Grand Pacific Resort [2011] QBCCMCmr 25 (28 January 2011)

Last Updated: 27 May 2011

REFERENCE: 0919-2010

ORDER OF AN ADJUDICATOR

MADE UNDER PART 9 OF CHAPTER 6

BODY CORPORATE AND COMMUNITY MANAGEMENT ACT 1997

Number of Scheme:	29576
Name of Scheme:	Grand Pacific Resort
Address of Scheme:	100 Bulcock Street CALOUNDRA QLD 4551

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

the Body Corporate for Grand Pacific Resort

I hereby order that the application for an order that David Cox and Cheryl Cox permit the body corporate, any authorised representative of the body corporate including any consultant engaged by the body corporate and any authorised officers of the sunshine Coast Regional Council to enter lot 115 on SP 126004 in the Grand Pacific resort Community Titles Scheme within 14 days of the date of the order for the purposes of inspecting and determining the nature of all building and utility infrastructure alterations which have been made to the interior of the Lot. Is dismissed. The above order was appealed in the Queensland Civil and Administrative Tribunal – Appeal No. APL074-11.

STATEMENT OF ADJUDICATOR’S REASONS FOR DECISION - REF 0919-2010

“Grand Pacific Resort” CTS 29576

Application

Grand Pacific Resort is a 122 lot scheme on a building format plan and is regulated by the Body Corporate and Community Management (Accommodation Module) Regulation 2008.The applicant is the body corporate for the scheme and seeks the following final outcome:

A declaratory order that David Cox and Cheryl Cox permit the body corporate, any authorised representative of the body corporate including any consultant engaged by the body corporate and any authorised officers of the sunshine Coast Regional Council to enter lot 115 on SP 126004 in the Grand Pacific resort Community Titles Scheme within 14 days of the date of the order for the purposes of inspecting and determining the nature of all building and utility infrastructure alterations which have been made to the interior of the Lot.

Background

The applicant body corporate states that in September 2007 it suspected the owners of lot 115 had made internal alterations to their unit to create a “dual key arrangement”. It further states that in February 2010, Queensland Police officers entered lot 115, and as a result, the body corporate obtained evidence that the lot had been changed to a “dual key arrangement”. Since that time the body corporate has written to the owners of lot 115 requesting access to the lot to determine if the alleged alterations require Council planning or building approval. However, the owners of lot 115 have failed to respond to correspondence from the body corporate and the Sunshine Coast Regional Council (Council).

The applicant believes that the respondent has contravened the BCCM Act as well as the scheme by-laws, and therefore a dispute exists for the purposes of the dispute resolution provisions of the Act. It is alleged that the respondents have changed the internal layout of lot 115 to create an arrangement whereby two separate living areas have been created within the one unit. By letter dated 12 September 2007, the body corporate was advised by the Council that any internal change to lot 115, to create two separate living areas, would contravene the Development Approval for the scheme and would result in an unlawful use. On the 19th September 2009, the
body corporate forwarded this advice to the respondents with a request to advise what action they proposed to take in light of that advice. However no response was received.

Following a number of communications between the body corporate and the Council, the respondents were again asked to provide access to their lot but refused. In June 2010, the Council wrote directly to the respondents seeking access to their lot to determine whether internal work had been undertaken, and if so, whether a development approval was required. However the respondents have also failed to respond to this correspondence.

In September 2007, when the applicant first became aware that the respondents may have undertaken internal building work, the applicable by laws were contained in the Community Management Statement dated 5 November 2002. In particular, by-law 14 provided:

“An owner or occupier of a residential lot shall not make any structural alterations to any lot (including any alterations to gas, water or electrical installations) without the prior written consent of the body corporate”.

This by-law was subsequently replaced by a more comprehensive by-law 16 contained in the new community statement dated 30 September 2009 and recorded on 12 October 2009.

The body corporate is unable to determine whether the alleged internal building work undertaken in lot 115 amounts to a “structural alteration” without entering the lot and conducting an inspection.
The Council would also need to gain access to the lot in order to determine:

(1) whether the alleged work was of such a nature that a development approval was required; and
(2) whether the alleged alterations resulted in an unlawful use of the premises.

Apart from the possible breach of scheme by-laws, the applicant has also raised concerns that the division of lot 115 into 2 separate living areas could result in jeopardise the body corporate’s insurance cover.

Pursuant to section 243 of the Act, the respondent owners of lot 115 were invited to make submissions regarding the outcomes sought by the applicant.

