Acacia Avenue Apartments [2009] QBCCMCmr 229 (19 June 2009)

Number of Scheme:	30814
Name of Scheme:	Acacia Avenue Apartments
Address of Scheme:	4 - 6 Acacia Avenue SURFERS PARADISE QLD 4217

TAKE NOTICE that pursuant to an application made under the abovementioned Act by Emanuel Hirakis, the owner of Lot 5

I hereby order that the application for an order by Emanuel Hirakis, the owner of Lot 5 against the body corporate for Acacia Avenue Apartments community titles scheme 30814 seeking approval: to relocate/install an air conditioning unit on the outside western wall similar to other units in the building for safety reasons; and under By-Law 5.2, to install shutters of a similar type/style/colour to existing units on the exposed side of the building for security reasons, is dismissed.

The scheme
“Acacia Avenue Apartments” community titles scheme 30814 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 made by Emanuel Hirakis, the owner of Lot 5 (Applicant) against the Body Corporate seeks approval: to relocate/install an air conditioning unit on the outside western wall similar to other units in the building for safety reasons; and under By-Law 5.2, to install shutters of a similar type/style/colour to existing units on the exposed side of the building for security reasons.

The Applicant states that, by letter dated 4 April 2008, he sought Body Corporate permission: to relocate the air conditioner to the western wall of the building as the one installed on the balcony does not comply with safety regulations; and to install shutters on the balcony as per Lot 1. He has shown that by letter to all owners dated 15 April 2008, Peter Bainbridge (secretary) stated: “We have received a request for permission by the Body Corporate, from the owner of Unit 5, to relocate the air conditioner to the external western wall. The owner states that the one installed in the balcony does not comply with safety regulations. Please indicate YES/NO to proceed, sign the section below and return same...within 10 days.” He has shown that, by letter dated 13 May 2008, Vivienne Cowles (acting Body Corporate Manager) informed him: “that following a circular letter sent to all proprietors...your request for the above has been denied. The reason unit no.1 has shutters on their balcony is for security purposes only. The air conditioner request was also denied. Relocation to the outside of the building is not an option.” The Applicant provided a copy of the minutes of the committee meeting dated 17 May 2008 which noted that the 13 May 2008 letter had been sent to the owner of Lot 5. The Applicant also provided a copy of a letter dated 27 May 2008 by Ms Cowles to committee members stating the “request was denied as 10 out of 12 said no”.

With respect to the air conditioner, the Applicant says he removed it from its previous location on the balcony as a small child could easily climb onto the unit and fall over the balcony. The Applicant has demonstrated that he holds a Queensland open builders licence. He stated the unit was removed because he felt it did not comply with Building Safety Standards. He has provided a photograph (noted as Photo 3) of an air conditioner located on a wall outside a unit saying it is in a similar position to where he proposes to install his unit. The Applicant provided a sketch (noted as Sketch 1) pointing out a ledge between “2” and “9”. The Applicant submits the proposed position would not be visible from the road.

With respect to the shutters, the Applicant provided a photograph (noted as Photo 4) stating it shows Lot 5 and the balcony which has one section that is not closed by shutters. The Applicant submits that Photos 4 and 5 show the shutters around the entire balcony of the below unit; shutters he proposes to install. He says there is distance of only 1.5m between the lower planter box and the balcony of Lot 5; making the balcony easily accessible to intruders. The Applicant states the shutters would include locks which would decrease accessibility. The Applicant is also concerned about privacy from the road and a hotel, and about limiting noise from the road.

Submissions to the Commissioner
The Commissioner provided a copy of the application to Larkin McDonald (Body Corporate Manager) for distribution to the owner of each lot (excluding the Applicant) and the committee, with an invitation to respond to the matters raised in the application (s 243, Act). The Commissioner subsequently re-sought submissions.

The owner of Lots 1 and 12 opposed the application saying the Applicant needed permission under By-Law 8 and this was refused; 10 out of 12 owners objected; the relocation of the air conditioner would be unsightly and unsafe as it would be over the front door; the shutters would change the appearance of the front of the building; and Lot 1 cannot be compared to Lot 5. They say the air conditioners were installed when the building was constructed. It is submitted the balcony of Lot 1 is not all enclosed.

