Chateau Beachside Management Pty Ltd v Body Corporate for "Surfers Chateau" - [2009] QDC 7

DISTRICT COURT OF QUEENSLAND

CITATION:	Chateau Beachside Management Pty Ltd v Body Corporate for “Surfers Chateau” Community Title Scheme 14382 [2009] QDC 7
PARTIES:	CHATEAU BEACHSIDE MANAGEMENT PTY LTD (Plaintiff) V BODY CORPORATE FOR “SURFERS CHATEAU” COMMUNITY TITLE SCHEME 14382 (Defendant)
FILE NO/S:	572 of 2007
DIVISION:	Civil
PROCEEDING:	Application
ORIGINATING COURT:	Southport
DELIVERED ON:	30 January 2009
DELIVERED AT:	Brisbane
HEARING DATE:	13 January 2009
JUDGE:	Judge Dick SC
ORDER:	(1) The Statement of Claim be struck out; (2) The Plaintiff’s application for summary judgement be dismissed; (3) That the Plaintiff be granted leave to amend the Statement of Claim; (4) That the Plaintiff file and serve the Amended Statement of Claim within 21 days of the Order; (5) That the Amended Notice of Defence be filed within 21 days of Service of the Statement of Claim; (6) That any Amended Reply be filed within 14 days of the Service of the Amended Notice of Defence; (7) That the costs of the Application be costs in the cause.
CATCHWORDS:	Body Corporate and Community Management Act (Qld) 1997
COUNSEL:	S M McNeil for the Plaintiff G Beacham for the Defendant

In this matter, I have before me an application for summary judgement and a cross-application to strike out the statement of claim.

It is logical that I deal first with the cross application.

Background

In January 1996, a company called Strand Resorts Pty Ltd became the body corporate manager for the community titles scheme known as “Surfers Chateau”.

In early 1998, Strand Resorts tendered for the renewal of the management rights for the scheme. The tender submission, inter alia, proposed that the management rights be granted on the basis that the manger’s duties would include an obligation to paint the building in 1998 and in 2005.

The agreement included a lease over the restaurant area within the community titles scheme at a significantly reduced rental.

In November 2001, the plaintiff and defendant entered into a Deed of Assignment and Variation of Management and Letting Agreements (“the Deed”)

Clause 5.03 of the Deed inserted an additional clause 3.1 (f) into the Management Agreement:

“If the Manager shall exercise the option for the First Further Term, the Manager shall during the year 2005 paint the external surfaces of the building to a good tradesman like standard at the Manager’s expense.”

The Plaintiff painted the Scheme at a cost of $51,345.80.

The Body Corporate and Community Management Act 1997 (“the BCCM Act”)

Section 113 of the BCCM Act provides:
No consideration for engagement or authorisation
(1) The body corporate for a community titles scheme must not seek or accept the payment of an amount, or the conferral of a benefit, for—

(a) the engagement of a person as a service contractor for the scheme (including a replacement or renewal of an engagement of the person as a service contractor); or

(b) the authorisation of a person as a letting agent for the scheme
(including a replacement or renewal of an authorisation of the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Chateau Beachside Management Pty Ltd v Body Corporate for "Surfers Chateau" [2009] QDC 7
Case: [2009] QDC 7
Decision Date: 30 January 2009

CaseChat Overview and Summary

In the matter of Chateau Beachside Management Pty Ltd v Body Corporate for "Surfers Chateau," the dispute revolves around allegations that the Defendant, Body Corporate for "Surfers Chateau," contravened provisions of the Body Corporate and Community Management Act (Qld) 1997. The Plaintiff, Chateau Beachside Management Pty Ltd, claims that the Defendant accepted payments and benefits in connection with the engagement of a service contractor. Specifically, the Plaintiff argues that the Defendant accepted payments for management services provided under a Deed of Assignment and Variation of Management and Letting Agreements executed in 2001.

