Isle of Palms Resort [2009] QBCCMCmr 337 (4 September 2009)

Last Updated: 9 October 2009

REFERENCE: 0395-2009A

INTERIM ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	20860
Name of Scheme:	Isle of Palms Resort
Address of Scheme:	2-10 Coolgardie Street ELANORA QLD 4221

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

Kay Gehl, the Co-owner of Lot 17

I hereby order that the following interim order issued on 4 June 2009: I hereby order that, pending final orders on this matter, the Body Corporate for Isle of Palms Resort, or any person authorised by or acting on behalf of the Body Corporate for Isle of Palms Resort, shall not enter any lot in the scheme for the purposes of carrying out maintenance or other work, or undertaking an inspection regarding the need for maintenance or other work, except in a genuine emergency or with the prior written consent of the owner of the lot. is extended. This interim order has effect until three (3) months have elapsed from the date of this further interim order, or until a further interim or final order for the application is issued, or until the application is withdrawn or otherwise ended (whichever is earlier).

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0395-2009A

“Isle of Palms Resort” CTS 20860

Isle of Palms Resort community titles scheme 20864 (Isle of Palms Resort) consists of 174 lots and common property. The Community Management Statement (CMS) for Isle of Palms Resort indicates that the Body Corporate and Community Management (Accommodation Module) Regulation 2008 (Accommodation Module) applies to the scheme.

Department of Natural Resources Mines and Water records show the scheme is registered as Group Titles Plan 1934 and Group Titles Plans of Re-subdivision 1946, 2020, 2039, 2089, 2097, and 2174, being a Standard Format Plan (SFP) of subdivision.

INTERIM APPLICATION

This application was lodged by Kay Gehl, Co-owner of Lot 17 (applicant) on 24 April 2009 under the Body Corporate and Community Management Act 1997 (Act).

The applicant sought interim orders against the Body Corporate for Isle of Palms Resort (respondent) in the following terms:

1. That the Body Corporate take no further action until Final Orders are made on the AGM 29th January, 2009 Motions - 1, 2, 3, 4, 5, 6, 7, 8, 10 and 14 as these motions are likely to conflict with the BCCM Act or are unlawful or unenforceable
2. That the Body Corporate take no further action until Final Orders are made on all Committee flying minute resolutions that have already been confirmed but have not been distributed to Lot owners in accordance with the BCCM Act.
3. That the Body Corporate be restrained from any further expenditure from body corporate funds towards Strata Sphere Management and the Committee appointed Body Corporate Consultant, Melissa Pahl, in any capacity until Final Orders are made, as the Committee has exceeded their expenditure authority on the services provided under the BCCM Act.
4. That the Body Corporate be restrained from any further expenditure from body corporate funds on any work carried out on private property within the scheme until Final Orders are made.
   

On 4 June 2009 I made the following interim orders:

I hereby order that, pending final orders on this matter, the Body Corporate for Isle of Palms Resort, or any person authorised by or acting on behalf of the Body Corporate for Isle of Palms Resort, shall not enter any lot in the scheme for the purposes of carrying out maintenance or other work, or undertaking an inspection regarding the need for maintenance or other work, except in a genuine emergency or with the prior written consent of the owner of the lot.

I further order that the application for interim orders shall otherwise be dismissed.

This interim order has effect until three (3) months have elapsed from the date of this order, a further interim or final order for the application is issued, or until the application is withdrawn or otherwise ended (whichever is earlier).

On 31 August 2009 our Office received a written request from the applicant to extend the interim order so that the interim order remained in place until the final orders are issued.

