FOK and OWNERS OF CHARTWELL STRATA PLAN 2604
[2016] WASAT 94
•8 AUGUST 2016
FOK and OWNERS OF CHARTWELL STRATA PLAN 2604 [2016] WASAT 94
| STATE ADMINISTRATIVE TRIBUNAL | Citation No: | [2016] WASAT 94 | |
| STRATA TITLES ACT 1985 (WA) | |||
| Case No: | CC:14/2016 | 22 MARCH 2016 | |
| Coram: | MS N OWEN-CONWAY (MEMBER) | 8/08/16 | |
| 35 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | WING CHUNG FOK OWNERS OF CHARTWELL STRATA PLAN 2604 |
Catchwords: | Section 47(1) of the Strata Titles Act 1985 (WA) Action purporting to be against council of owners Only strata company can sue and be sued Section 43(1a) and s 90 of the Strata Titles Act 1985 (WA) No order sought pursuant to s 90 of the Strata Titles Act 1985 (WA) No need for exercise of s 90 discretion by Tribunal Strata company's duty to keep minutes of general meeting No need to minute 'proceedings' No right to amend minutes with facts that did not occur at general meeting Turns on own facts |
Legislation: | Corporations Act 2001 (Cth), s 5F, s 251A State Administrative Tribunal Act 2004 (WA), s 32(5), s 34, s 47 Strata Titles Act 1985 (WA), s 3, s 7(5), s 28, s 29, s 30, s 31, s 32, s 32(4), s 35, s 36(1)(a), s 42, s 43, s 43(1a), s 44, s 47, s 81(4), s 83(1), s 90, s 114(1), s 114(2), s 132, Sch 1, Sch 3, Pt VI Strata Titles General Regulations 1996 (WA), reg 29 |
Case References: | Australian Securities and Investments Commission v Hellicar [2012] HCA 17 Gawor and The Owners of Dawesville Caravan Park Strata Plan 14644 [2015] WASAT 60 Maguire v Owners of Roslyn Strata Plan 35960 [2014] WASC 28 Re Duomatic Ltd [1969] 2 Ch 365 Salomon v Salomon & Co Ltd [1897] AC 22 Swiss Screens (Aust) Pty Ltd v Burgess (1987) 11 ACLR 756 The Owners of Metro Inn Apartments Strata Plan 11880 v Transmetro Corporation Ltd [2000] WASC 293 The Owners of Roslyn Strata Plan 35960 v Maguire [2013] WADC 64 |
Orders | 1. The correct respondent is The Owners of Chartwell Strata Plan 2604 and the proceeding is amended accordingly.,2. The applicant's application concerning s 43 of the Strata Titles Act 1985 (WA) and s 43(1a) of the Strata Titles Act 1985 is made pursuant to s 90 of the Strata Titles Act 1985.,3. The applicant's application pursuant to s 83(1) of the Strata Titles Act 1985 concerning the allegation of a contravention of s 47(1) of the Strata Titles Act 1985 is dismissed pursuant to s 81(4) of the Strata Titles Act 1985.,4. The applicant's application pursuant to s 90 of the Strata Titles Act 1985 concerning the allegation of a contravention of s 43(1a) and/or s 43(1)(b)(ix) of the Strata Titles Act 1985 is refused and dismissed pursuant to s 81(4) of the Strata Titles Act 1985.,5. The applicant's application pursuant to s 83(1) of the Strata Titles Act 1985 concerning an allegation of a contravention of s 35(1)(f) of the Strata Titles Act 1985 is dismissed pursuant to s 81(4) of the Strata Titles Act 1985.,6. The application is otherwise dismissed pursuant to s 47(1)(a) or (c) of the State Administrative Tribunal Act 2004 (WA). |
Summary | The applicant's claims were each dismissed. The applicant's claim against the respondent that the council of owners contravened s 47(1) of the Strata Titles Act 1985 (WA) because it exceeded the expenditure limit of $390 in any one case was dismissed because first, the expenditure by its nature had been approved in the budget at the earlier annual general meeting; secondly, all of the lot proprietors had unanimously agreed to the expenditure; and thirdly, the expenditure was ratified by the lot proprietors in general meeting when they approved the prior year's expenditure and the forthcoming year's budgeted expenditure. The applicant's claim that the respondent had contravened s 43(1a) by not providing the documents requested was dismissed because the applicant sought no order from the Tribunal and was satisfied with the production of copy documents as at the date of the hearing. The applicant's claim to be entitled to amend the minutes of the annual general meeting taken by the respondent so as to include facts and events that did not occur at the annual general meeting, and at which he was not present, was made with no foundation. All other claims that the applicant had been treated unconscionably and unfairly by the majority of lot proprietors were dismissed. |
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL ACT : STRATA TITLES ACT 1985 (WA) CITATION : FOK and OWNERS OF CHARTWELL STRATA PLAN 2604 [2016] WASAT 94 MEMBER : MS N OWEN-CONWAY (MEMBER) HEARD : 22 MARCH 2016 DELIVERED : 8 AUGUST 2016 FILE NO/S : CC 14 of 2016 BETWEEN : WING CHUNG FOK
- Applicant
AND
OWNERS OF CHARTWELL STRATA PLAN 2604
Respondent
Catchwords:
Section 47(1) of the Strata Titles Act 1985 (WA) Action purporting to be against council of owners Only strata company can sue and be sued Section 43(1a) and s 90 of the Strata Titles Act 1985 (WA) No order sought pursuant to s 90 of the Strata Titles Act 1985 (WA) No need for exercise of s 90 discretion by Tribunal Strata company's duty to keep minutes of general meeting No need to minute 'proceedings' No right to amend minutes with facts that did not occur at general meeting Turns on own facts
Legislation:
Corporations Act 2001 (Cth), s 5F, s 251A
State Administrative Tribunal Act 2004 (WA), s 32(5), s 34, s 47
Strata Titles Act 1985 (WA), s 3, s 7(5), s 28, s 29, s 30, s 31, s 32, s 32(4), s 35, s 36(1)(a), s 42, s 43, s 43(1a), s 44, s 47, s 81(4), s 83(1), s 90, s 114(1), s 114(2), s 132, Sch 1, Sch 3, Pt VI
Strata Titles General Regulations 1996 (WA), reg 29
Result:
Application dismissed
Summary of Tribunal's decision:
The applicant's claims were each dismissed. The applicant's claim against the respondent that the council of owners contravened s 47(1) of the Strata Titles Act 1985 (WA) because it exceeded the expenditure limit of $390 in any one case was dismissed because first, the expenditure by its nature had been approved in the budget at the earlier annual general meeting; secondly, all of the lot proprietors had unanimously agreed to the expenditure; and thirdly, the expenditure was ratified by the lot proprietors in general meeting when they approved the prior year's expenditure and the forthcoming year's budgeted expenditure. The applicant's claim that the respondent had contravened s 43(1a) by not providing the documents requested was dismissed because the applicant sought no order from the Tribunal and was satisfied with the production of copy documents as at the date of the hearing. The applicant's claim to be entitled to amend the minutes of the annual general meeting taken by the respondent so as to include facts and events that did not occur at the annual general meeting, and at which he was not present, was made with no foundation. All other claims that the applicant had been treated unconscionably and unfairly by the majority of lot proprietors were dismissed.
