Tokara Quays [2009] QBCCMCmr 338 (4 September 2009)

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

I hereby order that the extraordinary general meeting held on 6th March 2009 was validly held, and that votes cast at that meeting were validly cast. The persons appointed at that meeting to positions on the committee shall constitute the current committee for the scheme.

I further order that if, because of this application, any forthcoming annual general meeting is to be held outside the three month period following the end of the scheme’s financial year, that such a general meeting, held in accordance with the legislative provisions for holding an annual general meeting, shall be deemed to be the annual general meeting of the scheme for 2009.

In all other respects, the application is dismissed.

This is an application dated 2nd July 2009 and amended on 8th July 2009 by Linda Derry, owner of Lot 1, and Therese Shine, owner of Lot 15 (the Applicants) against the body corporate for the scheme (the body corporate) for an order as follows –

“that Bruce Blades accepts that he is no longer on the Committee, and agrees to cease contacting other owners purporting that he is on the committee for Tokara Quays. To achieve this outcome, the Committee feels that a ruling is required as to the validity of the Extraordinary General Meeting on the 6th March 2009; in which a motion to retain Mr Blades on the Committee, was lost.”

On 24th July 2009, I made interim orders inter alia in this matter as follows -

“Tokara Quays” CTS 24071 is a community title scheme governed by the Body Corporate and Community Management Act 1997 (the Act), and the Body Corporate and Community Management (Accommodation Module) Regulation 2008 (Accommodation Module). There are 16 lots in the scheme created under a Building Unit Plan of subdivision.

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)).

I note that there is reference to a conciliation at this office previously in this or a related matter. I have no knowledge of matters discussed at a conciliation session and no power to request that anything said or done at such sessions is made known to me. The Applicants must put their case “de novo” that is, this is a new application and will be assessed on its merits.

The Applicants say that prior to a requested extraordinary general meeting on 6th March 2009 (the EGM), Bruce Blades (Mr Blades) was the chairperson, secretary and treasurer for the scheme.

The requested EGM was by eight owners to vote on four motions including that the positions of chairperson, secretary and treasurer be declared vacant and an eligible person or persons be appointed to each role to fill the vacancy “from the floor of the meeting.”

On 5th February 2009, Mr Blades distributed the notice of meeting on the letterhead of body corporate management company, AAA Certified, a company which the Applicants say is not the authorised body corporate manager for the scheme. The agenda showed Motion 3 in the alternative, as submitted “by the committee.” Motion 3 contained the motions about the executive member positions, as drafted by the owners but with the fourth alternative (as alternative 1) that Mr Blades continue as the executive committee until the next AGM. The committee also circulated an explanatory note recommending that owners vote for alternative 1 (maintaining Mr Blades.)

The committee also added Motion 2 - “Repayment of Special Administrative Levy” by “Whittles” to owners.

Prior to the EGM, on 2nd March 2009, Mr Blades sought to postpone it by writing to lot owners, and subsequently, he wrote to lot owners saying that he does not acknowledge either the validity of the EGM, or the new committee. He continues to send correspondence, to contact owners and he has called an annual general meeting for 28th July 2009.

Owners are confused as the scheme now has two de facto committees, and two body corporate managers. Two owners are on “both committees.”

The circumstances of the EGM were that when a quorum of owners arrived for the meeting at the offices of AAA Certified, the location stated in the notice, they were told that the requested EGM “was postponed” and were turned away. Attendees held a brief meeting, chaired in the absence of the chairman by Terry Shine, and decided to reconvene at a lot on the scheme 20 minutes later where the meeting proceeded and minutes were taken. The minutes record that eight lots were represented at the EGM which was adjourned and that nine lots were represented at the “adjourned meeting”. Whittles Body Corporate Management was in attendance.

At the EGM, a motion to retain Mr Blades on the committee in the three executive member positions was lost 9-0, with alternatives 2, 3 and 4, to appoint new executive committee members to the vacant positions being carried 9-0. Nominations were called from the floor for each position, and Carlu Lawson was appointed as chairperson and treasurer, and Linda Derry was appointed as secretary.

