Narrowneck Court [2011] QBCCMCmr 349 (16 August 2011)

Last Updated: 13 September 2011

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

CITATION:	Narrowneck Court [2011] QBCCMCmr 349
PARTIES:	John & Gay Ashcroft, Owners of Lot 19 (applicants) Body Corporate for Narrowneck Court (respondent)
SCHEME:	Narrowneck Court CTS 12625
JURISDICTION:	Body Corporate and Community Management Act 1997 (Qld), (Act), ss 227(1)(b), 229(3)(a) Body Corporate and Community Management (Standard Module) Regulation 2008 (Standard Module)
APPLICATION NO:	0709-2011
DECISION DATE:	16 August 2011
DECISION OF:	I Rosemann, Adjudicator
CATCHWORDS:	INTERIM ORDER – whether an interim order is warranted in the circumstances. Act, s 279

INTERIM ORDERS MADE:

I hereby order that, pending the final determination of this application, the Body Corporate for Narrowneck Court may not undertake concrete spalling repair works to Lot 19 unless those works are approved by a minuted resolution of the Body Corporate for Narrowneck Court and consented to by the Owners of Lot 19, John and Gay Ashcroft. I further order that the Body Corporate for Narrowneck Court shall include a copy of this order and statement of reasons to all lot owners with the notice of meeting for the annual general meeting in September 2011. This interim order has effect until six (6) months have elapsed from the date of this order, a further interim or final order for the application is issued, or until the application is withdrawn or otherwise ended (whichever is earlier).

REASONS FOR DECISION
Introduction

[1] This application relates to works to the scheme building and the applicants’ lot in particular.
[2] The applicants are the owners of Lot 19 which apparently has concrete cancer. The applicants and the Body Corporate have both obtained engineers reports and other opinions with respect to the appropriate means of rectifying this problem. The Body Corporate engaged a contractor to undertake repair works, which were scheduled from 2-4 August 2011. The applicants have concerns about the method of the work, the qualifications of the contractor, and the judgement of the engineer engaged to supervise the work. There are also questions as to whether the Committee properly authorised the work.
[3] The applicants sought an interim order to defer the pending works until the final orders are determined. They seek final orders including that the Body Corporate properly maintain the foundation structures and waterproofing membrane in Lot 19; that the Body Corporate have a detailed plan of all the works required to Lot 19; that the Body Corporate only employ properly qualified, licensed and insured tradespersons to maintain the building structure; that the Body Corporate cancel its engineer and engage a new engineer; and that they be reimbursed for the engineering report and other costs that they have incurred;
[4] At this time, I am concerned only with the issue of whether an interim order is warranted. The key issues to be considered now are whether serious legal issues have been raised by the applicants and whether the balance of convenience between the parties warrants the making of the interim order sought.

Preliminaries

Application

[5] Narrowneck Court community titles scheme 12625 consists of 44 lots and common property. The community management statement (CMS) shows the Standard Module applies to the scheme. The scheme is registered as Building Units Plan 2513.
[6] This application was lodged under the Act on 1 August 2011.
[7] The applicants sought the following interim order:

That the body corporate postpones the AJ Baston P/L repairs arranged to commence of 2-8-2011 in our unit on the grounds that the BSA states both the company and Andrew Baston are unlicensed and therefore, BSA cannot supply protection against any future problems with the repairs.

[8] In addition, the applicant sought the following final orders (summarised):

That the body corporate take steps to properly maintain the foundation structure and waterproofing membranes in Unit 19, thereby accepting its responsibility to carry out and pay for the aforementioned repairs and rectification of concrete cancer and related damage. ...

That the body corporate will fulfil its responsibilities and act fairly and reasonably by having a detailed plan drawn up to cover all repairs and rectification related to Unit 19 to ensure that all trades are booked within a particular time frame, so the work will flow as seamlessly as practicable from one to another. ...

That costs totalling $1560.00 incurred by us in relation to this application for engineers’ reports and application fee be reimbursed to us. Odyssey Consulting Group for engineering report = $605.00. Odyssey Consulting Group for structural engineering advice = $270.00. Jeffery Hills & Associates P/L for engineering report = $550.00. Application fee for Interim Order and Adjudication $135.00.

That the body corporate maintains its responsibility within our building format plan for the maintenance of the structure of the building by employing tradesmen for work on repairs and rectification in Unit 19 who are properly qualified, licensed and insured. ...

