Hablethwaite v Andrijevic

[2005] QDC 112

DISTRICT COURT OF QUEENSLAND

CITATION:	Hablethwaite v Andrijevic and Ors [2005] QDC 112
PARTIES:	PETER AND MARCIA HABLETHWAITE (Appellants) v IVAN AND CARMELINA ANDRIJEVIC (AS TRUSTEES FOR MELIVAN PTY LTD) (First Respondent)
CLAUDE AND SHIRLEY MARSH (Second Respondents)
MICHAEL JOHN TAIFALOS (Third Respondent)
FILE NO/S:	91/04
DIVISION:	Trial
PROCEEDING:	Appeal
ORIGINATING  COURT:	Commissioner for Body Corporate and Community Management
DELIVERED ON:	13 May 2005
DELIVERED AT:	Cairns
HEARING DATE:	2 March 2005
JUDGE:	Bradley DCJ
ORDER:	Appeal dismissed. Order of adjudicator confirmed.
CATCHWORDS:
COUNSEL:	Self-represented appellants Mr C. Ryall for the first and second respondents
SOLICITORS:	Miller Bou-Samra Lawyers for the first and second respondents

Facts

1. The appellants and the respondents are all residents of the Maria Creek Estate, a subdivision scheme of nine lots registered under the Body Corporate and Community Management Act 1997 (“the Act”). Mr and Mrs Hablethwaite are co- owners of lots 3, 6, 7, 8 and 9, Mr and Mrs Andrijevic (as trustees for Melivan Pty Ltd) are co-owners of lot 4, Mr and Mrs Marsh the co-owners of lot 5 and Mr Taifalos is a co-owner of lot 1. As Mr and Mrs Hablethwaite are co-owners of five of the nine lots, they can constitute a majority when voting at meetings of the body corporate.

2. On 29 May 2003 an AGM was held where a number of motions were proposed, some of which were carried, but many were voted against by Mr and Mrs Hablethwaite and could not be passed. The other owners all voted for the motions. On 7 July 2003 Mr and Mrs Adrijevic, Mr and Mrs Marsh and Mr Taifalos lodged a Dispute Resolution Application under the Act, seeking an order declaring void the “no” vote of Mr and Mrs Hablethwaite in respect of a number of motions from the AGM.

3. Adjudicator Meek gave his decision in relation to the dispute on 2 December 2003, issuing the orders sought by the applicants, except in relation to two of the motions. Adjudicator Meek’s decision was made on the basis that Mr and Mrs Hablethwaite apparently had no specific objection to the proposed resolutions, and therefore the ‘no’ votes to each of the resolutions were unreasonable in the circumstances. As a result, 13 resolutions were deemed to have been carried and could therefore be implemented.

4. Mr and Mrs Hablethwaite have appealed against the decision of Adjudicator Meek and seek that the orders made be declared void. They do acknowledge that, with the passage of time, their objections to some of these matters have become redundant: specifically, four resolutions have already implemented and disputes regarding another three have effectively been resolved. An appeal to this court can only be on a question of law.

   Grounds of appeal

5. Mr and Mrs Hablethwaite have appealed on the following grounds:-

1.	That contrary to s 276 of the Act the adjudicator made an order which was not just and equitable in the circumstances.
2.	That contrary to s 269 of the Act the adjudicator did not investigate the application in a way consistent “with a fair and proper consideration of the application”.
3.	The adjudicator denied the appellants natural justice.
4.	The adjudicator did not act impartially and fairly.

Adjudicator’s reasons for decision

1. In his reasons the adjudicator referred to the “dysfunctional history of this scheme” which led to the appointment of an administrator. The administrator convened the meeting of 29 May 2003. In addition to the application made by the owners other than Mr and Mrs Hablethwaite concerning the AGM held on 29 May 2003, two other applications, one made in the name of body corporate and one made by Mr and Mrs Hablethwaite themselves, were also before the Office of the Commissioner for Body Corporate and Community Management. Mr and Mrs Hablethwaite’s application sought to invalidate the AGM, call an amending AGM and remove the administrator and appoint a registered liquidator or a chartered accountant in her stead. That application was dismissed by adjudicator Meek.

2. The adjudicator noted that with respect to each of the motions where the dissenting vote of Mr and Mrs Hablethwaite was sought to be “declared void” and effect given to the proposal, the other lot owners had submitted a statement explaining the basis for their request. The adjudicator noted that Mr and Mrs Hablethwaite “are fully aware of these reasons in consequence of the submission process. Notwithstanding that the applicants have in their grounds, specifically addressed each of the separate motions they seek to have validated, the Hablethwaites have not responded in this manner.”

3. After noting that Mr and Mrs Hablethwaite’s response was limited to the subject matter of only one of the motions, the adjudicator continued “the Hablethwaites do not take issue with the other 14 or so motions the subject of this application. I conclude from this that the Hablethwaites do not have specific objections to the proposals contained in all other motions, but rather have simply voted “no” to each of the motions as technically they are entitled to do. The scenario is such however that the “no” vote of the Hablethwaites is determinative of the outcome of each of the motions. In this context, the other owners are alleging that the “no” vote by the Hablethwaites is unreasonable and should be reversed.” The adjudicator then went on to consider each motion in turn and concluded that, with the exception of two of the resolutions, the “no” vote of Mr and Mrs Hablethwaite was, in circumstances, unreasonable and should be reversed.

