Atlantis West [2010] QBCCMCmr 58 (10 February 2010)

Number of Scheme:	8790
Name of Scheme:	Atlantis West
Address of Scheme:	2 Admiralty Drive SURFERS PARADISE QLD 4217

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

I hereby order that the body corporate shall within three (3) days of the date of this order affix to the interior of all lift cabins, laminated notices bearing the telephone numbers of both the building manager with hours when the building manager may be contacted, and the after-hours security personnel.

In all other respects, the application for interim orders is dismissed.

This is an application dated 21st December 2009 but lodged with this Office on 23rd December 2009 and amended on 25th January 2010. The Applicants are Gunter Berhart and Helga Berhart, owners of Lot 123 (the Applicants) and the order sought is against the body corporate for the scheme (the body corporate.) The Applicants seek final orders as follows –

The Applicants also seek interim orders in the same terms as the final orders sought and in addition the following orders –

Atlantis West CTS 8790 is a community titles scheme governed by the Body Corporate and Community Management Act 1997 (the Act) and the Body Corporate and Community Management (Standard Module) Regulation 2008 (Standard Module). There are 123 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)).

Section 247(3) of the Act allows the Commissioner to refer an application to an adjudicator for consideration for an interim order even though proper notice of the application has not been given to the body corporate or other affected persons, and despite the fact that parties to the application have not been given an opportunity to make a submission about the matters in dispute. It seems to me that the Act allows this process because applications for interim orders often relate to emergency or otherwise urgent circumstances, where it is simply impractical or impossible to allow a period for submissions prior to the consideration of the application for interim orders. It is also relevant that generally the purpose of an interim order is simply to maintain the “status quo” of a situation, and not finally to resolve the matters in dispute.

Section 279(1) of the Act allows an adjudicator to issue an interim order in response to an application “if satisfied, on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances to which the application relates”. Read together with section 247(3), section 279(1) appears to allow an adjudicator to issue an interim order without any reference to other parties to the dispute.

Notwithstanding that the Act allows for interim orders to be issued without reference to other parties, I am of the view that when possible, it is far preferable and more consistent with the principles of natural justice, to allow affected persons to make a submission about an application (even if the time allowed for submissions is necessarily brief) prior to the determination of an application for an interim order.

I therefore sought submissions on the interim outcomes sought from the body corporate committee.

The Applicants say that the lifts in the scheme are old and the security, emergency facilities and mechanisms are outdated. There are occasional breakdowns, one experienced by Mrs Berhart on 27th September 2009 when emergency facilities failed.

Mrs Berhart was stuck in the lift on the third floor for nearly two hours, (from 3.48 to 5.40pm) and was scared and claustrophobic. She banged on the lift doors and screamed until a lot owner on the 4th floor heard her and summoned the property manager. The emergency button did not work. The property manager contacted the lift manufacturers to report a fault. Mr Berhart did not know on which floor his wife was trapped. Although the body corporate was aware that she was trapped, there was no assistance from the property manager other than to call the chairman. After an hour of waiting for a service person, and Mrs Berhart being very distressed, Mr Berhart called the fire brigade. Thereafter, the service technician arrived, followed by the fire brigade. After about 15 minutes the technician was also under stress and the fire brigade prepared to open the doors by force. The technician then moved the cabin up to expose wiring and mechanisms for opening the door from the inside. Mrs Berhart was guided to open the door by moving parts as directed by the technician and was very scared to be touching mechanisms and by the fact that the power was still on and she was standing amidst cables and wiring.

The Applicants are concerned about residents with phobias or in ill health who may get trapped in the lifts. Mrs Berhart is now afraid to use the lifts.

The body corporate has proposed a motion to the annual general meeting on 11th March 2010 that the lifts be upgraded, but if that motion is approved, work will not start until the end of 2010.

The Applicants suggest that an Emergency Manual should include a step by step procedure with time limits, eg. when the fire brigade should be called if a lift technician is delayed. It should be compliant with workplace health and safety practices, and easy to follow for the building manager and security personnel.

When Mrs Berhart was stuck in the lift the security camera was partly out of order and the building manager had only a “fizzy picture” on the monitor. If the picture had been better the building manager could have guided Mrs Berhart to move parts of the mechanism to release herself. They say that pushing the emergency button should have activated the alarm bell and the phone connected to the lift service provider. However, when Mrs Berhart was stuck in the lift, the back-up batteries had been ‘discharged’ and there was no automatic connection. The Applicants believe that this may be the case with three of the four lifts.

If the number was printed on the inside of the cabins, people would also be able to use mobile phones to contact the building manager or after hours security personnel.

They enclose a sample of an “Elevator Malfunction” report and procedures, including what any trapped passengers should be told to do and not do whilst stuck in the lift.

The body corporate manager Body Corporate Services, on behalf of the body corporate says that an order is not necessary. Prior to this application, the body corporate had been researching tenders for lift equipment from various manufacturers and that approval is likely to be given for an upgrade at the forthcoming annual general meeting in March 2010. In the meantime more stringent measures have been taken to ensure that the current equipment, including alarms etc, work properly and a safety manual is being prepared which includes lift safety procedures. The document will be available to all residents.

On the day of the incident, lift-camera images were obscured by painters’ scaffolding interfering with the radio transmission of images. The lift camera images are now “hardwired” and this problem will not occur again.

The lift contractors make checks on the emergency facilities and they are not be tested weekly by anyone else. Otis had tested the emergency batteries “one week before the incident” and they were found to be in order. As Telstra was working on “the emergency lines in the building” also on that day, and had not advised the building manager, it is unclear whether the fault lay with the batteries or with work being done by Telstra.

