HOPKINS and CLAYTON
[2007] WASAT 255
•8 OCTOBER 2007
| JURISDICTION | : | STATE ADMINISTRATIVE TRIBUNAL |
| STREAM | : | COMMERCIAL & CIVIL |
| ACT | : | STRATA TITLES ACT 1985 (WA) |
| CITATION | : | HOPKINS and CLAYTON [2007] WASAT 255 |
| MEMBER | : | DR B DE VILLIERS (MEMBER) |
| HEARD | : | 24 AUGUST 2007 |
| DELIVERED | : | 8 OCTOBER 2007 |
| FILE NO/S | : | CC 650 of 2007 |
| BETWEEN | : BILLY HOPKINS |
Applicant
AND
TONY CLAYTON
Respondent
Catchwords:
Property - Strata titles - Application to erect a patio on common property - Unreasonable refusal to consent to alteration to common property - What constitutes unreasonable refusal - Autonomy of strata company
Legislation:
State Administrative Tribunal Act 2004 (WA), s 83.1
Strata Titles Act 1985 (WA), s 35, s 42(8), s 51, s 51A, s 85, s 94
Result:
Orders made
[2007] WASAT 255
Category: B
Representation:
Counsel:
| Applicant | : | Self-represented |
| Respondent | : | Self-represented |
Solicitors:
| Applicant | : | Self-represented |
| Respondent | : | Self-represented |
Case(s) referred to in decision(s):
Burns and The Owners Of Observation Rise Strata Plan 24414 [2006]
WASAT 17
Maber & Anor and The Owners of Strata Plan 11391 [2007] WASAT 99
Maber & Anor and The Owners Of Strata Plan 11391 [2007] WASAT 99 (S)
The Owners of Millpoint Strata Plan 11391 & Ors [2007] WASAT 9
[2007] WASAT 255
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
1 Mr Hopkins seeks an order from the Tribunal that the strata company
has unreasonably refused approval for a patio to be erected on common property. The strata company comprises two lots, with Mr Hopkins being the owner of Lot 1 and Mr Clayton the owner of Lot 2. Mr Clayton has refused approval of the application for a patio to be erected.
2 Mr Hopkins sought approval from Mr Clayton to erect a patio over a
portion of the common property in his back yard so as to shield his exterior entertainment area from direct sun and rain. This is the area, where according to Mr Hopkins, he entertains his guests from time to time and where they as a family spent leisure time. Mr Hopkins has already received approval from the local authority for the patio to be erected.
3 Mr Clayton refused permission for the patio to be erected on the
common property. He offered various reasons to justify his opposition thereto. He is concerned that the patio would become an amplifier of noise, it would deflect heat to Mr Clayton's lot, Mr Hopkins might use it as a parking area for his vehicle, and it is not in keeping with the design of the buildings.
The Tribunal undertook a site inspection to familiarise itself with the proposed location of the patio.
5 The Tribunal found that the strata company, through the "no" vote of
Mr Clayton, did withhold its approval unreasonably. Although the Tribunal must be slow to interfere in the affairs of a strata company, I am satisfied that on the facts, Mr Clayton withheld his approval unreasonably. The patio complies with all local government requirements, there is no evidence that it would lead to an increase in heat or odours in the neighbouring lot, the visual impact would be limited since it has a flat roof, and it is reasonable for a lot owner to erect a patio for protection against the high intensity summers and wet winters experienced in Perth.
6 The Tribunal therefore made an order that the strata company
consents to Mr Hopkins' application to erect the patio as proposed, on the
condition that he must insure the structure.
Background to the application
7 Mr Hopkins lodged his application on 23 April 2007. At first he
sought relief pursuant to s 83(1) of the State Administrative Tribunal Act
[2007] WASAT 255
2004 (WA) (SAT Act), but at the first directions hearing leave was granted for the application to be amended to be brought pursuant to s 85 Strata Titles Act 1985 (WA) ST Act. Section 85 of the ST Act specifically deals with instances where approval to alter common property has, purportedly, been refused unreasonably by the strata company.
The Tribunal adjourned the matter for mediation but it was not
resolved.
9 The Tribunal hence invited the parties to make further written
submissions which they did. Both parties also gave evidence during the hearing. The Tribunal took all of the submissions and evidence into account before coming to its decision.
