Dimitroff and Owners Of 43 Kinsella Street, Joondanna, Strata Plan 14493

Case •

[2012] WASAT 12

•

17 JANUARY 2012

JURISDICTION     :   STATE ADMINISTRATIVE TRIBUNAL

STREAM:   COMMERCIAL & CIVIL

ACT: STRATA TITLES ACT 1985 (WA)

CITATION:   DIMITROFF and OWNERS OF 43 KINSELLA STREET, JOONDANNA, STRATA PLAN 14493 [2012] WASAT 12

MEMBER:   MS L WARD (MEMBER)

HEARD:   15 AUGUST 2011 AND

17 OCTOBER 2011

DELIVERED          :   17 JANUARY 2012

FILE NO/S:   CC 5 of 2011

BETWEEN:   ADAM DIMITROFF

Applicant

AND

OWNERS OF 43 KINSELLA STREET, JOONDANNA, STRATA PLAN 14493
Respondent

Catchwords:

Strata titles ­ Exclusive use by­laws or a licence ­ Application to declare invalid resolutions ­ Application to repeal exclusive use by­laws ­ Resolution without dissent ­ Was notice of meeting provided ­ Provision of AGM minutes

Legislation:

Strata Titles Act 1985 (WA), s 3AC, s 3AC(2), s 3B, s 3C, s 3D, s 42, s 42(2)(a), s 42(4), s 42(8), s 42(9), s 81(1), s 93(5), s 94, s 95, s 97, s 100, Sch 1

Result:

Application partially successful

Category:    B

Representation:

Counsel:

Applicant:     Mr J Dimitroff (Acting as Agent)

Respondent:     Ms A Mijatovic (Acting as Agent)

Solicitors:

Applicant:     Self-represented

Respondent:     Self-represented

Case(s) referred to in decision(s):

Fisher and The Owners of Esplanade Court ­ Strata Plan 363 [2008] WASAT 301

Radford and The Owners Of Miami Apartments Strata Plan 45236 [2006] WASAT 293

Smart v The Strata Company ST/2003­000093

The Owners of Rosneath Farm Survey Strata Plan 35452 and Rowell & Anor [2007] WASAT 95

The Owners of St John's Court ­ Rivervale Strata Plan 6052 and Clark [2010] WASAT 126

REASONS FOR DECISION OF THE TRIBUNAL: 

Summary of Tribunal's decision

  1. The applicant, Mr Adam Dimitroff, seeks an order from this Tribunal seeking the reinstatement of By­law 18 and the invalidation of By­law 19 and By­law 20.  These by­laws related to the imposition of a fee on six lot owners, including Mr Dimitroff, for the exclusive use of the courtyards attached to those particular lots.  The courtyard is common property.

  2. The Tribunal found that s 42(8) of the Strata Titles Act 1985 (WA) applied. Under s 97 of the Strata Titles Act 1985, the Tribunal invalidated the two resolutions passed at the Annual General Meeting of the Owners of 43 Kinsella Street, Joondanna, Strata Plan 14493 on 25 April 2010 because the requirements of s 42(8) of the Strata Titles Act 1985 were not met. In particular, the consent of Mr Dimitroff was not sought in relation to the resolutions and he was also denied the opportunity to vote late on the resolutions under s 3AC(2) of the Strata Titles Act 1985.

  3. However, due to the operation of s 93(5) of the of the Strata Titles Act 1985, the Tribunal did not have the power to make any order relating to the reinstatement of By­law 18 and the repeal of By­law 19 and By­law 20.

  4. The reasons for this decision were delivered orally to the parties on 17 January 2012 based on the written decision below.

Background ­ the parties

  1. Mr Adam Dimitroff (applicant or Mr A Dimitroff), owns Unit 2 in a 20 lot strata complex which is located in Joondanna.  Unit 2 in the complex was one of six units shown on the plan which had exclusive use of part of the common property as courtyards.  According to the now repealed registered By­law 18 the six units which have this right conferred on them are: Units 1, 2, 11, 12, 15 and 16.

  2. The applicant has lived overseas since 18 March 2008.  Unit 2 in the complex is rented out to a tenant.  The applicant has given written authorisation to his father, Mr John Dimitroff (Mr J Dimitroff), to bring these proceedings and to act on his behalf.

  3. The respondent, Owners of 43 Kinsella Street, Joondanna, Strata Plan 14493 (strata company), is the strata company which collectively represents all of the owners of the complex, and owns and controls the common property of the complex.  The strata company is self­managed.

Application in the Tribunal

  1. On 5 January 2011 the applicant lodged an application, together with supporting documents, with the Tribunal seeking orders in relation to:

    •Certain fines purportedly imposed by the strata company on Mr A Dimitroff be waived and the fine of $100 already paid be refunded.

