Allunga [2008] QBCCMCmr 54 (19 February 2008)

Name of Parcel:	Allunga
Number of Plan:	Upper Plan No. 1
Address of Parcel:	3 Hanlon Street SURFERS PARADISE QLD 4217

TAKE NOTICE that pursuant to an application for an interim order made under section 76 and 77(1) of the Building Units and Group Titles Act 1980 by Toivo Kroll, the company nominee of Eden Court Holdings Pty Limited, the owner of Lot 89

I hereby order that the application for an interim order by Toivo Kroll, the company nominee of Eden Court Holdings Pty Limited, the owner of Lot 89, that “no further meetings or decisions are to be held or made by the existing committee”, is dismissed.

Application
Toivo Kroll, the company nominee of Eden Court Holdings Pty Limited, the owner of Lot 89 (Applicant) seeks an interim order that “no further meetings or decisions are to be held or made by the existing committee”. Further, the applicant seeks a final order “to be able to hold an EGM within prescribed time to elect a new committee”.

Jurisdiction
Upper Plan No. 1 (UP1) is a plan for the Registration of Plans (H.S.P. (Nominees) Pty. Limited) Enabling Act 1980 (ROPE Act).

Section 3 of the ROPE Act makes provision for the application of the Building Units and Group Titles Act 1980 (Act) stating:

Save to the extent that this Act is inconsistent with the provisions of the Building Units and Group Titles Act 1980 in which case the provisions of this Act shall apply, the provisions of that Act which relate to the subdivision of land by the registration of building units plans and apply in respect of those plans shall apply in respect of the subdivision of each of parcel l and parcel 2 by the registration of upper plans and lower plans pursuant to this Act and in respect of those plans as if those plans were building units plans under that Act and for those purposes references in that Act to building units plans, lots, common property, parcel, subdivision of land and body corporate shall be construed as references to upper plans or lower plans, lots, common property, parcel, subdivision of part of parcel 1 or, as the case may be, of part of parcel 2 and a body corporate of an upper plan or lower plan respectively within the meaning of this Act.

The Act applies for the operation of the ROPE Act (section 5A, Act). Part 5 of the Act concerns disputes. Part 5, division 3 makes provision for orders by a referee. Within division 3, section 77 provides general powers of a referee to make orders. Relevantly, section 77(1) provides a general power that a referee may on application of a body corporate ... a proprietor ... in respect of a parcel, make an order on any person entitled to make an application under this subsection ... for the settlement of a dispute, or the rectification of a complaint, with respect to the exercise or performance of, or the failure to exercise or perform, a power, authority, duty or function conferred or imposed by this Act in connection with that parcel.

Section 76(2) provides that where an applicant for an order under section 77(1) states in his or her application that the applicant requests an interim order, the referee may, if the referee is satisfied on reasonable grounds that, by reason of the urgent circumstances of the case, the referee should do so make, under this subsection, any order that may be made under section 77(1) with respect to the application. Section 76(3) provides that an interim order may be made notwithstanding that any power or duty of the referee under section 73(1) to give written notice of the application to the body corporate and to any affected person has not been exercised.

As the proprietor of a lot in UP1, the Applicant is entitled to make an application under section 77(1) against the Body Corporate. The orders being sought by the Applicant relate to the requisition of a meeting of the Body Corporate under the provisions of schedule 2, part 2 of the Act and are not of a nature dealt specifically with in sections 79 to 94B of the Act, and are capable of being made under section 77(1). Jurisdiction exists with respect to the orders being sought.

This dispute concerns the validity of a requisition for an EGM of the body corporate, given by the applicant and others to the secretary of the body corporate. The secretary refused to convene an EGM of the body corporate to consider the motions included in the notice of requisition, and the applicant is now seeking both the interim and final orders set out above as a remedy to the failure of the secretary to convene the requisitioned meeting.

Clause 1(3)(a) of Part 2 of Schedule 2 of the Act, headed Meetings other than First Annual General Meeting provides as follows:

(a) the secretary of a committee or, in the secretary’s absence, any member of the committee shall convene an extraordinary general meeting of the body corporate as soon as practicable after he or she receives a requisition for an extraordinary general meeting signed by 1 or more persons entitled to vote in respect of 1 or more lots, the lot entitlement or the sum of the lot entitlements of which is at least one-fourth of the aggregate lot entitlement; and

The applicant submits that a valid notice of requisition was submitted to the secretary, but the secretary has refused to convene the meeting as required in accordance with the above provision. Whilst accepting a number of the signatories (17) on the notice of requisition as being valid, the secretary has rejected a similar number (16) as invalid, for a number of reasons including:

In his grounds, the applicant has dealt with these objections by the secretary to the validity of the notice of requisition in a general sense. For example, he states at paragraph 16:

Many owners were rejected as not being registered corporate nominees but votes from these same owners were accepted without question at the AGM in April 2007 and at the EGM for concrete cancer on 17/12/07. Affected owners were:

The applicant concludes that the inclusion of the above 81 “entitlement points” would have been sufficient to obtain the requisite numbers for the notice of requisition to be valid.