That the body corporate postpones/cancels the SRB engineer engaged to supervise our repairs on the grounds that he made incorrect assumptions in his first report, that he ignored obvious rusted reinforcement in Unit 27 in his second report, and that he supplied a Response document that, at first glance, appears plausible but on perusal is biased and contains misleading and prejudicial statements.

That in future, the body corporate fulfils its responsibilities by engaging a suitably qualified and experienced engineer to supervise all repairs and rectification in Unit 19 on the grounds of its responsibility within a building format plan for the maintenance of the structure of the building.

Jurisdiction

[9] I am satisfied that this matter falls within the legislative dispute resolution provisions.[1]
[10] An adjudicator may make an order that is just and equitable in the circumstances to resolve a dispute, in the context of a community titles scheme, about: a claimed or anticipated contravention of the Act or the CMS, or the exercise of rights or powers or performance of duties under the Act or the CMS.[2] An order may require a person to act, or prohibit a person from acting, in a way stated in the order. An adjudicator's order may contain ancillary and consequential provisions the adjudicator considers necessary or appropriate.[3]
[11] The Act allows an adjudicator to make an interim order if satisfied, on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances.[4]

Procedural matters

[12] The Commissioner referred the application to me to decide whether the nature or urgency of the circumstances of the application warrant an interim order[5]. As provided for by the Act, the Commissioner made this referral notwithstanding that affected persons had not been given notice of the application or afforded an opportunity to make submissions about the application.
[13] Given that the application was only able to be actioned in this Office 24 hours before the work complained of was potentially commencing, I invited the Body Corporate to make submissions on the application only if it was in a position to give an undertaking not to proceed with the works until an interim order was made. The Body Corporate gave a written undertaking, and subsequently made a written submission.