    •Certain information and documents be made available by the strata company to Mr A Dimitroff.

    •The exclusive use levy imposed for the first time in the September 2010 quarter, in particular the repeal of By­law 18 and insertion of By­law 19 and By­law 20.

  2. In relation to the so called exclusive use levy, Mr J Dimitroff sought three orders from the Tribunal that:

    •The relevant resolutions passed at the Annual General Meeting of the strata company held on 25 April 2010 (2010 AGM) be treated as nullities.

    •The notification of change in By­law L299223 registered on the strata plan be repealed, withdrawn or cancelled.

    •The repealed By­law 18 be reinstated.

Procedural history in the Tribunal

  1. The matter was listed for directions on 20 January 2011.  Mr Tomas Mijatovic attended the direction hearing in his capacity as chair of the strata company.  The application was referred to mediation on 7 February 2011.  The mediation did not proceed on 7 February 2011 by reason of the strata company representative's non­attendance in person at the mediation.  The matter was listed for a second directions hearing on 15 March 2011.  The strata company did not appear at the second directions hearing.  However, the Tribunal made orders programming the matter for hearing on 29 April 2011.

  2. On 29 April 2011 the final hearing was adjourned so that the strata company could obtain suitable representation.  The next available date for final hearing which was suitable for both parties was 15 August 2011.  The final hearing is referred to further below.

Hearing on 15 August 2011

  1. Mr J Dimitroff and Ms Alex Mijatovic, a member of the council of the strata company, both attended the hearing in person on 15 August 2011.  They both gave oral evidence and made submissions at the hearing.

  2. At the final hearing on 15 August 2011 several documents were tendered to the Tribunal and were received into evidence and considered by the Tribunal.  The documents included:

    •The applicant's bundle of documents attached to his application and marked Exhibit A which comprised documents marked from 'A' to 'W', and a statement of facts, issues and contentions.

    •The strata company's bundle of documents marked as Exhibit B which comprised a copy of the decision of the Strata Titles Referee (STR) in Smart v The Strata Company ST/2003­000093 (Smart) delivered on 13 April 2004, and strata council minutes of meeting held on 28 February 2010 regarding the committee's resolution to impose a licence fee on the owners of all units who have the exclusive use of their courtyards.

    •An unsigned copy of the minutes of the 2010 AGM provided by the strata company at the hearing and marked as Exhibit C.  This was the first time the minutes of the 2010 AGM had been sighted by Mr J Dimitroff.

  3. During the course of the hearing on 15 August 2011 the parties resolved by consent the issues relating to the fines and the provision of documents to the applicant.  The Tribunal made orders by consent to reflect this agreement on 15 August 2011.

  4. Mr J Dimitroff and Ms Mijatovic both gave evidence before the Tribunal and made submissions in relation to the exclusive use area and levy.  By­law 18 was repealed because the 1987 strata survey plan was said by Ms Mijatovic to be inaccurate.  By­law 19 was said to attach a correct survey plan which included the correct dimensions for the carports, courtyards and other areas.

Hearing on 17 October 2011

  1. At the Tribunal's request the hearing was resumed on 17 October 2011.  Mr J Dimitroff appeared in person and Ms Mijatovic appeared by telephone.

  2. Ms Mijatovic properly conceded on behalf of the strata company that it had not complied with s 3AC(2) of the Strata Titles Act 1985 (WA) (ST Act). This was because s 3AC(2) of the ST Act permitted a vote on the resolution within 28 days of the meeting. However, the by­law in question had been lodged for registration at Landgate on 29 April 2010, just four days after the meeting. The orders which the Tribunal could make under the ST Act were also raised in general terms with the parties.

Issues for determination by the Tribunal

  1. The main issue for final determination by the Tribunal is whether or not the strata company validly repealed By­law 18 and created the additional By­law 19 and By­law 20, which created an exclusive use in relation to the same six units but in accordance with a new survey plan, and imposed an 'exclusive licence fee'.

  2. In summary, the issues for determination by the Tribunal are:

    1)Did the resolutions confer an exclusive use and enjoyment of part of the common property on Mr A Dimitroff?

    2)Was an exclusive use by­law under s 42(8) of the ST Act required?

    3)What are the requirements under s 42(8) of the ST Act?

    4)Have the requirements of s 42(8) of the ST Act been met?

    5)What orders is the Tribunal able to make?

Parties' contentions

  1. Mr J Dimitroff submits that the by­laws were not passed in accordance with the ST Act because:

    •He did not receive any notice of the 2010 AGM.  Mr J Dimitroff first became aware of the fee when he received an invoice for it on or about 11 September 2010 from the strata company for the September 2010 quarter dated 7 August 2010, which was some three months after the 2010 AGM.  The invoice included an amount of $141.90 stated to be for an 'Exclusive Licence Fee (approved at AGM 25/4/10) @ $1.10 per unit entitlement)'.  He did not receive a copy of the 2010 AGM minutes, despite numerous requests, until the hearing of this matter on 15 August 2011.

