Chee Min Thoo v The Owners ‑ Strata Plan No 50276 - [2014] HCASL 79

CHEE MIN THOO
v
THE OWNERS ‑ STRATA PLAN NO 50276 & ORS
[2014] HCASL 79
S178/2013

The first respondent ("the Owners Corporation") was constituted under the Strata Schemes Management Act 1996 (NSW) ("the Act"). It was constituted on registration of a freehold strata scheme comprising 58 lots over five floors in a building known as "the Hunter Connection". Other respondents own lots in the strata scheme.
The applicant is the registered proprietor of several lots, including Lot 17, which is on the basement level of the building. The applicant wants to sublet Lot 17 in three separate tenancies for the commercial cooking and sale of food. The Council of the City of Sydney requires that the premises be properly ventilated.
The building has a mechanical exhaust ventilation system. The applicant asked the Owners Corporation to provide exhaust ventilation capacity sufficient to allow him to sublet Lot 17 as three separate tenancies for the commercial cooking and sale of food.
The Owners Corporation maintained, and maintains, that the existing ventilation system is already being fully used to the limit of its available design capacity.
The applicant sought, and obtained at first instance, orders of the Supreme Court of New South Wales (Slattery J) requiring the Owners Corporation to modify, or add to, repair or replace the existing ventilation system so that Lot 17 would receive the exhaust ventilation capacity the applicant sought. By later orders, the applicant obtained an award of damages.
On appeal by the Owners Corporation (and others), the Court of Appeal (Barrett JA, Tobias AJA and Preston CJ of LEC) set aside the orders of the primary judge and dismissed the applicant's claim. The applicant now seeks special leave to appeal to this Court.
The determinative issue in the Court of Appeal was whether, as the applicant submitted, the relevant obligations of the Owners Corporation were regulated principally by s 62(2) of the Act (providing that an owners corporation "must renew or replace any fixtures or fittings comprised in the common property") or s 65A (empowering an owners corporation, "[f]or the purpose of improving or enhancing the common property", to add to or alter common property or to erect a new structure on common property.)
There is no reason to doubt the Court of Appeal's conclusion that, in the particular facts and circumstances of this case, s 65A applied, not s 62.
The questions about damages for breach of statutory duty which the applicant seeks to agitate in this Court would not fall for consideration and we need express no view about whether the reasoning of the Court of Appeal on that aspect of the matter is right.
An appeal to this Court would enjoy insufficient prospects of success to warrant a grant of special leave.
Pursuant to r 41.11.1 of the High Court Rules 2004 we direct the Registrar to draw up, sign and seal an order dismissing the application with costs.

K.M. Hayne
2 April 2014 S.M. Crennan

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

Case: [2014] HCASL 79
Decision Date

CaseChat Overview and Summary

Chee Min Thoo, the applicant, sought to sublet his property, Lot 17 in the "Hunter Connection" building, for the commercial cooking and sale of food. The property is part of a strata scheme governed by the Strata Schemes Management Act 1996 (NSW). The City of Sydney Council requires that such premises be properly ventilated. The building has a mechanical exhaust ventilation system, but the applicant claims it is insufficient for his intended use. The Owners Corporation, the first respondent, maintains that the existing ventilation system is already being fully used to the limit of its design capacity.

The legal issues before the Court of Appeal were whether the obligations of the Owners Corporation were governed by section 62(2) of the Act, which mandates the renewal or replacement of fixtures or fittings in common property, or by section 65A, which allows the owners corporation to add to or alter common property for the purpose of improving or enhancing it. The Court of Appeal concluded that section 65A applied in the circumstances of this case, and dismissed the applicant's claim. The applicant now seeks special leave to appeal to the High Court.

The High Court considered the appeal and determined that there were insufficient prospects of success to warrant the granting of special leave. The Court of Appeal's conclusion that section 65A applied in the particular facts and circumstances of this case was not doubted. The questions about damages for breach of statutory duty raised by the applicant would not be considered by the High Court. The application for special leave to appeal was dismissed with costs.

This case highlights the importance of understanding the specific obligations and powers of an Owners Corporation under the Strata Schemes Management Act, as well as the requirements of local councils for certain types of businesses. The High Court's decision reinforces the need for careful consideration of the relevant provisions of the Act and the specific circumstances of each case when determining the obligations of an Owners Corporation.

Orders