Moss and the Owners Of Bijou Marina Village Strata Plan 36747 & Others
[2005] WASAT 180
•20 JULY 2005
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL
STREAM: COMMERCIAL & CIVIL
ACT: STRATA TITLES ACT 1985 (WA)
CITATION: MOSS and THE OWNERS OF BIJOU MARINA VILLAGE - STRATA PLAN 36747 & OTHERS [2005] WASAT 180
MEMBER: MR T CAREY (MEMBER)
HEARD: 17 MAY 2005
DELIVERED : 20 JULY 2005
FILE NO/S: CC 508 of 2005
BETWEEN: GEOFFREY JOEL MOSS
Applicant
AND
THE OWNERS OF BIJOU MARINA VILLAGE - STRATA PLAN 36747 & OTHERS
Respondent
Catchwords:
Real property - Strata titles - Bylaws of strata company prohibiting use of lot in contravention of a law or requirement of local government of other authority - Whether prohibition extended to Town Planning Scheme requirements - Whether use of lots for shortterm rental contravened Scheme - Whether use "tourist accommodation" - Strata Plan 36747
Legislation:
Shire of Busselton District Town Planning Scheme No 20
Strata Titles Act 1985 (WA), s 5C, s 35(1), s 42, s 81(3), s 83(1), s 83(4)
Town Planning and Development Act 1928 (WA), s 7
Result:
Application successful
Orders made under s 81(3) Strata Titles Act 1985 (WA)
Category: B
Representation:
Counsel:
Applicant: Ms R Lee
Respondent: Ms L Price
Solicitors:
Applicant: Peter Bogue
Respondent: Anderson Kershaw
Case(s) referred to in decision(s):
Moss and Owners of Bijou Marina Village – Strata Plan 36747 & Others [2005] WASAT 107
Case(s) also cited:
Nil
REASONS FOR DECISION OF THE TRIBUNAL:
Summary of Tribunal's decision
The applicant is the owner of a lot in a strata development in which a number of other owners has used their lots for letting to short‑term tenants. By‑laws of the strata company prohibit use of lots in a way that contravenes local or other government requirements governing usage of land or causes a nuisance or interference with the use and enjoyment of others. The applicant claimed that the use by a number of owners of their lots breached the by-laws and sought orders restraining such breaches. The respondents contended that the by-laws did not incorporate breaches of the town planning requirements, that, if they did, the respondents had not been shown to have breached them, and that the Tribunal should not in any event engage in the de facto enforcement of planning requirements.
The Tribunal found that the planning requirements had been incorporated into the by‑laws of the strata company and that the respondents intended their lots to be used in a way that breached those requirements. Therefore, the applicant was entitled to orders in substantially the form of those sought, but expressed so as to take account of the planning scheme and the use of lots giving rise to the applicant’s complaints.
Strata plan
Strata plan 36747 ("the plan") was registered on 1 September 1999 pursuant to the Strata Titles Act 1985 (WA) ("the Act"), which continues to be the relevant Act.
Parcel
The parcel, known as "Bijou Marina Village" is situated at lot 589 Spinnaker Boulevard, Port Geographe, Busselton. When first registered, the plan comprised 36 lots. Subsequently, 19 lots were converted to common property. The remaining 17 lots have had what are described as "villa units" constructed on them.
The applicant
The applicant has owned lot 14 since 19 February 2004. He gave evidence that he purchased the property initially for the purpose of his daughter living there, which she did for approximately six months. Since then, the applicant, who shares his time between Perth, Busselton and overseas, has used his lot as his home where he generally spends at least two nights a week and holidays.
Application
In his application, filed on 18 February 2005, the applicant sought the following orders under s 83(1) of the Act:
"1. The proprietors of units 1, 2, 3, 4, 6, 10, 11, 12, 13 and 15 of Bijou Marina Village refrain from advertising that their units are available for lease and refrain from entering into lease agreements for short-stay or holiday accommodation.
2. The proprietors of units 1, 2, 3, 4, 6, 10, 11, 12, 13 and 15 of Bijou Marina Village be required to terminate or cancel any current lease agreements for short-stay or holiday accommodation and to take all steps necessary to ensure that any tenants vacate within 14 days of making this order."