    •Mr A Dimitroff and the other three unit holders who have not been identified in these proceedings and who did not attend the 2010 AGM either personally or by proxy were denied the opportunity to vote late under s 3AC(2) of the ST Act because the by­law was registered at Landgate within four days of the 2010 AGM. Section 3AC(2) of the ST Act permits a vote on the resolution within 28 days after the day of the meeting.

  2. In response Ms Mijatovic, for the strata company, submits that the repeal of By­law 18 and the addition of By­law 19 and By­law 20 have all been passed properly by the strata company.  She said that the notice of meeting was sent to Mr A Dimitroff's address for all correspondence, namely, to his father, Mr J Dimitroff.  She acknowledges that there is no formal proof in relation to the sending of the notice of the 2010 AGM.  In effect, the strata company submits that because 16 of the 20 lot owners attended the 2010 AGM in person or by proxy this is proof that the notices were sent to all lot owners.

  3. However, Ms Mijatovic did concede that the registering of the by­law so soon after the 2010 AGM did prevent the four lot owners, who did not attend the 2010 AGM, from casting a vote within 28 days of the meeting.  However, even if the Tribunal finds that the formalities surrounding the 2010 AGM have not complied with the ST Act, then Ms Mijatovic submits that a by­law of this nature is not required and that the council of the strata company may grant a licence.  Ms Mijatovic submits that the STR's decision in Smart supports this position.

Chronology in relation to the imposition of the exclusive use levy

  1. By way of background, based on the documents and oral evidence before the Tribunal, the relevant chronology in relation to the imposition of the exclusive use levy is set out below.

  2. The strata plan was registered on 12 January 1987 pursuant to the ST Act (Strata Plan 14493).

  3. Mr A Dimitroff became the registered proprietor on 23 June 2004 of Lot 2 on Strata Plan 14493, together with a share in any common property as set out on the strata plan. At the time of purchase, Lot 2 was subject to By­law 18, in Pt 1 of Sch 1, registered on 5 January 1989 (No D982827) and stating:

    Exclusive use of common property courtyards granted to units 1, 2, 11, 12, 15 [and] 16 as defined by the plan held in the Strata Company's files.

Previous attempt to impose an exclusive use licence fee in 2005

  1. A previous attempt to impose an exclusive use licence fee in relation to the six courtyards in the complex took place in the complex in 2005.

  2. On 15 September 2004 the council of management passed a resolution to the effect that it meet with the owners of the six units with exclusive use areas regarding a motion to impose a leasing fee.  Reference is made to the STR's Smart decision.  In response, on 29 September 2004 the then owner of Unit 1, Ms Evans, wrote to the council and requested that a full meeting of owners be called to change the by­law as she had advice that it was only at an Annual General Meeting (AGM) or extraordinary general meeting (EGM) that such an amendment could be made.  In accordance with the request from the owner of Unit 1, the 2005 AGM considered the imposition of a licence fee of $300 on the owners of the six units with exclusive use of their courtyards.  The motion was lost 8­9.  The minutes of this meeting show that Mr A Dimitroff attended the 2005 AGM in person.

  3. According to Mr J Dimitroff, his son voted against the resolution in 2005.  The minutes of the 2005 AGM do not clearly identify who voted for and who voted against the motion.  Although the Tribunal accepts that Mr A Dimitroff voted against it, as it is consistent with Mr A Dimitroff's view of the 2010 resolutions as expressed to this Tribunal by his father and in correspondence with Mr Mijatovic in late 2010.

2010 proposal to impose exclusive use levy

  1. In 2010 a second attempt was made to impose an exclusive use licence fee in relation to the six courtyards in the complex.  The strata committee resolved on 28 February 2010 to:

    •Impose a licence fee payable quarterly of $1.10 per unit, entitlement payable by the owners of all units who have exclusive use of their courtyards.

    •Put a resolution to the owners in a general meeting.

  2. Ms Mijatovic told the Tribunal at the hearing that the notice of the 2010 AGM was sent by post or delivered personally to all registered proprietors on 31 March 2010.  Since Mr A Dimitroff has resided overseas the strata company has sent all of his post to Mr J Dimitroff's address in Brentwood.  Mr J Dimitroff confirmed to the Tribunal that as far as he is aware he has received all other letters from the strata company by post without a problem.  However, Mr J Dimitroff did not receive notice of the 2010 AGM and Mr A Dimitroff did not attend the 2010 AGM, either in person or by proxy.