10 The hearing, which took place on 24 August 2007, was preceded by
a site inspection. The inspection gave the parties the opportunity to show the Tribunal where the proposed patio would be located, the reasons for concerns with it, and other alterations that have been brought about to the common property over the years.
Submissions of the parties
The submissions made by Mr Hopkins in favour of his application can be summarised as follows:
• The patio complies with all local government requirements and has been approved by the City of Stirling. A building licence has been issued and all that remains is approval from the strata company. • The area where the patio is to be constructed is exposed to the glaring sun which makes it virtually impossible to use the entertainment area in daytime during summer. In winter the area is exposed to rain, which also renders it useless most of the time. • The concerns raised by Mr Clayton in regard to possible noise and fumes, are not unique to strata title units, but can be addressed through good neighbourliness. The patio in itself would not increase noise or fumes as contended by Mr Clayton. This is evident in the many similar patios that exist in Perth. • Mr Clayton has also brought about alterations to common property through the years without registering an [2007] WASAT 255
exclusive use by-law being for each of the alterations. He has, for example, enclosed a common property car port without a by-law being registered.
• The proposed patio roof would be flat, which means the visual impact on Mr Clayton and other neighbours would be minimal. The patio would not be visible from the street. A letter by a Mr Chad Muntz from Mindarie Patios was tendered. In it Mr Muntz explained that he had discussed the design with Mr Clayton who, at the time, objected to a gable roof. Mr Clayton did however, according to Mr Muntz, indicate at the time that he would consider a flat roof. The design was therefore altered to a flat roof. • Mr Hopkins contended therefore that Mr Clayton's refusal for the patio to be erected was unreasonable, and the Tribunal should grant permission on behalf of the strata company for the alteration to common property to go ahead.
The submissions made by Mr Clayton in opposition to the application can be summarised as follows:
• The area where the patio is to be erected is not the subject of an exclusive use by-law. Any alteration to common property, or the granting of such a special privilege, has to be supported by a properly registered exclusive use by-law. • The patio will impact on the visual attractiveness and symmetry of the complex and will bring about asymmetry. It would therefore devalue the lots. • The patio will cause a visual nuisance and obstruction from the lot of Mr Clayton. • The patio area could be used as an additional carport and could increase the noise and odours that are experienced at Mr Clayton's lot. • The patio will capture heat in summer and release it sideways into the lot of Mr Clayton. [2007] WASAT 255
• The patio will only have benefit for Mr Hopkins and cannot be construed as of the benefit of all proprietors as envisaged by s 35 of the ST Act. • Mr Clayton also explained the circumstances that gave rise to the alterations to the common property that he has brought about. According to him he obtained verbal approval from the other lot owner at the time to make the changes.
Legal framework
The application is brought under s 85 of the ST Act which provides
as follows:
"Where, pursuant to an application by a proprietor for an order under this section, the State Administrative Tribunal considers that the strata company for the scheme to which the application relates has unreasonably refused to consent to a proposal by that proprietor –
(a) to effect alterations to the common property; or (b)
to have carried out repairs to any damage to the common property or any other property of the strata company,
it may make an order that the strata company consent to the
proposal."
14 There is no dispute that the proposed patio would be erected on
common property and that the strata company has, through the "no" vote
of Mr Clayton, rejected the proposed change to the common property.
The questions for this Tribunal are whether (i) it has jurisdiction to hear the matter and (ii) if approval has been unreasonably withheld.
Does the Tribunal have jurisdiction to deal with the dispute?
The Tribunal must first of all be satisfied that it has jurisdiction to deal with the dispute.
17 The ST Act envisages two main avenues to be followed for a
proprietor to obtain approval for special rights or privileges in regard to
common property.[2007] WASAT 255
18 The first avenue is where a unanimous resolution or resolution
without dissent is required. The most common example is the registration of an exclusive use by-law. Mr Clayton contends this is the appropriate avenue for Mr Hopkins to take. Section 51 and s 51A of the ST Act determine how disputes in regard to such matters are to be dealt with. If Mr Clayton is correct that the erection of the patio requires the registration of an exclusive use by-law, the dispute would have to be dealt with pursuant to s 42(8) and s 51Aof the ST Act. In essence, a dispute would then fall within the jurisdiction of the District Court (s 51A ST Act).