Category: B
Representation:
Counsel:
Applicant : In Person
Respondent : Mr NP Hasluck
Solicitors:
Applicant : N/A
Respondent : N/A
Case(s) referred to in decision(s):
Australian Securities and Investments Commission v Hellicar [2012] HCA 17
Gawor and The Owners of Dawesville Caravan Park Strata Plan 14644 [2015] WASAT 60
Maguire v Owners of Roslyn Strata Plan 35960 [2014] WASC 28
Re Duomatic Ltd [1969] 2 Ch 365
Salomon v Salomon & Co Ltd [1897] AC 22
Swiss Screens (Aust) Pty Ltd v Burgess (1987) 11 ACLR 756
The Owners of Metro Inn Apartments Strata Plan 11880 v Transmetro Corporation Ltd [2000] WASC 293
The Owners of Roslyn Strata Plan 35960 v Maguire [2013] WADC 64
The application
1 On 7 January 2016, the applicant, an owner of Lot 2 on Strata Plan 2604, filed an application pursuant to s 83(1) of the Strata Titles Act 1985 (WA) (ST Act) against the council of owners of the Owners of Chartwell Strata Plan 2604. The orders sought by the applicant, and the grounds for those orders, are the subject of an attachment to the application with appendices AK, which comprise the evidence upon which the applicant originally relied. At a directions hearing on 8 February 2016, the Tribunal made an order joining the Owners of Chartwell Strata Plan 2604 as a respondent.
2 The Tribunal shall make a further order that the Owners of Chartwell Strata Plan 2604, a company created by the ST Act, is the only respondent. The council of owners is an executive body of the strata company which may make certain decisions on behalf of the strata company without the need to call a general meeting of all of the lot proprietors, as provided for by the Act or any by-laws (s 44 of the ST Act). Unlike the strata company (in this case, the Owners of Chartwell Strata Plan 2604), the council of owners is not capable of being sued (s 32 of the ST Act). The first order in this matter is that the sole respondent is the Owners of Chartwell Strata Plan 2604.
3 The applicant has sought the following:
1) A finding that the respondent contravened s 47 of the ST Act in that the 'Council/Strata Company' paid Mr J Angus (Strata Manager Specialist) the sum of $550. The applicant sought no specific order to resolve any dispute. In his application, the applicant states that he sought 'any order that [the Tribunal] considers appropriate based on the evidence provided'.
2) A finding that the respondent contravened s 43 of the ST Act by failing to make available the information and/or documents requested by the applicant. At the time of the hearing the applicant was satisfied with the documents he had received from the respondent. The applicant sought no specific order to resolve any dispute and states in his application that he sought to 'leave it' to the Tribunal to make any order that it considers appropriate based on the evidence provided.
3) A finding that the respondent contravened its obligations to comply with the ST Act in the manner in which minutes of the annual general meeting of the respondent held on 22 October 2015 (AGM) were recorded. In essence, this issue contracted into whether the minutes of the AGM should have been supplemented by the applicant's post AGM submissions, which submissions were not made at the AGM and at which AGM the applicant was not present.
4) A finding that the respondent, by its council of owners, had not conducted itself for the 'benefit of all the owners' and had conducted itself with an 'element of favouritism and unconscionable conduct'. The applicant sought a direction that the respondent takes 'appropriate remedial action'.
The lot proprietors
4 The proprietors of the individual lots at the relevant time were:
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5 At all relevant times the applicant was the representative of the proprietors of Lot 2. Mrs Hasluck was the representative of the proprietor of Lot 4 and the chair of the council of owners of the respondent and corresponded with the applicant in that capacity at all relevant times prior to 22 October 2015. Mrs Hasluck stood down from that position at the AGM. Mr Hasluck was in attendance at the AGM.
Documents before the Tribunal
6 The following documents were before the Tribunal:
a) Applicant's application pursuant to s 83(1) of the ST Act with submissions, received 7 January 2016
b) Respondent's submissions and bundle of documents, received 27 January 2016 (Exhibit 5)
c) Applicant's submission in response to specific issues, received 3 February 2016 (Exhibit 6)
d) Respondent's submissions and copy AGM minutes, received 5 February 2016 (Exhibit 7)
e) Applicant's supplementary submission, received 15 February 2016 (Exhibit 8)
f) Respondent's further submissions and bundle of documents including strata plans, received 16 February 2016 (Exhibit 9)
g) Applicant's further submission and additional information, received 22 February 2016 (Exhibit 10)
h) Applicant's supplementary submission (repeat of Exhibit 8), received 22 February 2016 (Exhibit 11)
i) Applicant's further submissions and documents including invoice from Mr Angus, received 26 February 2016 (Exhibit 12)
j) Respondent's submission, received 26 February 2016 (Exhibit 13)
k) Applicant's email and attachments attaching applicant's Proposed Amendment to Exclusive Use By-Law 16 -Comments/Suggestions for Consideration, received 23 March 2016 (Exhibit 14)
l) Applicant's email to Mrs Hasluck dated 19 June 2016 (Exhibit 2)
m) Agreed comparison and original By-Law 16 (Exhibit 1)
n) Witness statement and documents Mrs S Hasluck (Exhibit 3)
o) Witness statement and documents Mr N Hasluck (Exhibit 4)
Background facts
7 Until about May 2015, the proprietors of Lots 1 to 6 of the respondent's strata scheme conducted the business of the respondent for some considerable period of time without dispute. The applicant agreed in crossexamination that there was no evidence of any illfeeling or rancour between lot proprietors and their representatives in the past.
8 The strata scheme in issue comprises a parcel of land fully described in Certificate of Title Volume 1382 Folio 412. The strata scheme comprises the strata plan which identifies the manner of division of the parcel of land into lots and common property and the allocation of unit entitlements among the lots together with all rights and obligations on proprietors as conferred by the ST Act. The strata scheme was lodged in 1974. The boundaries of the individual lots comprise the inner surface of any boundary wall, the under surface of the ceiling and the upper surface of the floor (Sch 3 cl 3(a), s 3 and s 132 of the ST Act), which floor is depicted on the floor plan on the strata plan. All else (land and improvements) is common property. The balconies of the building adjacent to and abutting each lot comprise common property. The courtyards, storage areas and carports also comprise common property.
9 On 10 March 2011, the exclusive use and enjoyment Bylaw 16, created pursuant to s 42(8) (11) of the ST Act, was registered on the strata plan. Bylaw 16 provides for each lot proprietor to have exclusive use and enjoyment of a specific balcony, courtyard, storage area and carport as identified on the exclusive use plans annexed to By-law 16. Reading the definitions of the boundaries, as specified on the exclusive use plans, each individual lot proprietor has the exclusive use and enjoyment of:
a) an area of the parcel comprising common property that is marked on the exclusive use plans as a courtyard for that individual lot, the boundary of which commences at the junction of the surface of the external vertical wall of the ground floor of the building (the inner surface of which comprises the boundary of the individual lot) and the land abutting that external wall, but excludes the storage structure and the carport area as marked on the exclusive use plans;
b) an area of the building constructed on the parcel comprising common property that is marked as a balcony for that individual lot on the exclusive use plans, comprising the surface of the external vertical wall of the first floor of the building (the inner surface of which comprises the boundary of that individual lot);
c) an area of the parcel comprising common property that is marked on the exclusive use plans as a storage area for that individual lot which itself appears to be bounded by vertical structures abutting the carport structure nearest the individual lot; and
d) an area of the parcel comprising common property that is marked on the exclusive use plans as a carport for that individual lot.
10 The boundary of each balcony is defined on the exclusive use plans as follows:
The boundaries of the exclusive use areas marked balcony are the external surfaces of the Building walls and the external surface of the balustrading.
The stratum of the exclusive use areas marked balcony extends from the upper surface of the balcony floor to a height of 2.5 m above their floor, except where covered.
11 In the case of the balconies, the cubic space or area of the common property to which an individual lot proprietor has exclusive use and enjoyment includes:
• the external surface of the external wall of the building on the first floor (the inner surface of which comprises the boundary of that individual lot);
• the external surface of the balustrading of the balcony that is, the external surface of the building at that point; and
• the upper surface of the balcony floor to a height of 2.5 metres above that surface, unless the balcony is covered.