The proprietors of "Unit 9" were joined as respondents during the course of the proceedings and the same orders are sought against them. A third order, that the strata company enforce its by‑laws in relation to the matters raised in proposed orders 1 and 2, was not pursued at the hearing.
The application sought interim as well as final orders. On 11 March 2005 I made an interim order under s 82(2) of the Act that the proprietors of all units in the scheme refrain from advertising that their units are available for lease on a short‑stay or holiday accommodation basis and from entering arms‑length lease agreements for short‑stay or holiday accommodation – see Moss and Owners of Bijou Marina Village – Strata Plan 36747 & Others [2005] WASAT 107. On 10 June 2005, I renewed the interim order, with the effect that the operation of the order continued until the making of final orders.
In summarised form, the grounds for the application were that there has been, and, unless the specified owners are restrained in the way sought, there will continue to be, breaches of the strata company's by‑laws by the use of their lots for "short‑stay and/or holiday accommodation", which is not a permitted use under the Shire of Busselton District Town Planning Scheme No 20 ("Town Planning Scheme"). Further, the by‑laws were said to have been breached in various respects by conduct attributable to the non‑permitted user amounting to a nuisance to (among others) the applicant.
By-laws
At the time of registration of the plan, a management statement was lodged pursuant to s 5C of the Act. Upon registration of the management statement, the by‑laws set out in the statement are regarded as by‑laws made by the strata company under s 42 of the Act: s 5C(5) of the Act.
The management plan provided for the adoption of the by‑laws in Sch 1 and Sch 2 in the management statement. The following provisions in Sch 1 are relevant to the application:
"2. Proprietors and occupiers
2.A proprietor, occupier or tenant of a lot shall –
(a)use and enjoy the common property in such a manner as not unreasonably to interfere with the use and enjoyment thereof by other proprietors, occupiers, or tenants, or their visitors; …
(c)take all reasonable steps to ensure his or her visitors do not behave in a manner likely to interfere with the peaceful enjoyment of the proprietor, occupier or tenant of another lot or of any person lawfully using common property …"
The following provisions in Sch 2 of the management statement are relevant:
"1. Use of lots
No lot be used for any purpose that contravenes any by-law of the Strata Company or requirement or by-law of the local government authority and any other authority that may have jurisdiction over the use to which a lot may be put.
2.Behaviour of proprietors, occupiers and tenants within the scheme
A proprietor, occupier or tenant of a lot shall not:
(a)use any lot or part of the common property for any purpose which may be a breach of any Strata Company by-law applying to the scheme, any local government authority regulation or by-law, or any other government and regulating authority law…
(m)use language or behave in a manner likely to cause offence or embarrassment to the proprietor, occupier or tenant of another lot or to any person lawfully using common property …"
The application also referred to Sch 2 by‑law 22 which is concerned with the regulation of the pool area.
Town Planning Scheme
The parcel comes within the Town Planning Scheme which is given the force of law by s 7 of the Town Planning and Development Act 1928 (WA).
Features of the Town Planning Scheme include:
(a)In respect of land (such as the parcel) zoned residential, the permitted use classes are "home occupation", "recreation area" and "single house".
(b)"Tourist accommodation" is a non‑permitted use on residential zoned land. Tourist accommodation is defined to mean:
"a building or group of buildings substantially used for the temporary accommodation of tourists, visitors and travellers which may have facilities for the convenience of patrons such as restaurants, convention areas and the like…."
(c)Any person proposing a change in use of land is required to first apply for and obtain the planning consent of the council.
Evidence – applicant
In relation to the alleged unlawfulness of use of individual lots, the applicant relied upon the following documents:
(a)Facsimile dated 18 June 2004 from Barry Payne, Customer Services Officer of the Shire of Busselton, which advised that:
(1)the parcel was zoned "Residential R20" under the Town Planning Scheme;
(2)given the zoning, "Short Stay Tourist accommodation" is a non-permitted use. This is an assessment with which the respondents take issue; and
(3)there are no agreements or approvals in place to allow any short-stay or holiday accommodation use of the land.