Matters in dispute

[14] The applicants say their lot has concrete cancer in the floor slab in various locations. They understand that this is not unexpected in a building of the age of Narrowneck Court (some 33 years) and located next to the beach. They argue that the damage arose from omissions and faults in the construction of the building, exacerbated by age-related deterioration of materials and the lack of maintenance of the scheme.
[15] The applicants argue the Body Corporate is responsible for maintaining waterproofing and floor slabs, and therefore it is responsible for rectifying the damage to their lot at its own cost.
[16] The applicants say they notified the Body Corporate of cracks in their lot in early 2010. Some minor repairs were undertaken. However they say the Chairperson, Brian McMahon, asserted it was not a Body Corporate issue because the previous owners had not installed waterproofing when they undertook retiling and there was no other internal concrete cancer in the building.
[17] In February 2011 the applicants sought advice from Gold Coast City Council (GCCC). A GCCC officer inspected Lot 19. On 30 March 2011 the GCCC issued the Body Corporate with a notice inviting the Body Corporate to ‘show cause’ why it should not be issued with an enforcement notice on the basis that the building is in a ‘dilapidated condition’ with the structural integrity of the floor and column compromised, concrete cancer in Lot 19, and that Lot 19 may become unfit for use if not properly addressed by a registered engineer.
[18] The Chairperson engaged engineer SRB Consulting (SRB) and concrete repairer AJ Baston Enterprises P/L (Baston) to inspect Lot 19 in April 2011. The SRB report stated there was significant concrete spalling (cancer) in Lot 19 which required repair but “...no discernable degradation of the structural integrity of the building...” at this time. The report suggested that an original hob at the balcony doors had been removed and the original waterproofing had not been restored during re-tiling, allowing moisture penetration. The report noted that less stringent requirements for older buildings left them more susceptible to spalling in the absence of adequate waterproofing. It said other spalling was unrelated arising from age deterioration.
[19] On 4 May 2011 Baston contacted the applicants to arrange to commence works. The applicants considered that the SRB report was flawed and refused access to Baston until they obtained their own engineers report.
[20] They obtained a report from Odyssey Consulting Group (OCG) which was provided on 6 June 2011. OCG reported that the current tiles were laid on top of the original tiles and that no waterproofing was observed to be present. OCG noted that an original concrete hob may have been removed but moisture ingress would have occurred regardless. It reported that the spalling is extensive and appears to have been present for over 10 years. It recommended repairs to prevent “...additional deterioration of the floor structure”.
[21] Jeffery Hills & Associates P/L (Hills) provided a second report to the applicants dated 26 July 2011. He said tests showed the concrete had carbonated and that the depth of concrete cover was as little as 14mm in some areas, where the building standard at the time was 20mm and the current standard in a highrise close to the beach is 40mm. He notes that while waterproofing is now a requirement it was often not applied the era when this scheme was built. He notes the premise that any modification of the tiling or doors destroyed the waterproof membrane has yet to be proven. He recommended a more detailed investigation to determine the true cause of the problem and ascertain if a waterproof membrane exists. He further recommended that there be a plan to manage concrete cancer in the long term rather than just reaction maintenance.
[22] The applicants also present evidence from tilers and the former owner of Lot 19 that the balcony doors were not moved by the previous owners and the absence of waterproofing.
[23] The applicants are concerned that Baston does not have a Building Services Authority (BSA) licence. Although the work to their lot is below $3,300 in value, and of itself does not need to be licensed, they believe that there is no protection for the work if the contractor is not licensed. In addition, Baston commenced concrete cancer repairs to the exterior of the scheme on 27 July 2011. These works cost more that $3,300 and require a licence. They are also concerned about the lack of specification in the Baston quote and the appropriateness of the type of work being undertaken by Baston. They detail concerns with the work expressed by Hills, a concrete specialist, including that the method of repair was no industry standard.
[24] Because of the alleged flaws in its original report, and subsequent comments, the applicants are concerned that SRB should not be supervising the repair work.
[25] The applicants believe that concrete cancer is also a problem in other lots. In January 2011 the applicants ascertained that there were similar cracks in Lot 20, and in April 2011 they identified such cracks in Lot 18. SPG undertook a further inspection of the scheme on 4 July 2011. It considered reported cracking in Lots 12, 18, 20, 24, 27, 29 and 36. SPG found no significant spalling in Lots 12, 24, 27, 29 and 36. It was unable to assess Lot 18. It found spalling damage in Lot 20 and noted that the balcony doors were not original (as was also the case in Lots 24, 29 and 36) and that moisture penetration arose from insufficient waterproofing.
[26] The applicants say the Chairperson has agreed to carry out repairs in accordance with the GCCC notice but disputes that the costs are a Body Corporate responsibility. The applicants say most other Committee members have not been supportive and the Chairperson has refused to have a meeting to discuss the matter. They have had numerous email exchanges with the Chairperson querying the detail, order and timeframe of the works.
[27] The applicants have been dissatisfied with the response and are concerned that the proposed works would leave them without shutters for over two months, and these shutters provide them privacy for their bedroom and minimise dust which is a health issue for both the Ashcrofts. They would like a plan drawn up to cover all the works related to Lot 19 so that the works can be booked within a particular time frame and flow on from each other. They consider this will condense the period of works and minimise the inconvenience to them.
[28] The applicants have submitted motions to the Annual General Meeting (AGM) of the scheme at the end of September. One is that the Body Corporate engage a registered engineer to inspect all lots for concrete cancer. The second is that the Body Corporate accept responsibility for all rectification costs relating to concrete cancer repairs in Lot 19.
[29] The applicants have also sought reimbursement of the costs they have incurred in obtaining two OCG reports and one Hills report (at a total of $1,425) plus their application fee ($135).
[30] The Committee Chairperson advised that:

1. The Ashcrofts approached the GCCC but he will now inform the GCCC that they cannot comply with the Show Cause Notice because of the Ashcroft’s application.
2. The work was ready to go eight weeks ago but was postponed because the Ashcrofts would not give them access.

100. The Body Corporate has a responsibility to all owners to maintain the building, and they repair concrete cancer as and where it appears on the surface of the building.

4. Lot 19 is the first lot in 33 years to have concrete cancer in the interior slab.
5. No workmen will enter Lot 19 without the Ashcroft’s permission or an order for access.

[31] The submission made by the Chairperson on behalf of the Committee advised that:

1. The interim order is not required because there was never a risk that the work would proceed without the consent of the Ashcrofts or an access order.
2. They seek an urgent order allowing the Body Corporate and its agents to enter Lot 19 at reasonable times to undertake the concrete and waterproofing repairs urgently.

100. Their goal has been to maintain the building to the highest standard and they rely on owners to report concrete cancer in a timely manner.