12 In the period February to June 2015, a dispute arose amongst the lot proprietors concerning whether Bylaw 16 required each lot proprietor to maintain and repair only the additions or improvements to the original balcony structure in respect of which they had exclusive use and enjoyment or whether Bylaw 16 directed that individual lot proprietors were responsible for the repair and maintenance of the balconies regardless of whether the balcony was in its original form or had been altered by the lot proprietors or anyone else since Bylaw 16 was passed. The applicant, as the proprietor of Lot 2, advocated that the first interpretation was correct and that he was not responsible for the repairs and maintenance of the balustrade of the balcony in respect of which Lot 2 had the exclusive use and enjoyment because there had been no 'improvements' to that balcony since the exclusive use bylaw was registered. It appears that all other lot proprietors or at least the majority of all other lot proprietors disagreed with the applicant.
13 Bylaw 16 must be read in the full context of all of its subparagraphs, the exclusive use plans and the definitions of the boundaries. The applicant's interpretation appears to be inconsistent with the express obligation imposed by Bylaw 16(3); the definition of the external boundaries of the balcony area in respect of which Bylaw 16(3) imposes an obligation to repair and maintain, and Bylaw 16(8), particularly when read in the context of Bylaw 16(7). Read in its entirety, the intention of By-law 16 appears to be that each lot proprietor is liable for the repair and maintenance of the balcony in respect of which they have exclusive use and enjoyment, including the entirety of the balustrading, and regardless of when any additions or improvements to the original balcony were installed and regardless of who undertook that work. Construed in this way, by reason of s 42(11)(b) of the ST Act, the respondent is relieved of the obligation to repair and maintain the area that is the subject of the exclusive use and enjoyment Bylaw 16.
14 The applicant continued to dispute the interpretation of Bylaw 16 with the respondent and any obligation to repair and maintain the common property within Lot 2's exclusive use and enjoyment balcony area referred to by that Bylaw.
15 Rather than have that issue resolved by the Tribunal, in an effort to undertake repairs to the balconies quickly and avoid a protracted dispute before the Tribunal on the correct interpretation of Bylaw 16, by 1 July 2015 the lot proprietors, including the applicant, agreed to a compromise that the respondent would, on that one occasion only, assume liability for the repairs necessary to the Lot 2 and Lot 6 exclusive use and enjoyment balconies as both required repairs. The respondent assumed financial liability of the repairs required to the Lot 6 exclusive use and enjoyment balcony as well because, as Mrs Hasluck explained in her evidence, once a compromise agreement had been reached with all lot proprietors that the respondent would pay for the repairs to the Lot 2 exclusive use and enjoyment balcony, it would have been unfair if the respondent did not also assume the financial responsibility for the structural repairs necessary for the Lot 6 exclusive use and enjoyment balcony on this one occasion. The respondent says that it was also agreed by all lot proprietors on that occasion that a strata titles management specialist would be consulted by the respondent on the correct meaning of By-law 16, and, if necessary, to propose amendments to clarify that each lot proprietor was responsible for the repairs and maintenance of their areas of exclusive use and enjoyment.
16 On or about 2 July 2015, the respondent, through the council of owners and the strata manager, proceeded to consult a strata management specialist regarding Bylaw 16 and, in particular, Bylaw 16(7), and incurred a liability for the sum of $550 for those services. The applicant objects to the council of owners incurring this expenditure and states that:
a) the respondent was acting unfairly because the applicant's interpretation, which favoured him, was clear and a change to Bylaw 16 was not acting in all of the proprietors' interests because any amendments to Bylaw 16 were against his interests; and
b) the respondent should not be expending strata funds in a way that was not for the benefit of all the proprietors' interests.
17 In advancing this case, the applicant has failed to recognise that the respondent was acting in all of the proprietors' interests by ensuring that every proprietor (not just the applicant) was liable for the repair and maintenance of their exclusive use and enjoyment balcony.
18 While the issue of the necessary structural repairs to the Lot 2 exclusive use and enjoyment balcony and payment was therefore resolved by the compromise agreement, the respondent's council of owners' performance of that agreement has resulted in this application to the Tribunal.
Issue 1: Alleged contravention of s 47 of the ST Act
The principles of law
19 Section 47 of the ST Act provides, relevantly:
(1) Except as authorised by or under this section the council of a strata company shall not, in any one case, undertake expenditure exceeding the sum obtained by multiplying
(a) a sum per lot fixed by special resolution of the strata company; or
(b) if no such sum is fixed, the prescribed amount per lot,
by the number of lots that are the subject of the scheme.
(2) Subsection (1) does not apply to
…
(e) expenditure authorised by the strata company in general meeting as part of the budget of the company.
21 Although not specifically provided for in s 47 of the ST Act, it has been held that common law principles of company and agency law apply when considering issues of authority of the council of owners. As a matter of law any infringement of s 47(1) of the ST Act may be ratified by the members in general meeting (The Owners of Metro Inn Apartments Strata Plan 11880 v Transmetro Corporation Ltd [2000] WASC 293 (Transmetro)).
22 It is also a principle of the common law of company law that the unanimous agreement of the company members may confer authority on the board of directors or a director to do an act which on its face is beyond that board's or director's power (Lord Davey in Salomon v Salomon & Co Ltd [1897] AC 22 at 57 (Salomon)). Where a company acts on the unanimous directive of the members as if that directive had been resolved at a general meeting, those acts are validly undertaken on behalf of the company (Re Duomatic Ltd [1969] 2 Ch 365 (Duomatic)). By analogy all of the lot proprietors acting unanimously may confer power on the council of owners that it would not otherwise have.
The expenditure and the facts
23 The respondent advanced the contention that the compromise reached with the applicant to repair the Lot 2 exclusive use and enjoyment balcony was reduced to writing and signed by all lot proprietors (compromise agreement). The respondent advanced the contention that the compromise agreement obliged or entitled the respondent to investigate the correct interpretation of Bylaw 16 and to consult a specialist with respect to any necessary amendments. The respondent's secondary evidence of the compromise agreement supports that contention. At no time did the applicant challenge the compromise agreement or the terms as referred to by the respondent. The written compromise agreement itself was not before the Tribunal. However, there was unchallenged evidence before the Tribunal of the compromise agreement and the relevant terms.
24 Mrs Hasluck gave evidence that the compromise agreement had been signed by each of the lot proprietors and it was on the basis of that agreement that the council of owners proceeded to instruct Mr Angus, through Mr van Es as explained herein.
25 The unchallenged minutes of the council of owners meeting on 1 July 2015 record, and the Tribunal finds, relevantly:
6. Strata By Laws
It is recorded that all unit owners have signed individual agreement to agreed [sic] to pay for the current maintenance needs on the balconies of Units 2 and 6 subject top [sic] the following statement:
The strata company to arrange and pay for the balcony repairs as were determined … just for this instance, and future maintenance costs for both original and improved (added, altered or renovated) balconies will be the responsibility of individual owners.
Actions:
- …
6.2 … Henry is requested to obtain necessary additional words to Clause By Law [16.7] to ensure clarity of interpretation, so that in the future all balcony maintenance be the responsibility of the owner. …
6.3 Additional words need to be agreed by all owners at an Extraordinary General Meeting[.]
(Tribunal emphasis).
27 The council of owners incurred the cost of $550 to Mr Angus for reviewing Bylaw16, and in particular Bylaw 16(7), and suggesting amendments to clarify the liability of lot proprietors for repairs and maintenance of exclusive use areas.
28 The AGM minutes note that the proprietor of Lot 6 asserted that the expenditure of $550 for the amendments to clarify Bylaw 16(7) by Mr Angus was not necessary because Bylaw 16(7) was clear. The AGM minutes note, and the Tribunal finds, that Mrs Hasluck, as the outgoing Chair, responded to this statement:
… noting that this expenditure for reviewing the Bylaw was a consequence of all owners individually signing the Memorandum of Agreement re the maintenance of balconies dispute. The compromise evidenced by the Memorandum of Agreement was composed by the owner of Lot 2 and was signed by all owners including the owner of lot 6.
29 This record is consistent with Mrs Hasluck's evidence and the minutes of the council of owners' meeting on 1 July 2015, that in compromising the interpretation dispute with the applicant, all lot proprietors agreed for the respondent to pay for the Lot 6 balcony repairs as well as the Lot 2 balcony repairs because it would have been unfair to have, in effect, preferred and benefited the applicant only.
