Mahana [2009] QBCCMCmr 129 (25 March 2009)

Last Updated: 29 April 2009

REFERENCE: 0188-2009

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	9971
Name of Scheme:	Mahana
Address of Scheme:	164 The Esplanade BURLEIGH HEADS QLD 4220

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

Rani Silver, Ruth Wood and John Kirwan, the Owners of lots 5, 10 & 12.

I hereby order that pending the making of final orders, the owners of lot 9 are not to carry out any further work of a structural nature which could impact on the structural integrity of the building.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0188-2009

“Mahana” CTS 9971

APPLICANT

The applicant is the Body Corporate for the scheme which is seeking the following Interim Order:

For all building work to be stopped immediately, pending a final decision being made to:-

1. Prevent further damage being done to the structure and integrity of the building;
2. Prevent water damage as the result of plumbing works being carried out;
3. ensure that the general insurance policy is not rendered invalid by any illegal building work being performed;
4. To prevent further distress to other unit owners and residents living in fear of a floor collapse.
   

The final outcomes sought are as follows:

That the owners of Unit No.9, “Mahana” should:-
1. Submit proper plans detailing all building works;
2. obtain an independent Engineer’s report to certify all building works;

3. obtain professional certification that the reinforcing rods exposed by removing part of the load bearing wall, and the holes drilled into the ceiling of the outside balcony, have been properly treated to prevent concrete cancer.
4. Provide adequate insurance cover from a reputable underwriter to cover any problems arising from their building works.
   

SCHEME DETAILS

Mahana consists of 12 lots and was registered as a building units plan (now described as a building format plan) under the provisions of the Building Units and Group Titles Act 1980 (BUGTA). It is now regulated by the Body Corporate and Community Management (Standard Module) Regulation 2008 (Standard Module).

BACKGROUND

The body corporate is seeking orders against the owners of lot 9 who began certain internal renovations in January 2009. The applicants state that they became aware that the renovation work involved certain structural alterations including removal of part of a load bearing wall. The applicants are therefore concerned that such work could potentially impact upon the structural integrity of the building and believe that body corporate approval should have been obtained before the renovations began. The body corporate is also concerned that Council approval was not obtained for what they believe to be substantial renovations. However when these concerns were raised, the owners of lot 9 wrote “we intend on proceeding with the work to our unit and we will not enter into any further discussions based on unfounded allegations or demands that we gain approvals where none are required”.

The body corporate states that it has acted with the objective of ensuring the interests of all owners are protected, including compliance with by-laws and legislation, and adequate insurances are made available. As at the date of the application no plans were supplied by the owners of lot 9, body corporate approval had not been sought and the body corporate believed that no engineer had inspected the building works. The applicants claim that they do not know what work is being undertaken other than extensive building works and structural changes i.e. removal of part of a load bearing wall.

In reply the respondents stated “We intend on proceeding with the work to our unit and we will not enter into any further discussions based on unfounded allegations or demands that we gain approvals when none are required”. The respondents went on to state that they had received legal advice that they were entitled to undertake the work and had obtained an engineer’s report stating that it was safe to remove part of the load bearing wall. However they refused to supply any documentation to the body corporate committee.

The body corporate manager was informed by the Gold Coast City Council that the work would need to be certified and body corporate approval would be required. The body corporate therefore requested the respondents to provide details of approvals, certification etc. However the information provided by the respondents consisted of a handwritten certificate from “Showers Engineering” dated 23 November 2007 which included the following:

“Kitchen wall ok to remove section 600 wide to allow for passage way being set up by moving non load bearing wall to bedroom”...

The applicants also attached the following documents to the application:

• Letters dated 20 & 23 January 2009 from respondents to body corporate manager in which respondents state that they do not require body corporate permission for renovations;
• Letter dated 1 February 2009 from committee member to body corporate manager requesting advice;
• Email communications between committee members and body corporate manager;
• Minutes of committee meeting held on 14 February;
• Letter to respondents from body corporate dated 14 February 2009, advising of requirement to comply with section 165 of the Body Corporate and Community Management Act.
  

SUBMISSIONS BY RESPONDENTS

The respondents state that on 15 January 2009 they put a notice in the elevator apologising for building noise and on 16 January a contractor cut away a 600mm section of a load bearing wall. A number of conversations with other lot owners ensued, during which the respondents were made aware of their concerns regarding structural alterations to lot 9. A number of lot owners requested the respondents to provide a copy of the engineer’s certificate and a committee member requested one of the respondents to make an application to the committee for permission to undertake the work.

On 14 February the respondents received a letter from the body corporate committee advising that they had obtained advice from another engineer, Ken Brown & Associates and again reiterated their request for a copy of the certificate from Showers Engineers. On 21 February a committee member contacted the respondents again and stated that they did not believe the “Showers” certificate was sufficiently detailed.

However the respondents believe that this matter has been blown out of proportion because the committee has little knowledge of building, approval and licence requirements. The respondents believe that the work is “self- assessable” and therefore, body corporate or Council approval is not required. Further, they are not aware of any legislative requirement for them to have insurance coverage apart from the insurance held by licensed tradesmen.

The respondents also advise that:

• The section removed from the wall was only some 600mm wide;
• the 4 reinforcing rods in the ceiling, exposed by removal of the wall, will be concealed behind a bulkhead and do not require any particular treatment as they are internal to the building. However the respondents sprayed the rods with a cold galvanising substance as a precaution;
• two years ago they drilled two holes and inserted 2 stainless steel “dyna bolts” into the ceiling of the outside balcony for the purposes of hanging “swing type canvas chairs”.
  