(b)Facsimile dated 14 February 2004 on the letterhead of "The Tides Port Geographe Marina Tavern and Restaurant" of 21 Spinnaker Boulevard, Busselton, advising of the availability of "Bijou units for the period the 17th to 23rd June" and nominating units 1, 3, 4, 11, 12, 13 and 15, and possibly unit 2.
(c)Print out of a website of Port Geographe Waterside Villas, of 21 Spinnaker Boulevard Busselton, advising of the availability for holiday leasing of "Bijou Villas."
(d)Brochure titled "Port Geographe Waterside Villas" providing generic information.
(e)Print out from website of Geographe Bay Yacht Club advertising a yachting regatta during the period 25 February 2005 to 4 March 2005 advertising the "Bijou Villas" as available accommodation and providing a link to Port Geographe Villas' website.
(f)Letter from Ravensthorpe Nominees Pty Ltd ("Ravensthorpe") which advises that Ravensthorpe manages Villas (lots) 1, 3, 4, 11, 12, 13 and 15, in the cases of Villas 1, 11, 12 and 13 pursuant to a signed "Unit Management Agreement" ("UMA").
(g)Pro‑forma and signed UMAs.
The applicant relied particularly on the following provisions (references are to provisions as they appear in the pro‑forma agreement):
Recital B:the owner has agreed to appoint Ravensthorpe as the booking agent of the unit for the purpose of allowing Ravensthorpe to rent the unit to third parties subject to the terms and conditions of the UMA;
Clause 2:whereby the owner appoints Ravensthorpe as booking agent of the owner's lot "with the sole exclusive right to rent the Unit for the purpose of short‑stay accommodation" for the term referred to in the Schedule;
Clause 5.1:requiring that the unit only be rented for the purpose of "Short‑Stay Accommodation";
Clause 13:whereby the owner acknowledges that Ravensthorpe rents other lots for holiday accommodation, and Ravensthorpe agrees not to discriminate between owners of lots;
Clause 14:whereby Ravensthorpe covenants to take all reasonable steps to promote and advertise lots for rent.
The following clauses are relevant to the question of the owners' own use of their lots:
Clause 4:whereby Ravensthorpe is to endeavour to make the lot available for the use by the owner unless rented or booked, but Ravensthorpe is under no obligation to make the lot available for owners save for times referred to in the Schedule.
Clause 34:permitting the owners or their family to occupy their lot from time to time, provided it has not previously been booked by Ravensthorpe, which is to be advised of dates required by the owners in advance.
Item 2 in the "additional provisions" included in the Schedule to the UMA, which is applicable by reason of cl 32, provides for an agreed performance target for annual return of gross rental of $13 000.
(h)Profit and loss statements issued by Ravensthorpe for the following periods:
July 2004 – April 2005 – showing the following gross rentals:
VillaAmount
1$10 401.18
3$11 276.17
4$11 906.17
11$18 790.17
12$19 447.17
13$14 281.17
15$10 870.17
May 14 2004 – June 30 2004
Amounts for each of the same villas shown varying between nil dollars and $1352.
(i)Owners' rental statements issued by Ravensthorpe and its predecessor, Geographe Holiday Rentals, in respect of the same lots and, in addition, lots 2, 6 and 10.
(j)Letter from Kevin Claffey, the part‑owner of lot 9, to his solicitors, which advises, "commercial short‑term rentals August 13, 2004 to June 30, 2005 totalling 27 nights", together with documents evidencing rental activity in relation to the lot.
(k)Individual owner records of advertising, rental bookings and rental income received.
The records of current bookings indicate two future bookings only in relation to lot 9 in December 2005/January 2006 (and a possible booking of lot 2 for May 2005), which tends to demonstrate the respondents' compliance with the interim order.
