APGF Property Limited v Body Corporate for Gateway Office Park
[2010] QCAT 360
•22 July 2010
| CITATION: | APGF Property Limited v Body Corporate for Gateway Office Park [2010] QCAT 360 |
| PARTIES: | APGF Property Limited |
| v | |
| The Body Corporate for Gateway Office Park |
| APPLICATION NUMBER: | OCL035-10 |
| MATTER TYPE: | Other civil dispute matters |
| HEARING DATE: | 22 July 2010 |
| HEARD AT: | Brisbane |
| DECISION OF: | Ms J Reid |
| DELIVERED ON: | 22 July 2010 |
| DELIVERED AT: | Brisbane |
ORDERS MADE: | The application is dismissed. |
| CATCHWORDS : | No adjustment to the current Lot contributions to be made on the basis that the inequality is in fact fair and just in the circumstances. Decision on the papers. |
APPEARANCES and REPRESENTATION (if any):
| APPLICANT: | APGF Property Limited |
| RESPONDENT: | The Body Corporate for Gateway Office Park |
REASONS FOR DECISION
The application in this proceeding was filed 14 May 2010. The application is brought by the owners of Lot 5 in Community Titles Scheme 36494. The application seeks an adjustment of the lot entitlements in the Contribution Schedule of the CTS. It is brought pursuant to section 48(1)(b) of the Body Corporate and Community Management Act 1997 (“BCCM Act”), as facilitated by the Queensland Civil and Administrative Tribunal Act (“QCAT Act”).
In accordance with section 48(2) of the BCCM Act, the respondent is the Body Corporate of the CTS. It filed its defence on 12 May 2010.
On 12 May 2010, Senior Member O’Callaghan directed that the application be determined on the papers.
The applicant and respondent filed all submissions and reports in accordance with the Tribunal directions. The applicant’s filed a report prepared by Resident Building Services (Linkhorn & Simpson) in support of their application. The respondent filed a report by Stewart Silver King and Burns (SSKB) to support their response.
It is not in dispute between the parties that the relevant legislation is contained in sections 46, 47, 48 and 49 of the BCCM Act.
It is also not in contention between the parties that the relevant principle to be applied by the Tribunal with respect to the Contribution Schedule is that stated in section 48(6) of the BCCM Act (namely, that the respective lot entitlements should be equal, except to the extent to which it is just and equitable in the circumstances for them not to be equal).
Section 49(4) states that, among the matters the Tribunal may have regard to for deciding whether an adjustment should be made for the Contribution Schedule by section 49(4) of the BCCM Act, includes –
- how the community titles scheme is structured;
- the nature, features and characteristics of the lots included in the scheme; and
- the purposes for which the lots are used.
Further, it is not in dispute that the relevant principles about the correct construction of sections 46 to 49 (inclusive) of the BCCM Act in circumstances such as these in this proceeding are governed by the Court of Appeal decision in Fischer v Body Corporate for Centrepoint Community Titles Scheme 7779[2004] QCA 214; [2004] 2 Qd R 638. (the Centrepoint case).
In particular, Justice Chesterman stated inter alia, ….the preferable view is that a contribution schedule should provide for equal contributions by …owners, except insofar as some…can be shown to give rise to particular costs to the body corporate which others do not.. The question whether a schedule should be adjusted, is to be answered with regard to the demand made on the services and amenities provided by a body corporate to the respective (lots)….what is the issue is the “equitable” distribution of the costs.”
Nature of the CTS
10 The scheme is described as a commercial office park and consists of 4 standard formal lots. The buildings on the site were built by the original owners and the CMS was lodged when all buildings were completed. The size of each building is as follows:
Lot 1 - 1200 sqm
Lot 2 - 4000 sqm
Lot 5 - 6000 sqm
Lots 3 & 4 - 1200 sqm.
The common property is comprised with a secure 2 level basement car park, storage areas and internal access to each lot, together with ground level visitor parking; security gated driveways, an internal access road, BBQ areas and gardens.
11. The current contributions of each lot entitlement are as follows:
Lot 1 - 12
Lot 2 - 38
Lot 5 - 58
Lot 3&4 - 12
These contributions reflect the approximate area in square metres of building on the site.
12. The applicant is seeking an order varying the contributions to equal. In support of that application, they rely on the decision in the Fischer case and Justice Chesterman’s statement at [26] “Although the Act gives no clear indication one way or the other, the preferable view is that a contribution schedule should provide for equal contributions…”
13.The applicant argues that the presumptive starting point is that the contributions should be equal and that any changes to entitlements are permitted only on the condition to which it is just and equitable for them not be equal.
14. The applicant maintains that the an examination of the Schemes records does not reveal any just reason for making an adjustment to any value other than equal and that the four lots share all of the Scheme’s facilities and services equally.
15. The BCCM Act requires that contribution schemes be equal except to the extent to which it is just and equitable in the circumstances for them not to be equal.
16. The respondent’s submissions are that the contribution schedule should not be equal for each lot. The respondent states that each lot is commercial in nature and that the size and proportion of each lot in the Scheme is a major consideration in determining what is fair and equitable within this Scheme. For example, Lot 1 has 1200 sqm of office space and Lot 5 has 6000sqm, the submission being that Lot 5’s use of common property is 5 times greater than Lot 1.
17. The respondent stresses that it is this proportion that has been used to set the existing entitlements in the Scheme.
18. Furthermore, the respondent contends that the current contribution scheme provides a fair and equitable balance in the commercial lease rate per sqm and any adjustment would create an inequality between lots.
19. The respondent further contends that the Lots do not share common property equally, especially in the basement (the majority of the common property) which is divided under exclusive use by laws in an unequal proportion.
Findings
20. An examination of the Distribution of Expenditure in the report prepared by SSKB does show that a higher percentage of costs can be attributable to Lot 5. The applicant’s report prepared by Resident Building Services stated they did not ascertain any expenses that could be costed against individual Lots. Hence they argue that the contributions by each Lot should be equal.
21. I am not persuaded by the applicant’s submissions that there should be an equal adjustment to the contributions. On careful consideration of the evidence, in particular the Distribution of Expenditure to Lots in the SSKB Report, I am satisfied that in the current Scheme, the inequality of contributions is in fact fair and just.
22. As the decision in Fischer dictates that the starting point is equality and that a departure from that principles is allowable only where it is just, or fair, to recognise inequality, and where such inequality must be of a financial kind concerning costs sheeted home to the Body Corporate by law, the applicant has not satisfied the onus in this case of establishing that the contributions should be adjusted to equal. While the respective lot entitlements are presently not equal, the evidence shows that they should continue to be not equal, because it is just and equitable in the circumstances for such inequality to prevail;
23. The Tribunal finds that the current contribution schedule should not be adjusted.
24. Since the provisions of the QCAT Act state that the main purpose of the cost provisions is to have the parties pay their own costs unless the interests of justice require otherwise, and given relevant authority in this area, it is inevitable in a proceeding such as this that there should be no order as to costs.
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