Solaris [2009] QBCCMCmr 179 (7 May 2009)

Last Updated: 3 June 2009

REFERENCE: 0251-2009

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	11471
Name of Scheme:	Solaris
Address of Scheme:	29 The Boulevard BROADBEACH QLD 4218

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

James and Libby Cousins, the Owners of lot 7

I hereby order that the application for the following Interim Order an injunction to restrain the Body Corporate from proceeding or resolving to proceed with the repair of balustrades until such time as two compliant quotes from qualified Queensland engineers can be obtained for consideration by the Body Corporate. Is dismissed

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0251-2009

“Solaris” CTS 11471

The Scheme

Solaris is a subdivision of 12 lots recorded under a building format plan of subdivision. The regulation module applying to the scheme is the Body Corporate and Community Management (Standard Module) Regulation 2008.

Application

This application was lodged on behalf of the owners of lot 7 on 16 March 2009. I note that certain communications took place between the case management section of this office and the applicants regarding the nature of the interim and final outcomes sought, and as a result, the application was amended on 24 March 2009 so that the Interim Order sought is an injunction to restrain the Body Corporate from proceeding or resolving to proceed with the repair of balustrades until such time as two compliant quotes from qualified Queensland engineers can be obtained for consideration by the Body Corporate.

The final outcomes sought are:

That the motion to authorise and proceed with repair of balustrade defects as per the consulting engineer’s specification via O’Brien Window Maintenance or Building Rectification Services (BRS) be ruled out of order given the defects in the quotes obtained and non compliance with the motions passed on 28 September 2007 and 30 January 2009; and.

Should it be resolved at the EGM scheduled for 13 March 2009 at 11am to authorise and proceed with repair of balustrade defects through O’Brien Window Maintenance or Building rectification Services (BRS) and this resolution to be held invalid; or

Background

The applicants are the owners of lot 7 who state that in 2007 they began making inquiries about the state of balustrades surrounding the building and common property of the scheme which is approximately 30 years old. The applicants are of the belief that pursuant to section 159 of the Standard Regulation Module the body corporate is obliged to maintain the balustrades and that the balustrades should be maintained to Australian Standards.

At the AGM held in September 2007 it was unanimously resolved that the balcony rails be inspected and a report presented by a registered building inspector on the condition and safety of same and if replacement or repair was necessitated based on the outcome of the report, serious consideration be given to type, i.e. restriction of breezes, restriction of view, cleaning difficulties.

Subsequently, on 17 December 2007, the body corporate manager, Australian Unit Administration (AUA) issued a Notice to All Owners advising lot owners that replacement of the balustrades was necessary from both an aesthetic and safety viewpoint. However, it would appear that little progress occurred until 9 April 2008 when a quotation was obtained from Solutions IE Pty Ltd., a company which specialises in provision of quantity surveying, valuation and safety reports, to conduct testing of the balustrades and that the fee payable for the testing would be $1,587.
ISubsequently, AUA issued a letter stating that insurance coverage would continue to provide cover until an engineer was able to sign off on the safety of the balustrades.

As there was no update on the repairs to the balustrades at the 2008 AGM, the applicants wrote a letter to AUA (which they copied to other lot owners) requesting confirmation that insurance coverage would continue to apply in respect of “balustrade liability” whilst waiting for an engineer to sign off on the safety of the balustrades. An EGM was subsequently called for 7 November 2008 which included the following motion proposed by the committee:

2. Balustrade Repair
That the body corporate authorise and proceed with repairs to the existing balustrades at the building with the cost of the works to be approximately $54,000 inc GST and which includes repair work to the balustrades, engineers fee and supply and install of eye bolts.

However the above motion did not include at least 2 quotes for the balustrade repairs as required by section 152 of the Standard Module Regulation.

The applicants state that a number of letters from them or their solicitors to the body corporate manager went unanswered until about 3 February when the body corporate solicitors wrote to the applicant, enclosing a copy of the Insurance policy for the building accompanied by a Certificate of Currency.

At a committee meeting held on 30 January 2009 it was resolved as follows: It was agreed to repair the railings, that they meet Australian Standards when completed and the work is to be certified by a qualified engineer. It was further agreed that an EGM was to be held on 13 March 2009. The Notice of meeting and Agenda was circulated along with two quotes – one from O’Brien Window Maintenance (O’Brien) and one from Building Rectification Services (BRS).

