for committee spending.

I have considered the information provided by the Applicant with respect to a 2007 survey and in emails. However, the Applicant has not shown for example, that either resolution is contrary to a previous Body Corporate decision made as a consequence of this survey or that the survey is otherwise relevant. The emails indicate the concerns another owner has with the resolutions. However, these concerns are not a basis for making the interim order.

In my view, the Applicant has not raised a serious legal question to warrant making an interim order in the terms sought. For these reasons, the application for an interim order is dismissed. This application will now be administered in accordance with the Act and the normal processes of this Office. The application will be finally determined in due course.