30 The AGM minutes record that Mr Hasluck stated, and the Tribunal finds:
In an effort to adopt a pragmatic litigious approach and save what could have amounted to large legal expenditure for the strata company for essentially the same result the strata company arranged for clarification of clause 16(7) in accordance with the compromise from a consultant expert on Strata matters, namely, John Angus.
31 This record is consistent with Mr and Mrs Hasluck's evidence concerning the background facts referred to above and the council of owners' minute dated 1 July 2015.
32 According to the evidence of the AGM minute, the council of owners' minute dated 1 July 2015 and the evidence of Mr and Mrs Hasluck, albeit secondary evidence of the compromise agreement, it was a term of the compromise agreement that the respondent would consult a specialist in ST Act matters concerning the meaning of the extant Bylaw 16 and, in particular, Bylaw 16(7) and the need for amendments to make certain that the individual lot proprietors would be solely liable for the maintenance and repair of the balcony to which each lot proprietor has been granted exclusive use and enjoyment. On this unchallenged evidence the Tribunal finds that the compromise agreement was entered into by each lot proprietor and that it constitutes a unanimous agreement. No explanation was given by the respondent as to why the compromise agreement was not produced to the Tribunal. However, the Tribunal has made its finding on the basis of the undisputed secondary evidence of the compromise agreement referred to. The expenditure for the strata management specialist consultation is an obvious and necessary consequence of the respondent complying with this term of the compromise agreement and was implicitly unanimously agreed to by all lot proprietors.
33 Mrs Hasluck stated, and the Tribunal finds, that the costs associated with the strata management specialist consultation and any proposed amendments to By-law 16 were to be paid by the respondent from the funds allocated to general administrative costs in the respondent's budget, which budget had been approved at the annual general meeting in 2014. The applicant did not challenge this evidence.
34 Mrs Hasluck had been the chair of the respondent for a number of years. She gave evidence of her extensive experience at chairing meetings in a range of areas including the arts and charitable sectors. The Tribunal acknowledges that Mrs Hasluck stood down from the role as chair of the respondent at the AGM. Although the budget approved at the 2014 annual general meeting was not before the Tribunal, it was not challenged and the Tribunal accepts the evidence of Mrs Hasluck as to the annual allocation of funds in the budget to general administrative costs.
35 The Tribunal also notes that the AGM minutes record, and the Tribunal finds, that the financial statements for the year ending 30 September 2015 were approved at the AGM along with the budget for the forthcoming year. Although the approved financial statements for the year ending 30 September 2015 and the budget for the 2015/2016 year were not before the Tribunal, the Tribunal finds that general administrative expenses were included in the financial statements and in the budget based upon the evidence of Mrs Hasluck.
The Tribunal's consideration of Issue 1
36 This aspect of the applicant's application to the Tribunal may only be brought pursuant to s 83(1) of the ST Act. In closing, the applicant informed the Tribunal that the amount of the expenditure was not the issue for him as the matter concerned only a very small sum of money, in any event. This is a curious position for the applicant to take, given that the amount of the expenditure is the focus of the restriction of the council of owners' authority in s 47(1) of the ST Act. The applicant informed the Tribunal in closing that he simply sought the recording of a finding that the respondent's council of owners had contravened s 47(1) of the ST Act. The applicant therefore seeks no order by the Tribunal for the resolution of the dispute concerning s 47(1) of the ST Act as is required of an applicant when an application is made to the Tribunal pursuant to s 83(1) of the ST Act. As there is no penalty specified for any infringement of s 47(1) of the ST Act, there is no utility in a Tribunal finding of contravention as might be the case where a party agitates for the prosecution for the infringement of the ST Act and the imposition of a penalty.
37 This is sufficient to dispose of the matter by way of a dismissal of this aspect of the application, on the basis that the application on this issue is frivolous and an abuse of the Tribunal's process (s 47(1)(a) and (c) of the State Administrative Tribunal Act 2004 (WA) (SAT Act).
38 However, the Tribunal has considered the question of whether s 47(1) of the ST Act has been infringed on the evidence. In the Tribunal's view, the provisions of s 47(1) of the ST Act have not been infringed by the respondent through its council of owners.
39 First, although the respondent's 2014 approved budget is not before the Tribunal, the Tribunal finds that the respondent had budget approval for general administrative expenditure when the general administrative expense to Mr Angus was incurred. The expenditure in issue is by its nature general administrative expenditure. It is the respondent's statutory duty to enforce the strata by-laws; control and manage the common property for the benefit of all proprietors and repair, maintain, renew and where necessary replace the common property (s 35(1)(a) - (c) of the ST Act). Investigating the correct interpretation and obtaining advice concerning necessary amendments to Bylaw 16 falls within the respondent's statutory duties. It is the respondent's duty to ensure that all lot proprietors have the same obligations in respect of their exclusive use balconies and that the respondent is relieved of the responsibility to repair and maintain those balconies to which it has limited access and over which it has given substantial control to the lot proprietors. By reason of s 47(2)(b) of the ST Act, the Tribunal concludes that there is no infringement of s 47(1) of the ST Act by the respondent through its council of owners.
40 Secondly, the Tribunal finds that the applicant and all other lot proprietors executed the compromise agreement whereby all of the lot proprietors unanimously agreed and directed the respondent to investigate the correct interpretation of Bylaw 16 and to seek advice on proposed amendments if necessary to ensure lot proprietors were liable for repairs and maintenance to their respective exclusive use and enjoyment balconies. The Tribunal concludes that in so executing the compromise agreement the applicant and all other lot proprietors expressly unanimously agreed for a consultant to be engaged by the respondent to consider Bylaw 16 and implicitly unanimously agreed that the respondent could incur the cost of that service. The respondent was at all times acting in accordance on the unanimous directive of the lot proprietors as if that directive had been resolved at a general meeting and the actions of the council of owners in incurring the expenditure was therefore at all times authorised by the lot proprietors (Salomon and Duomatic). For this reason, the Tribunal concludes that s 47(1) of the ST Act was not infringed by the respondent through its council of owners.
41 Thirdly, any infringement of s 47(1) of the ST Act may be ratified by the lot proprietors in general meeting by majority vote in the usual fashion. In this matter, the lot proprietors in general meeting ratified the expenditure incurred with Mr Angus by the council of owners by approving the financial statements for the year to 30 September 2015 or approving the budget for the year commencing 1 October 2015 (Transmetro). In each case, the Tribunal finds there was an expenditure or allowance for general administrative expenditure, particularly in the context of the discussion of the liability for Mr Angus' fees at the AGM recorded in the minutes which the Tribunal finds did take place. For this reason, the Tribunal concludes that s 47(1) of the ST Act was not infringed by the respondent through its council of owners and was ratified by the lot proprietors in general meeting.
42 For this reason, the Tribunal concludes on the evidence that the respondent's council of owners has not contravened s 47(1) of the ST Act and this aspect of the application is dismissed pursuant to s 81(4) of the ST Act.
Issue 2: Alleged contravention of s 43 of the ST Act
Statutory provisions
43 Section 43(1)(b) of the ST Act relevantly provides:
(1) Upon application made in writing to a strata company by a proprietor … the strata company shall do such one or more of the following things as are required of it in the application
…
(b) make available for inspection by the applicant …and for the exercise of the rights conferred by subsection (5)
…
(ix) any other record or document in the custody or under the control of the strata company;
- …
- at such time and place as my be agreed upon by the applicant … and the strata company and failing agreement, at the parcel at a time and on a date fixed by the strata company under subsection (2).
On application made in writing to a strata company by a proprietor … of a lot … the strata company may provide:
(a) any document referred to in subsection(1)(b); or
(b) …
and … may require the applicant to pay the prescribed fee for any copy so provided.