Attached to the submission was a letter from “Showers Engineering” dated16 March 2009 which read as follows:-

“We have previously inspected this unit to certify that a small section of load bearing wall to the kitchen could be removed. Following removal of this part of the wall we inspected this on 14 March 2009 and found the work to be carried out correctly and the wall remains structurally sound. The section of wall removed is about 600mm at the end of a wall of 3 metres long.
This represents a minor part of the wall and the structure of the area about the wall and given that there are only three floors over the area concerned will not be influenced by such a small removal of this long wall. The bolts to the ceiling of the outside balcony are structurally adequate and are ably to safely sustain loads from seating. There is no risk or evidence of corrosion to the slab or the bolt fixing.”

JURISDICTION

The application evidences a dispute between an owner of a lot included in a community titles scheme and another owner of a lot included in the scheme (section 227(1)(a) of the Act).

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)).

DETERMINATION

Members of the body corporate are concerned that renovation work has been carried out in lot 9 without firstly informing the body corporate of the scope of the works and without obtaining body corporate approval. They therefore seek the following interim order:

For all building work to be stopped immediately, pending a final decision being made to:-

• Prevent further damage being done to the structure and integrity of the building;
• Prevent water damage as the result of plumbing works being carried out;
• ensure that the general insurance policy is not rendered invalid by any illegal building work being performed;
• To prevent further distress to other unit owners and residents living in fear of a floor collapse.
  

At this point in time, I am concerned with the application for interim orders and the threshold issue of whether interim orders are warranted. 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.[1] Any order granted must be just and equitable in the circumstances.[2] The examples in section 279 of the Act indicate the usual circumstances where an interim order might be made and are in the nature of injunctive relief.

While it is not possible to exhaustively define what matters might be the subject of an interim order, an applicant does need to establish that the circumstances warrant an interim order. An interim order will not be made if the only urgency relates to an applicant’s desire to resolve or expedite the
matters in dispute, or where the nature of the circumstances are such that the matter is not capable of being dealt with in the context of an interim order. An adjudicator must be satisfied that the application raises serious questions to be determined and that the balance of convenience between the parties justifies the making of the order. That is, an adjudicator must balance the inconvenience of granting relief now if final orders are ultimately refused against the inconvenience of refusing relief now if final orders are ultimately granted. Of particular relevance is evidence that an interim order is necessary to prevent serious or irreparable harm.

The applicant states that an interim order is required as the work currently being undertaken by the respondents involves removal of part of a load bearing wall which, they believe, has the potential to impact upon the structural integrity of the building.

In this regard Section 115N of the Land Title Act 1994 provides as follows:

115N Easements for support

(1) An easement of lateral or subjacent support exists—

(a) in favour of a lot against another lot capable of supplying lateral or subjacent support; and

(b) in favour of a lot against common property capable of supplying lateral or subjacent support; and

(c) in favour of common property against a lot capable of supplying lateral or subjacent support; and

(d) in favour of common property against other common property capable of supplying lateral or subjacent support.

(2) An easement for support under subsection (1)—

(a) entitles the owner of a lot (“lot X”) to enter a lot or common property supplying support to lot X under the easement to maintain or replace any support; and

(b) entitles the body corporate to enter a lot or common property supplying support to common property under the easement to maintain or replace any support.

(3) An easement for support under subsection (1) subsists until the scheme no longer exists.

Further, section 165 of the Body Corporate and Community Management Act 1997 provides:

Interference with easements of support or shelter

The occupier of a lot included in a community titles scheme must not

interfere, or permit interference, with support or shelter provided by the lot

for another lot included in, or the common property for, the scheme.

Maximum penalty—100 penalty units.

While there is no by-law for this scheme which requires an owner to seek body corporate approval for internal renovations, it is of course necessary that such renovations not interfere with the statutory easement for support. In this case, the evidentiary material clearly states that the respondents have removed part of a load bearing wall. The concerns raised by other lot owners regarding the possible impact upon the structural integrity of the building are understandable, particularly when they have not been provided with details of the scope of the proposed works.

I note that an engineer has provided a brief advice that “following removal of part of the wall we inspected this on 14 March 2009 and found the work to be carried out correctly and the wall remains structurally sound”

While the engineer’s advice should give some comfort to other lot owners, it is not unreasonable for other lot owners to have ongoing concerns regarding the structural integrity of the building.
Although it would appear that the respondents do not intend to undertake any further structural work within their lot, as a precautionary measure I propose to make an interim order that the respondents not carry out any further work of a structural nature which is likely to impact on the structural integrity of the building.

I note from correspondence that the proposed plumbing work will be of a minor nature and the respondent’s plumber will submit a minor plumbing works application with Council. Given that the respondents are aware of their legal obligations in this regard, I do not propose to make any interim orders regarding plumbing works.

Finally, the applicant has requested an interim order to ensure that the general insurance policy is not rendered invalid by any illegal building work being performed. The applicants have not stated how the insurance policy for the scheme could be invalidated by the respondent’s works and have not provided me with a copy of the policy. Consequently, at this point in time, I do not believe it would be appropriate for me to make orders concerning the insurance policy for the scheme.

As mentioned above, I propose to make an interim order that, pending the making of a final order, the respondents are to desist from making any further structural alterations to their lot. This dispute resolution application will be further dealt with in accordance with the usual processes undertaken by this office which may include seeking further submissions from the respondents and other lot owners. A final order regarding the application will be made in due course.

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[1] Section 279 of the Act
[2] Section 276 of the Act