  3. The 2010 AGM minutes relevantly record that:

    •Mr Mijatovic was chairman of the council of management and chaired the meeting of the strata company.

    •Eight of the 20 proprietors were present in person.  The minutes do not indicate which particular unit the proprietors own.

    •Three people in attendance held proxies for eight of the other proprietors.

    •Proposed motion ­ register survey plans for exclusive use areas:

    That the by­law passed 9 January 1987 numbered 18 of [Pt] 1 of [Sch] 1 to the [ST] Act as they applied to the building referred to in the strata plan at the time, are repealed and the following by­law is adopted and added as [B]y­law 19 of [Sch] 1 of the [ST] [A]ct ­ that the registered proprietor of each lot will be entitled to the exclusive use and enjoyment of that part of the common property as is marked on the attached plans as being 'for the use of' each lot respectively.  [P]assed 13­0 ([A]lex abstained)

    •Proposed motion:

    That the Council of Management impose a licence fee payable quarterly of $1.10 per unit of entitlement (assessable by the council) payable by the owners of all units who have the exclusive use of their courtyards (as previously approved at the AGM on 9 January 1987).  [P]assed unanimously 16­0, no votes against[.]

  4. The proposed motions above became By-law 19 and By-law 20 respectively.

  5. Exhibit A includes the Form 21 change of by­law which states that it 'became unconditional' on 22 May 2010 and attaches By­law 19 and By­law 20 as follows:

    Resolution (Register Survey Plans for Exclusive Use Areas)

    That the by­law passed 9 January 1987 numbered 18 of [Pt] 1 of [Sch] 1 to the [ST] Act as they applied to the building referred to in the strata plan at the time, are repealed and the following by­law is adopted and added as [B]y­law 19 of [Sch] 1 of the [ST]  [A]ct ­ that the registered proprietor of each lot will be entitled to the exclusive use and enjoyment of that part of the common property as is marked on the attached plans as being 'for the use of' each lot respectively.

    Resolution ­ Licence Fees for Exclusive Use Areas

    That the Council of Management impose a licence fee payable quarterly of $1.10 per unit of entitlement (assessable by the council) payable by the owners of all units who have the exclusive use of their courtyards (as previously approved at the AGM on 9 January 1987).

  6. The Form 21 is signed by Mr Mijatovic as chair and Ms E Mijatovic as secretary on 26 April 2010.  It is stamped as being lodged at Landgate on 29 April 2010 and given the number L299223.  The survey plan dated 8 March 2010 is attached to Form 21.

  7. Mr A Dimitroff's certificate of title provided, lodged with the application to the Tribunal, which is on a print out dated 5 January 2011, shows that the notification of change of By­law L299223 was registered on the date it was lodged, that is, on 29 April 2010.

  8. Mr J Dimitroff first became aware that a levy had been imposed when he received an invoice from the strata company for the September 2010 quarter dated 7 August 2010.  The invoice included an amount of $141.90 stated to be for 'Exclusive Licence Fee (approved at AGM 25/4/10) @ $1.10 per unit entitlement).'

  9. On 11 September 2010 Mr J Dimitroff wrote to the strata company and requested a copy of the 2010 AGM minutes and a copy of the notification of the by­laws.  By letter dated 19 September 2010 the strata company responded and provided a copy of the notice of meeting for the 2010 AGM and several invoices.

  10. On 30 September 2010 Mr J Dimitroff wrote to the strata company again and relevantly noted that:

    The notice of AGM … was the first correspondence received about the AGM you held on 25 April 2010.  I asked for a copy of the minutes … you did not send it.  You would be well aware that Adam would dissent to [an] additional fee being levied for exclusive use and that he will wish to check further on why he was not informed … of this very important decision.

  11. The strata company chair, Mr Mijatovic, responded to Mr J Dimitroff by email on 19 October 2010 and relevantly stated that:

    The AGM notices were all sent and mailed by Erin and Rada so if you were aware of the AGM you could attend but still had no right to vote as you are [sic] unfinancial for some time.  The other votes in favour even those who would pay much more such as Rada and Erin for the sake of the benefit of the area. [sic]

  12. Mr J Dimitroff sent an email on 21 October 2010 to the strata company chair, Mr Mijatovic, and relevantly stated that:

    The exclusive use levy

    This fee will not be accepted without further clarification.  For the [third] time the minutes of the AGM held on Anzac Day (25/4/10) have not been received and again I ask that you send them by return mail.  Clearly you have an issue with your mail procedure which is no doubt the reason why Adam never received notification of the 25/4/10 AGM at which he or his proxy would have dissented to the motion to levy an exclusive levy fee.