45 Section 90 of the ST Act provides:
Where, pursuant to an application for an order under this section, the State Administrative Tribunal considers that the strata company for the scheme to which the application relates, or the administrator for that scheme, or the chairman, secretary or treasurer of that strata company has wrongfully
(a) withheld from the applicant information to which he is entitled under this Act; or
(b) failed to make available for inspection by the applicant or his agent a record or document that under this Act he is entitled to inspect,
the State Administrative Tribunal may order that strata company, administrator, chairman, secretary or treasurer to supply or make available the information or to make so available the record or document, as the case may require, to the applicant.
46 Section 83(6) of the ST Act provides:
Nothing in this Part affects the generality of subsection (1), but an order in respect of any matter referred to in any other section of this Part shall not be made under this section.
47 Therefore, the applicant's application for copies of documents may only be brought before the Tribunal pursuant to s 90 of the ST Act, which falls within Pt VI of the ST Act. The applicant's application was incorrectly made pursuant to s 83(1) of the ST Act and should have been made pursuant to s 90 of the ST Act. The Tribunal shall order that the proceeding be amended to reflect this error, it being an amendment that does not alter the nature of the application.
48 Section 43 and s 90 of the ST Act identify the obligation of a strata company in relation to the relevant requests for inspection and copies of documents and the powers of the Tribunal.
49 Section 90 of the ST Act empowers the Tribunal to make orders against a strata company where the Tribunal considers that the strata company has 'wrongfully' either 'withheld' information (an issue arising under s 43(1) of the ST Act) or 'failed' to provide copies of documents (an issue arising under s 43(1a) of the ST Act) to the person requesting the same. In the case of the provision of copies of documents (that is, in the case of an application made pursuant to s 43(1a) of the ST Act), the strata company has a discretion to provide the copy documents requested. Section 43(1a) of the ST Act does not imposed an obligation on the strata company to provide the copy documents requested. In addition, s 90 of the ST Act confers on the Tribunal a discretion whether to make any order even if the Tribunal is satisfied that the strata company had 'wrongfully' 'failed' to provide the requesting party with the copy documents requested (Maguire v Owners of Roslyn Strata Plan 35960 [2014] WASC 28). The provisions of s 43(1a) and s 90 of the ST Act do not confer on the requesting party a right to an order from the Tribunal directing the strata company to provide a copy document that was requested.
50 Section 43(1)(b)(ix) and s 90 of the ST Act do not confer on the requesting party a right to an order that the strata company provide an inspection of documents when an inspection is requested. Those provisions confer on the applicant a right to apply to the Tribunal for an order to direct the strata company to provide an opportunity to inspect documents when inspection was requested and confer a discretion on the Tribunal to make an order for inspection.
51 A right to inspect documents does not equate to a right to an order for inspection and a right to request a copy document does not equate to a right to an order for a copy of the requested documents (Maguire v Owners of Roslyn Strata Plan 35960 [2014] WASC 28 and Gawor and The Owners of Dawesville Caravan Park Strata Plan 14644 [2015] WASAT 60 (Gawor)).
52 In considering an application to the Tribunal pursuant to s 90 of the ST Act, the Tribunal must exercise the discretion conferred.
The applicant's application and the facts
53 On 14 December 2015, the applicant emailed the then members of the respondent's council of owners requesting 'the following information to be provided to me'. However, the nature of the request was for the provision of copies of the documents requested rather than the information contained in those documents. The documents requested are described as follows:
1. All correspondence (including file notes of discussions) between the Strata Company and John Angus with respect to the engagement of John Angus for the read draft of Bylaw 16, including details of briefing given for the scope of the re-drafting work, negotiation/agreement of the fee involved time schedule for completion, terms of engagement (including professional liability insurance cover) and tax invoice for the work.
2. Strata Management Agreement between the Strata Company and the Smithwick Strata Services.
54 The request contains a statement as to the relevance of the request as follows:
Please be assured that that this is a genuine request as the information is needed for the preparation of my application and associated comprehensive evidence to the SAT. I don't believe the information requested has been copied or distributed widely to all owners previously.
55 The Tribunal is satisfied that the applicant's request was made in writing to the correct representative of the respondent.
56 Ms Mackie referred the applicant to the respondent's strata manager. The applicant correctly responded that the application is one within the respondent's secretary's scope of authority (Bylaw 9, Sch 1 of the ST Act). Ms Mackie forwarded the applicant's email request to the respondent's strata manager. At that stage the office bearers had not been elected by the council of owners. The respondent's strata manager responded by email dated 15 December 2015, which response was irrelevant, as follows:
Personally I think your emails are coming very close to being bullying behaviour and the members of the Council of owners should possibly seek some legal advice and look at that issue however that is my opinion alone. I would however recommend that the Council of Owners at their meeting on Friday under Agenda item 8, Any Other Business, include: 'Correspondent from Unit 2' and that they resolve that all correspondence from yourself be referred to the next meeting of the CoO and only handled at that meeting and then a response provided to you after they have had time to consider your correspondence. Responses should not be provided outside of those meetings so that all correspondence can be handled appropriately and that minutes are kept so that there is a paper trail. I also advise that I take my instructions from the Council of Owners and not from individuals.
Attached is a list of owners as requested.
57 The list of owners attached to the email from the strata manager was not requested by the applicant and it appears that the strata manager had not read the applicant's request. The respondent's strata manager misconceived of his role and the provisions of s 43(1a) and Bylaw 9, Sch 1 of the ST Act on this occasion. The applicant again wrote to Ms Mackie on behalf of the respondent to follow up on his request made on 14 December 2015 and repeated it. Ms Mackie forwarded the strata manager's email response dated 21 December 2015 to the applicant, which referred to some unspecified provisions in the ST Act, and that he would not be available to attend an inspection until 26 January 2016. Again, the strata manager appears to have missed the point that the applicant's request was for copies of documents, not inspection of documents. A further email was sent by the applicant on 22 December 2015 wherein he referred to the period of time relevant to arranging for an inspection of documents (s 43(1) of the ST Act) so as to correct Mr van Es' view that the respondent could determine when the information could be provided. In that email he suggested that the requested documents could be emailed to him as PDF (portable document format) attachments. That email puts it beyond doubt that the applicant's request was at all times for copies of the documents requested and not for inspection of documents. As such, the applicant's request was made to the respondent pursuant to s 43(1a) of the ST Act and in respect of which the respondent has a discretion whether to provide the copies requested or not.
58 In due course and after these proceedings were commenced, by order of this Tribunal made pursuant to s 34 of the SAT Act, the Tribunal ordered that:
… the respondents [sic] must file with the Tribunal and provide to the applicant a copy of any correspondence from the strata company to Mr Angus …
59 On 15 February 2016, the respondent filed in the Tribunal and served on the applicant all such documents that fell within paragraph 1 of the applicant's original request made 14 December 2015, except the invoice by Mr Angus. The respondent also indicated that certain documents requested by the applicant did not exist. On 26 February 2016 the respondent provided the applicant with a copy of the invoice by Mr Angus. No other documents requested by the applicant were provided by the respondent before or during the final hearing.
60 In closing, the applicant informed the Tribunal that he was satisfied with the provision of documentation following the hearing, but sought an order that the respondent had failed to comply with the provisions of the ST Act in responding to the request. The applicant sought no order for the provision of copies of any documents. The applicant had, it seems, abandoned his application for an order pursuant to s 90 of the ST Act and no longer sought a copy of the strata management agreement referred to in paragraph 2 of the applicant's original request dated 14 December 2015.