19 The second avenue is, if it is within the powers of the strata company
to approve, by ordinary majority, a proposal to alter common property, but it refuses to do so (s 85, ST Act). Such an application would fall within the jurisdiction of the Tribunal. The Tribunal would then determine if the refusal is "unreasonable".
Mr Clayton had two contentions in regard to the jurisdiction
question.
21 Mr Clayton contended firstly that the proposed patio effectively
constitutes an alteration to Lot 1 and should therefore be treated as a de facto merger of common property into Lot 1. He relied on the matter of The Owners of Millpoint Strata Plan 11391 & Ors [2007] WASAT 9 par 43 in support of his contention. The Tribunal does not accept this contention. There is no comparison between the proposal submitted by Mr Hopkins and the facts in the Millpoint matter. In the Millpoint matter an owner had enclosed a common property balcony into his lot. Mr Hopkins is not proposing to enclose the patio or to do anything that would in effect make the patio part of his lot. It is clear from the drawings that, if the patio is approved, it would be attached to the lot (building) from a structural perspective, but would for all practical purposes remain separate from it and part of the common property. The mere adding of the patio over a portion of common property does not change the legal status of it as being common property. Senior Member Raymond observed in the Millpoint matter as follows:
"This case differs markedly from the more common situation in which an owner carries out unauthorised improvements to common property, because alterations of that type do not alter the lot itself." (par 43) (Tribunal emphasis).
The Tribunal is satisfied that the type of alteration being proposed by Mr Hopkins, does not constitute an alteration of Lot 1 itself.
[2007] WASAT 255
23 Mr Clayton contended secondly that an owner who seeks to effect
alterations to common property, must do so by means of an exclusive use by-law pursuant to s 42(8) ST Act. He relied on the matter Maber & Anor and The Owners of Strata Plan 11391 [2007] WASAT 99 (par 29) in support of his contention. The essence of his submission is that the type of alteration proposed is to grant exclusive use rights to Mr Hopkins; that it does not fall within the general powers of the strata company pursuant to s 35 ST Act; and that the application should therefore be dealt with by way of a by-law. The Tribunal does not accept the contention of Mr Clayton. The facts in the Maber matter were such that the applicants sought to enclose a balcony in a manner that would have constituted nothing short of giving them exclusive use of the area and making it effectively part of their lot. That is not what Mr Hopkins is proposing. It must also be noted that, in the Maber matter, Deputy President Chaney specifically commented as follows on the availability of s 85 of the ST Act for purposes to effect alterations to common property:
"… The failure by the strata company to approve the making of the by-law in the terms proposed does amount to a refusal of consent to a proposal by a proprietor which is capable, if found to be unreasonable, of triggering the Tribunal's jurisdiction to make an order under s 85." (at par 35)
24 Deputy President Chaney clearly envisaged that, in the appropriate
circumstances, an application for the alteration of common property could be dealt with pursuant to s 85 of the ST Act, even if such an alteration were only for the benefit to a single proprietor.
25 The Tribunal finds that an alteration of common property in the
manner proposed by Mr Hopkins, is capable of being dealt with under s 85 of the ST Act. Mr Hopkins is not seeking to have exclusive use rights to a portion of common property. He wants approval to alter the common property in a way that would increase his enjoyment thereof. Legally, his position would remain the same in regard to the way he may use the common property. Nor does he want to include the area, the subject of the proposed patio, into his lot. The strata company is therefore empowered to consider and approve the request to erect the patio.
26 This finding of the Tribunal is consistent with the way in which
Mr Clayton has in the past obtained approval to enclose the common property parking bay of which he now has the de facto exclusive benefit. As admitted by Mr Clayton in his written submissions and in evidence, he requested and received oral permission from the previous owner of Lot 1
[2007] WASAT 255
to enclose the common property parking area without the need to register a by-law to that effect. Both parties also have sheds on their respective areas of common property and those are not the subject of exclusive use by-laws. There is no difference between the type of alteration Mr Clayton brought about when he enclosed the carport, and the approval that is now sought by Mr Hopkins.
The Tribunal therefore finds that it has jurisdiction to deal with the application under s 85 of the ST Act.