The chairperson and co-owner of Lot 3 opposes the relocation of the air conditioning unit saying it will generate noise to surrounding units, will leak water to the common property and be an eyesore above the main entry. The chairperson questions whether the balcony railing will be removed to install the shutters and whether this could increase the danger of falling from the balcony.

The owner of lot 4 opposed the application saying the air conditioner was in a similar position to that on the unit above Lot 5. The owner questions the statement about being unsafe as similar apartments on the Gold Coast have air conditioning units on their balcony. The owner considers the air conditioning unit would detract from the appearance and would interfere with the outlook from other units. The owner believes the shutters would contravene the by-laws and be out of place.

The owner of Lot 6 submits the proposed position of the air conditioner would be directly above the main entrance to the first block of units, would be an eyesore for anyone entering this block and would be seen when he looks out from his balcony. The owner is concerned about the noise from the unit. The owner opposes the proposal to install shutters which he says will change the overall appearance and street appeal of the block of units.

The owner of Lot 8 opposed the application saying the proposed work is detrimental to the look of the building.

The owner of Lot 10 objected to the application. With respect to the relocation of the air conditioner, he states the proposed position will result in noise which would impact on Lot 6; the relocation would create a precedent allowing Lot 9 to relocate theirs which would result in the same noise complaint impact on Lot 10. He adds the propose position will detract from the aesthetics of the building and will impact on the view/outlook of Lot 6. He states that if the position of the unit was unsafe, there is sufficient room for the unit to be relocated to another position on the balcony. Mr McLauchlan believes shutters will significantly alter the appearance of the building from the street, an application from the previous owner of Lot 10 was refused, and approval would create a precedent.

Adjudication
A dispute resolution recommendation has been made under section 248 of the Act referring the dispute to departmental adjudication.

Jurisdiction
An adjudicator may make an order that is just and equitable in the circumstances to resolve a dispute, in the context of a community titles scheme, about a claimed or anticipated contravention of the Act; or the exercise of rights or powers, or the performance of duties, under the Act (s 276(1), Act).

Investigation
In accordance with the investigative powers of an adjudicator stated in section 271 of the Act, on the 26 May 2009 I invited the Applicant to make submissions:

On 9 June 2009, the Applicant made submissions stating he is not seeking any special approval other than what has previously been given to existing owners to install air conditioners and shutters. He submits he would like to install shutters of the same profile, same colour, same location and the same security reasons as Lot 1. He adds that he would like to place the air conditioner on the western wall on brackets the same as existing air conditioners and at the some location as some existing air conditioners. He believes that the noise issue is not different from another air conditioner and that it will make less noise as it will be a new model. The Applicant provided a page of an unidentified document making reference to balustrades.

Decision
The Plan and by-laws
The plan of subdivision for the scheme (SP 149806) defines scheme land, common property and the lots included in the scheme. This Plan is in a building format. The Plan shows Lot 5 on Level C and indicates that the Lot includes a balcony on its north-eastern side.

The boundaries between Lot 5, other lots and common property is defined by provisions of the Land Title Act 1994 (LTA) and the registrar of titles directions for the preparation of plans. “A building format plan of survey defines land using the structural elements of a building, including, for example, floors, walls and ceilings” (s 48C(1), LTA). Structural element includes “floors, walls and ceilings (s 48C(2), LTA). “Except to the extent permitted under a direction given by the registrar...the boundary of a lot created under the plan, and separated from another lot or common property by a floor, wall or ceiling, must be located at the centre of the floor, wall or ceiling” (s 49C(4), LTA). Section 9.6.1 of the Registrar of Titles directions for the preparation of plans states that acceptable structural elements for a boundary definition include the outer face of balustrades or railings and the outer edge of a floor or concrete base not abutting a wall.

On the basis of the Plan, the LTA and Sketch 1 provided by the Applicant, I am satisfied that the external wall of the building on which the Applicant proposes to install air conditioning infrastructure is common property. The horizontal boundary between the balcony of Lot 5 and common property is on or about the railings or the outer edge of the balcony.