Submissions made by the owners of lot 115 included the following:

• no inspection is required to determine the nature of building and utility infrastructure alterations;
• they deny the allegation that they have breached the scheme by-laws;
• they have previously requested the body corporate to provide them with evidence that they have made alterations in breach of the by-laws;
• they are unable to provide the “evidence” requested because there is no “evidence” to provide;
• they deny that they have breached any by-laws;
• the Council has always had the option to initiate legal proceedings if it believes that they have done work which contravenes the development approval or involves a material change of use;
• they are capable of determining whether any work to their unit involves a breach of the scheme by-laws or the local Council by-laws;
• no committee member has ever contacted them to raise allegations regarding work undertaken on their apartment;
• they have not received a BCCM Form 10 or a BCCM Form 11 in relation to any alleged breach of the scheme by-laws;
• the applicant has failed to produce any evidence to indicate that their apartment contravenes any rules or regulations;
• they believe that the application is frivolous, vexatious, misconceived and without substance;
• they believe that the application should be dismissed and the current committee members should be required to reimburse the body corporate the legal expenses incurred in bringing this application.
  

Jurisdiction

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

The applicant body corporate seeks the following final outcome:

A declaratory order that David Cox and Cheryl Cox permit the body corporate, any authorised representative of the body corporate including any consultant engaged by the body corporate and any authorised officers of the sunshine Coast Regional Council to enter lot 115 on SP 126004 in the Grand Pacific resort Community Titles Scheme within 14 days of the date of the order for the purposes of inspecting and determining the nature of all building and utility infrastructure alterations which have been made to the interior of the Lot.

I have perused the application and annexures and made the following observations:

• on 12 September 2001 a certificate of classification was issued by the Caloundra City Council regarding the building bounded by Bulcock St., Otranto Ave. and The Esplanade, Caloundra. Lot 115 is located on level K and consists of 123 square metres including 2 balconies;
• On 12 September 2007 the Caloundra City council wrote to the body corporate manager, advising that it had received a complaint alleging that lot 115 had been altered to create a “twin key unit” arrangement allowing for the occupation of 2 separate living areas within the unit: The letter further advised that the alleged works do not accord with the approved plans that form part of the development approval. This letter was forwarded to the respondents on 19 September 2007. On 20 December 2007 the body corporate manager requested the respondents to respond to their communication dated 19 September 2007;
• On 9 January 2008 the body corporate manager asked Mr Shane Coffey of the Caloundra City Council how the matter was progressing. In a reply dated 10 January 2008, Mr Coffey advised that in order to assess the respondent’s compliance with the Council’s requirements, it would be necessary to access the interior of the unit to verify that the alleged unauthorised works had been removed. However, as it was anticipated that the respondents would not permit Council Officers to inspect the interior of their unit, it was suggested that the body corporate exercise powers of entry which it may have under the BCCM Act, or the scheme by-laws, and advise the Council of its findings.;
• On 16 January 2008 the body corporate manager replied to Mr Coffey stating that the body corporate was of the view that in order to determine whether the owners of lot 115 had complied with the Council’s requirements, it would be necessary for a Council officer to inspect the unit.
• On 8 April 2009 the body corporate manager wrote to the respondents stating that the body corporate was concerned that they had made changes to their unit which could impact upon insurance coverage for the building. The respondents were requested to either provide a statutory declaration to the effect that they had not made alterations which caused their lot to be used in a way not authorised by the development approval, or

to allow the body corporate’s engineer to access their lot to and to conduct an inspection;

• On 18 February 2010 the body corporate manager again wrote to the respondents, stating that it had conclusive evidence that lot 115 had been made “dual keyed” and requesting that either the alterations be approved by a building certifier, or the respondents take steps to return the unit to its original condition and allow the body corporate’s representative to inspect the premises;
• In a letter to the body corporate manager dated 15 June 2010, the Sunshine Coast Council advised as follows:
  

As per our telephone discussion of 7 June 2010 I am writing to confirm the following;

1. Council has written to the above unit owners requesting the opportunity to inspect the unit to confirm the extent of the work and if development approval for building work is required;
2. If access is denied, Council will be required to obtain a Court order to gain access to the unit. Council is therefore requesting the names and contact numbers of the residents/ contractors who have inspected the unit and who are prepared to sign an affidavit in support of the Council case in any future Court case.
   