The Tribunal's consideration of Issue 2
61 Reading the email correspondence between the parties, commencing with the applicant's email request on 14 December 2015, the Tribunal is of the view that the applicant sought copies of specific documents pursuant to s 43(1a) of the ST Act and not inspection of specific documents pursuant to s 43(1) of the ST Act. It does appear that the respondent, through Ms Mackie, delegated the task of deciding what documents fell within the request and whether they should be provided to the applicant, perhaps not comprehending that the respondent (through the secretary) was obliged to consider the application and exercise the discretion conferred on it by s 43(1a) of the ST Act. The respondent did fail to exercise the discretion conferred on it by s 43(1a) of the ST Act and this occurred partly because the strata manager, to whom that task had been delegated, failed to properly recognise the request and failed to turn his mind to the exercise of the discretion. The respondent's strata manager, on behalf of the respondent, misconceived the applicant's request and failed to discharge the function that the secretary of the respondent purported to delegate to him. In any event, it seems that the strata manager mistook the applicant's request as one made pursuant to s 43(1) of the ST Act, at least in his email dated 21 December 2015.
62 There being no request made pursuant to s 43(1) of the ST Act, the Tribunal concludes there was no breach of s 43(1) of the ST Act by the respondent.
63 It is apparent from the facts referred to above that the production of the invoice by Mr Angus on 21 March 2016 by Mrs Hasluck as an attachment to her witness statement, and the provision of other documentation by the respondent pursuant to the Tribunal's order made on 8 February 2016, overtook the substantive application made pursuant to s 90 of the ST Act. As the documents pursued by the applicant have now been provided to the applicant, and to the extent that the copy documents have not been provided, the applicant has abandoned his claim for the same, there is no need for the Tribunal to now exercise its discretion and make an order compelling the respondent to provide the applicant with a further copy of the documents requested pursuant to s 90 of the ST Act; that is, the applicant does not seek any order pursuant to s 90 of the ST Act. Given that the Tribunal shall not exercise the discretion conferred by s 90 of the ST Act for the reasons referred to, there is no relevant purpose to be served in considering whether the Tribunal could have, and would have, exercised the discretion conferred by s 90 of the ST Act on the facts of this application. However, the Tribunal notes that the documents provided and the invoice by Mr Angus add nothing to the facts as known by the applicant at all relevant times that would assist him in his application to the Tribunal concerning Issue 1 and Issue 3. The likelihood of the Tribunal exercising its discretion as conferred by s 90 of the ST Act in those circumstances is far from certain (Gawor).
64 For these reasons, the application insofar as it concerns the grant of relief pursuant to s 90 of the ST Act, shall be dismissed pursuant to s 81(4) of the ST Act.
Issue 3: Alleged failure to keep minutes and s 35(1)(f) of the ST Act
Statutory provisions
65 Section 35(1)(f) of the ST Act relevantly provides:
A strata company shall
…
(f) cause to be kept minutes of its meeting, which shall include particulars of motions, passed at those meetings, and proper books of account in respect of monies received or expended by the strata company showing the items in respect of which the moneys were received or expended;
66 Section 114(2) of the ST Act directs the strata company to 'cause' the terms of certain orders made by the Tribunal and referred to in s 114(1) of the ST Act to be recorded in the strata company's minute book.
67 Schedule 1 Bylaw 8(6) of the ST Act provides relevantly:
The council shall keep minutes of its proceedings.
68 Schedule 1 Bylaw 9 of the ST Act provides further that:
The powers and duties of the secretary of a strata company include
(a) the preparation and distribution of minutes of meetings of the strata company and the submission of a motion for confirmation of the minutes of any meeting of the strata company at the next such meeting[.]
69 In addition, various provisions of the ST Act in effect oblige the strata company to record the nature of each vote on a general meeting resolution and the reasons for each vote (see, for example, s 7(5) of the ST Act).
70 A lot proprietor may seek to inspect the minutes of the general meetings of the strata company and of the council of owners meetings (s 43(1)(b)(iv) of the ST Act) and may request a copy of the minutes (s 43(1a) of the ST Act).
71 The strata company is required to keep minutes of general and council of owners' meetings and record the particulars of the motions passed in general meetings and the proceedings of council of owners' meetings. There is no obligation on the strata company to record in the minutes of the general meetings 'the proceedings' of those meetings. There is no express provision concerning the manner in which the minutes are to be kept. There is no obligation to record in the minutes of the general meetings anything other than particulars of the motions that are passed at those general meetings. The provisions referred to above cannot be construed so as to require the strata company to keep a record of any submissions or arguments put at any general meeting and cannot be construed so as to require the strata company to keep, in effect, a transcript of the proceedings at any meeting. Minutes of meetings are intended to be the official record of the events that occur at a meeting (see, by analogy: Swiss Screens (Aust) Pty Ltd v Burgess (1987) 11 ACLR 756 at 1076). The minutes of a meeting are not intended to be a transcript of evidence of the meeting but are intended to record the events of the meeting insofar as it is necessary to record the events. The minutes are intended to be relatively contemporaneously made, regardless of when they are confirmed at subsequent meetings. To that extent they comprise a contemporaneous note of the events recorded therein, and are admissible in evidence of what occurred at the meeting insofar as the minute records the events. This is consistent with the express provisions of s 35(1)(f) of the ST Act which requires that the minutes of general meetings of the strata company record the motions passed at any general meetings.
72 Minutes of meetings generally, and under the ST Act, are not expected or intended to record what events did not occur at a meeting. Nor is it the proper purpose of a minute of a meeting to record what might have occurred at the meeting but did not in fact occur at a meeting.
73 Section 251A of the Corporations Act 2001 (Cth) (Corporations Act) provides:
Minutes
(1) A company must keep minute books in which it records within 1 month:
(a) proceedings and resolutions of meetings of the company's members; and
(b) proceedings and resolutions of directors' meetings (including meetings of a committee of directors); and
(c) resolutions passed by members without a meeting; and
(d) resolutions passed by directors without a meeting; and
(e) if the company is a proprietary company with only 1 director - the making of declarations by the director.
Note: For resolutions and declarations without meetings, see sections 248A, 248B, 249A and 249B.
(2) The company must ensure that minutes of a meeting are signed within a reasonable time after the meeting by 1 of the following:
(a) the chair of the meeting;
(b) the chair of the next meeting.
(3) The company must ensure that minutes of the passing of a resolution without a meeting are signed by a director within a reasonable time after the resolution is passed.
(4) The director of a proprietary company with only 1 director must sign the minutes of the making of a declaration by the director within a reasonable time after the declaration is made.
(5) A company must keep its minute books at:
(a) its registered office; or
(b) its principal place of business in this jurisdiction; or
(c) another place in this jurisdiction approved by ASIC.
(5A) An offence based on subsection (1), (2), (3), (4) or (5) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
(6) A minute that is so recorded and signed is evidence of the proceeding, resolution or declaration to which it relates, unless the contrary is proved.
74 However, the provisions of s 251A of the Corporations Act have no application to a strata company (s 32(4) of the ST Act and s 5F of the Corporations Act). The provisions of s 251A of the Corporations Act therefore have no bearing on the respondent's obligation to keep minutes of general meetings.
The AGM minutes
75 It is common cause that the applicant was unable to attend the AGM.
76 On 17 October 2015 and prior to the AGM, the applicant circulated to all lot proprietors a submission in support of his contention for a particular draft or redraft of Bylaw 16.
77 The AGM minutes record that the respondent had requested that his dissent to any amendment of Bylaw 16 drafted by Mr Angus, on instruction by the strata manager and council of owners referred to above, should be recorded in the minutes. This occurred. The minutes recorded that:
(a) The applicant as the lot proprietor of Lot 2 and the proprietor of Lot 6 dissented to the amendments proposed as drafted by Mr Angus.
(b) The motion to amend Bylaw 16(7) failed.
78 The minutes also record, at the request of the relevant proprietor, at the AGM:
(a) the proprietor of Lot 6 held the view that the meaning of the current Bylaw 16(7) 'is clear and required no clarification from experts'.
(b) the proprietor of Lot 4 does not agree to the further amendments requested by the applicant or to any further expenditure in this matter.