In relation to the claim of nuisance, the applicant relied upon oral evidence of Paul Clark, who was the owner of lot 17 but recently sold, on his evidence, "because it was too hard living with short‑term tenants". The applicant also gave evidence designed to demonstrate a pattern of unruly behaviour beyond the bounds of acceptable limits in a residential complex and which he attributed to the fact that lots were being rented out on a commercial basis to short‑stay tenants. For reasons which will become apparent it is not necessary to go into the detail of the conduct complained about.
Evidence – respondents
I will for the balance of these reasons use the expression "respondents" to refer to all respondents bar the first respondent, who did not appear at the hearing. Those respondents (being the owners of lots 1, 2, 3, 4, 6, 9, 10, 11, 12, 13 and 15) were represented by the same solicitors and counsel.
In relation to both the unlawful use and nuisance issues, the respondents relied upon a series of correspondence to which the strata manager was a party and minutes of an annual general meeting of the strata company on 25 February 2005, as evidence that the strata company had embarked on a course of action in response to the applicant's complaints. That course of action involved setting up a working committee, circulating to owners a copy of the by‑laws relating to behaviour, closure of the swimming pool during the winter months, barring short‑term stays during "schoolies" weekend and erection of signs indicating that skateboarding is prohibited.
The respondents relied upon a letter dated 24 January 2005 from a senior planner with the Shire of Busselton to the applicant. The letter advised that under the Town Planning Scheme, the letting of dwellings, whether single houses or grouped dwellings, for unsupervised short stay accommodation would fall under the "Tourist accommodation" use class which is prohibited on residential zoned land. Again, this is not an assessment with which the respondents agree. However, they do rely upon advice in the letter that the Shire had not taken compliance action against the proprietors who lease their lots for tourist accommodation. The letter referred to the "difficulty" with compliance action and unsuccessful prosecution action, including problems with obtaining evidence and differing interpretations of provisions and definitions of the Town Planning Scheme.
The respondents produced a schedule setting out the number of nights per month from May 2003 until January 2006 for which each of the lots has and will be rented out. The accuracy of the schedule was not the subject of dispute, and I am prepared to accept its accuracy. Typically, the schedule shows a bunching of frequency of tenant occupancy between December and March, when readings of between 10 and 25 rented days are typical, with much lower, or non‑existent tenancies for the remaining months.
Submissions – applicant
The applicant submitted that by reason of the parcel's residential zoning under the Town Planning Scheme, the only three permitted uses of land in the parcel (in the absence of a relevant approval) are home occupation, single house and recreation area. To the extent that any lot is being used for short‑stay or holiday accommodation, it therefore contravenes the Town Planning Scheme.
Although on the applicant's argument it was not necessary for him to go that far, he submitted that the requirements for the prohibited use of "tourist accommodation" were satisfied on the evidence. None of the respondents lives in his or her respective lots, and in all but one case, management of the lot has been placed at least to some extent in the hands of Ravensthorpe. Under the definition of "tourist accommodation", the intention of the owners (as distinct from the rate of success) is crucial, and the evidence indicated, in general, an intention to rent the lots out whenever a willing tenant was available. The "high water mark" for the argument was in those cases where owners have entered into the UMA. In all but one of the remaining units, Ravensthorpe has been used as booking agent, and there is no qualitative difference in those cases. In the case of lot 9, the evidence established the requisite intention of the owner.
On the issue of nuisance, the evidence established, firstly, numerous examples of conduct in breach of the by‑laws referred to under "By‑laws" above, and secondly, that the perpetrators were generally the "short‑stayers" and their friends rather than lot owners. The actions being undertaken, since the issue of the application, at strata company level was an acknowledgement of the existence of the problems.
Submissions – respondents
The respondents made the following submissions in support of their claim that the use of the lots for short‑term rentals from time to time is not illegal and/or not in breach of the strata company's by‑laws:
(a)The Shire of Busselton is entrusted by the Town Planning and Development Act 1928 (WA) with the function of taking enforcement action for breaches of the Town Planning Scheme. As such, that is not a function of the strata company, nor of the Tribunal "standing in the shoes" of the strata company.
(b)Given that where the Shire has declined to take enforcement action, it would be an excessive use of power by the strata company or the Tribunal to effectively enforce the provisions of the Town Planning Scheme.