The Applicants say that they have since found out that the former committee which convened the EGM should not have added its own agenda items. They say that the “endorsed” body corporate manager is Whittles, which company acknowledges the committee appointed at the EGM and not the former committee.

The Applicants fear confusion and expense if two body corporate managers are maintained, two annual general meetings are called, and two committees are administering the scheme.

The letter of 2nd March 2009 from the body corporate said that the EGM would have to be postponed “as the Committee has not yet received the books and records from Whittles and is unable to provide the body corporate with an explanation of the need for the special administrative levy.” It says this matter has been referred to this Office for an order that Whittles return the body corporate records.[1]

The Applicants say that the letter gave no re-scheduled date and was not received by some owners before the date of the scheduled meeting on 6th March 2009.

The Applicant Linda Derry advised on 10th July that some owners had been sent a 13 page agenda for an annual general meeting on 28th July 2009.

In accordance with section 243(2)(b) Act submissions on the final outcome sought were invited from all lot owners.

David and Linda Wulff, co-owners of Lot 5 say that they support the application, and the legality of the EGM. They complain of the behaviour of Mr Blades over a period of time and refer to a Magistrates Court Order wherein Mr Blades was bound to keep the peace and be of good behaviour to Mr Wulff for a period of 12 months from 8th April 2009.

Dr Thomas Choong owner of Lot 10 also supports the application, and says there is a lot of confusion within the scheme as to who is the authorised committee.

Karl and Maureen Robinson, co-owners of Lot 14, also support the application in all details. They say that the company AAA Certified have “nothing to do with Tokara Quays” and that meetings should not be convened there. They say they hope that the sorry saga can be resolved quickly.

A submission was received from owners Bruce and Carol Blades (co-owners Lot 11), Paul Nettleton (Lot 6), and Kerri and Gary Jeffrey (co-owners Lot 12), giving a postal address of Lot 8, and representing the body corporate committee.

They said that this application was “simply a smoke screen to cover up the $10,500 which had been paid by [Whittles body corporate management] to the caretaker without committee approval or receipts.” They say that they have “never been considered the valid committee” either by the body corporate manager or some owners despite an adjudicator’s order finding to the contrary in January 2009.

The EGM purporting to remove Mr Blades from the positions of the executive committee had several “significant legal issues.” The committee resolved to postpone the EGM and “as no-one objected, the committee believed the EGM was postponed.” Mr Blades went to the meeting place on hearing that owners had arrived at the offices of AAA Certified but when he arrived there at 2.20pm there was no-one there. He was not advised of the new venue and therefore denied his right to attend the EGM in person. Owners who genuinely thought the EGM was postponed were denied their right to vote in person for eligible members of the committee.

They say that voting papers received by the secretary (Mr Blades) were not counted at the EGM and that the caretaker of the scheme advised owners to send voting papers to a different address from that on the notice of meeting. The minutes are dated 9th March 2009 when the adjourned meeting was supposed to have been held on 6th March 2009.

They complain of unauthorised financial transactions by the “current committee”.

Their committee has organised and distributed AGM notices “in an attempt to move forward”, and Mr Blades undertakes that he is not standing for the committee again. There will be only one committee after the AGM.

There was only one further submission between the interim order being made and the final order, from the “appointed” body corporate manager Whittles Body Corporate Services on behalf of the body corporate. It says that the committee is made up of Carlu Lawson, chairperson/treasurer; Linda Derry, secretary; and ordinary members Michael Newlyn and Nigel Price, and that the committee supports this application, and the outcome of the extraordinary general meeting on 6th March 2009.

It advises that Bruce Blades has now sold his lot in the scheme and is no longer a member of the body corporate.

There was a budget committee meeting held on 30th July 2009 at Whittles’ Office and the minutes of the committee meeting of 27th April 2009 were confirmed, and draft budgets approved for putting to the forthcoming annual general meeting. The committee noted that the date of the annual general meeting could not be set until this application was determined.

The Applicants did not a request a copy of the submissions and did not exercise their right of Reply. The matter therefore was set down for departmental adjudication on 2nd September 2009.

