Shakespeare Gardens [2009] QBCCMCmr 526 (24 December 2009)

Number of Scheme:	2603
Name of Scheme:	Shakespeare Gardens
Address of Scheme:	63 Shakespeare Street COORPAROO QLD 4151

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

I hereby order that the Body Corporate for Shakespeare Gardens is authorised under section 151(1)(c) of the Body Corporate and Community Management (Standard Module) Regulation 2008 to spend the sum of:

$2,490.00 (including GST) to engage Alliance Plumbing per the quotation dated 18 December 2009 for the repair of the sewer drain in Unit 1; and
$1,050.00 (plus GST) to engage engineer, John Reid, per the quotation dated 21 December 2009 for the purposes of inspecting the situation under the affected floor slab and outlining a safe method of approach for the re-instatement of support to the undermined slab.

The Shakespeare Gardens community titles scheme 2603 (“Shakespeare Gardens”) consists of 9 lots and common property. The community management statement (“CMS”) for Shakespeare Gardens indicates that the Body Corporate and Community Management (Standard Module) Regulation 2008 (”Standard Module”) applies to the scheme. The Department of Environment and Resource Management records show the scheme is registered as Building Units Plan 13040.

Pursuant to the Body Corporate and Community Management Act 1997 (“Act”), this application was made by The Body Corporate for Shakespeare Gardens (“the applicant”) on 23 December 2009, pursuant to a resolution passed outside a committee meeting on 23 December 2009. The applicant has sought a declaratory order in the following terms:

An Order that the Committee be authorised to accept the quote from Alliance Plumbing to expend the funds to repair one sewer drain in one of the bathrooms of Unit 1 and to engage an Engineer to advise how to proceed after that.

Section 243A of the Act provides that the Commissioner may refer an application immediately to a dispute resolution officer, notwithstanding that affected persons have not been given notice of the application and invited to make submissions as would normally be required under section 243(1). This referral can occur when the Commissioner reasonably considers that the application relates to emergency circumstances and it is not appropriate to deal with the application as an interim order under section 247. The example of emergency circumstances provided in section 243A(1)(a) is whether the repair or replacement of a burst water pipe exceeds the Committee’s spending limit.

The application seeks authorisation for emergency expenditure to undertake repairs to a broken sewer pipe and engage an engineer to make further recommendations on the matter. The facts of the dispute can be summarised as follows:

The body corporate state that they recently discovered moisture in the ground outside unit 1. The body corporate engaged Alliance Plumbing (AP) to investigate the moisture and provide a report regarding the matter. On 18 December 2009, AP provided a report stating that the sewer pipes for both the main and ensuite bathrooms of unit 1 had completely broken off and all the sewer drainage from both bathrooms was discharging into the surrounding soil. Further, the report states that the under-slab drainage in this area is laid in compacted fill, and AP believes that the fill has subsided providing no support for the under-slab drains.

Upon the advice of AP, the body corporate engaged an engineer, John Reid, to further assess the matter. In a letter dated 21 December 2009, Mr Reid advised that continuation of escaping moisture will possibly further undermine the affected floor slab.

The committee state that the expenditure required to rectify the sewer drainage issues and engage Mr Reid is beyond the committee’s expenditure limit. The committee state that there is insufficient time to risk taking the matter to a general meeting of the body corporate. AP are prepared to carry out the work next week beginning Tuesday 29 December 2009.

The committee are seeking authorisation of emergency expenditure of $2,490.00 (including GST) to engage AP to:

Further, the committee are seeking authorising of emergency expenditure of $1,050.00 (plus GST) to engage engineer, John Reid, to:

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]

The main issue for consideration in this matter is whether the body corporate should be granted authorisation for emergency expenditure to undertake repairs to a broken sewer pipe and engage an engineer to make further recommendations on the matter.

Sections 151-153 of the Standard Module provide for the control of spending by a body corporate. A committee is prohibited from authorising spending above the committee spending limit except in certain circumstances. Section 151(1)(c) of the Standard Module states that a committee may give effect to spending above the relevant spending limit if an adjudicator is satisfied that the spending is required to meet an emergency.

The body corporate has sought authorisation for emergency expenditure under section 151(1)(c) of the Standard Module because, the proposed costs of $2,490.00 (including GST) to engage AP to repair the sewer drain in unit 1 and $1,050.00 (plus GST) to engage Mr Reid to make further recommendations on the matter, exceeds the relevant limit for committee spending.

The body corporate argue that the work is urgent as they have received advice from AP that the sewer pipes for unit 1 have broken off and all the sewer drainage is discharging into the surrounding soil. Further, AP have stated that the discharge from the sewer drain is causing the under-slab to subside and recommends that an engineer be engaged to provide advice on the issue.

In the circumstances, I am satisfied that it is appropriate to authorise emergency spending for the works in question rather than requiring the committee to call a general meeting for owners to vote on the matter.

For these reasons, I consider it is appropriate to authorise the emergency expenditure as above.

[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.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Shakespeare Gardens [2009] QBCCMCmr 526 (24 December 2009)