79 The AGM minutes also record that Mr Hasluck requested leave to address the meeting, and leave was granted, because '[A]ll of those present agreed' (the owners or proxy holders for the owners of Lots 1, 3, 4 and 6), although the Tribunal notes the email from Ms A Lennon dated 3 December 2015 rejects the recorded fact that Mr Hasluck requested, and was granted, leave to address the meeting. Whether leave was requested or granted by a majority or all of those present is not to the point. The Tribunal accepts as a fact that Mr Hasluck did address the meeting substantially as recorded in the AGM minutes, bearing in mind that strata company minutes do not need to record the proceedings and minutes are not required to take the place of a transcript of evidence.
80 The following was recorded in the minutes concerning that address:
It was noted that further 'tinkering and tweaking' of the Bylaws presented at this meeting is unacceptable. The amendments requested by owner of Lot 2 are not convincing in law and the present redraft was at his insistence and further expense was not warranted.
81 It is the addition of this information in the AGM minutes to which the applicant objects and the reason why he seeks an order directing the respondent to amend the AGM minutes to include his responsive submissions.
82 The AGM minutes have not yet been confirmed at any other general meeting. However, the applicant's complaint is unrelated to what actually occurred at the AGM.
The applicant's contentions
83 The applicant alleges that the contents of the address referred to in the AGM minutes are untrue and inaccurate and he asserts that he has a right to have the AGM minutes amended to incorporate his responsive submissions that were not made at the meeting. The applicant asserts in his application to the Tribunal that he sought to have the AGM minutes revised to better reflect the proceedings by adding a substantial supplement to those minutes was unfairly or unconscionably refused by the respondent and, in particular, the council of owners of the respondent who met on 24 November 2015. This contention assumes that the applicant has a right to add anything that did not occur at the AGM to the AGM minutes. It also assumes an obligation on the respondent to record the proceedings at the AGM.
84 The applicant alleges that the respondent's refusal to allow the minutes to be redrafted so as to include all of his submissions results in a breach of the respondent's obligations to keep the AGM minutes as required in law.
85 The applicant asserts that generally minutes of meetings may be amended to include annotations prior to being confirmed and that minutes should reflect all of the matters relevant to the meeting and not only what occurred at the meeting. The applicant relies upon:
a) His experience in an Australian publicly listed company where the practice was to allow all members of a meeting to annotate the minutes before they were confirmed and that they be confirmed within a month of the meeting. The Tribunal notes that there was no documentary evidence of this practice and there was no evidence that this is what took place at a meeting of the board of directors of such a company or of the shareholders of such a company which might be analogous to a strata company council of owners' meeting and a general meeting respectively.
b) The decision in Australian Securities and Investments Commission v Hellicar [2012] HCA 17; Brown; Gillfillan; Koffel; Willcox and Shafron by reference to an article entitled Feature Making your minutes count published in Company Director Magazine in which it is suggested that substantial discussion should be captured by the minutes.
86 Further, the applicant alleges that the inclusion of the reference to the address by Mr Hasluck in the minutes, referred to above, is 'unfair', 'unconscionable', 'denigrates' him, and evidences that he has been the subject of unfair and unconscionable treatment by the respondent which is exacerbated by the respondent's refusal to amend the AGM minutes to include his submission.
87 Further still, the applicant asserts that the respondent's decision to refuse to amend the minutes of the AGM, made at a council of owners meeting on 24 November 2015, is itself an invalid decision or resolution because the council of owners' meeting was not called in the manner required by the rules and the decision made by the council of owners to 'place' the submission with the AGM minutes (instead of amending the AGM minutes) is invalid because no such procedure exists and it is vague and meaningless.
Tribunal's consideration of Issue 3
88 The applicant's submissions refer to an email by Ms Lennon on 3 December 2015 wherein she complained about the AGM minutes and asserted that events and statements were recorded in the minutes that did not occur the seeking and granting of leave to address the meeting. Ms Lennon was not called by the applicant to prove that the minutes were inaccurate. Ms Lennon is a proprietor and the Tribunal expected that she would be called by the applicant to prove that the minutes were inaccurate. That did not occur. The applicant cannot give evidence that the minutes were inaccurate as he was not in attendance at the meetings. There is therefore no evidence before the Tribunal that the AGM minutes were inaccurate. In any event, the applicant's complaint is not about the inaccuracy of the minutes.
89 The Tribunal concludes that the respondent has complied with the provisions of s 35(1)(f) of the ST Act by recording in the AGM minutes the fact of the motion to amend Bylaw 16 and the fact that the motion was defeated. For good measure, the minutes record the express dissenters as referred to above.
90 The incorporation of the applicant's postAGM submissions cannot better reflect the proceedings because those submissions did not comprise any part of the proceedings at the AGM. The applicant's application on this issue is based upon a misconception of the purpose of the AGM minutes. As stated, there is no obligation on a strata company to minute the 'proceedings' of the meeting, and even if there were such an obligation the applicant and the applicant's submission did not form part of the proceeding. A company governed by s 251A of the Corporations Act has an obligation to minute the 'proceedings' of the directors' meetings and meetings of the shareholders, as well as the resolutions of company member meetings and directors' meetings. But s 251A of the Corporations Act has no application to a strata company general meeting or council of owners meeting.
91 In any event, to the extent that the applicant seeks to rely on the Corporations Act by analogy, the Tribunal notes that s 251A of the Corporations Act does not permit an event that did not occur at a meeting governed thereby to be included in the minute of such a meeting.
92 There is no basis in law to support the applicant's contention that the AGM minutes must or should be annotated by people who were not at the meeting or by anyone about events that did not occur at the meeting.
93 The applicant's contention that the minutes may be, and should be, amended to include his submission is made without any foundation in general law or the ST Act and shall be dismissed pursuant to s 81(4) of the ST Act.
Other matters
The address at the AGM
94 Nothing in the recorded statement of Mr Hasluck's address in any way objectively denigrates the applicant and does not amount to unfair or unconscionable conduct. At this point it is necessary to expand on the proposed amendments to Bylaw 16 that the applicant advances and why such amendments are illconceived. First, the applicant's proposed amendment removes the word 'destruction' thereby altering the duration of the operation of his proposed Bylaw 16(7). Section 42(10) and s 42(11) of the ST Act refer to the period of duration of an 'exclusive use and enjoyment' or 'special privileges' bylaw and so it is necessary for such a bylaw to specify the duration of the bylaw. The 'destruction' of a building is the event that may justify an order that the strata scheme be terminated, varied or substituted (s 28 to s 31 of the ST Act). The reference to 'destruction' of the building in Bylaw 16(7) is intended to give the ByLaw the longest possible period of operation, as a matter of law. To remove the reference to 'destruction' of the building may render the ByLaw inoperative or uncertain.
95 Secondly, the applicant's proposed removal of the word 'resident' is to remove the rights of those who are residents of the lots but are not lot proprietors to the exclusive possessory rights created by the bylaw. Section 42(6) of the ST Act provides that the bylaws bind the strata company with each lot proprietor and a mortgagee in possession and resident or occupier of a lot from time to time. To remove the word 'resident' from Bylaw 16(7) would fly in the face of s 42(6) of the ST Act and would make the bylaw inoperative to all residents who are not lot proprietors. Clearly, that is not what was intended by the extant ByLaw 16.
96 Thirdly, the applicant's proposed removal of the words 'and enjoyment' may well have the effect of rendering the bylaw incapable of creating an exclusive use bylaw. Section 42(8) of the ST Act provides that a bylaw may only be created under s 42(6) of the ST Act to confer 'exclusive use and enjoyment' or 'special privileges' concerning the common property. To remove the words 'and enjoyment' would throw into doubt the purpose and objective of the bylaw and whether it actually succeeds in creating an area of exclusivity for a lot as a matter of law becomes doubtful.
97 The applicant's proposed amendments simply do not take into account the provisions of the ST Act, their operation and their application in drafting valid and binding bylaws for a strata company as a matter of law.Validity of council of owners' meeting on 24 November 2015 and the responsive submission
98 The council of owners' decision made at the meeting on 24 November 2015 to 'place' the applicant's submission with the AGM minutes, its refusal to amend the AGM minutes, as the applicant urged, and whether that meeting of the council of owners was validly convened or not, is irrelevant. The applicant's 'right' to have the minutes amended to include his submission is one that does not exist for the reasons referred to above.