Has approval been unreasonably withheld?
28 In considering the reasonableness of the refusal to approve
Mr Hopkins' application, the Tribunal must take into account the interests of both parties. A balance has to be struck between the interests of Mr Clayton and the interests of Mr Hopkins. It is ideal for the interests to be harmonised but that is not always possible.
29 The , recognises that each proprietor has an undivided share, in
proportion to his lot entitlement, in common property. Being an owner of common property, each proprietor is entitled to be involved in any decision affecting the common property.
30 The involvement of owners in matters affecting common property
can be affected through various means, for example consideration of a budget and raising of levies for general control and management of common property (s 35 ST Act); an application for an exclusive use by-law (s 42(8), ST Act); an application for a licence to use common property for a certain purpose (s 94, ST Act); and an application to alter common property (s 85 ST Act).
31 Section 85 of the ST Act empowers the Tribunal to consider the
reasons for refusal of the strata company and to determine whether such reasons were reasonable or not. The Tribunal must be slow to intervene in the way in which proprietors manage a strata company and make decisions regarding the use of common property. The strata company has autonomy to make decisions in a manner that it believes, serve the interests of the complex. At the same time, however, Parliament clothed the Tribunal with the power to consider the merit of decisions of a strata company when it comes to making alterations to common property, in order to protect an individual proprietor against the unreasonable refusal by a strata company.
[2007] WASAT 255
32 The ST Act does not define what is meant by "unreasonable". The
Macquarie Concise Dictionary defines "unreasonable" as "not agreeable to or willing to listen to reason" and "not based on or in accordance with reason or sound judgement". (Macquarie University, 2004).
33 In the matter of Maber & Anor and The Owners Of Strata Plan 11391 [2007] WASAT 99 (S) (par 26), the Tribunal made the following observation in regard to what constitutes "unreasonable refusal".
"There is no guidance under the ST Act as to what amounts to unreasonable refusal. All lot owners have a proprietary interest in common property as tenants in common. There is a requirement under s 35(1)(b) of the ST Act that common property be managed for the benefit of all proprietors. What amounts to unreasonable refusal will depend on the facts of each case. It must, however, be judged in its legislative context ... Therefore, as long as the reasons for refusal by the respondent are cogent when judged in this context, this Tribunal should be slow to find there has been an unreasonable refusal."
34 In the matter of Burns and The Owners Of Observation Rise Strata Plan 24414 [2006] WASAT 17 (par 34 and par 35) the Tribunal found that a strata company had unreasonably refused permission for an air-conditioner to be installed. The Tribunal observed as follows:
"The impact that the air-conditioner the subject of this application would have on the external appearance of the complex is far less intrusive than the unbearable heat and discomfort that Ms Burns has to suffer in her apartment. Perth is known for the harshness of its summers and in particular the build-up of heat in rooms that face the glaring afternoon sun. It is generally accepted that rooms along the coast that face in a westerly direction require some form of air-conditioning to make them habitable.
The Tribunal finds that the refusal of the strata company and the seven proprietors to approve the application to install an air-conditioner was unreasonable. It is completely reasonable for Ms Burns to be given approval to install an air-conditioner in an attempt to ameliorate the impact of the heat on the bedroom."
[2007] WASAT 255
The reasons raised by Mr Clayton must therefore be balanced against the justification for approval as set out by Mr Hopkins.
36 The test for the Tribunal to apply is not merely if it would come to a
different conclusion in regard to the same facts. It is obvious that many decisions are made within strata schemes where an external person may come to a different conclusion. But having a difference of opinion is not sufficient to overrule the decision of a strata company on the ground of "unreasonableness".
37 The Tribunal must apply a higher test, namely that it must be
satisfied that Mr Clayton's refusal was "unreasonable". The nature of his concern and the facts, if any, upon which his refusal is based must therefore be taken into account in order to determine if the refusal is unreasonable.
Mr Clayton's objections can be categorised into two clusters of concerns: nuisance and aesthetics.
39 The concerns raised by Mr Clayton regarding nuisance are that the
area may be used for parking, car fumes may escape into Lot 2; the build- up of heat under the roof would affect Lot 2; and noise from the undercover area would become more audible in Lot 2 due to the roof serving as an amplifier.