Since Mr Blades has now left the scheme, I am no longer able to make any relevant finding about Mr Blades’ behaviour. In any event, I am of the view that I would not have been able to make an order which could be enforced as to the acceptance or not by Mr Blades of any order of this Office. I could have made an order that Mr Blades was or was not a member of the committee, and it seems that the Applicants still want confirmation of the legitimacy of the extraordinary general meeting of 6th March 2009 even though that confirmation was sought initially with the objective of determining the position held by Mr Blades in the scheme.

The circumstances of the requested EGM were that when a quorum of owners arrived for the meeting at the offices of AAA Certified, the location stated in the notice of meeting, they were told that the requested EGM “was postponed” and were turned away. Attendees held a brief meeting, chaired in the absence of the then chairman Bruce Blades, by Terry Shine, and decided to reconvene at a lot on the scheme 20 minutes later where the meeting proceeded and minutes were taken. The minutes record that eight lots were represented at the EGM which was adjourned and that nine lots were represented at the “adjourned meeting”. Whittles Body Corporate Management was in attendance.

The legislation is silent on whether a general meeting might be postponed and how that is to be effected. There have been no submissions to the effect that any lot owner was, because of the postponement, unable to vote at the EGM, although the body corporate submits that voting papers held by the secretary were not counted in the voting which ensued at the adjourned meeting.

It is for this reason that postponing a meeting at such short notice does not fit well with the prescribed times given in the legislation for holding meetings and casting votes. A vote cast by mail to a meeting which is then “postponed” indefinitely becomes a vulnerable document. The voter might withdraw his or her vote, especially if the reason for the postponement alters his or her view of the way he or she wishes to vote. Is the voter then able to vote again if the situation changes? Should the body corporate discard votes cast by mail for a meeting which is postponed indefinitely?

I am of the view that a meeting cannot be postponed once called, save in the circumstances where no quorum is achieved, or where the body corporate votes at the meeting to postpone it to a fixed day and date. The chairperson of a meeting might also adjourn a meeting if documents are not available or if there is violence or reason to be concerned about a breach of the peace. Again, such an adjournment would be normally for only a short period of time, and a new time and if necessary a new date, should be given on the announcement of the adjournment. If documents were unavailable, the correct procedure would have been to open the meeting as notified, carry on with the rest of the business of the meeting and then propose an adjournment to a specific time for the consideration of the documents, if required.

The legislation does not envisage adjournments and it is all too easy to see how a committee or a chairperson might use a power to postpone in order to silence opposition.

For the reasons above, I am of the view that the continued meeting on 6th March 2009 was lawful. The meeting was held on the day and date notified, and was convened at the place notified, and thereafter moved to another venue because of an inability to be continued in the notified venue.

Section 74(2)(ii) Accommodation Module requires that where a general meeting is requested that the substance of motions proposed by lot owners must be included. I have concerns that the re-batching of the three motions proposed as one ‘motion in the alternative’ (which had no substantive motion of its own) does not meet the requirement of section 74(2)(ii).

However, those attending the duly convened meeting voted on the motions as set out by the committee, and did not challenge those motions at the time, although I understand attendees were not happy with the wording. They did the best with the agenda given, and no owner has challenged the motions themselves. Nor has any owner submitted that postal votes were not counted or that he or she has not had the opportunity to vote.

As noted in the interim order, the earlier committee did not bring an application to this Office within the three month period for lodging such an application, if it was of the view that the EGM, or the election of office bearers, was invalid.

The aim of the requested extraordinary general meeting was for owners requesting the meeting to vote on their own requested motions, and there was no reason why they should have been prevented from doing this.

I therefore order that the extraordinary general meeting held on 6th March 2009 was validly held, and that votes cast at that meeting were validly cast. The persons appointed at that meeting to positions on the committee shall constitute the current committee for the scheme.

I note that the committee has held a budget meeting and I hope that this scheme might now proceed to hold its annual general meeting. If, because of this application, any forthcoming annual general meeting is outside the three month period following the end of the scheme’s financial year as required by the legislation, I order that such a general meeting shall be deemed to be the annual general meeting of the scheme for 2009.

Number of Scheme:	24071
Name of Scheme:	Tokara Quays
Address of Scheme:	52 Naroon Crescent WURTULLA QLD 4575

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Tokara Quays [2009] QBCCMCmr 338 (4 September 2009)