4. The concrete cancer on the external column of the building cannot be seen by anyone but the Ashcrofts. The Committee and they were not aware of it until the show cause notice. The Ashcrofts went to the GCCC rather than the Committee.
5. There was never any doubt about who pays for the concrete cancer on the exterior of the building and it is clear repairs are needed urgently.
6. The Ashcrofts failed to report the cancer in the internal slab of Lot 19 and nothing was heard from them since 2008. This may be a breach of the duty of care to other owners. It may have allowed the damages suffered and costs to be higher than otherwise.
7. The history of the application in the application is disputed, and the Chairperson’s recollection of events is outlined.
8. The Ashcrofts have had a rigid attitude and it is difficult to negotiate with them. They insist on setting the terms and conditions of access which alter over time.
9. The question of who pays can be left for the final orders. However on an interim basis they propose that the Body Corporate pay for the concrete repairs and waterproofing only and the Ashcrofts pay for any other costs. To burden the Body Corporate with all the costs would be prejudicial to the Body Corprate and pre-empt the final decision. The retiling of the entire unit may be necessary as it will be difficult to match the tiles.
10. On 1 May 2011 the Committee (five votes in favour, nil against) approved the Baston quote. There was no obligation on it to employ a licensed contractor but it was not their intention to have anyone unlicensed do the work. The Baston quote has been replaced by the same quote from the partnership of Getting High on Maintenance (formerly Baston) and Bud Mantheys Concreter. Andrew Baston advises that the first quote used the wrong letterhead by mistake[6]. Mantheys is BSA licensed (1067478) and they see no reason why he would be excluded from doing the work in Lot 19.
11. The concreter advises the work will take three days. Dust control mechanisms will be put in place and the inconvenience will be kept to a minimum.

50. They believe the subject matter of the Ashcrofts’ AGM motions should be dealt with in the final determination of this application. They would like an urgent order that the motions be withdrawn from consideration at the AGM. They believe the volume and complexity of the material could not be understood by owners.

13. The Committee had an engineer report on seven lots, a concreter looked at 17 units, and the caretaker looked at all lots. They found little evidence of concrete cancer.

[32] The Committee Chairperson and the applicants were requested to provide a copy of any Committee minutes authorising the Baston works. The applicants verbally advised that they received no minutes. The Chairperson did not supply any resolution authorising the work.
[33] I also sought further clarification from the applicants. They provided a copy of the GCCC show cause notice and advised the AGM is set for 17 September 2011, although the notice has not been issued. They said they are unable to obtain their own quotes for the repairs to Lot 19 because there are unresolved issues about the scope of the works including whether the door and window frames need to be removed to be waterproofed under and around; will the Body Corporate remove the double layer of balcony tiles and lay a new membrane and restore the area. While they have pursued quotes to obtain tiles of the same tone and size, they believed it was the Body Corporate’s responsibility to gather quotes for the repairs.

Analysis

[34] The only issue at this time is whether an interim order is warranted. It is not appropriate to consider the substantive issues in the application at this time. But to determine whether it is just and equitable to grant interim relief, it is relevant to briefly consider the issues in the dispute in the application.

Basis for interim orders

[35] Any order granted must be just and equitable.[7] An interim order will not be granted unless it is necessary due to the nature or urgency of the circumstances.[8] The examples in the Act indicate the usual circumstances where an interim order might be made are in the nature of injunctive relief. While it is not possible to define the range of matters that might be the subject of an interim order, an applicant must establish that the circumstances warrant an interim order. An interim order will not be made if the only urgency is a desire to expedite the dispute.
[36] As an interim order can be considered on an ex parte basis, an adjudicator must be satisfied that the application raises serious legal questions and that the balance of convenience between the parties justifies injunctive relief. That is, an adjudicator must balance the inconvenience of granting relief now if final orders are ultimately refused against the inconvenience of refusing relief now if final orders are ultimately granted. Of particular relevance is evidence that an interim order is necessary to prevent serious or irreparable harm.

Serious legal issues

[37] This application primarily relates repairs to Lot 19. Various comments are made about the external building repairs and issues in other lots, and so the dispute may have broader impact on the building. However, the key issues include:

1. Has the Body Corporate actually made a decision to engage Baston (or Mantheys)?
2. Is it reasonable for the Body Corporate to engage Baston (or Mantheys) to undertake repairs to Lot 19, or to the rest of the building?

100. Is it reasonable for the Body Corporate to engage SRB to oversee the repair works?

4. What is the extent of the Body Corporate’s liability in regard to the repairs to Lot 19?
5. Has the Body Corporate acted reasonably in regard to the information given to the Owners of Lot 19 about the works to their lot and the scheduling of repairs to Lot 19?
6. Should the applicants be reimbursed for the engineering reports obtained by them?