However, the body corporate has decided to make application to this Office for an order authorising the entry and inspection of lot 115. There is a long established common law right of occupiers to exclude other persons from entry to their premises[1]. This right may be abrogated by statute, but even then, entry into a private residence often requires authorisation by a judicial officer.[2] I believe that the only provision of the BCCM Act which authorises entry into a lot, is section 163 which provides that a person authorised by the body corporate is empowered to enter a lot, to conduct an inspection and to carry out work the body corporate is authorised or required to do.

Section 163 of the Act provides as follows:

Power to enter lot

(1) A person (an “authorised person”) authorised by the body

corporate for a community titles scheme may enter a lot included in the

scheme, or common property the subject of an exclusive use by-law, and

remain on the lot or common property while it is reasonably necessary—

(a) to inspect the lot or common property and find out whether work

the body corporate is authorised or required to carry out is

necessary; or

(b) to carry out work the body corporate is authorised or required to

carry out.

(2) The power of entry may be exercised—

(a) in an emergency—at any time; and

(b) in other cases—

(i) for entry to the lot mentioned in subsection (1)—at a

reasonable time after at least 7 days notice of the intended
entry has been given to—

(A) the owner of the lot; or

(B) if the owner is not in occupation of the lot—the

occupier of the lot; and
(ii) for entry to the common property mentioned in
subsection (1)—at a reasonable time after at least 7 days
notice of the intended entry has been given to—

(A) the owner of the lot to which the exclusive use by-law

attaches; or

(B) if the owner of the lot mentioned in

sub-subparagraph (A) is not in occupation of the

common property—the occupier of the common

property; and

(iii) in compliance with the security or other arrangements or

requirements ordinarily applying for persons entering the

lot or the common property.

(3) If the scheme is other than a basic scheme, the power of entry to a lot

or common property the subject of an exclusive use by-law conferred

under this section includes power to enter the scheme land for a community

titles scheme (the “subsidiary scheme”) that is a lot included in the scheme.

(4) If subsection (3) applies, notice of intended entry must be given to—

(a) the body corporate for the subsidiary scheme; and

(b) if scheme land to be entered is a lot that is not itself a community

titles scheme—

(i) the owner of the lot; or

(ii) if the owner is not in occupation of the lot—the occupier of

the lot; and

(c) if scheme land to be entered is common property the subject of

an exclusive use by-law for the subsidiary scheme—

(i) the owner of the lot to which the exclusive use by-law

attaches; or

(ii) if the owner of the lot mentioned in subparagraph (i) is not

in occupation of the common property—the occupier of the

common property.

(5) A person must not obstruct an authorised person who is exercising or

attempting to exercise powers under this section.

Maximum penalty for subsection (5)—20 penalty units.

The applicant has not provided evidence to suggest that the body corporate is authorised or required to carry out work in lot 115. Rather, it is alleged that lot 115 may have been altered to create a “twin key unit” arrangement allowing for the occupation of 2 separate living areas within the unit.

The body corporate believes that the owners of lot 115 may have breached the previous by-law 14 which provided that “An owner or occupier of a residential lot shall not make any structural alterations to any lot (including any alterations to gas, water or electrical installations) without the prior written consent of the body corporate”. The owners of lot 115 do not deny undertaking work within their lot, but state that they are capable of determining whether such work involves a breach of the scheme by-laws or the local Council by-laws and therefore, do not believe the body corporate should be permitted to inspect the interior of lot 115.

The difficulty that I have is that there is no objective evidence, upon which I can be satisfied that two separate living areas have been created by means of structural alterations requiring body corporate approval. Similarly, I have not been provided with any evidence that the owners of lot 115 have done work which contravenes the development approval given by the Council or involves a material change of use. The respondents state that no inspection is necessary because they are capable of determining whether any work involves a breach of the scheme by-laws or the local Council by-laws. Further, the Council has always had the option to initiate legal proceedings if it believes that they have done work which contravenes the development approval or involves a material change of use.

While the applicant submits that in the circumstances, and having regard to those matters outlined in the application, it would be just and equitable to make the order sought, I am required to reach a decision in accordance with principles of law and equity rather than a subjective view as to what is fair.[3]

For the above reasons, I have dismissed the application.

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[1] See for example Kuru v New South Wales [2008] HCA 26
[2] See section 4 Legislative Standards Act 1992
[3] See Body Corporate for Palm Springs Residences v J. Patterson Holdings Pty. Ltd. [2008] QDC

Burrell v Body Corporate for Boulevard North [2010] QDC.