Body Corporate for Ocean Pacifique CTS 8379 v Pugliese

Body Corporate for Ocean Pacifique CTS 8379 initiated legal proceedings against Pugliese and others, the body corporates for neighbouring buildings, concerning a dispute over water ingress and a shared retaining wall. The applicants sought specific performance of a deed of settlement that required the respondents to remedy the water ingress. The respondents challenged the validity of the deed, leading to the court determining the validity and enforceability of the deed as a preliminary matter. The court was required to decide whether the deed was void due to the invalidity of the appointment of the applicants' committee and an alleged invalidity of a resolution authorising the affixation of the applicants' seal. Additionally, the court had to determine whether the applicants validly ratified the deed.

The court found that the decision to execute the deed was not invalidated by a conflict of interest, even if section 100(4) was applicable. The court examined whether the decision to execute the deed was an act capable of ratification by the members of the applicants and whether the conduct of the applicants amounted to ratification. The court referred to Project Blue Sky Inc v Australian Broadcasting Authority, which established that an act done in breach of a statutory provision is not necessarily invalid unless there is a legislative purpose to invalidate such acts. The court distinguished between provisions that indicate a lack of power or capacity to act and those that regulate the exercise of power. The court concluded that the decision to execute the deed could be ratified by the members of the applicants if the instrumentality by which it was exercised was not competent to do so.

The court ordered the parties to confer on the form of order to be made and directed them to provide their agreed form of order or their respective proposed orders and written submissions within seven days. The applicants were directed to file and serve written submissions on the question of costs within seven days, and the respondents within fourteen days. Any remaining issues regarding the form of order or costs would be decided on the papers.