  13. The strata company chair, Mr Mijatovic, responded to Mr J Dimitroff by email on 22 October 2010 and relevantly stated that:

    As to the AGM vote for the exclusive use fees, the committee clearly remember[s] mailing it to your address and in any event even if you had attended, the vote in favour was 12­0 so a vote of 12­1 would still have passed as it is a majority vote for that matter assuming you would be allowed to vote as a proxy for your absent son when he is unfinancial which has [prohibited him] from voting for the last 3 AGMs.  Your misunderstanding that your 1 vote could block this decision is incorrect.

  1. Following a further exchange of emails, the strata company chair, Mr Mijatovic, sent an email on 6 November 2010 and relevantly stated that the 2010 AGM minutes would be issued in March as usual.

  2. On 26 November 2010 the strata company wrote a letter addressed to 'Mr A & J Dimitroff' and requested, in effect, the payment of several invoices, including, relevantly, one for the outstanding $141.90 for the exclusive licence fee.  Mr J Dimitroff responded to this letter on 7 December 2010 and requested once again a copy of the 2010 AGM minutes, and relevantly stated that:

    ... [A] proprietor is entitled to vote on matters requiring a resolution without dissent even if he is unfinancial.  Your email … clearly states that Adam was not eligible to vote and that his vote of dissent would not have changed the final outcome.  There are several interesting aspects to that statement particularly in view of the fact that Adam never received notification of the 25/4/10 meeting and as you know had previously dissented to your proposal and would have done so again if he was aware [of it].

  3. For the record, Mr J Dimitroff received an unsigned copy of the 2010 AGM minutes for the first time at the hearing on 15 April 2011.

Consideration of the issues by the Tribunal

  1. Did the resolutions confer an exclusive use and enjoyment of part of the common property on Mr A Dimitroff?

  1. Section 42 of the ST Act deals with how by­laws may be amended. Schedule 1 by­laws can only be amended at a general meeting of the strata company and only by a resolution without dissent (s 42(2)(a) of the ST Act). By­law 18 is registered as a Sch 1 by­law and, therefore, it must be amended, repealed or added to by resolution without dissent.

  2. In relation to By­law 19 and By­law 20, the Tribunal must decide if the insertion of those by­laws confers an exclusive use and enjoyment of part of the common property or if some lesser right is conferred.  The strata company submits, as a secondary argument, that something less than exclusive use and enjoyment has been conferred on Mr A Dimitroff.

  3. However, the parties accept that not all proprietors of lots in the complex have access to the courtyards; only those six units listed as Units 1, 2, 11, 12, 15 and 16 have access.  It is only the proprietors shown on the plan as having courtyards.

  4. The use of common property by lot owners as considered by the Tribunal in The Owners of St John's Court ­ Rivervale Strata Plan 6052 and Clark [2010] WASAT 126, which cited an earlier Tribunal decision of The Owners of Rosneath Farm Survey Strata Plan 35452 and Rowell & Anor [2007] WASAT 95, and relevantly stated at [23] ­ [26]:

    Thus, while an individual lot owner, as a tenant in common, is entitled to the use and enjoyment of any part of the common property, it is subject to the control and management of the common property by the strata company.  That right of use does not enable the lot owner to exclude any other tenant in common from making use of the common property, unless by way of a resolution without dissent (or unanimous resolution in the case of a two­lot scheme)[,] a by­law is passed granting exclusive use and enjoyment, or special privileges in respect of the common property or any part of it (s 42(8)).

    The legislative intent is, therefore, that common property cannot be used to the exclusion of other lot owners, nor can it be dealt with in any of the above senses, unless the requisite resolution has been passed. The standard by­laws imposed by virtue of s 42, and which cannot be varied unless consistent with the legislation, restrict the use and enjoyment of common property in that it may only be used in a manner which does not unreasonably interfere with the use and enjoyment thereof by other proprietors, occupiers, residents or their visitors (Sch 1, [B]y­law 1(2)(a)). Nor may a proprietor obstruct lawful use of common property by any person (Sch 2, [B]y­law 2).

    It is, therefore, clear that control and management of common property vests in the strata company and that any part of common property cannot be used to the exclusion of other co­owners without their consent.  That consent may be obtained in the above circumstances by way of the requisite resolution.  The strata company may also deal with common property by way of a simple majority vote of members in general meeting where the proposal is sufficiently detailed and the expenditure is approved as part of the budget or where the nature of the proposal comes under the control and management of the common property:  see Sisto and The Owners of Glenway Gardens Apartments [2005] WASAT 282.