The Tribunal finds these concerns as a basis for refusing the application, to be unreasonable for the following reasons:
• The design of the patio is such that is complies with all the planning and building requirements of the local authority. The City of Swan has already given building approval for the patio. The City is therefore satisfied that the construction of the patio is such that it would be in compliance with general building standards, and in particular that it complies with the Building Code of Australia. • The patio would be erected in a manner that is consistent with other patios of private residences and other strata complexes in the City of Stirling. There is no evidence that similar patios have caused an increase of noise, odours or heat in neighbouring properties to the level alleged by Mr Clayton. [2007] WASAT 255
• The patio would, most importantly, be compliant with the prescribed distance from the common dividing fence (500mm). Mr Hopkins is not seeking approval to construct the patio closer to the dividing fence than is normally the case. He is in full compliance with the distances specified by the City. Thousands of households in Perth in general, and the City of Stirling in particular, would have neighbours with patios that are the same distance from the common fence. • Although there may be some elements of noise or odours observable from a neighbouring property, it is in the very nature of urban living, small blocks and strata units that people live close to each other. One has to demonstrate tolerance towards the right of neighbours to enjoy their life and property. The mere fact that a noise originating in a neighbouring lot may be audible, does not equate with the right of absolute veto over any alterations to common property.
41 The concerns of Mr Clayton that he would suffer from an increase in
odours of BBQ's, noise from Mr Hopkins guests; noise and fumes from a car starting; and heat that may escape from the patio, are not supported by evidence and seem to be oversensitive. His refusal to approve the application of Mr Hopkins to erect a patio over an area of common property for reasons of potential nuisance, is unreasonable.
42 The second cluster of concerns raised by Mr Clayton relates to the
aesthetics of the lots and buildings. His concern is that the patio roof would be visible from Lot 2, that it would not be in keeping with the current structure and colour scheme, and that it would affect the general appearance of the two lots.
The Tribunal finds these concerns as a basis for refusing the application, to be unreasonable for the following reasons:
• The patio will have a flat roof and the part of the structure that is visible from Lot 2 would be minimal. Mr Hopkins redesigned the roof in order to minimise the visual impact of the patio. The roof will be visible from Lot 2 but given the fact that it is flat, the impact on the owner of Lot 2 would be minimal. [2007] WASAT 255
• The patio is not dissimilar to thousands of similar patios erected in Perth to give occupiers of residences more enjoyment of their outdoor living opportunities. The Perth summers are hot and the winters are rainy, and it therefore makes sense to erect a patio for outside enjoyment. • The patio would affect the symmetry of the lots, but account must be taken that (a) the patio does not face the street; (b) it would form part of the backyard of the lots; and (c) it is not exceptional in its design. Many houses and strata units provide for a similar type of undercover area. The slight asymmetry is therefore outweighed by the use and benefit of a structure. • The visual impact that the patio would have on the external appearance of Lot 1, is far less intrusive than the heat and discomfort that Mr Hopkins has to suffer due to not being able to properly use the outside entertainment area. • As pointed out by Mr Hopkins, the colour scheme would be as close as possible to the existing scheme to ensure the best possible match.
44 The Tribunal therefore finds that the refusal of Mr Clayton to
approve the application of Mr Hopkins to erect a patio over an area of
common property for reasons of aesthetics, is unreasonable.45 Mr Clayton also raised concerns that the erection of the patio may
bring about additional insurance liabilities. The Tribunal notes, however, that the parties already have their own insurance for their lots and for other structures on common property that are used by them, that is, each has a shed. Mr Hopkins has also indicated his willingness to include the patio in his insurance.
Finding
46 The Tribunal finds, pursuant to s 85 of the ST Act, that the strata
company has, through the refusal of Mr Clayton, unreasonably refused consent to the proposal by Mr Hopkins to effect an alteration of common property by erecting the proposed patio. The Tribunal should therefore make an order that the strata company consent to the proposal.
[2007] WASAT 255
Orders
1. The application succeeds.
2. The Strata Company grants approval for Mr Hopkins to erect, as per the submitted plan, a patio on the condition that he must insure the structure.
I certify that this and the preceding [46] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
___________________________________
DR B DE VILLIERS, MEMBER
9
0
2