Sainte Maxime [2009] QBCCMCmr 170 (29 April 2009)

Number of Scheme:	17859
Name of Scheme:	Sainte Maxime
Address of Scheme:	38 Woodroffe Avenue MAIN BEACH QLD 4217

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

I hereby order that the application for an order –
“ approving the roofing contractor, On Top Roof Restoration to undertake the following works at a cost of $9,306.00
1. Replace any broken tiles on both rooftops at the complex;
2. Repair lead flashings on both rooftops at the complex;
3. Re-point all ridge capping on both rooftops at the complex.”
is dismissed.

This is an application dated 6th April 2009 and amended on 16th April 2009 by the body corporate for Sainte Maxime CTS 17859 (the body corporate) for an order that the committee might spend the sum of $9,306 for emergency repairs on the roof of the two buildings of the scheme.

“Sainte Maxime” CTS 17859 is a community title 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 28 lots in the scheme created under a Building Unit Plan of subdivision.

Section 151(1)(c) Standard Module allows a committee to give effect to a proposal involving spending above the relevant limit for committee spending if an adjudicator is satisfied that the spending is required to meet an emergency. The relevant limit for committee spending, unless the body corporate has previously fixed a limit by ordinary resolution, is an amount worked out by multiplying $200 by the number of lots in the scheme.

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 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)).

The body corporate committee, by resolution passed outside a committee meeting on 13th March 2009, had approved repairs by Peter’s Roofing costing $4,400 to the roof one of the two buildings in the complex, the one fronting Woodroffe Avenue. However, the authorised contractor was unable to start within an appropriate timeframe and the committee had to find another contractor, On Top Roof Restorations (On Top) costing $4,653. There were no reports at that time that the other building fronting Cronin Avenue needed repair.

It has now become apparent that each of the two buildings needs roof repairs, and the cost of the project has doubled to $9,306, taking the cost outside the spending limit of the committee. The Cronin Avenue building is now starting to “have similar water ingress problems” as the Woodroffe Avenue building. On Top wished to start work on 8th April, weather permitting.

The committee provided four pages of a copy of a quotation dated 12th February 2009 from On Top, although there is no sum of money mentioned or itemised list of work on that extract. It consists of the cover page, introductory page, “terms of trade”, and “general information” with two photos.

The body corporate manager, Body Corporate Services, advises that there is no time to hold a general meeting, and seeks an urgent order for the repairs to be authorised by this Office.

I sought a full copy of the quotation dated 12th February 2009 from On Top from the body corporate manager. It appears that only one page was missing from the original application, being page 3 which detailed the work to be undertaken and the price inclusive of GST. The quotation is valid until 30th August 2009. The scope of the work is described as “replacing any broken tiles, repair lead flashings, repointing of all ridge capping,” and refers only to the apartment buildings at 38 Woodroffe Avenue.

In this scheme, the relevant limit of committee spending is $5,600. The committee was therefore authorised to spend the sum of $4,653 for On Top’s work on the roof of the Woodroffe Road building, in accordance with On Top’s quotation dated 12th February 2009. The committee at first resolved that the work should be done by another company, Peter’s Roofing, and approved that company by resolution outside a committee meeting on 13th March 2009.

That company was then unable to proceed, and the committee advises that it “then approved to engage the alternative contractor” On Top, although there is no copy of that subsequent resolution provided in this application.

However, since that decision, the committee has been advised, (the application does not say by whom or when), that the second building is also in need of the same type of repairs. The quotation from On Top, now provided in full by the body corporate manager, is taken to be $4,653 for each building, even though only the Woodroffe Avenue building is referred to in the quotation.

Section 151(2) states that where the committee’s proposal is a “series of proposals forming a single project, the cost of carrying out any 1 of the proposals is taken to be more than the relevant limit of committee spending if the cost of the project, as a whole, is more than the relevant limit.”

It is fair to say that the roofwork on each building by the same contractor might be said to be a “single project”, and it is for this reason that the body corporate has made this application.

The issue for consideration in this matter is whether it is appropriate in the circumstances to override the usual right of owners to vote on body corporate expenditure, and instead authorise the expenditure on the repairs notwithstanding that it has not been considered by owners. It is a fundamental issue whether the circumstances amount to “an emergency” which justify the usual decision-making processes of the body corporate to be by-passed.

I have been provided with no evidence that there is any risk to the health and safety of any person that could occur while the matter waited for normal general meeting approval. I appreciate that water ingress to either building may cause further damage, but have no evidence that the damage is structural or will effect the quotation received from On Top on which the body corporate relies.

I note that the first building has waited several months to be repaired and that The Cronin Avenue building is now starting to “have similar water ingress problems.”

I note that the sum required does not come within the realm of “major spending” which for this scheme is $10,000. The committee does not therefore need to find a second quotation for the same work to be done, pursuant to section 152 Standard Module.

I am of the view that there is sufficient time in the circumstances to hold a general meeting, putting forward all facts and any reports and quotations to the lot owners, and allowing them to vote.

I have some sympathy for the committee, which is attempting to get repairs done, but my sympathy for the unfortunate situation in which the committee finds itself does not override the rights of lot owners to say how their money should be spent. Owners might also wish to know for example, the extent of the maintenance required on the roof of the Cronin Avenue building, and a breakdown of why the repairs are quoted at an identical price by On Top. A general meeting might be held within a month, or all owners might give written consent to the repairs in accordance with section 151(1)(b) Standard Module.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Sainte Maxime [2009] QBCCMCmr 170 (29 April 2009)