    If any more were needed to conclude that on a proper construction of the ST Act, a lot owner must seek the approval of the strata company before using any part of the common property to the exclusion of other lot owners, it is self­evident from the very provisions on which the respondents rely, namely[,] s 85 and s 94 which are predicated upon refusal of a consent, or licence, as the case may be. (Emphasis added)

  5. Relevantly, in the matter of Fisher and The Owners of Esplanade Court ­ Strata Plan 363 [2008] WASAT 301 (Fisher) at [36] ­ [38] which involved the placing of pot plants on common property, the Tribunal discussed the options available for the use of common property and stated:

    There are essentially four main ways in which to deal with the use of common property by proprietors ­ resolution without dissent pursuant to s 42(8) of the ST Act[,] special resolution pursuant to s 3B of the ST Act, a lease pursuant to s 19 of the ST Act and a licence pursuant to the inherent powers of a strata company to manage and control common property (s 35 of the ST Act).

    The contention by Mr Kronberger that common property can only be dealt with by way of a s 42(8) ST Act by­law or by a lease is not consistent with the ST Act. The Tribunal is of the view that the ST Act does not mandate that any use of common property should automatically be the subject of a Sch 1 by­law. It depends on the nature and scope of rights and privileges afforded to a proprietor.

    Although the Tribunal appreciates the plea of Mr Kyle that a 'common sense' approach should be used to deal with something as relatively trivial as the placing of pot plants, the question is, what are the rights and privileges that are bestowed on the beneficiaries?  The principle of dealing with exclusive use and special privileges of common property must guide the Tribunal regardless of the subject matter.

  6. In Fisher a by­law authorising those proprietors of three bedroom units to keep one pot plant on parts of common property outside their front doors was held to be an exclusive use by­law because the by­law conferred an exclusive use and special privileges on those owners of three bedroom units, that is, about 16 of the 63 units.  Therefore, the Tribunal found in Fisher that the by­law had to comply with s 42(8) of the ST Act.

  7. In this application the strata company relies on the former STR's decision in Smart to support its submission that, in any case, an exclusive use by­law is not required.  The Smart decision dealt with a proprietor keeping her privately owned washing machine in the laundry, which was common property.  The STR stated that the strata company had the power to authorise this action by way of a licence subject to certain conditions.

  8. However, the Tribunal considers that in light of its more recent decision in Fisher, in this Tribunal's view, the Smart decision cannot be considered correct.  Clearly allowing one owner to place a washing machine on common property is conferring a special privilege on one owner, just as authorising the placement of pot plants conferred a special privilege on some owners to part of the common property, as was found in Fisher.

  9. In this case, clearly the courtyards in question confer an exclusive use and enjoyment of part of the common property within the meaning of s 42(8) of the ST Act. Accordingly, s 42(8) of the ST Act states that in such circumstances a resolution without dissent is required. This is because s 42(8) of the ST Act states that it is under this subsection only and not otherwise. That is, if an exclusive use is being conferred then it must be via s 42(8) of the ST Act.

  10. In the Tribunal's view, the 'may' in s 42(8) of the ST Act refers to the ability of the strata company to confer on a proprietor an exclusive use and enjoyment. Once the strata company decides to confer such a privilege, it must be done in accordance with s 42(8) of the Act.

  11. For these reasons, this Tribunal does not consider the STR's decision in Smart to be of assistance in deciding this matter. This Tribunal considers that the only appropriate mechanism for the by­laws in question in this application to be repealed and inserted is by a resolution without dissent as required under s 42(8) of the ST Act.

  1. If so, was an exclusive use by­law under s 42(8) of the ST Act required?

  1. Yes, for the reasons already given above.

  2. The Tribunal will now consider if the resolutions were passed at the 2010 AGM in accordance with the requirements of the ST Act.

  1. What does s 42(8) of the ST Act require?

•Firstly and fundamentally s 42(8) requires the consent of the proprietors of the lots where a by­law in respect of that lot confers on the proprietor the exclusive use and enjoyment of part of the common property.

•Notice must be given in accordance with s 3AC and s 3C of the ST Act; that is, at least 14 days notice of the proposed resolution.

•A quorum must be present as set out in s 3C of the ST Act. The Tribunal notes that this aspect of the 2010 AGM is not in dispute.

•Section 3D of the ST Act permits unfinancial proprietors to vote in certain circumstances.

•Section 3AC(2) of the ST Act allows voting within 28 days of the meeting.

•Once the 28 days has elapsed, the by­law is to be registered within three months of it passing to have effect (s 42(4) of the ST Act).

•After the expiration of the period of two years from the making or purported making of a by­law under s 42(8), it is conclusively presumed that all steps precedent to making the by­law have been complied with and performed (s 42(9) of the ST Act), that is, deemed to comply after two years.

  1. Have the requirements of s 42(8) of the ST Act been met?

  1. Firstly and fundamentally Mr A Dimitroff's consent has not been sought. Mr A Dimitroff has not consented in relation to the conferring of a right under By­law 19 in the terms set out in By­law 20 and the repeal of his rights under By­law 18. Section 42(8) requires the proprietors of the lots consent where a by­law in respect of that lot confers on the proprietor the exclusive use and enjoyment of part of the common property.  In the Tribunal's view this is a fundamental flaw in the manner in which the strata company has passed the by­laws in question.  In the Tribunal's view Mr A Dimitroff's consent was a necessary precondition to the making and repealing of the by­laws.