[38] These issues will require investigation in the context of any final order determination. However, to assist the parties in progressing this matter I will make some preliminary observations. Given these observations, I am satisfied that there are serious legal issues to be determined in this dispute.
[39] The applicants have also sought reimbursement of its application fees. However it is a settled matter that adjudicators have no power to award a parties costs in relation to a dispute resolution application, except to a respondent where an application is dismissed for being frivolous, vexatious misconceived, or without substance or to an applicant if a respondent fails without reasonable excuse to participate in conciliation).[9]

Approval for the Lot 19 works

[40] The Chairperson advised the applicants that the Body Corporate engaged Baston to undertake works to Lot 19. Although it is not clear that the applicants were advised by the Chairperson, this quote was replaced by a quote from Mantheys. Both quotes are for $2,600.
[41] In this scheme the relevant limit for committee spending is $8,800 unless a different amount has been set by ordinary resolution at a general meeting.[10] Accordingly, the quoted work would be within the committee spending limit unless it is just part of a single project. It seems there are other steps in the repair of Lot 19 in which case the Baston/Mantheys quote would only be part of a broader project. Any cost to engage SRB to supervise the work would be included in the project total. If the total cost of the repair project was above the committee spending limit, approval of the work may require a general meeting resolution.
[42] It would seem to be appropriate to obtain quotes to undertake all the necessary steps in the repair works to Lot 19 so that there is a clear picture of the full extent and cost of the entire project. This would enable proper planning for the work and also proper approvals.
[43] A committee can approve spending above the committee spending limit if the spending is necessary to comply with a statutory notice given to the body corporate. Although the Body Corporate has been given a show cause notice by the GCCC, this notice does not in itself direct work to be undertaken. It is not apparent that an enforcement notice has yet been issued by the GCCC. Prima facie the show cause notice would not be sufficient to authorise the Committee to approve spending above the committee spending limit.
[44] Even if a committee resolution was sufficient to authorise the Baston/Mantheys quote, I do not yet have evidence that this quote was authorised by a valid Committee decision authorising the expenditure. The Chairperson said there was a vote but did not supply minutes. This will require further investigation. There is similarly a question of whether SRB has actually been engaged to supervise the works and whether this engagement was properly authorised.
[45] I note that decisions that can bind the body corporate can only be made in a general meeting or by the committee as a whole, either as minuted decisions of a formal committee meeting or the minuted record of voting outside a committee meeting conducted under section 54 of the Standard Module. No individual committee member, including the chairperson, can decide to engage a contractor or expend Body Corporate funds (even with a statutory notice) without a proper minuted decision.

Maintenance responsibilities

[46] It seems clear on the material presented that the proposed works to Lot 19 (and also to the exterior of the scheme) are maintenance rather than improvements.
[47] Section 170 of the Standard Module provides a general responsibility for an owner to maintain a lot in good condition. Section 159 of the Standard Module requires a body corporate to maintain the common property. However in a building format plan (BFP) of subdivision (which this scheme is) a body corporate has additional responsibilities. This includes a responsibility to maintain foundation structures, roofing structures providing protection, and essential supporting framework, in a structurally sound condition. They must also maintain in good condition any roofing membranes that provide protection for lots or common property.
[48] If the concrete cancer in the Lot 19 slab means that the slab is not structurally sound or that preventative work is clearly required to prevent the slab becoming structurally unsound, then prima facie the Body Corporate would be responsible for the repairs. Similarly if the slab provides protection for the lot or common property below, and the waterproof membrane on Lot 19 is inadequate or in poor repair, the Body Corporate would prima facie be responsible.
[49] Pursuant to section 281 of the Act, the Body Corporate would prima facie also be liable for the cost of any repairs caused by any structural or waterproofing deficiency, for example repairing cracked tiles, along with all consequential costs associated with giving effect to the repairs.
[50] Section 159(4) of the Standard Module does provide that a body corporate may recover a portion of the ‘reasonable’ costs of maintenance that it would be responsible for to keep a lot in good or structurally sound condition that would otherwise be the responsibility of the body corporate from a person (whether the lot owner or otherwise) whose actions caused or contributed to the damage or deterioration of the lot. Therefore, if the Body Corporate were responsible for the repairs but could establish that the current Owners of Lot 19 had caused or contributed to the concrete cancer in Lot 19, they could seek to recover a corresponding proportion of the cost of the damage. However, if it was a previous owner of Lot 19 whose actions allegedly contributed to the concrete cancer (as appears to be suggested here), it is my view that the Body Corporate would need to pursue the costs against that owner rather than against the applicants. In either event I consider the Body Corporate would bear the onus of proving the alleged conduct occurred and that it caused or contributed to the damage.
[51] If the Body Corporate is prima facie responsible for the repairs, then it would be responsible for undertaking all of the necessary work in the first instance, and then seeking to recover any reasonable costs from a person who it believes contributed to the cost. However if the work was properly the owner’s responsibility pursuant to section 170 of the Standard Module, and the Body Corporate had no responsibility under section 159 of the Standard Module, then it should be the owner who undertakes the work rather than the Body Corporate undertaking work when and how it chooses and charging the owner for it.
[52] If the Body Corporate purported to charge the applicants for costs that are not properly the applicants’ responsibility under the body corporate legislation, those decisions could be invalidated. Similarly, if the Body Corporate refused to pass motions taking responsibility for works that are its responsibility under the legislation, that decision could also be challenged.