The Applicant has referred to By-Law 5.2. A submission has referred to By-Law 8. There are 12 by-laws stated in Schedule C of the community management statement for the scheme. By-Law 5 makes provision for damage to common property. By-Law 5(2) states: “...an occupier may install a locking or safety device to protect the lot against intruders, or a screen to prevent entry animals or insects, if the device or screen is soundly built and is consistent with the colour, style and material of the building.” By-Law 8 regulates appearance of lot. By-Law 8(1) states: “The occupier of a lot must not, without the body corporate’s written approval, make a change to the external appearance of the lot unless the change is minor and does not detract from the amenity of the lot and its surrounds.” The by-laws are binding on the Body Corporate, a lot owner and a person who otherwise occupies a lot (s 59, Act).

The Applicant’s request
It is apparent that the Applicant wrote to the Body Corporate Manager on 4 April 2008 seeking permission to install shutters and to relocate the air conditioner and that after the distribution of a letter to owners, on 13 May 2008, the Body Corporate Manager informed the Applicant that his request had been denied. No material has been presented demonstrating that any other request has been made by the Applicant.

Body Corporate authorisation – Air conditioning request
The material indicates the only meeting where this matter has been considered is the committee meeting dated 17 May 2008, and that the meeting simply noted the abovementioned 13 May 2008 letter.

The proposal to install air conditioning is an improvement to common property for the benefit of Lot 5 (see definition of improvement - schedule 6, Act). The Standard Module may provide for making improvements to common property, including improvements for the benefit of a lot owner (s 159, Act). When the Applicant made the request to the Body Corporate, the Body Corporate and Community Management (Standard Module) Regulation 1997 (Previous Regulation) applied. This regulation was repealed and the current Standard Module commenced on 30 August 2008. Section 114(1) of the Previous Regulation provided that the Body Corporate may, if asked by a lot owner, authorise the owner to make an improvement to common property for the benefit of the owner’s lot. In the circumstances of the request, it was necessary that the improvement was authorised by special resolution (s 114(2)). For a scheme subject to the Standard Module, a motion requiring a special resolution is decided in general meeting (s 106, Act). Sections 38 to 61B of the Standard Module make provision for calling, holding and voting at a general meeting.

It is clear that a general meeting was not called as a consequence of the 4 April 2008 letter. While the Previous Regulation did not require the Body Corporate react to the request made in April 2008 by calling a general meeting, there was no provision that permitted a body corporate decision to be made in the form of the letter dated 15 April 2008 sent to owners. The Body Corporate would have had to call a meeting if at least 25% of owners made a written request under then applying section 61. A request of this nature was not made. Otherwise, the meeting could have been called by authorisation of the committee; it is clear that the committee did not authorise the calling of a general meeting under the then applying section 40 of the Previous Regulation.

Given the legislative requirements, the response in the May letter is nothing more than an indication from owners about the question put by the Applicant. It is not a decision of the Body Corporate made under the Act. The basis of the claim being made by the Applicant is that the Body Corporate has not acted reasonably in making the decision not to authorise the making of the improvement (s 94(2), Act). Even though it is apparent from submissions that owners generally oppose the proposal, the Body Corporate has not made a decision.

Notwithstanding the response from owners, if he wanted to pursue the matter, the Applicant should have proceeded to submitting a motion for consideration at a general meeting. In most cases, this motion should have been included on the agenda of the next general meeting (s 69, Standard Module). If an appropriate motion was submitted, considered and opposed, the Applicant could then have proceeded to making a dispute resolution application. In determining whether a body corporate acted reasonably in deciding a motion it is appropriate to consider if the decision is objectively reasonable: Greiner v Independent Commission Against Corruption (1992) 28 NSWLR 125. The objective test requires a balancing of factors in all the circumstances according to the ordinary meaning of the term ‘reasonable’: Secretary, Department of Foreign Affairs and Trade v Styles [1989] FCA 342; (1989) 88 ALR 621 (see also McKinnon v Treasury [2006] HCA 45 per Hayne J at p61). The absence of evidence of proper consideration by the Body Corporate is a fundamental problem with the application for the outcome being sought.