  2. Secondly, s 3AC(2) of the ST Act allows voting within 28 days of the meeting. Mr A Dimitroff, and for that matter, the three other proprietors who did not attend the 2010 AGM personally or by proxy, were denied the ability to vote late on the resolution because it was registered at Landgate within four days of the 2010 AGM. Landgate accepted lodgement of the Form 21 even though it expressly stated that it became unconditional on 22 May 2010. The lodging of the form at Landgate was properly acknowledged by Ms Mijatovic as a procedural irregularity.

  3. In addition, there is no independent proof before the Tribunal that the notice of meeting was 'given' to Mr A Dimitroff as required by s 3C of the ST Act. However, Sch 1, By­law 11(5) sets out what the notice of meeting is required to include and states that 'accidental omission' does not invalidate the proceedings. In this case the evidence from Ms Mijatovic on 15 August 2011 varied from 'all notices for the 2010 AGM were sent to the proprietors by post' to 'some were sent and some were delivered to owners personally'. In these circumstances there is no reliable and independent evidence of any consistent course of conduct of the strata company as to how it sends notices to proprietors. However, By­law 11(5) is in clear terms. It means that unless the omission was something other than 'accidental' Mr A Dimitroff is deemed to have received it. In this case Mr J Dimitroff acknowledges that he received all other correspondence from the strata company. In circumstances where 16 of the 20 proprietors attended the 2010 AGM in person or by proxy, the evidence which is before the Tribunal suggests that any omission to give the notice of meeting was accidental and does not invalidate the proceedings at the 2010 AGM for that reason alone.

  4. However, the failure of the strata company to provide minutes of the 2010 AGM held on 25 April 2010 until 15 August 2011, some 16 months later and after numerous written express requests by Mr J Dimitroff, is deplorable.  While the ST Act and by­laws do not prescribe when minutes are to be circulated to proprietors, good corporate governance would dictate that minutes should be mailed out as soon as practicable after the meeting.  The minutes are in effect in draft form until they are accepted as a true and accurate record at the next AGM.  However, the draft nature of the minutes does not negate the need to circulate them as soon as practicable.  Support for this view is set out in John Angus's book Understanding Strata Titles (2nd ed, 2010) at page 104, where he states that: 'Minutes should be mailed as soon as possible after the meeting and certainly within say three weeks'. In this case, had Mr A Dimitroff been aware of what happened at the 2010 AGM before September 2010, when he received the invoice, then the resolutions could have been dealt with much sooner, possibly under s 100 of the ST Act, and may even have allowed him to vote late under s 3AC of the ST Act.

  5. The Tribunal also notes that the strata company provided some inaccurate information in the correspondence between the parties in late 2010.  For the sake of clarity the Tribunal notes that:

    •A resolution without dissent was required for the by­laws to pass contrary to what Mr Mijatovic states in his email dated 22 October 2010.

    •Unfinancial members can vote on a resolution without dissent as s 3D of the ST Act states that this is possible. This is contrary to Mr Mijatovich's email letter dated 19 October 2010.

    •Mr Mijatovic states that the vote was 12­0 in relation to the resolution passed at the 2010 AGM; however, the 2010 AGM minutes provided to the Tribunal on 15 April 2011 state that the fee resolution was passed 16­0 and the repeal of By­law 18, and insertion of By­law 19 was passed 13­0.  This variation is of some concern to the Tribunal and is a good example as to why minutes should be provided as soon as practicable after the meeting, when the details of the meeting are fresh and voting is more likely to be recorded accurately.

    •Once the 28 days has elapsed, the by­law is to be registered within three months of it passing to have effect (s 42(4)) of the ST Act). The strata company has complied with this requirement under s 42(4) of the ST Act, although in doing so, it contravened s 3AC of the Act by lodging the change in by­laws before 28 days had elapsed after the meeting.

  6. For the reasons set out above, namely, the failure of the strata company to obtain Mr A Dimitroff's consent to the by­laws and the lodging of the change in by-laws within 28 days of the meeting contrary to s 3AC of the ST Act, the Tribunal finds that the provisions of the Act in relation to a meeting of the strata company have not been complied with in terms of s 97 of the ST Act.

  7. The orders the Tribunal is able to make are considered below:

  1. What orders is the Tribunal able to make?

  1. The Tribunal notes that under s 81(1) of the ST Act, it has power to make an order sought by the applicant and an order made may be expressed in terms different from the order sought, so long as it does not differ in substance from the order sought.

