62 Pembridge Circuit [2011] QBCCMCmr 22 (25 January 2011)

Last Updated: 21 February 2011

REFERENCE: 1064-2010

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	37231
Name of Scheme:	62 Pembridge Circuit
Address of Scheme:	62 Pembridge Circuit, Urraween, Qld 4655

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

Desiree Davidson, the Owner of lot 2

I hereby order that: Whittles Management Services Pty. Ltd. trading as Whittles Body Corporate Management, is hereby appointed as administrator of 62 Pembridge Circuit and granted exclusively all the powers, functions and responsibilities of the body corporate committee and its executive members. I further order that: the appointment of the administrator is for an initial term of one year and thereafter monthly but can be terminated by order of an adjudicator. After the expiry of one year, the appointment can be terminated by either the body corporate or the administrator on one months’ written notice; the administrator is granted the power to levy contributions against the owners of lots to meet the costs of complying with its obligations and the costs of the administration; the grant of powers, functions and responsibilities to the administrator pursuant to this order is exclusive to the administrator and not capable of delegation; and the administrator is entitled to its reasonable costs of undertaking the administration as set out in the quotation attached to the application i.e. an annual fee of $880 plus disbursements properly incurred. I further order that the owner of lot 1 and the owner of lot 2, must take all reasonable steps to cooperate with the administrator in matters relating to the body corporate. .

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 1064-2010

“62 Pembridge Circuit” CTS 37231

APPLICATION

This is an application by the Owner of lot 2, Ms Desiree Davidson, seeking the appointment of an Administrator.

The Applicant states that the scheme is currently self-managed with two lots, each of which are owner occupied. On a number of occasions she has attempted, without success, to discuss with the owner of lot 1, various body corporate issues including payment of body corporate levies and parking on common property.

The applicant further states that the scheme has a history of conflict, and because of this conflict, the scheme has been frustrated into a deadlock situation regarding the administration of the body corporate. In addition, the applicant states that the owner of lot 1 has parked his vehicle on common property outside the applicant’s lot, rather than in his allocated parking space. Although the applicant has advised him that this makes access and egress difficult for her, he has continued to park on common property.

The applicant believes that the Body Corporate has become unworkable and requires the appointment of an outside administrator to ensure the body corporate operates in accordance with the legislation and that basic matters such as renewal and payment of the insurance policy are attended to.

In accordance with section 243 of the Act, by letter dated 9 December 2010, the owner of lot 1 was provided with a copy of the application and invited to make submissions by 7 January 2011.
In reply, the owner of lot 2 made submissions by means of an email communication dated 13 January. These submissions included the following:

• he denies that there is a conflict with the applicant or that he has parked his car on common property;
• he believes that the scheme is insured and is neat and tidy;
• he believes that appointment of an administrator would involve unnecessary expense because there is little to be done in a duplex scheme;
• he has called meetings but the applicant does not attend.
  

JURISDICTION

“62 Pembridge Circuit” was created by registration of plan SP 198362 in August 2007 and comprises two lots and common property. The scheme is regulated by the Body Corporate and Community Management Act 1997 (the Act) and the Body Corporate and Community Management (Standard Module) Regulation 2008 (the Standard Module).

This is a dispute between two owners and comes within the dispute resolution provisions of the legislation (see sections 226, 227 & 228, Act).

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)).

DETERMINATION

By definition, a community titles scheme is a subdivision of land into two or more lots and common property.[1] Notwithstanding that this is a two lot scheme, it is required to comply with statutory requirements that go well beyond keeping the grounds tidy and ensuring that the building is insured. Amongst other things, a body corporate is required to:

• establish and keep an administrative fund and a sinking fund;[2]
• Maintain an account kept solely in the name of the body corporate at a financial institution;[3]
• Keep proper accounting records and prepare for each financial year a statement of accounts showing the income and spending (or receipts and payments) of the body corporate for the financial year;[4]
• Maintain common property in good condition;[5]
• Insure, for full replacement value, the common property and body corporate assets;[6] and
• Maintain public risk insurance of the common property and relevant assets[7].
  

Without the co-operation of both owners it is not possible for the body corporate to meet its legislative obligations. Since the lodgement of this application there has been adequate time for the parties to take steps to put the body corporate on a proper legal footing but this has not eventuated. An order appointing an administrator may be the only order the adjudicator makes for an application or may be made to assist the enforcement of another order made for the application[8]; and if an adjudicator appoints an administrator to perform obligations of the body corporate, the committee for the body corporate or a member of the committee, anything done by the administrator under the authority given under the order is taken to have been done by the body corporate, committee, or member.[9]

In the circumstances, I am satisfied that the appointment of an administrator is necessary to authorise a person to call and hold a general meeting of the scheme, and allow it to thereafter proceed on a proper legal basis. The legislation includes provisions to the effect that: An order appointing an administrator may be the only order the adjudicator makes for an application or may be made to assist the enforcement of another order made for the application[10]; and if an adjudicator appoints an administrator to perform obligations of the body corporate, the committee for the body corporate or a member of the committee, anything done by the administrator under the authority given under the order is taken to have been done by the body corporate, committee, or member.[11]

The applicant has submitted a quotation from Whittles Body Corporate Management, whereby it agrees to be appointed as Administrator to exercise all the functions of the committee, for an annual fee of $880 plus disbursements. I consider that this firm is appropriate for appointment as an administrator having regard to the firm’s experience as a body corporate manager and the schedule of fees provided. For the avoidance of doubt, the role of the administrator is primarily to perform secretarial type functions to ensure the body corporate is functioning in accordance with the legislation.

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[1] See section 10 Act
[2] See section 146(1) Standard Module
[3] See section 146(5) Standard Module
[4] See section 154(1) Standard Module
[5] See section 159 Standard Module
[6] See section 178 Standard Module
[7] See section 187 Standard Module
[8] Section 276(4) Act
[9] Sections 278 & 301 Act
[10] Section 276(4) Act
[11] Section 278 Act