Henry v The Body Corporate for La Solana CTS 456 and CTS 224

[2017] QCAT 22

CITATION:

Henry v The Body Corporate for La Solana CTS 456 and CTS 224 [2017] QCAT 22

PARTIES:

Carole Henry
(Applicant)

v

The Body Corporate for La Solana CTS 456 and CTS 224

(Respondents)

APPLICATION NUMBER:

OCL083-14

MATTER TYPE:

Other civil dispute matters

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Member Gordon

DELIVERED ON:

18 January 2017

DELIVERED AT:

Brisbane

ORDERS MADE:

The proceedings OCL083-14 are dismissed in their entirety.

CATCHWORDS:

REAL PROPERTY – STRATA AND RELATED TITLES – BODY CORPORATE: POWERS DUTIES AND LIABILITIES – where caretaking service contractor applied to the Tribunal in a complex dispute – where the parties reached a compromise and signed heads of agreement – whether the application should be dismissed

Queensland Civil and Administrative Tribunal Act 2009 (Qld), s 47, s 48, s89

Board of Professional Engineers of Queensland v Lennox [2010] QCAT 702 considered

APPEARANCES:

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).

REASONS

1. This is an application which has been made during the course of the proceedings, in which the bodies corporate who are the Respondents to the proceedings, apply for the proceedings to be dismissed.  Their reason is that the proceedings have been settled by agreement between the parties.

2. The Applicant, Ms Henry, would prefer to have the proceedings remain afoot, because she still has concerns.  She says that some of those concerns are within the proceedings, and some are new.

3. In order to decide whether the proceedings should be dismissed, I need to consider the subject matter of the proceedings before the Tribunal and the nature of the dispute between the parties, and then to consider whether the proceedings have been compromised.  If I am satisfied that there has been a compromise of the proceedings I need to consider whether it is right to dismiss the application as the bodies corporate ask, or whether it is right to make some other order.

Brief factual background

1. In brief, the bodies corporate involved in these proceedings are La Solana CTS 456 and La Solana Villas CTS 224.  They are Community Titles Schemes governed by the Body Corporate and Community Management Act 1997 (Qld). They are in close proximity in Mackay. At the time the proceedings were commenced, Ms Henry was the caretaking service contractor for the two schemes. She was also the letting agent for both schemes and continues in that role.

2. The original caretaking agreements were by deeds dated 14 April 2005 between the bodies corporate and a previous caretaker.  They started on 1 March 2005 and continued to 28 February 2015 with the caretaker having an option to renew for a further term of 10 years (to 28 February 2025).  These agreements were assigned to Ms Henry on 28 July 2006.

3. It appears from the material in Ms Henry’s application to the Tribunal that over the years, disputes developed between Ms Henry and the committees of the bodies corporate.  She brought her application to the Tribunal on 7 November 2014.  She criticised both the committees and the body corporate manager for (she said) not acting in the best interests of the building, and for ignoring safety issues reported by her in her role as onsite letting agent and caretaker.  She pointed to a safety report which had been produced and referred to her attempts to discuss the issues in the committee or in an informal meeting and also directly with some owners and committee members.  She provided a log of her efforts to get various maintenance issues done, and what she regarded as more efficient processes put in place.  She sought various outcomes in Part D of her application. 

4. In response to the application, the bodies corporate responded to each of the points made by Ms Henry, and responded with a set of their own outcomes which were different from those sought by Ms Henry.

The compromise

1. In these proceedings, the Tribunal followed its usual practice, as it was obliged to do by its own statute, of seeking to assist the parties to resolve the issues between them.  There were three compulsory conferences in 2015.[1]

   [1]Held on 22 June, 16 October and 4 December.

2. On 4 December 2015 the parties signed a document entitled “Heads of Agreement”.  This stated that the parties agreed to certain terms in principle.   It is clear from the agreement that the reason why it was “in principle” was that it was subject to the approval of both schemes in general meetings.  The agreement contained comprehensive terms dealing with the future contractual relationship between the parties, and also dealing with the main issues between the parties in the proceedings before the Tribunal.  It provided for the execution of a deed of variation of the caretaking agreement (and a minor variation of the letting agreement) by all parties.

3. In the application to dismiss, evidence has been provided to show that the Heads of Agreement were approved at general meetings of both schemes and that the deed of variation has been executed as contemplated by the agreement.

4. In other words, the evidence shows that the condition required by the Heads of Agreement for it to convert from an agreement in principle to a firm binding agreement has been met.