The application also seeks the following final orders:

1. An order that the Motion 1 - Amendment to Caretaking and Letting Agreements be declared invalid in the original instance and not subsequently able to be withdrawn by a proxy holder.
2. An order that Motion 2 - Confirmation of previous minutes of the EGM 5th November 2008 be declared invalid as they are not a full and accurate record of the meeting.
3. An order that Motion 3 - Statement of Accounts be declared invalid.
4. An order that motion 4 - Appointment of an Auditor be declared invalid.
5. An order that Motion 5 - Administration Fund Budget and Contributions be declared invalid.
6. An order that Motion 6 - Sinking Fund Budget and Contributions be declared invalid.
7. An order that Motion 7 - Confirmation of Insurance be declared invalid.
8. An order that Motion 8 - Appointment of Body Corporate Manager be declared invalid
9. An order in regard to Motion 10 - Refund of Expense that the Chairman was in error in ruling the motion out of order and the motion allowed to stand.
10. A order in regard to Motion 14 that Mr L. Dodd is not eligible to be a committee member as he is an associate of the Caretaking/Service Contractor.
11. A order that the Committee has erred in making known aggregate payments of $13,373.65 in excess of their expenditure authority under the BCCM Act, to Strata Sphere Management and Melissa Pahl, as the Committee appointed Body Corporate Consultant in various capacities.
12. An order to invalidate payments made in excess of the Committee's expenditure authority to Strata Sphere Management and Melissa Pahl, as the Committee appointed Body Corporate Consultant in various capacities, for example Public Officer and Taxation Agent for the Body Corporate
13. An order that the committee has erred in authorising works to be carried out on private property without the consent of lot owners and have erred in the payment of such work out of body corporate funds which is contrary to the BCCM Act.
14. An order to invalidate all payments made from the body corporate funds for work carried out on private property which is contrary to the BCCM Act.
15. That the Body Corporate provide immediate access for lot owners and uninterested parties to all material and information related to the secret ballots for the AGM 29th January, 2009, still held but the Committee appointed Returning Officer, Mr. C. Glenister, MBA Lawyers, Robina and the EGM 5th November, 2008, still held by the Committee appointed Returning Officer Mr. J.McDonald, Robinson & Robinson Solicitors, Surfers Paradise.
    

PROCEDURAL MATTERS

The interim order was issued on 4 June 2009 after a limited opportunity had been provided to the Committee and Laurie Dodd (Dodd), who was named as an affected party, with a limited opportunity to make submissions in relation to the interim order. Submissions were subsequently received from the Body Corporate.

Following the interim order I referred the application back to the Commissioner with a recommendation that it be referred for attempted conciliation of the dispute. I understand the parties participated in a conciliation session on 8 July 2009 but unfortunately were not able to reach agreement.

Subsequently, the Commissioner’s Office sought submissions from affected parties including all owners. The period for making submissions has now closed and the applicant has been provided with an opportunity to respond to submissions, which closes shortly.

The Body Corporate Committee have been advised of the applicant’s request for an extension of the interim order. The Secretary has confirmed in writing that the Committee have no objection to the extension of the interim.

MATTERS IN DISPUTE

This application raises a range of issues relating to motions considered at the Annual General Meeting of the Body Corporate on 29 January 2009. In addition, the applicant raises concerns regarding Committee flying minute resolution, expenditure in respect of Strata Sphere Management Pty Ltd, and expenditure on maintenance works. These issues are outlined in detail in the reasons for the interim order and it is not necessary to restate those at this time.

JURISDICTION

Section 279(1) of the Act allows an adjudicator to make an interim order if satisfied, on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances.

Section 279(2) of the Act further provides that:

(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; and

(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

The sole issue for consideration at this time is whether it is appropriate to make an order extending the interim order to enable it to remain in place pending a determination of the final order.

In relation to the interim order issued on 4 June I canvassed the issues relating to the impact on parties of making the particular order. I was satisfied at the time that, in the circumstances, there would be no inconvenience suffered to the Body Corporate from the interim order. I have not been advised that these circumstances have changed and the Committee have not raised any objection to the interim order.

Accordingly, and for the same reasons as indicated on 4 June, I am satisfied that it is appropriate to extend the interim order to preserve the status quo pending final orders.

While there are a significant number of matters currently pending adjudication in this Office I anticipate that an extension of a further three months should be sufficient until this matter can be finalised. However, if unforseen events change the anticipated timeframes for determining the application, the applicant may request a further extension.