Reasonableness

[53] There is a general requirement[11] that a committee and body corporate act reasonably in making or not making a decision. The question is not whether the decision was “correct” but whether it is objectively reasonable[12], and a "logical and understandable basis for the decision" is a factor in determining the reasonableness of a decision but does not necessarily mean the decision is reasonable as important matters may have been overlooked or discounted[13].
[54] Therefore, if the Body Corporate were to make decisions in relation to the repairs that, while procedurally valid and even supported by a majority of owners, were nonetheless objectively unreasonable, those decisions could be overturned by an adjudicator.

Balance of convenience

[55] Although stating that the work is urgent, the Body Corporate has not stated any specific inconvenience to it from postponing the work on Lot 19. It has confirmed that it will not proceed with the work until it receives permission from the applicants to access Lot 19. Therefore, while it argues that the interim order is not necessary, it does not specifically oppose it.
[56] The Body Corporate refers to the GCCC show cause notice, and the fact that it would not be able to complete the required work if they are not given access to the lot. This is not entirely the case. Firstly, the show cause notice does not of itself direct the work to be undertaken, but rather asks the Body Corporate to give it any reason why the repairs should not be undertaken. Furthermore, the order sought by the applicants does not of prevent the Body Corporate progressing the repair referred to in the show cause notice.
[57] It is the engagement of the unlicensed Baston[14] and the issues about the specifications, scheduling and supervision of the work, that are the primarily concerns for the applicants. If the Body Corporate engaged a licensed contractor with an appropriately detailed quote and planned schedule of work that is acceptable to the applicants, it could complete the repairs with the full consent of the applicants. Alternatively, if the applicants were to submit an alternative quote to complete the works in a manner that would address their concerns, the Body Corporate may be in a position to support that. In short I consider that there is ample scope for these matters to be resolved between the parties.

Other issues

[58] The Body Corporate has requested that I make two alternative interim orders being to give the Body Corporate access to Lot 19 to undertake urgent repairs and secondly that the applicants’ motions be withdrawn from the AGM agenda. These requests are beyond the scope of the current application and so I cannot determine them. If the Body Corporate actually seeks such orders the onus is on it to lodge its own application (authorised by a Committee resolution) formally setting out the orders sought and the basis for them, and in which case the Ashcrofts can be invited to formally respond to the request. However I will make the following observations on these requests.
[59] An order requiring access to a lot to undertake work is not an appropriate subject matter for an interim order. An interim order is generally intended to be injunctive in nature and cannot finally determine the substantive issue. The Body Corporate could apply for a final order, which could be expedited if the Body Corporate could demonstrate that there is a genuine emergency. While the material submitted to me to date indicates that the repairs should not be unreasonably delayed, I have yet to receive any evidence of an emergency.
[60] It is also noted that section 163 of the Act allows a person authorised by a body corporate to enter a lot to inspect a lot or carry out work that the body corporate is authorised or required to carry out. Seven days notice is required unless there is an emergency. However, a body corporate must always act reasonably, including in respect of this power of entry. Therefore the body corporate should be wary as to how it exercises its power of entry where there is a genuine dispute about the appropriateness of a contractor, the scope of works and the scheduling of works.
[61] In regard to the suggestion that the applicants’ motions be removed from the AGM, I am unclear at this stage as to how this would assist. Self-management is one of the inherent objectives of the legislation and issues within a body corporate should be considered by owners wherever possible. At this stage it would seem entirely appropriate that the issues be considered at the AGM. Any decisions at the AGM may assist to resolve some parts of the dispute, but does not prevent subsequent determination of issues in a final order if it does not.
[62] I am concerned that the Chairperson appears to suggest that owners would not be able to understand or appropriately consider the issues relating to the concrete cancer, and that the reports should not be distributed to owners. Given the financial and other impact of this issue on all owners, I am concerned if owners have not been kept informed of the events of the last six months and given the opportunity to inspect the reports obtained by the Body Corporate. In any event, all the material submitted by the applicants will be available to owners when they are invited to make submissions on the final order application.