The body corporate agrees that the numbers of the building manager and after-hours security personnel should be fitted in the lift cabins although some mobile phones will not work in lifts. They are also concerned that if the building manager or security remain on the phone when someone is trapped in the lift, this may interfere with “other emergencies which may be as urgent.”

The body corporate investigated the problem with Otis the lift manufacturers and contractors, in December 2009. Otis has said that the occurrence was rare; that technicians were attending to other trapped passengers elsewhere at the time; and that a new procedure for testing the emergency back-up battery should be used by them in future. Otis says that the alarm and batteries were “last checked on 27th April 2009” and found to be in order.

In this matter, the Applicants seek the same orders in an interim order as they do for a final order. There are two additional orders sought in the interim order application. There is no dispute that Mrs Berhart was trapped in the lift for well over an hour on 27th September 2009 and that the emergency alarm did not work during the entire time during which the list was disabled.

It appears that the body corporate is taking steps to draw up a safety procedures manual although there is no date given for its availability.

Clearly there are issues in this matter which need further exploration and which cannot be explored at this interim order stage. For example, the body corporate says that Otis tested the emergency batteries one week before the incident, but Otis note that it “last tested” the alarm in April 2009. There may be a discrepancy here, or the difference may be between the testing of ‘the batteries’ and the testing of ‘the alarm.’ I do not know.

An application for an interim order must demonstrate that there is a serious legal issue to be decided, that the applicant can show a prima facie case, and that on the balance of probability, the applicant would be successful in obtaining the final outcome sought. The interim order is a “holding order”, requiring one party to take steps, or to refrain from taking steps, whilst the serous issue is further investigated. It is not a way of expediting the final order.
An adjudicator must then decide whether to grant the “holding order” if it would inconvenience one party to its detriment or whether any detriment suffered should be borne by that party in the light of the possible danger, injury or inconvenience to others.

The body corporate admits that the lifts are in need of an upgrade and that work on renewing or upgrading the lifts will not be completed until at least some time in 2011. It will no doubt be an unavoidable inconvenience to all lot owners whilst this work is undertaken.

In this case, the serious legal issue is whether or not the body corporate had satisfied its obligation to maintain the lift, by having regular service from the Otis contractors, or whether the body corporate is required to do more to satisfy its obligation to maintain common property in good condition pursuant to section 159 Standard Module.

The question of the level of maintenance required is one that also cannot be entered into at this stage. In New South Wales, a body corporate has been held liable for damage caused by a leak occurring in a roof, even though that roof had been regularly maintained by the body corporate. That is, maintenance is a “strict liability” in New South Wales for which the body corporate can put up no excuse.[1] However, this obligation to maintain does not impose a standard of care requiring the body corporate to inspect the premises for the purpose of discovering unknown and unsuspected defects.[2]

In Queensland, the Act provides that the body corporate must "administer, manage and control the common property ... reasonably and for the benefit of lot owners" and the body corporate must act "reasonably" in carrying out its functions (sections 152(1), 94(2), 100(5) Act ). In this context, it appears that the obligation in section 159 Standard Module should not be interpreted as imposing a strict liability that is contravened as soon as something stops operating properly. Rather, it appears that a body corporate, acting reasonably, should have a system in place for monitoring the maintenance and state of repair of the common property.[3] The body corporate would only be in breach of its duty to maintain if it fails to remedy deterioration or defects within a reasonable time of when it became aware of the problem or should reasonably have become aware of the problem.[4] Also, the body corporate would not be in breach of its duty if there is no deterioration or defect but a breakdown occurs only as a result of an extraneous event.

I am satisfied that there is a serious legal issue to be considered here, but I am not satisfied that the interim outcomes sought by the Applicants are in fact of an “interim” or “holding” nature. To draw up an Emergency Manual is not a holding order, nor is the regular maintenance of equipment.

I am willing to order that whilst the Manual is being prepared, and perhaps some permanent notices displaying emergency phone numbers are put up in lifts, that the body corporate as a temporary measure, attaches laminated notices inside each of the lift cabins displaying clearly the telephone numbers of the building manager and the hours for contact; and the after hours security personnel.

I add that the anxiety experienced by the Applicants during and following this incident is understandable and that the body corporate should expedite the preparation of the safety manual. This is a large scheme and the smooth and safe running of the lifts must be a prime concern.

Mrs Berhart lost time and was put to gross inconvenience and discomfort. Whether the body corporate is found to be at fault or may properly blame Otis and/or extraneous circumstances, the body corporate should be now well aware of the possibility of failure of these aging lifts and be extremely careful that all aspects of lift maintenance are attended to promptly. What I am saying is that, the vulnerability of the lift systems being known, if any owner or visitor is caused suffering, injury or delay in future, the body corporate might have an action for negligence on its hands.

This file will now be referred back to the Commissioner in accordance with section 278(4) Act.

[1] Seiwa Pty Ltd v Owners Strata Plan 35042 [2006] NSWSC 1157, paragraphs 3-5.
[2] Ridis v Strata Plan 10308 [2005] NSWCA 246, paragraphs 133, 175, 186.
[3] Ridis v Strata Plan 10308 [2005] NSWCA 246, paragraph 5.
[4] Klinger & Anor v Body Corporate for Costa D’Ora Apartments [2007] QDC 300, paragraph 67.

Queensland Body Corporate and Community Management Commissioner - Adjudicators Orders

Atlantis West [2010] QBCCMCmr 58 (10 February 2010)