Rosebank South [2009] QBCCMCmr 431 (30 October 2009)

Last Updated: 8 February 2010

REFERENCE: 1012-2009

INTERIM ORDER OF A REFEREE

MADE UNDER PART V

BUILDING UNITS AND GROUP TITLES ACT 1980

Number of Building or Parcel:	Rosebank South
Address of Parcel:	Hope Island Resort, Hope Island, QUEENSLAND

TAKE NOTICE that pursuant to an application made under sections 76 and 77(1) of the Building Units and Group Titles Act 1980 by Suzanne Niven, Maclan Investment Pty Ltd and Stuart & Stephanie Innes, the Owners of lots 5, 21 & 42

I hereby order that owing to the possibility that the resolution upon motion 23, considered at the AGM on 30 September 2009, could be invalid, the Body Corporate committee is not to take any action to withdraw the appeal in the matter Order Ref No.508-2009 or to otherwise bring that matter to an end, until such time as a final order has been made in respect of this dispute resolution application.

STATEMENT OF REFEREE’S REASONS FOR DECISION - 1012-2009

“Rosebank South” CTS 0

APPLICATION

The applicants are lot owners in Rosebank South and have submitted a dispute resolution application under the Building Units and Group Titles Act 1980.

The applicants seek the following Interim order:

That the new committee takes no action to withdraw the appeal in the matter Order ref 508-2009 and takes no steps to bring that matter to an end by such withdrawal or otherwise contrary to the resolution of motion 23 at the AGM of Rosebank South GTP 102509 on 30 September 2009.

The applicants also seek a number of final outcomes relating to certain resolutions made at the Annual General Meeting held on 30 September 2009.

BACKGROUND

The applicants state that the AGM for Rosebank South was held on 30 September 2009 and a total of 23 motions were voted upon at that meeting, including Motion 23 which was a motion to withdraw an appeal against adjudicator’s order 508-2009.

As the parties would be aware, on 29 May 2009, the Body Corporate Committee for Rosebank South lodged application 508-2009 seeking an order invalidating a motion by the Principal Body Corporate to enter into a Management Agreement with Cambridge Management Services.
Following receipt of detailed submissions from the principal body corporate and the various residential bodies corporate, a final order was made dismissing that application.

The Body Corporate Committee for Rosebank South subsequently lodged an appeal against that order with the Magistrates Court. However at the last AGM lot owners voted upon the following motion 23:

“That the body corporate immediately withdraw its appeal in the matter Order ref No. 0508/2009 and that the committee take all steps required to bring that matter to an end by such withdrawal”.

The Minutes for the AGM record that there were 25 votes in favour of the motion, 21 votes against the motion and 0 abstentions. However the applicants have called the results of the vote into question on the following grounds:

• 19 lots were represented at the meeting and 31 lots were represented by proxies at the meeting. However, while 50 lot owners attended in person or by proxy, the minutes record that only 46 in total either voted or abstained from voting on all 23 motions;
• A re-check of votes indicates that 47 lots voted;
• Lot 18, owned by Roy and Ralda Hooker gave a proxy to Roy Hooker but it is claimed that as that proxy expired before the meeting, the vote by Roy hooker should not have been included in the tally;
• Lot 81, owned by Mr. & Mrs. Lanigan is an amalgamation of 2 lots and therefore is only entitled to one vote but it is claimed that they were afforded 2 votes;
• It is claimed that proxies were accepted for lots 2, 8, 39 and 48 which were not entitled to vote because at the relevant time they had not paid all contributions owing to the body corporate, and therefore should not have been included in the tally.
• The applicants therefore claim that “there is a serious question mark over at least 8 votes and this irregularity also raises the possibility of other errors “ and therefore all resolutions and motions considered at the AGM on 30 September should be set aside as invalid and reconsidered at another general meeting.
  

In order to afford natural justice to the respondent it is customary to seek submissions pursuant to section 73 of the Building Units and Group titles Act 1980 prior to making any order. However the applicants are concerned that the body corporate may withdraw the appeal submitted with the Magistrates Court before an order is made. In such circumstances I am empowered by section 76(3) of the Act to make an urgent interim order on an ex parte basis.

DETERMINATION

The Interim Order sought by the applicant is as follows:
That the new committee takes no action to withdraw the appeal in the matter Order ref 508-2009 and takes no steps to bring that matter to an end by such withdrawal or otherwise contrary to the resolution of motion 23 at the AGM of Rosebank South GTP 102509 on 30 September 2009.

The Building Units and Group titles Act 1980 (the Act) applies to this scheme. Part 5 of the Act concerns disputes and Part 5, division 3 makes provision for orders by a referee. Within division 3, section 77 provides general powers of a referee to make orders. Relevantly, section 77(1) provides a general power that a referee may on application of a body corporate ... a proprietor ... in respect of a parcel, make an order on any person entitled to make an application under this subsection ... for the settlement of a dispute, or the rectification of a complaint, with respect to the exercise or performance of, or the failure to exercise or perform, a power, authority, duty or function conferred or imposed by this Act in connection with that parcel.

Further, under section 76 of the Building Units and Group titles Act 1980 I am able to make an interim order as a matter of urgency, despite not having received submissions from the other parties to the dispute. The rationale for conferral of this power is that the purpose of an interim order is to maintain the status quo until such time as the substantive issues in dispute can be considered in depth by the referee. Accordingly, 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 and the applicant needs to establish that the circumstances warrant an interim order. An interim order will not be made if the only urgency relates to an applicant’s desire to resolve or expedite the matters in dispute, or where the nature of the circumstances are such that the matter is not capable of being dealt with in the context of an interim order. Of particular relevance is evidence that an interim order is necessary to prevent serious or irreparable harm.

On the information at hand I have concerns regarding the validity of a number of votes cast at the last AGM. In particular I note that the minutes of the meeting record the results of voting upon motion 23 as 25 votes in favour and 21 votes against. Given that the applicants have impugned the validity of up to 8 votes that were cast at the AGM, I believe it is appropriate for me to make a temporary order as requested until I am able to obtain additional evidentiary material and submissions to enable me to consider the matter in detail.

Accordingly, I propose to make the following Interim Order:

that owing to the possibility that the resolution upon motion 23, considered at the AGM on 30 September 2009, could be invalid, the Body Corporate committee is not to take any action to withdraw the appeal in the matter Order Ref No.508-2009 or to otherwise bring that matter to an end, until such time as a final order has been made in respect of this dispute resolution application.

This matter is now referred back to the Commissioner for consideration as to what further action should be taken in respect of this application. This may include seeking of further submissions and affording the applicant a right of reply to submissions.