The Hudson [2011] QBCCMCmr 219 (25 May 2011)

Last Updated: 14 July 2011

ADJUDICATOR’S ORDER
Office of the Commissioner
for Body Corporate and Community Management

CITATION:	The Hudson [2011] QBCCMCmr 219
PARTIES:	James Hanna (applicant) The Body Corporate for The Hudson CTS 31537 (respondent) All owners (affected persons)
SCHEME:	The Hudson CTS 31537
JURISDICTION:	Sections 227(1) and 229(3)(a) of the Body Corporate and Community Management Act 1997 (Qld) (BCCMA), applying the BCCMA and the Body Corporate and Community Management (Accommodation Module) Regulation 2008 (Accommodation Module).
APPLICATION NO:	1170-2010
DECISION DATE:	25 May 2011
DECISION OF:	Mr. R. Miskinis, Adjudicator
CATCHWORDS:	MAINTENANCE – obligation of body corporate to maintain roofing membranes in scheme created under a building format plan of subdivision. Section 152 of the Body Corporate and Community Management Act 1997 (Qld) and section 157 of the Body Corporate and Community Management (Accommodation Module) Regulation 2008.

ORDER MADE:

I hereby order that within 3 months of the date of this order the body corporate is to engage a suitably qualified contractor to undertake the following work: (i) Installation of a new waterproofing membrane on the lot 9 balcony; (ii) re-tiling the lot 9 balcony floor; and (iii) repair of water damage to the lot 8 balcony ceiling.

REASONS FOR DECISION
Introduction

_[1] The applicant is the owner of lot 8 and seeks an order that the body corporate meet the costs of repairing the damaged lot eight soffit, replacing the defective waterproofing membrane and re-tiling the lot 9 balcony floor.
_[2] The issues for consideration are:

• What are the waterproofing issues?
• Is the body corporate required to ensure that the lot 9 balcony slab is waterproof?; and
• Is the body corporate is responsible for the cost of repairing water damage to lot 8?

Overview

Procedure and jurisdiction

_[3] The application was referred to me for resolution under the dispute resolution provisions of the Body Corporate and Community Management Act 1997 (Act), as it involves a dispute between an occupier and the body corporate for the scheme.
_[4] 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

(c) a claimed or anticipated contractual matter about-

(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)).

_[5] In accordance with section 243 of the Act, a copy of the application was provided to the body corporate and all owners other than the applicant, with an invitation to make submissions.

How the dispute arose

_[6] The Hudson CTS 31537 consists of 10 lots and is regulated by the Body Corporate and Community Management Act 1997 (Act) and the Body Corporate and Community Management (Accommodation Module) Regulation 2008 (Accommodation Module).
_[7] The applicant states that the ceiling of lot 8 has been damaged by the seepage of rainwater through the concrete slab, which also forms the floor of the lot 9 balcony. The applicant submits that the body corporate has legal responsibility for maintaining the roofing membranes and is therefore required to install a new waterproofing membrane on the lot 9 balcony and attend to the water damage to lot 8.
_[8] In July 2009, the body corporate engaged Cardno, Consulting Engineers, to ascertain the cause of water leakage from the swimming pool and concrete balconies. That inspection revealed the following:

• Water ingress through the lot 9 balcony has caused peeling of the rendered finish on the under slab in lot 8;
• During heavy rain, water ponds on the balconies and the existing drainage system on the balconies is inadequate;
• standing water on the balcony is finding its way through the porous tile grout and micro cracks in the concrete floor; and
• At the time of the inspection the presence of the water had not caused a weakening of the structure.

_[9] The report recommended that:

• Drainage from the balconies be improved;
• Balcony tiles be removed and a new waterproofing membrane installed; and
• The damaged lot 8 rendering be repaired after the lot 9 balcony is waterproofed.

_[10] A further inspection report was prepared by Acqualogical Pty. Ltd., plumbing consultants, to determine the adequacy of the existing stormwater system at The Hudson, particularly downpipes servicing the roof and balcony drains and their capacity to collect and discharge stormwater from the roof and balcony areas. That report contained the following findings:

• Ponding is occurring on balcony areas;
• This is no provision for overflows from balconies;
• Balconies are 16 square metres in size and each has a 32mm diameter outlet which connects to the main roof downpipe via a 40mm connection;
• Water damage to the concrete slabs indicates that the balconies are not water proof;
• The main roof currently drains via a 100 mm downpipe which discharges over a small awning that is serviced by 2 x 100 mm downpipes. Discharge of water onto the awning is considered poor practice.

_[11] The report from Acqualogical Pty. Ltd. also contains the following recommendations:

• There should be separate downpipes for the roof and balconies to ensure adequate drainage and to prevent backflow to the balcony drains;
• The existing 100mm pipe should be capped and sealed above the top balcony so that it services the balconies only; and
• a second 100mm downpipe should be installed to exclusively service the roof.

_[12] Also attached was a Building Condition Assessment Report prepared by Quality Building Management which contains the following observations:

• The ceiling of the lot 8 balcony is peeling in two places and showing signs of efflorescence;
• The ceiling of the lot 6 balcony is peeling in two places and showing signs of efflorescence;
• The ceiling of the lot 9 balcony is peeling in two places and showing signs of efflorescence.