4. Mr and Mrs Hablethwaite did not attend the meeting of 29 May 2003 but forwarded a voting paper indicating how they wished to vote with respect to each motion and a written submission which included their response to each of the motions to the administrator. Those documents set out Mr and Mrs Hablethwaite’s objections to each of the motions they voted against. There is some dispute as to whether the submission was actually received by the administrator, however in his reasons for dismissing the application by Mr and Mrs Hablethwaite to invalidate the AGM, the adjudicator made reference to a handwritten note on a copy of the voting paper which was provided to him by Mr and Mrs Hablethwaite which states – “We also vote yes to the motions included in our submission to the Administrator”. As a result of this reference the adjudicator posed the question – “Is this an admission (as it appears to be) that the applicants did in fact provide motions to the administrator in any event. If so, this contradicts their argument that they were denied this opportunity.”

5. Mr and Mrs Hablethwaite argue that having been alerted to the existence of a submission by them to the administrator, the adjudicator should have sought a copy either from the administrator or from Mr and Mrs Hablethwaite themselves and in failing to do so he failed to properly investigate the application by the other owners. They argue that the adjudicator thereby made an order which was not just and equitable and that he denied Mr and Mrs Hablethwaite natural justice.

   Procedure used by adjudicator

6. In accordance with s 290 of the Act, the Office of the Commissioner for Body Corporate and Community Management has forwarded to this court its original file regarding the application made to that office.

7. It is clear from that file that following receipt of the application by the other owners the Commissioner invited Mr and Mrs Hablethwaite (along with other interested parties) to make a written submission on the matters raised in the application. It is clear from subsequent correspondence between Mr and Mrs Hablethwaite and the Office of the Commissioner that Mr and Mrs Hablethwaite did receive the invitation to make a submission. In fact extensive correspondence was entered into between the Commissioner’s Office and Mr and Mrs Hablethwaite prior to the determination by the adjudicator.

8. Mr and Mrs Hablethwaite did forward to the Office of the Commissioner a submission dated 4 August 2003 and a further letter dated 5 August 2003. Those submissions essentially relate to only one of the contested motions.

9. Mr and Mrs Hablethwaite were clearly put on notice that the onus was on them to place any relevant submissions before the adjudicator and whilst it had been brought to the adjudicator’s attention (in relation to their own application) that written submissions may have been forwarded to the administrator by Mr and Mrs Hablethwaite, the adjudicator was not under any obligation to seek out a copy of, or make investigations regarding, those submissions. It was not reasonable for Mr and Mrs Hablethwaite to assume that the written submissions forwarded by them to the administrator for the AGM would be considered by the adjudicator in the absence of them providing the adjudicator with a copy. Nor could they assume that the administrator would provide a copy of their submissions to the adjudicator, in fact, Mr and Mrs Hablethwaite were aware that the administrator denied receiving the submissions.

10. The adjudicator was investigating, and seeking to determine three separate applications brought by different applicants arising out of the AGM held on 29 May 2003. The correspondence on the file between the Commissioner’s Office and Mr and Mrs Hablethwaite discloses that Mr and Mrs Hablethwaite were well aware that each of the applications were being investigated, and would be determined, separately, even if by the same adjudicator.

11. Section 271 of the Act gives an adjudicator extensive investigative powers, including the power to require a person to be present to be interviewed and the power to enter and inspect body corporate records. In investigating this application the adjudicator chose to limit investigations to inviting interested parties to make written submissions. Given the circumstances and the nature of the dispute, this was an entirely reasonable approach to take.

12. Mr and Mrs Hablethwaite argue that if the adjudicator intended to base his decision on the finding that they had offered no specific objections to the motions, he was obliged to advise them of that finding and allow them the opportunity to respond. This argument misconceives the concepts of a fair hearing, due process and natural justice. An adjudicator is not obliged to seek clarification or further information from a party once a party has responded, apparently sensibly, to an invitation to make submissions. Neither is an adjudicator obliged to forewarn a party of the basis of adverse findings prior to determining a matter.

13. The record from the Office of the Commissioner for Body Corporate and Community Management shows that the adjudicator did investigate the matter fairly and did accord Mr and Mrs Hablethwaite natural justice. The adjudicator considered the application fairly and properly and made an order which was just and equitable in the circumstances.

14. In their Outline of Argument, Mr and Mrs Hablethwaite have detailed the basis of their opposition to three of the motions. Had I found that the adjudicator’s discretion had miscarried, then it would be open to me to exercise the same discretion and substitute other orders. However, I am satisfied that there were no errors of principle in the decision made by the adjudicator or the process he used to arrive at that decision. Accordingly it is not necessary for me to exercise my discretion with respect to the contested motions.

15. The appeal is dismissed and the order made by Adjudicator Meek on 2 December 2003 is confirmed.