(c)A balancing of the following factors is required:
• extent of short‑stay use.
• nature of complaints.
• interests of all owners.
• the strata company's response.
(d)The strata company's by‑laws do not preclude short‑stay use of lots, because the operation of the Town Planning Scheme as part of the Town Planning and Development Act 1928 (WA) means that it is not "a local government requirement" and is not otherwise caught by cl 1 and cl 2(a) of Sch 2 of the management statement.
(e)There is no such use under the Town Planning Scheme as "short‑stay accommodation", but rather "tourist accommodation". The demonstrated uses do not satisfy the definition of "tourist accommodation" because the levels of actual use of the lots is insufficient for the requirement of substantial use, and the parcel includes none of the facilities referred to the definition.
(f)On the nuisance issue, the applicant had failed to clearly identify who was causing the problems, and could not exclude the possibility that they were caused by friends or relatives of owners or members of the public coming on to the complex. In any event, the response of the strata company was adequate and appropriate and the working committee which had been set up should be permitted to do its work.
The applicant made submissions in reply to the respondents' submissions. Those submissions will be referred to, to the extent that is necessary, in the "Consideration" part of these reasons.
Subsequent to the hearing, the respondents' solicitors provided the Tribunal with a copy of parts of a resolution by the Shire of Busselton at its meeting on 8 June 2005 to amend the Town Planning Scheme in the following respects:
(a)to amend the "Zoning Table" by including "home holiday accommodation" as a use class and a permitted use in the case of land zoned "residential". The definition of "home holiday accommodation" to be inserted in the schedule of interpretations refers to "a dwelling …used for the purpose of over night or holiday accommodation on a short‑term basis"; and
(b)that "short‑stay tourist occupation" of grouped residential dwellings be a permitted use under the scheme.
The respondents contend that the passing of the resolution indicates that the Shire is addressing the matter and also suggests that the Town Planning Scheme needs clarification.
Be that as it may, the resolution for the proposed amendment to the Town Planning Scheme is just that – a proposal, which may or may not ultimately succeed in its current form or after amendment. It does not have the status of a seriously entertained planning proposal. As such, it is not a sufficiently advanced proposal to have an effect on the determination of the application.
Consideration
In my view, the evidence demonstrates a purpose on the part of all the respondents to use their lots for commercial gain by renting them out, generally, to as large an extent as possible. Those owners who were party to the UMA with Ravensthorpe authorised Ravensthorpe to act as booking agent, and to rent their lots "for the purpose of short‑stay accommodation", to quote the UMA. Although owners have a right of occupancy from time to time, that right is provisional on there being no previous booking by Ravensthorpe for the desired time.
In relation to those lots whose owners have not signed UMAs, a number of them is nonetheless managed by Ravensthorpe. Only one lot, lot 9, has not been managed at all by Ravensthorpe, but its owners admit that their lot was used for commercial short‑term rentals for 27 nights from August 2004 to June 2005.
I reject the respondents' submissions regarding the relationship between the Town Planning Scheme and its legislative enforcement regime, on the one hand, and the by‑laws of the strata company, on the other. I consider the wide language adopted by by‑laws 1 and 2(a) in Sch 2 has the effect of catching the use of a lot in contravention of the Town Planning Scheme. The strata company's by‑laws prevent owners from using their lots for any purpose which contravenes any applicable law or requirement regarding the use to which they may be put. This must in my view include the Town Planning Scheme.
I also reject the contention that some usurping of the function of the Shire of Busselton is involved in finding that a breach of the Town Planning Scheme can also be a breach of the strata company by‑laws actionable by the strata company or, as in this case, an owner. The rules by which the strata company operates compel such a finding. The Shire of Busselton is entitled to enforce the Town Planning Scheme as it sees fit. The strata company, on the other hand, has used all applicable laws or requirements, which, as I have found, include the Town Planning Scheme, as an identifier for the acceptable use of lots in the strata scheme. The relevant question is whether or not the Town Planning Scheme has been breached by the manner of use of any or all of the respondents' lots. Nor is it to the point that, for various reasons, the Shire has declined to take enforcement action in relation to the same factual circumstances.