The legal issues the court was required to decide included whether the Statement of Claim sufficiently alleged that the Defendant accepted payments and benefits for the engagement or authorisation of the Plaintiff as a service contractor, as required by section 113(1)(a) of the BCCM Act. Additionally, the court had to determine whether the Statement of Claim adequately pleaded that the Defendant accepted a benefit under section 114 of the BCCM Act. The court also had to consider whether the Plaintiff's claim for restitution was adequately supported by the pleadings.

The court found that the Plaintiff's Statement of Claim did not sufficiently allege the matters required to engage the relevant sections of the BCCM Act. The court noted that section 113(1)(a) required an allegation that the Defendant accepted a benefit for the engagement, which was not adequately pleaded. The court also found that the Plaintiff's claim under section 114 failed to identify the specific benefit conferred on the Defendant. Furthermore, the court held that the Plaintiff's claim for restitution did not constitute a cause of action in and of itself. Consequently, the court struck out the Statement of Claim and dismissed the Plaintiff's application for summary judgment. The court granted the Plaintiff leave to amend the Statement of Claim and set out a timeline for filing the amended pleadings. The court also ordered that the costs of the application be costs in the cause.

Orders

Orders of the court

(1) The Statement of Claim be struck out;

(2) The Plaintiff’s application for summary judgement be dismissed;

(3) That the Plaintiff be granted leave to amend the Statement of Claim;

(4) That the Plaintiff file and serve the Amended Statement of Claim within 21 days of the Order;

(5) That the Amended Notice of Defence be filed within 21 days of Service of the Statement of Claim;

(6) That any Amended Reply be filed within 14 days of the Service of the Amended Notice of Defence;

(7) That the costs of the Application be costs in the cause.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Section 113 of the BCCM Act provides:No consideration for engagement or authorisation(1) The body corporate for a community titles scheme must not seek or accept the payment of an amount, or the conferral of a benefit, for— Section 114 of the BCCM Act provides:Limitation on benefit to body corporate under service contractor engagement(1)The engagement of a person as a service contractor for a community titles scheme must not include, whether directly or indirectly, a requirement for the payment of an amount to, or the conferral of a benefit (other than the services the service contractor is engaged to supply) on, the body corporate. The Statement of Claim relevantly pleads:(2).“On or about 25 November 2001 the Plaintiff entered into a Deed of Assignment and Variation of Management and Letting Agreements (hereinafter referred to as “the Deed”) with the Defendant and Strand Resorts Pty Ltd ACN 008 498 315 (hereinafter referred to as “Strand Resorts”).(3).The effect of the Deed was to assign pre-existing Management and Letting Rights held by Strand Resorts to the Plaintiff and to vary certain provisions of those previous Agreements. It is submitted that the Statement of Claim does not allege the matters required to engage the relevant sections of the BCCM Act namely: In relation to S 113 (1) (a), the defendant submits that the pleading simply alleges that the defendant received or accepted a benefit but that it fails to allege that the benefit was accepted for the engagement. In relation to S 114, it is submitted that the pleading fails to identify the benefit that the agreement required the plaintiff to confer on the defendant. It is submitted that clause 3.1 (f) of the Deed did no more than restate an existing agreement to perform the painting and that the pleading fails to state how clause 3.1 (f) conferred a benefit as distinct from a continuation of a commercial arrangement. It is further submitted that the restitution claim simply alleges unjust enrichment/restitution on behalf of the defendant and that unjust enrichment or restitution is not a cause of action in and of itself. The Uniform Civil Procedure Rules (“UCPR”) provide relevantly:Rule 149 UCPR Statements in pleadings(1) Each pleading must—(a) be as brief as the nature of the case permits; and(b) contain a statement of all the material facts on which the party relies but not the evidence by which the facts are to be proved; and(c) state specifically any matter that if not statedspecifically may take another party by surprise; and(d) subject to rule 156, state specifically any relief the partyclaims; and(e) if a claim or defence under an Act is relied on—identifythe specific provision under the Act.(2) In a pleading, a party may plead a conclusion of law or raise apoint of law if the party also pleads the material facts insupport of the conclusion or point.Rule 150 UCPR Matters to be specifically pleaded(2) Also, any fact from which any of the matters mentioned in subrule (1) is claimed to be an inference must be specifically pleaded.