Unconscionable conduct and favouritism
99 At the directions hearing on 8 February 2015, the applicant orally clarified that at that stage the third aspect of the applicant's claim included an assertion that the respondent had:
a) not discharged its functions or the benefit of all the owners concerning the events of an AGM held on 22 October 2015; and
b) exhibited 'favouritism' to others and acted unconscionably towards the applicant.
100 There is no statutory relief that may be granted by the Tribunal in the case of unconscionable conduct in a strata scheme. Such a claim must be made in the context of specific statutory rights of actions provided for in the ST Act. The ST Act and the SAT Act do not confer general equitable jurisdiction on the Tribunal. In any event, there are no facts in this matter that would give rise to any equitable claim for unconscionable conduct as known to the general law. Being in the minority of voters in the case of a resolution that passes or is defeated does not constitute unconscionable conduct by the majority. Not being able to persuade a majority of voters to a view in a general or other meeting does not constitute unconscionable conduct by the majority.
101 The assertion concerning 'favouritism' likewise has no relevance beyond any specific statutory provision in the ST Act giving rise to a right to bring proceedings for resolution by a specific kind of order by the Tribunal. In any event, there is no evidence of favouritism or unfavourable treatment of the applicant by the respondent. The ST Act provides, where a simple majority resolution, special resolution, resolution without dissent and a unanimous resolution must be made for the purposes of valid resolutions. In the case of a simple majority and special resolution, it is implicit that there will be a minority of dissenters. In any event, the relevant motion to amend By-law 16 was defeated because the applicant's dissent was recorded. The mere fact that a proprietor finds themselves in the minority on an issue of interpretation does not result in a conclusion that the respondent is malfunctioning or is in breach of the ST Act or that minority proprietors have been treated unfairly in any way.
102 Further, the proprietors are entitled to properly debate an issue in general meeting and the council of owners' members are entitled to debate an issue in meeting. It is not the Tribunal's task to sit in judgment on the proceedings of general meeting or council of owners' meeting save as is specifically provided for by the ST Act. It is not the Tribunal's function to stifle proper debate in such meetings or rule on what should or could have been debated but was not debated.
103 For this reason, the application insofar as it asserts a claim for unconscionable conduct, or for any kind of unfair treatment, is dismissed on the basis that it is an abuse of process (s 47(1)(c) of the SAT Act).
104 Further, the applicant, on a number of occasions in the hearing and in his submissions, has stated that he is at a disadvantage because Mr Hasluck is legally qualified and the applicant is not. Nothing further was made of this allegation. The applicant was afforded the fullest opportunity to put his case in a practical sense. All lot proprietors could have given evidence if they had wanted to. Judge Sharp consented to Mr Hasluck representing Mrs Hasluck and the respondent pursuant to the SAT Act, and no objection was made by the applicant and no objection could have been made by the applicant.
The final hearing
105 At the final hearing, the applicant complained to the Tribunal that:
a) he was not aware that the respondent would call any witnesses;
b) he was not aware that he could give evidence;
c) he was not aware that he could cross-examine; and
d) he was not aware that he could be cross-examined.
106 The Tribunal has had regard to the recording of the directions hearing on 8 February 2015 before Judge Sharp and notes that Judge Sharp stated that a final hearing might entail witnesses being called to give evidence. His Honour also noted that the member at the final hearing would identify the process to be adopted. The Tribunal notes that at the commencement of the final hearing the Tribunal indicated it was flexible in the manner in which the hearing would be conducted taking into account that the applicant was unrepresented and not legally qualified as is the norm in ST Act matters. The Tribunal also notes that the matter was listed for a full day. Given his Honour's statement at the directions hearing, the fact that the application was listed for a full day for a final hearing and the fact that there was already substantial written submissions before the Tribunal, it should not have surprised the applicant that witnesses may be called by the respondent to give evidence. It is the Tribunal that determines its own procedures (s 32(5) of the SAT Act) and it is not open to a party to determine that the matter should proceed in a particular way. The applicant's criticism that the Tribunal has allowed oral evidence at a final hearing has no justification. It is a matter for each party to decide whether he will give or call evidence. However, the decision by the applicant will not determine how the Tribunal will hear the respondent's case. In a letter to the Tribunal following the hearing, the applicant further complained about the Tribunal process and that one of the lot proprietors was legally qualified. As stated, the fact that Mr Hasluck is legally experienced and qualified is a fact but not a relevant fact in this proceeding. The applicant failed to take this fact any further and make it relevant. The applicant was afforded a full opportunity to give any evidence he thought was relevant; to cross-examine the respondent's witnesses; to put his case as he preferred; to debate any issues that arose on the day, and to respond to questions by the Tribunal. In addition, the applicant relied on extensive written submissions and email correspondence with no objection as to relevance or weight by the respondent. The applicant was afforded natural justice and procedural fairness at all times in this proceeding in every practical sense.
107 The applicant also complained that the respondent's witness statements were not provided to the applicant along with annexed documents prior to the hearing. There was no order by Judge Sharp for the exchange of witness statements and the witness statements were, in any event, overtaken by the oral evidence given by Mr and Mrs Hasluck when they read their witness statements to the Tribunal. Save for the order made on 8 February 2016 to provide certain documents to the applicant, there was no order for exchange of documents. The witness statements were handed up to the Tribunal as the witnesses gave their evidence so the applicant was in no better position than the Tribunal. The fact that the witness statements were exhibited does not mean they have any greater weight than the oral evidence given. The witness statements merely provided an aid to the Tribunal and the applicant in that the evidence in chief was also recorded in those statements. In any event, the respondent was encouraged to and did crossexamine the respondent's witnesses. The applicant had the opportunity to call witnesses to give evidence and in fact did give evidence himself.
108 The Tribunal considers that the applicant was provided with an opportunity to be heard and to put his case fully before the Tribunal made its decision. The applicant was informed that the Tribunal processes were flexible to accommodate the fact that he was not legally qualified or experienced and was informed that the strict rules of evidence did not apply. There is no obligation to obtain the consent of all parties to witnesses being called. The applicant should not have been taken by surprise by witnesses giving evidence as:
a) the application was listed for a hearing and the taking of evidence is the principal function of a hearing;
b) Judge Sharp mentioned at the directions hearing on 8 February 2015 that witnesses might be and could be called at the final hearing; and
c) the application was listed for one full day which should have alerted the applicant to the fact that there would likely be more than oral submissions.
Orders
109 For the reasons referred to above, the Tribunal makes the following orders:
1. The correct respondent is The Owners of Chartwell Strata Plan 2604 and the proceeding is amended accordingly.
2. The applicant's application concerning s 43 of the Strata Titles Act 1985 (WA) and s 43(1a) of the Strata Titles Act 1985 is made pursuant to s 90 of the Strata Titles Act 1985.
3. The applicant's application pursuant to s 83(1) of the Strata Titles Act 1985 concerning the allegation of a contravention of s 47(1) of the Strata Titles Act 1985 is dismissed pursuant to s 81(4) of the Strata Titles Act 1985.
4. The applicant's application pursuant to s 90 of the Strata Titles Act 1985 concerning the allegation of a contravention of s 43(1a) and/or s 43(1)(b)(ix) of the Strata Titles Act 1985 is refused and dismissed pursuant to s 81(4) of the Strata Titles Act 1985.
5. The applicant's application pursuant to s 83(1) of the Strata Titles Act 1985 concerning an allegation of a contravention of s 35(1)(f) of the Strata Titles Act 1985 is dismissed pursuant to s 81(4) of the Strata Titles Act 1985.
6. The application is otherwise dismissed pursuant to s 47(1)(a) or (c) of the State Administrative Tribunal Act 2004 (WA).
I certify that this and the preceding [109] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MS N OWEN-CONWAY, MEMBER
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