5. Of importance to the application to dismiss are these two clauses in the Heads of Agreement:-

   2.7 On completion of these Heads of Agreement, the Parties will file a notice of discontinuance in respect of these proceedings and will do all things necessary to bring proceedings OCL083-14 to an end with no order for costs.

   2.8 The rights and remedies of the Parties are not compromised by the terms of these Heads of Agreement, but in the event that the Parties obtain the appropriate authorisations to enter into the Deed, then the rights and remedies of each of the Parties are compromised and neither Party has a right or action or claim or otherwise whatsoever against the other in respect of all facts, matters and issues arising from OCL083-14, except for an action for the breach of, or enforcement of these Heads of Agreement.

6. By clause 2.7 the manner in which the proceedings were to be ended was by notice of discontinuance, but under the Tribunal’s procedure a notice of withdrawal would be needed.  The effect would be the same, and the clause is not invalidated by this, because the intention is clear.  

7. Clause 2.7 refers to “completion of these Heads of Agreement”.  It is clear to me that this refers to the condition in the Heads of Agreement being met (the approval of both bodies corporate in general meetings), which has happened.

8. Equally, the compromise in clause 2.8 has taken effect for the same reasons.

9. It is clear from the terms of clauses 2.7 and 2.8, the condition having been met, that the issues in OCL083-14 have been compromised in full.  In the circumstances the proceedings cannot be permitted to continue, unless an opportunity is given to Ms Henry to amend them to add her other concerns.

The correct order to make

1. In some cases it would be more appropriate to stay the proceedings in such circumstances rather than dismiss them.  The difficulty here is that except where there are unpaid costs or to support an order for security for costs,[2] or where the names of partners are awaited,[3] there is no express power to stay these types of proceedings in the QCAT Act. However there may be an implied power to do so.[4] 

   [2]Sections 108 or 109 of the QCAT Act.

   [3]Rule 13 of the Queensland Civil and Administrative Tribunal Rules 2009 (Qld).

   [4]As found by Member T Fantin in the context of a Commercial and Consumer Tribunal case taken over by the Tribunal: Board of Professional Engineers of Queensland v Lennox [2010] QCAT 702.

2. Rather than trying to resolve the issue whether the Tribunal has power to stay proceedings, I think it is right to accede to the bodies corporate’s application to dismiss the proceedings altogether.

3. This seems to me to be the correct course of action, rather than a stay because:-

   a)  A stay preserves an opportunity for a party to seek to set aside any compromise agreement on the grounds of fraud, misrepresentation or undue influence.  However, here there is no hint in Ms Henry’s submissions that she is considering this or concerned about it.

   b)  A stay preserves an opportunity for a party to bring the compromise agreement to an end if the other party repudiates the agreement, by accepting that repudiation.  Again there is nothing to suggest that the bodies corporate would wish to do this.  To the contrary, they have asked for the proceedings to be dismissed because of the compromise agreement.

   c) The compromise agreement required the parties to discontinue the proceedings. By section 89 of the QCAT Act, the Tribunal may make an order giving effect to the terms of a compromise agreement where one side does not comply with its terms. Effect can therefore be given to the agreement to discontinue the proceedings by dismissing them. There is also an express power to dismiss the proceedings in that section.

   d) Section 47 of the QCAT Act permits the Tribunal to dismiss proceedings in certain circumstances. Here, any continued pursuit of these proceedings as they stand in the Tribunal would clearly be misconceived, lacking in substance and an abuse of process, Ms Henry having clearly compromised the proceedings which she brought.

   e) Section 48 of the QCAT Act permits the Tribunal to dismiss proceedings if a party acts in a way which unnecessarily disadvantages another party. Here, any continued pursuit of these proceedings as they stand in the Tribunal would clearly unnecessarily disadvantage the bodies corporate, Ms Henry having clearly compromised the proceedings which she brought.

4. I have considered whether Ms Henry should be given an opportunity to amend her application in the proceedings so that her present concerns can be addressed by the Tribunal.  In the light of her clear agreement with the bodies corporate to end this litigation now, I do not think it would be appropriate to give that opportunity.

5. Accordingly the proceedings OCL083-14 are dismissed in their entirety.  In making this order, I intend that any orders or outcomes which were sought by the bodies corporate in their response cannot proceed either.  This was clearly the intention of the bodies corporate in applying to have the proceedings dismissed.