Conclusion

[63] In the circumstances I am satisfied that the applicants have raised serious questions regarding the conduct of repairs to their lot. Although the Body Corporate has indicated that it does not intend to undertake the work without the applicants’ consent or an order giving access, in the circumstances and given the legislative power of entry I consider that it is appropriate to make an interim order. I intend to order that, until the substantive issues in this application can be resolved, the Body Corporate cannot proceed with the any work in Lot 19 unless that work is properly approved by a minuted resolution and the applicants consent to the work.
[64] Given that this matter is scheduled to be considered at the AGM in September 2011, I consider that it may assist the matter if all owners are informed of the current issues. Accordingly I intend to order that the Body Corporate provide a copy of this order and reasons to all owners.

Next steps

[65] The matter will now be progressed in accordance with the legislative processes. In the first instance I propose to refer the application back to the Commissioner[15] with a recommendation that the matter be referred to conciliation. It seems that there is agreement that repairs need to be undertaken promptly, but the detail of when, how and what work is done. In my view a discussion between the parties and an independent conciliator may be the most expeditious means of working through how the repairs can best be progressed. It may be that some aspects of the matter can also be progressed at the AGM in September.
[66] In the context of both the conciliation and the AGM, I would encourage the parties to move forward constructively in negotiating how the repairs can be undertaken. I do not consider that the matter would be assisted by rehashing past events or who told what to whom. I would also suggest that if the applicants are not satisfied with the contractor or quotes proposed by the Body Corporate, they should seek alternative quotes to submit to the Body Corporate that would be acceptable to them.
[67] If conciliation and the AGM is unable to resolve the dispute, submissions on the final orders will be sought from all affected parties. The matter will then be referred back to me for investigation and a final order would be made in due course.
[68] All parties should note the provisions of section 279(2) of the Act below. I have provided that this interim order will have effect for a period of not longer than six months. It is the responsibility of the applicant to apply to extend this order if no final determination has been made within that period. The interim order will not automatically be renewed and will automatically lapse upon a final order being made or this application being withdrawn.

(2) An interim order—

(a) has effect for a period (not longer than 1 year) stated in the order; and

(b) may be extended, varied, renewed or cancelled by the adjudicator until a final order is made; and

(c) may be cancelled by a later order made by the adjudicator; and

(d) if it does not lapse or is not cancelled earlier, lapses when—

(i) the application is withdrawn; or

(ii) the commissioner gives the person who made the application a written notice under section 241 rejecting the application; or

(iii) a final order is made by an adjudicator to whom the application is referred.

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[1] See sections 227, 228, 276 and Schedule 5 of the Act
[2] Section 276 of the Act
[3] Section 284(1) of the Act
[4] Section 279(1) of the Act
[5] Section 247 of the Act

[6] The quote is the same date, quote number and with identical specifications as the original Baston quote.
[7] Section 276 of the Act
[8] Section 279 of the Act
[9] Sections 270(1)(c) and 280 of the Act
[10] Section 151 of the Standard Module (44 lots x $200)

[11] Pursuant to sections 94(2) and 100(5) of the Act

[12] Commonwealth Bank of Australia v Human Rights and Equal Opportunity Commission (1997) 150 ALR 1 pp34, 38.

[13] Commonwealth Bank of Australia v Human Rights and Equal Opportunity Commission, pp34, 38.

[14] A BSA database search shows no record of a licence for Andrew Baston or AJ Baston Enterprises Pty Ltd.
[15] Section 279(4) of the Act