The applicant argues that all the respondents have used their lots for the purpose of short‑stay rental accommodation, which is a non‑permitted use. The respondents see the matter in terms of whether or not the definition of "tourist accommodation" is satisfied, and submits that it has not been. The respondents also made what I consider to be an erroneous reference to the parcel as a "grouped dwelling being put to residential use", which has not assisted in reaching a conclusion one way or the other.
I have reached a finding in the case of each of the respondents, based on the relevant evidence, that the respondent has used its lots for a non‑permitted use, that use being, to adopt the language in the UMA, "short‑stay accommodation". I agree with the respondents that such a use is not a use class listed in the zoning table in the Town Planning Scheme. However, it does provide a useful short hand description for the actual use. I accept the submission of the applicant that it is sufficient for him to establish a use which does not fall within the three permitted uses, and it is not necessary to go so far as establishing that the definition of "tourist accommodation" is satisfied.
In any event, based on the evidence provided in relation to each of the respondents, I find that the user of all respondents' lots does satisfy the definition of "tourist accommodation" under the Town Planning Scheme, and therefore that the respondents have breached the Town Planning Scheme by using their lots for a prohibited use. I agree with the applicant's submissions on this issue. In particular, I agree that the intention or design of the owners in respect of their lots is the crucial factor, and that design has in all cases been to rent out the premises "for the temporary accommodation of tourists, visitors and travellers", generally through the agency of Ravensthorpe, and generally whenever a willing tenant can be found. The fact that there is none of the facilities such as restaurants, convention areas and the like which are referred to in the definition is not fatal to satisfaction of the definition.
I accept that the evidence discloses some variations between owners who are not party to a UMA regarding reservation of lots for their own or relatives'/friends' use, but this does not discount the fact that each of them has the use identified in the "tourist accommodation" definition as a significant, or "substantial" use of their lots when the pertinent question of intention or design is considered.
In light of my findings on the issue of unlawful use, it is not necessary for me to determine the applicant's claims in relation to nuisance.
Comments on orders sought and made
The applicant sought relief under s 83(1) of the Act, "in rectification of a complaint …with respect to…the failure to exercise or perform a duty…imposed by…the by‑laws on the respondents". Although an argument was made on the respondents' behalf that no order could be made under s 83(1) because s 83(4) applied, the findings I have made preclude the application of that sub‑section. Section 81(3) of the Act provides a specific basis for the orders that I make.
In formulating the Tribunal's order, the "tourist accommodation" definition has been the corner‑stone. This is for two reasons. Firstly, the order will be more readily understood and enforced where it corresponds with the framework of use classes for which provision is made in the Town Planning Scheme. Secondly, the adoption of a term such as "short‑stay or holiday accommodation" might expose the owners to enforcement action for alleged contraventions in respect of isolated incidents far removed from the circumstances giving rise to the applicant's complaint. Those circumstances are the systematic letting of lots on a short‑term basis to paying customers. Section 81(1) of the Act authorises an order expressed in terms different from that sought so long as it does not differ in substance.
The second of the Tribunal's orders, requiring the termination or cancellation of current lease agreements, will on the evidence provided have a very limited impact on third parties. In any event, the order is warranted by the history of non‑compliance by the respondents with the strata company's by‑laws.
Orders
The Tribunal makes the following orders:
1.Pursuant to s 81(3) of Strata Titles Act 1985 (WA), the proprietors of units 1, 2, 3, 4, 6, 9, 10, 11, 12, 13 and 15 of Bijou Marina Village refrain from advertising that their units are available for lease and refrain from entering into lease agreements for the temporary accommodation of tourists, visitors and travellers.
2.Pursuant to s 81(3) of the Strata Titles Act 1985 (WA), the proprietors of units 1, 2, 3, 4, 6, 9, 10, 11, 12, 13 and 15 of Bijou Marina Village be required to terminate or cancel any current lease agreements for the temporary accommodation of tourists, visitors and travellers.
I certify that this and the preceding [43] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MR T CAREY, MEMBER
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