Harburg v Body Corporate Management for Riparian Apartments
[2010] QCAT 421
•23 August 2010
| CITATION: | Harburg v Body Corporate Management for Riparian Apartments [2010] QCAT 421 |
| PARTIES: | Mr Peter Victor Harburg |
| v | |
| Body Corporate Management for Riparian Apartments CTS 34665 |
| APPLICATION NUMBER: | OCL039-10 |
| MATTER TYPE: | Other civil dispute matters |
| HEARING DATE: | 23 August 2010 |
| HEARD AT: | Brisbane |
| DECISION OF: | Ms Anne Forbes |
| DELIVERED ON: | 23 August 2010 |
| DELIVERED AT: | Brisbane |
ORDERS MADE: | 1. The lot entitlement contribution schedule for Riparian Plaza Apartments CTS34665 shall be adjusted so that the respective lot entitlements recorded in the Community Management Scheme be as attached Schedule A. 2. The Body Corporate for Riparian Plaza Apartments shall act as quickly as possible in lodging a request to record a new Community Management Statement reflecting the adjustments ordered. |
| CATCHWORDS : | Application for adjustment to contribution schedule lot entitlement – Body Corporate and Community Management Act 1997 – amalgamation of a pair of apartments into one – departure from principle that lot entitlement of each shall be equal. |
APPEARANCES and REPRESENTATION (if any):
| Decision on the papers in the absence of the parties. |
REASONS FOR DECISION
The applicant owns Lots 4602 and 4603 in Riparian Plaza Apartments CTS 34665, in a mixed use commercial and residential apartment building. The Lots have been amalgamated by Plan SP 226069 and are now called Lot 4602 [“the Lot”]. As a result of the amalgamation the Contribution Schedule Lot Entitlement [the “CSLE”] has become 415 units in the Community Management Scheme [“the CMS”] executed on 1 February 2010.
The Applicant submits that this entitlement for the amalgamated Lot 4602 is not just and equitable. He seeks orders that the CSLE be adjusted to apportion 227 units to the Lot. The orders sought rely on advice obtained by the Applicant from Mr Martin Walsh of Stewart Silver King and Burns Strata Consulting, who has expertise in analysis of body corporate structures.
The Manager for the Body Corporate has advised the Tribunal that it opposes the application and has set out its reasons supported by submissions of owners of two other apartments in Riparian Plaza.
Position of the Applicant
The Applicant has provided no background information, apparently preferring to rely entirely on the Walsh report.
Owners of Lot 5004, Kevin and Joyce Evans, who object to the application, say that Riparian Plaza was initially occupied in 2005 and that the Applicant purchased the two lots in 2006/2007. In 2009, according to the Joyces, the Applicant undertook “massive work” to redesign and amalgamate the units.
The Scheme described by Mr Walsh consists of thirteen levels of residential apartments in a fifty-three storey tower. Owners are separately billed by the local council for water. All units have access to the central air-conditioning plant. Electricity is separately billed. Two lifts stop at all levels. There are common recreation facilities including a pool, sauna, spa, gymnasium and function rooms.
Mr Walsh has provided a comprehensive report in which he describes the scheme, its physical aspects, lot usage, lot areas and contribution entitlements. He has analysed the historical and budgeted expenditure of the Body Corporate, and has set out his findings to support his conclusion that the lot entitlements for the scheme should not be equal. He has provided details of the matters considered for calculating and adjusting the CSLE to make it just and equitable and has recommended a contribution schedule of adjustments to achieve this. The average range of entitlements in the recommended schedule is between 206 and 220, with the Applicant’s amalgamated apartment at 227 and one other at 253.
Position of the Body Corporate and objecting owners
The manager for the Body Corporate , Mr Lovell submits that the relevant Minister has recently announced the Queensland Government’s proposal to amend the current legislation. An order to change the present schedule of lot entitlements would impose an unnecessary burden of administrative and legal work on the Body Corporate, with the possibility that further changes would have to be made to implement the legislative changes.
The objecting owners say that they anticipate that several other owners with adjoining units will amalgamate and seek similar orders to those sought by the Applicant thereby increasing their financial commitment to the Scheme.
Legislation and Principles
The Body Corporate and Community Management Act 1997 [the BCCM”] provides principles by which the maintenance costs of a building such as Riparian Plaza having a community titles scheme are met by contributions of the owners of the lots. Their proportionate contributions are to be set out in a contribution schedule: section 47. Lot owners may apply for an order of QCAT for an adjustment of a lot entitlement schedule: section 48. The informing principle is that the “respective lot entitlements should be equal, except to the extent to which it is just and equitable in the circumstances for them not to be equal”: section 48(6). Criteria are provided for determining just and equitable circumstances: section 49(4). These include but are not limited to:
(a)how the community titles scheme is structured; and
(b)the nature, features and characteristics of the lots included in the scheme; and
(c)The purposes for which the lots are used.
Guidance in the interpretation of section 49(4) is afforded by the Court of Appeal in Fischer & Ors v Body Corporate for Centrepoint Community Title Scheme 7779 [2004] QCA 21, namely that:
§The starting point is that the entitlements should be equal;
§A departure from the principle is allowable where it is just or fair to recognise inequality;
§The allocation of lot entitlements is to be made on the basis of the impact that individual apartments make upon the cost of operating a community titles scheme; and
§The matters referred to in section 49(4) to which the tribunal may have regard may be considered only to the extent that they affect the cost of operating the community titles scheme and
§“More general questions of amenity, value or history are to be disregarded”.[1]
[1] Fischer & Ors v Body Corporate for Centrepoint Community title Scheme 7779 [2004] QCA 21 at paragraph [26].
Consideration
The tribunal’s decision must be guided by the particular unit structure of the scheme as it is today. It is necessary to look at how the unit in question uses the administration and maintenance services provided by the body corporate.
The fact that there have been several and may be further amalgamations of pairs of units is irrelevant to the exercise.[2] A ministerial press statement about a possible future change to the present legislation does not represent the present law, and it may not ever do.
[2] Meek G and K v Body Corporate for Bridgeport Apartments [2008] CCT KL013-07 per K Dorney SC (as he then was)
The default position is for contributions to the common expenses to be equal unless considerations of justice and equity require a departure from that principle. The Applicant bears the onus of showing that the apportionment of the expenses in the proposed schedule is just and equitable.
Accordingly I find that Mr Walsh has properly identified the relevant costs and allocated them among the lot owners equitably, and that orders should be made implementing his recommended entitlement schedule after the amalgamation of lots 4602 and 4603, contained in the report of Stewart Silver King and Burns of 19 March 2010. The schedule is appended to these orders as Schedule A
Schedule A
1