_[13] At the last AGM on 24 November 2010, the applicant submitted the following motion for consideration:

That the body corporate rectify rainwater seepage to the Howard Street balcony soffit of Unit 8 as per engineer’s report (Cardno 23/7/09). Further delay could lead to the steel reinforcing corroding thus impacting on the structural integrity of the concrete slab. Once a leak develops under the tile bed, moisture will permeate at any weakness in the slab. This weakness has been caused by infill, after removal of the crane.

Attached to the motion were two quotes:

• from Muggeridge Constructions Pty. Ltd. for $11,552.20 inc GST; and
• a combined quote from McSweeney Plastering and All Your Laying Needs for $5,129 inc GST.

However, as there were 4 votes in favour of the motion, and 4 votes against, the motion was lost.

_[14] In accordance with section 243 of the Act, a copy of the application was provided to the body corporate and all owners other than the applicant, with an invitation to make submissions. Another owner supported the application and agreed that the body corporate is obliged to maintain common property and roofing membranes in good condition under section 157of the Accommodation Module. That owner also believes the current committee is indifferent to water penetration problems experienced by units 5, 6, 7, 8 & 9.

Analysis

_[15] The issues for consideration are:

• What are the waterproofing issues?
• Is the body corporate required to ensure that the lot 9 balcony slab is waterproof?; and
• Is the body corporate is responsible for the cost of repairing water damage to lot 8?
  

_[16] In deciding the above questions it is useful to briefly a number of statutory provisions that are applicable to the circumstances of this case.
_[17] Subsection157(1) of the Accommodation Module provides that the body corporate must generally maintain common property in good condition.
_[18] Subsection157(2) of the Accommodation Module provides that:

(2) To the extent that lots included in the community titles scheme are created under a building format plan of subdivision, the body corporate must--
(a) maintain in good condition--

(i) railings, parapets and balustrades on (whether precisely, or for all practical purposes) the boundary of a lot and common property; and

(ii) doors, windows and associated fittings situated in a boundary wall separating a lot from common property; and

(iii) roofing membranes that are not common property but that provide protection for lots or common property; and

(b) maintain the following elements of scheme land that are not common property in a structurally sound condition--
(i) foundation structures;
(ii) roofing structures providing protection;

(iii) essential supporting framework, including load-bearing walls.

_[19] If an applicant has suffered damage to property because of a contravention of the Act, the adjudicator may order the person, who the adjudicator believes on reasonable grounds to be responsible, to carry out stated repairs to the damaged property, or pay the applicant an amount fixed by the adjudicator as reimbursement for repairs carried out to the property (Act, 281).
_[20] The Hudson is registered on a building format plan of subdivision and therefore, under subsection 157(2)(a)(iii) of the Accommodation Module, the body corporate is responsible for maintenance of roofing membranes and roofing structures, irrespective of whether the membranes or roofing structures are located on common property or within the boundaries of a lot.
_[21] In the case under consideration, the concrete slab that forms the floor of the lot 9 balcony is also the roof of the lot 8 balcony, and therefore provides protection to lot 8. The duty of the body corporate to maintain roofing membranes and roofing structures requires the body corporate to undertake reasonable monitoring and investigation of their state of repair.[1] It also includes a duty to take preventative measures and to remedy defects in the original construction.[2] The body corporate is therefore obliged to ensure the floor of the lot 9 balcony is waterproof
_[22] The reports from Cardno and Aqualogical, both indicate that rainwater is seeping through the concrete slab floor of the lot 9 balcony. This is evidenced by the presence of efflorescence on the underside of the slab and the peeling of the rendering as depicted in the photographs attached to this application.
_[23] Cardno, the Consulting Engineer, states that the lot 9 balcony tiles need to be removed and a new waterproofing membrane installed. While an owner is required to maintain their own floor coverings such as tiles, a body corporate normally cannot replace a waterproofing membrane without destroying the owner’s existing floor covering. A recent decision of the District Court confirms that if a body corporate has to remove tiles to replace a defective waterproofing membrane, then the body corporate is also responsible for the cost of retiling the balcony.[3]
_[24] Further, given that the body corporate has a statutory obligation to ensure that the roof to the lot 8 balcony is waterproof, and the applicant has suffered damage by the ingress of water, it is appropriate to order that the body corporate is responsible for the cost of repairs to the damaged render on the lot 8 balcony ceiling.
_[25] I note that at the time of Cardno inspection, the presence of water had not caused a weakening of the structure. However, as the applicant points out, prolonged exposure has the potential to cause the steel reinforcing to rust and cause spalling of the concrete. Damage of this nature is serious and expensive to rectify.
_[26] In the circumstances, I believe it is appropriate to order that within 3 months of the date of this order the body corporate is to engage suitably qualified contractors to undertake the following work:

• Install a new waterproofing membrane on the lot 9 balcony;
• Re-tile the lot 9 balcony floor; and
• Repair water damage to the lot 8 balcony ceiling.

_[27] I note that the applicant has provided two quotes for consideration by the body corporate. Expenditure of this nature is usually met from the sinking fund. However, if there is insufficient provision for such expenditure in the sinking fund, it may be necessary to fund this work by means of a special levy.

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[1] Ridis v Strata Plan 10308 [2005] NSWCA 246, paragraph 5.
[2] Seiwa Pty Ltd v Owners Strata Plan 35042 [2006] NSWSC 1157, paragraph 4.
[3] Klinger & Anor v Body Corporate for Costa D’Ora Units [2007] QDC 300 at paragraphs 65 to 70.