The applicant believes there are a number of issues with these quotations viz:

• Neither quote states how the repairs will comply with WH&S Act, there is no reference to a Job Safety Analysis, there is no reference to Insurance and no license details;
• Neither quote states that repairs will be in accordance with Australian Standards;
• O’Brien have indicated that they contract with other firms to do the work. The applicant believes that this is unacceptable as there is no clarity or transparency as to who will be providing the services. In addition, the O’Brien quotation does not include a QBSA license number as required by the BSA Act;
• The applicant believes that the BSA number on the BRS “does not pertain directly to BRS” but to director and an associated company;
• The applicant does not believe that either O’Brien or BRS should undertake the work and if the balustrades are not replaced to Australian Standards the insurance cover will be void.
  

Submissions

In accordance with section 243 of the Act submissions were sought from the body corporate and all lot owners. Submissions were received from the owners of lot 8 and also from the body corporate.

The owners of lot 8 made the following submissions:

• They proposed motion 13 which was carried at the AGM on 28 September 2007 and are concerned that no progress has been made in almost two years;
• They are particularly concerned about the potential for a serious accident to occur;
• Attempts by them to have an inspection of the railings conducted by an engineer have been marred by lack of coordination by the body corporate and body corporate manager;
• Minutes of meetings are incomplete;
• On at least 5 occasions correspondence with the body corporate regarding this matter was not acknowledged or tabled at a meeting of the body corporate;
  

The body corporate made the following submissions:

• The committee agrees that the balustrades require maintenance and that this is the responsibility of the body corporate;
• The applicants have not produced any evidence to substantiate their submission that the balustrades must be maintained to a particular Australian Standard;
• the applicants have not provided evidence as to what the Australian Standard is in respect of the maintenance of balustrades;
• The applicants do not state how the balustrades do not comply with Australian Standards;
• Although not stated in their application, if it is the case that the applicants are concerned about the height of the balustrades, the committee is of the view that at the time of construction the building complied with the relevant Australian Standard and that therefore it is exempt from compliance with any subsequent alteration to the Australian Standard;
• It is noted that the applicants’ preferred contractor, Buildcheck (Qld) Pty. Ltd. states in its letter dated 15 December 2008 “It is not mandatory to extend handrails to meet the 1 metre high and 125 mm spacing requirement contained in the current Code”;
• The applicant has not provided any evidence to support its assertion that legal issues could arise in relation to insurance and liability as well as safety issues;
• The committee acknowledges that progress has been slow but states that the process of arranging quotations and organising engineers to attend the site at the same time as the contractors has been time consuming;
• O’Brien Window Maintenance is operated by a Mr. Greg O’Brien who holds a QBSA gold licence (no.658945) which is current;
• The quote from O’Brien Window Maintenance sets out the proposed repair work and costings. There is no mention of the work being subcontracted to anyone, let alone anyone who does not have the appropriate QBSA licence;
• BRS is merely a trading name for the following three companies: CAN 010 600 521 Pty. Ltd.; Campbell Concepts Pty. Ltd.; Corrosion Management Systems Pty. Ltd.;
• Arthur Kay consulting is a firm of Engineers which has already submitted a report to the committee;
• The committee is not aware of any requirement in the QBSA Act or Regulations which requires a contractor’s licence number to appear on a quotation;
• They reject the applicant’s assertions that neither O’Brien or BRS are suitable contractors and note that O’Brien was introduced to them by the applicant;
• There has been no attempt at internal dispute resolution as bombardment with letters, e-mails and phone calls does not amount to an attempt at internal dispute resolution or conciliation.
• The committee believes that it should be allowed to proceed with repairs to the balustrades in accordance with the motion carried on 13 March 2009 without further disruption.
  

Jurisdiction

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)).

Sub-sections 279(1) & (2) provide that -
(1) The 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.
Examples
1. The adjudicator may stop the body corporate from carrying out work on common property until a dispute about the irregularity of proceedings has been investigated and resolved.
2. The adjudicator may stop a general meeting deciding or acting on a particular issue until it has been investigated and resolved.
(2) An interim order
(a) has effect for a period (not longer than 1 year) stated in the order; and
(b) may be extended, varied, renewed or cancelled by the adjudicator until a final order is made; (c) may be cancelled by a later order made by the adjudicator; and
(d) if it does not lapse or is not cancelled earlier, lapses when
(i) the application is withdrawn; or
(ii) the commissioner gives the person who made the application a written notice under section 241 rejecting the application; or
(iii) a final order is made by an adjudicator to whom the application is referred. ...