In the circumstances, I do not consider there is any basis to proceed to make an order in the terms being sought. The Applicant has not demonstrated the claimed safety issue, has not objectively shown why the infrastructure could not be relocated to another part of Lot 5, has not provided any explanation to owners or in this application about the exact position on common property he proposes to install the infrastructure (including associated pipes and wires), and has not provided any undertaking about for example, the workmanship. In my view, information of this nature is imperative to any objective consideration of this type of request. The onus rested with the Applicant to provide enough information to owners about the proposal and he has failed to do so. I do not consider the argument that another air conditioner is installed on common property warrants making an order in the terms sought given the abovementioned issues. If the Applicant intends to have the proposal properly considered by the Body Corporate in general meeting, he may choose to provide this information with a motion given to the Body Corporate. The person submitting a motion may include an explanatory note not longer than 300 words (s 73, Standard Module). For these reasons, the outcome sought seeking approval to relocate/install an air conditioning unit on the outside western wall similar to other units in the building for safety reasons is dismissed.

Body Corporate authorisation – shutters request
As with the air conditioner request, it is apparent that the only meeting where this matter has been considered is the committee meeting dated 17 May 2008, and that the meeting simply noted the abovementioned 13 May 2008 letter. While there is no material indicating that owners responded to a letter in the form of the April 2008 letter, it is apparent from submissions that owners generally oppose the request to install shutters.

The April 2008 request from the Applicant proposed installing shutters on the balcony, seemingly in the same way as Lot 1. It appears no other information was given to the Body Corporate. Yet the Body Corporate would seem to have proceeded to get an indication from owners about the request. There was no explanation about the precise position the shutters would be installed. It was not known then—and it is no clearer despite my request to the Applicant—as to whether the shutters would be installed on common property or wholly within Lot 5. This question is significant in determining the level of authorisation (if any) that is required from the Body Corporate.

By referring to By-Law 5(2), it would seem the Applicant considers the shutters would be on common property. I requested submissions from the Applicant on this point. The Applicant did not provide any explanation to assist. In the circumstances, I do not consider it necessary to pursue this line of enquiry for the purposes of determining this application. In my view, a proposal to install shutters on common property would be an improvement to common property and at the time of the request, section 114 of the Previous Regulation would have applied in a similar way as it did to the air conditioning proposal. A special resolution would be required and it is clear that an appropriate motion has not been considered in general meeting. I do not agree that By-Law 5(2) applies in the circumstances. It should also be noted that the By-Law applies to an occupier; it would seem the Applicant does not occupy Lot 5.

In addition, the Applicant has stated more information in the outcome sought than in the April 2008 letter to the Body Corporate. As is the case with the proposal to install air conditioning, the Applicant as the person seeking permission to do work is obliged to provide the necessary information to allow an objective assessment of the proposal. In the circumstances, I do not consider there is any basis to proceed to make an order in the terms being sought in the absence of proper requisite Body Corporate consideration. The Applicant has not provided any explanation to owners, or in this application, about the exact position the shutters are proposed to be installed (on Lot 5 or the common property), has not described the nature of the work proposed, and has not provided any undertaking about for example, the workmanship. As one owner submitted, what is intended to be done with the existing balcony railings? A mere reference to another installation is not sufficient. The uncertainty about the position of the shutters is demonstrated by one owner’s reference to By-Law 8, a By-Law that seemingly regulates changes made to a lot (and not common property).

The onus rested with the Applicant to provide information to owners about the proposal, and in my view, the Applicant has not done so. I do not consider the ground that shutters have been installed on another balcony is sufficient to make an order in the terms sought given the abovementioned issues. For these reasons, the outcome sought that under By-Law 5.2 the Applicant install shutters of a similar type/style/colour to existing units on the exposed side of the building for security reasons is dismissed.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Acacia Avenue Apartments [2009] QBCCMCmr 229 (19 June 2009)