  2. In this application Mr A Dimitroff has always sought the reinstatement of By­law 18 and the invalidation of By­law 19 and By­law 20.  This objective has not changed during the application.

  3. The Tribunal notes that the relief available to Mr A Dimitroff in this application is very limited.  For example:

    •Section 93(5) of the ST Act ­ excludes the Tribunal from being able to invalidate exclusive use by­laws.

    •Section 94 of the ST Act ­ applies only to licences and is not relevant to this situation for the reasons set out above.

    •Section 95 of the ST Act ­ relates to a refusal to make by­laws in certain circumstances with respect to fixtures and fittings, which is not relevant to this application.

    •Section 100 of the ST Act ­ may apply, as the registration of the by­law effectively denied Mr A Dimitroff a late vote under s 3AC of the Act; however, such an application may not be made later than 30 days after the meeting. In this case, of course, Mr A Dimitroff was not aware of the 2010 AGM until September 2010. Unfortunately, Mr A Dimitroff is too late to avail himself of this section of the ST Act.

  4. The effect of this finding, that the provisions of the ST Act in relation to a meeting of the strata company have not been complied with, is that the Tribunal 'may' invalidate the resolution under s 97 of the Act.

  5. In accordance with Radford and The Owners Of Miami Apartments Strata Plan 45236 [2006] WASAT 293 at [151], the Tribunal has a discretion to take into account the seriousness of the alleged non­compliance with the ST Act before it considers setting aside a resolution.  In this application there are a number of factors which all tend to indicate that the resolution should be invalidated.  These factors include:

    •The failure to seek Mr A Dimitroff's consent to implement By­law 19 and By­law 20 and to repeal By­law 18 did prejudicially affect him.  The by­laws resulted in the imposition of a fee, assessable by the council, for the exclusive use of his courtyard.  This failure was a serious one and it meant that he was not aware of the resolution and that he certainly did not consent to it.  The council now has the power to increase the rate of the fee which is currently $1.10 per unit of entitlement, but may be increased at its discretion.

    •Further, the Tribunal is satisfied that, even if the strata company had complied with the ST Act, the resolution to repeal By­law 18 and to implement By­law 19 and By­law 20 would have resulted in the resolutions not being passed without dissent.  This is because Mr A Dimitroff voted against the proposal at the 2005 AGM and his position, as indicated to this Tribunal, has not altered.

  6. Accordingly, the Tribunal orders that the resolutions passed at the 2010 AGM repealing By­law 18 and inserting By­law 19 and By­law 20 are invalidated.

  7. However, due to the operation of s 93(5) of the ST Act the Tribunal has no power to order the reinstatement of By­law 18 and the repeal of By­law 19 and By­law 20. This is because s 93(5) expressly states that:

    This section does not apply with respect to a by­law made or deemed to be made under section 42(8).

  8. This is a most unfortunate outcome for Mr A Dimitroff and means that any order relating to By­law 18, By­law 19 and By­law 20 can only be made by:

    •the strata company convening an EGM as soon as is permitted and passing a resolution without dissent revoking By­law 19 and By­law 20 and reinstating By­law 18; or

    •the applicant applying to a court of competent jurisdiction for an order against the registered title insofar as it relates to the by­laws in this application.

  9. While the history between the parties prior to 15 April 2011 may be described as difficult, the parties agree that, since a change in the office holders in 2011, the parties have been able to communicate and cooperate more effectively.  The Tribunal is encouraged by the level of cooperation recently demonstrated between the parties, and it was particularly evident to the Tribunal at the final hearing on 17 October 2011.

  1. Accordingly, given the protracted history of this matter since the 2010 AGM, mostly due to the manner in which the strata company has conducted itself previously, the Tribunal encourages the parties to resolve this issue by convening an extraordinary meeting without the need for a costly application in a superior court.

  2. In this regard the Tribunal is mindful of s 42(9) of the ST Act regarding the purported making of a by­law which takes effect at the expiration of the period of two years after the purported making of the by­law, which is on 25 April 2012. Accordingly, any such strata company resolution without dissent or application to a court of competent jurisdiction will need to be acted upon by the parties promptly.

Order

  1. The Tribunal orders that:

    1.Pursuant to s 97 of the Strata Titles Act 1985 (WA), resolutions 'Register Survey Plans for Exclusive Use Areas' and 'Licence Fee for Exclusive Use Areas' passed at the Annual General Meeting of the Owners of 43 Kinsella Street, Joondanna, Strata Plan 14493 on 25 April 2010, and for which minutes were provided on 15 April 2011, are invalidated.

I certify that this and the preceding [76] paragraphs comprise the reasons for decision of the State Administrative Tribunal.

___________________________________

MS L WARD, MEMBER

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