The Bay Apartments [2009] QBCCMCmr 306 (20 August 2009)

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

I hereby declare that an annual general meeting of the Body Corporate for The Bay Apartments held within one month of the date of this order will not be invalid simply because it is held more than three months after the end of the financial year of the Body Corporate.

I further order that the Committee for the Body Corporate for The Bay Apartments is authorised to call and conduct the annual general meeting for 2009, notwithstanding that the legislative timeframe for the meeting has expired.

I further order that the Committee for the Body Corporate for The Bay Apartments shall provide a copy of this order and the statement of reasons to all owners with the notice of meeting for the 2009 annual general meeting.

The Bay Apartments community titles scheme 1592 (The Bay Apartments) consists of 27 lots and common property. The community management statement (CMS) for The Bay Apartments indicates that the Body Corporate and Community Management (Standard) Regulation 2008 (Stamdard Module) applies to the scheme.

Under the Body Corporate and Community Management Act 1997 (Act), this application was made by the Body Corporate for The Bay Apartments (applicant) on 30 June 2009, an authorised by a resolution passed outside a committee meeting on 17 August 2009.

To convene the Body Corporate Annual General Meeting outside of the Financial Year end. (Financial Year ending 31 December 2008)

On receipt of the application staff of the Commissioner’s Office contacted the applicant to seek further information, including authorisation from the Committee for the lodgement of the application. This information has only now been received in full, after follow up by this Office.

I am satisfied that this is a matter which falls within the legislative dispute resolution provisions.[1]

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:

(b) the exercise of rights or powers, or the performance of duties, under the Act or the CMS; or

(i) the engagement of a person as a body corporate manager or service contractor; or

An order may require a person to act, or prohibit a person from acting, in a way stated in the order.[2] An adjudicator's order may contain ancillary and consequential provisions the adjudicator considers necessary or appropriate.[3]

Section 66 of the Standard Module provides that an annual general meeting (AGM) must be called and held within three months after the end of each of the scheme’s financial years. Time limits are placed on the period within which an AGM is required to be held for a number of reasons, including accountability and accessibility to information regarding the operation of the scheme.

The end of the financial year for the scheme is 31 December, and so that the AGM must be held by 31 March each year.

It appears that there have been ongoing problems with the conduct of AGMs in this scheme. The AGM which should have been held by 31 March 2008 (the 2008 AGM) was not held until 5 February 2009. That AGM was held pursuant to an order of an adjudicator (Reference 0887-2008) which was made on 11 December 2008. At the 2008 AGM resolutions agreed to undertake a sinking fund forecast, insurance valuation, and workplace health and safety audit. The Committee apparently wished to meet to discuss these reports and develop appropriate AGM motions, but by the time the reports were available the Committee could not meet until 20 April 2009.

On 25 March 2009 a first notice was issued to owners advising that the AGM would be held on 15 May 2009. For reasons not explained in the application, this date was apparently not progressed. The application also does not explain why, when on 20 April 2009 the Committee minuted the need to hold the 2009 AGM as soon as reasonably possible, the Body Corporate took until 30 June 2009 to lodge an application in this Office and have then taken some six weeks further to respond to requests for clarification of the application. However I will not delay this matter further by again seeking details of the reasons for these delays.

I appreciate that very unusual circumstances exist in this case as the 2008 AGM was held almost 11 months late. I also appreciate that there was a valid interest in obtaining relevant reports before another general meeting was held. However, I am concerned that there has been a considerable unexplained delay since April in organising the 2009 AGM. I also note that the issue of the legislative timeframe was apparently not identified until after the timeframe had already expired. I note that the Committee will be putting a motion to the 2009 AGM to change the end of financial year date and perhaps this may alleviate some of the apparent difficulties. Whether this occurs or not, I would encourage all those involved with this scheme to have greater regard to the legislative timeframes in 2010.

Obviously it is preferable that an AGM be held within the prescribed timeframe, and a body corporate should make every effort to ensure that this timeframe is complied with. However, the courts have recognised that the very detailed provisions of the regulations make it almost inevitable that from time to time there will be non-compliance with the legislation. In particular the courts have commented that non-compliance of an insubstantial nature should not be allowed to imperil the actions of bodies corporate or their committees, particularly in the instance of committees where actions are taken in good faith.[4]

Notwithstanding my concerns, the 2009 AGM clearly cannot now be held within the legislative timeframe. If the Committee were to call the AGM now, the convening and conduct of the AGM could be invalid in the absence of the authorisation of an adjudicator. This would leave in doubt the legal status of the Body Corporate, as well as the validity of any decisions purportedly passed by any AGM. This would clearly not be in the interests of owners.

In the circumstances I am satisfied that it is appropriate for an order to be made that the AGM will not be invalid if it is held within the timeframe specified in this order. The application indicates that that the meeting could be held within four weeks of the date of the order, and so I have made an order providing that timeframe. I have also authorised the current Committee to call and convene the meeting. In addition I have required that a copy of this order and statement of reasons be provided to all owners so they are fully aware of the circumstances.

[1] See sections 227, 228, 276 and Schedule 5 of the Act
[2] Section 276(2) of the Act
[3] Section 284(1) of the Act

[4] Wei-Xin Chen v Body Corporate for Wishart Village CTS 19482, Appeal 4080 of 2000, District Court Brisbane, 29 May 2001 (Unreported).

Number of Scheme:	1592
Name of Scheme:	The Bay Apartments
Address of Scheme:	43 The Strand NORTH WARD QUEENSLAND 4810

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

The Bay Apartments [2009] QBCCMCmr 306 (20 August 2009)