Clause 1(3)(a) provides in part that to be valid, the notice of requisition must be signed by “1 or more persons entitled to vote in respect of 1 or more lots”. What therefore is meant by the phrase “entitled to vote”. This requirement is dealt with in Clause 2 of Part 2 of Schedule 2 of the Act, quote:

(1) Subject to section 131 of this Act, a person is entitled to vote in respect of any lot on any motion submitted at a general meeting of a body corporate or on an election of the chairperson, secretary and treasurer of the body corporate and other members of the committee only if the person is the proprietor of that lot as shown on the roll or, where the proprietor so shown is a corporation, the company nominee of that corporation as shown on that roll. ...

The applicant is submitting that the body corporate has acted inconsistently in respect of the notice of requisition: refusing to accept as valid (for the purposes of the requisition) signatures of persons who it allowed to vote as proprietors at previous general meetings of the body corporate. Whilst this irregularity might be so, my enquiry is not concerned with who the body corporate allowed to vote at previous meetings. If this were an issue for any party then I suggest that it should have been raised and challenged shortly after the relevant meeting or meetings in question.

For the purposes of this application, what I am concerned with is the validity of the signatures of those proprietors requisitioning that an EGM be held. The body corporate secretary has raised objections to certain of those signatures and this is the question to be considered here: whether the objections of the secretary are valid and should be upheld, or invalid and should be overturned, and the notice of requisition validated.

The body corporate secretary has disallowed the notice of requisition, for the several reasons outlined above. Two of those reasons were that there was no company nominee appointed for the lot, or that the person who signed the requisition was not the company nominee of the lot. Clause 2(1) of part 2 of the second schedule relevantly provides:

... a person is entitled to vote in respect of any lot ... only if the person is the proprietor of that lot as shown on the roll or, where the proprietor so shown is a corporation, the company nominee of that corporation as shown on that roll. ...

(12) A vote cast at a meeting of a body corporate by or on behalf of a company nominee of a corporation has no effect unless the body corporate has been given notice in writing specifying the company nominee of the corporation.

In the circumstances, I conclude that the failure of the proprietors of lots 9, 43, 62 and 89 to appoint a company nominee fatal to the right of those proprietors to validly sign the notice of requisition for an EGM to be called. The Act is very clear on this requirement, and whilst non-compliance with this requirement in the past might have been overlooked, thus allowing these proprietors to cast their vote, this cannot be assumed to validate or authorise their current failure.

The position is very similar in my view for those proprietors who appointed a company nominee, and who then allowed another person to sign the requisition notice. Again, the Act is very clear on this requirement: namely the appointment of a company nominee in the case of a corporate owner, and the entitlement of only that person to vote on behalf of the company proprietor, or in this case, sign the notice of requisition. In the circumstances, I am satisfied that prima facie, the proprietors of lots 1, 17 and 55 did not validly sign the notice of requisition.

It is clear that without the inclusion of the lot entitlements of these 7 lots (a total of 73) the notice of requisition did not achieve the requisite lot entitlement, namely one-fourth of the aggregate lot entitlement for the scheme. I conclude that at this stage, I am not satisfied that a valid notice of requisition of EGM was given by the applicant and other proprietors. I consider that on the basis of the information provided, there is not a prima facie basis for preventing the existing committee from holding further meetings. I intend to now seek the submission of all owners on this application.

One observation I will make is that I am informed that the AGM for the scheme is to be held on 26 March, 2008. Both for the purposes of nominating persons for election to the new committee, and for voting at that meeting, all proprietors should ensure that they have complied with the requirements of the Act in respect of their entitlement to vote. In this regard another particularly relevant provision is Clause 2(3) of Part 2 of Schedule 2 of the Act, quote:

(3) Notwithstanding section 53(11) of this Act, co-proprietors or co-mortgagees including, where a co-proprietor or co-mortgagee is a corporation, the company nominee of that corporation as shown on the roll shall only be entitled to cast a vote by a person duly appointed in writing as a proxy by them jointly and if notice of the person’s appointment has been given to the secretary of the body corporate before the commencement of the meeting at which the vote is cast or by furnishing to the secretary of the body corporate a voting paper referred to in section 1(6)(b) indicating their joint vote on that motion or, where relevant, a ballot paper, duly completed, referred to in section 1(5)(c).

This clause provides that in the case of co-proprietors, only a person duly appointed in writing as a proxy by them jointly, with notice of their appointment having been given to the secretary before the meeting, is entitled to vote at the general meeting.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Allunga [2008] QBCCMCmr 54 (19 February 2008)