Determination

At this point in time, I am concerned with the application for interim orders and whether an interim order is warranted in the circumstances. 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] 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 the range of matters which might be the subject of an interim order is not capable of precise definition, the applicants do need to establish that the circumstances of the application warrant the making of an interim order. For it to be just and equitable to grant injunctive relief pending a final determination, I would need to be satisfied that the balance of convenience between the parties justifies the grant of injunctive relief. That is, I would need to 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.

Solaris is a subdivision of 12 lots recorded on a building format plan of subdivision and consequently maintenance of the balustrades in this building is the responsibility of the Body Corporate. I understand that the balustrades in question are the original balustrades installed approximately 30 years ago at the time of construction. Documentary evidence submitted by the applicant indicates that these balustrades are fabricated from aluminium and consist of a top rail and bottom rail with intermediate vertical bars with flared ends, affixed to posts that are dyna bolted to the concrete upstands.

The proposed repair work is to be carried out under the supervision of a certifying engineer and will involve the following steps:

• Dismantling of balustrades for the engineer’s inspection;
• Reassembly using new stainless steel rivets and screws;
• Removal of hob fittings; and
• Refitting of balustrades to hobs using marine grade stainless steel bolts chemset into existing hobs.
  

The applicants believe that a full replacement rather than repair of the balustrades, would not only provide better value for money in the long term, but also ensure that the balustrades comply with the current Australian Standard applicable to balustrades. It is argued by the applicants that the motion to authorise repair of balustrade should be ruled out of order having regard to motions passed on 28 September 2007 and 30 January 2009 and due to alleged defects in the quotes obtained.

At the AGM held on 28 September 2007 it was resolved that the balustrades be inspected and a report was to be prepared on the condition and safety of the balustrades and whether replacement or repairs were necessary. I note that an inspection report was obtained from Arthur Kay consulting Services, a structural engineering firm on 17 October 2008.

On 30 January 2009 the committee resolved to repair the railings, that the railings would meet Australian Standards when the work was completed, and the work would be certified by a qualified engineer. However, given the level of expenditure involved, this was a matter for determination by the body corporate in general meeting , and in any event the wording of this committee motion is ambiguous. The documentary material accompanying the application also indicates a certain degree of confusion regarding compliance with Australian Standards.

The significance of Australian Standards to building issues is that certain Australian Standards are given legislative force by the Building Code of Australia which regulates national building standards and applies Australian Standards to construction work. The applicants have expressed concern that the current Australian Standard applicable to balustrades requires that the top of a balustrade must be at least 1 metre (1000mm) above floor level, which exceeds the requirements applicable at the time of construction of this building. However, it is my understanding that where a balustrade was approved under a standard applicable at the time of construction, but does not comply with the requirements of the current Australian Standard / Building Code of Australia, it is not necessary to upgrade the balustrade to conform to present day requirements unless the balustrade is to be replaced or the building is to be substantially upgraded. Further, I do not agree with the view that a failure to upgrade the balustrade will necessarily result in legal liability on the part of the body corporate in the event of an accident. For a detailed consideration of these issues see Toomey v Scolaro Concrete Constructions and Others (No.2) [2000] VSC 279.

Finally, I do see how certain alleged “defects in the quotes obtained” would result in the invalidity of a resolution to accept either quotation. Again there seems to be some confusion regarding licensing requirements. It is my understanding that a tradesman contracting in his own name or under a business name, needs to be personally licensed. On the other hand, where a company undertakes building work in its own name or under a business name, the company itself would need to be licensed and to obtain an appropriate QBSA licence, the company would, inter alia, need to have a nominee (who may be a director or employee) with appropriate trade qualifications.

At this point in time, I have no reason to disbelieve the solicitors for the body corporate who have advised as follows:

• O’Brien Window Maintenance is operated by a Mr. Greg O’Brien who holds a QBSA gold licence (no.658945) which is current;
• The quote from O’Brien Window Maintenance sets out the proposed repair work and costings. There is no mention of the work being subcontracted to anyone, let alone anyone who does not have the appropriate QBSA licence;
• BRS is merely a trading name for a group of companies which are individually licensed by the QBSA.
  

In the present circumstances, I am not satisfied an interim order is necessary to prevent serious or irreparable harm. Nor am I satisfied that the balance of convenience favours making of an Interim Order.

---

[1] Section 279 of the Act