Nulama Village Pty Limited v Donald Francis Rannard
[2010] NSWDC 46
•19 March 2010
CITATION: Nulama Village Pty Limited v Donald Francis Rannard & Ors [2010] NSWDC 46 HEARING DATE(S): 23/2/10 and 19/3/10
JUDGMENT DATE:
19 March 2010JURISDICTION: Civil JUDGMENT OF: Rolfe DCJ DECISION: See para 84 of Judgment CATCHWORDS: Appeal from CTTT - Consideration of Community Management Statement and relevant by-laws made under Community Development Land Act 1989 - Application to CTTT to revoke certain by-laws pursuant to the Community Land Management Act 1999 - Proper characterisation of by-laws - whether delegated legislation or statutory contract - Application of common law principles of contractual interpretation - Whether CTTT made errors of law in its application of s 80 of the Community Land Management Act 1999 Meaning of "best interest" - Obligation to act according to equity and in good conscience required objective examination of surrounding circumstances - Consideration of whether a particular by-law was unworkable. LEGISLATION CITED: Community Land Management Act 1999 (NSW)
Uniform Civil Procedure Rules 2005
Crimes (Appeals & Review) Act 2001
Community Development Land Act 1989 (NSW)
Strata Schemes (Freehold Development) Act 1973CASES CITED: Riana Pty Limited v The Owner Strata Plan No. 22336 (2007) NSW SC 1033
Currabubula Holdings Pty Limited v State of New South Wales (2000) NSW SC 232
Neighbourhood Association DP 285249 v Watson (2008) NSW SC 876
The Owners of Strata Plan No. 3397 v Tate (2007) 70 NSWLR 344
One-Tel Ltd v Australian Communications Authority (2001) 110 FCR 125
North Wind Pty Ltd v Proprietors - Strata Plan 3143 (1981) 2 NSWLR 809
National Roads and Motorists Association Limited v Parkin (2004) 60 NSWLR 224
Toll (FGCT) Pty Limited v Alphafarm Pty Limited (2004) 219 CLR 165
Kalokerinos & Or v HIA Insurance Services Pty Limited (2004) NSW CA 312
Bahadoriv v Permanent Mortgages Pty Limited (2008) 72 NSWLR 44
Owners of Strata Plan 41100 v Penda & Sons Pty Limited (2009) NSW DC 59
Secretary, Department of Health and Community Services v JWB & SMB (Marion's case) (1992) 175 CLR 218
Equiticorp Finance Limited (In Liq) v Bank of New Zealand (1993) 32 NSWLR 50PARTIES: Nulama Village Pty Limited (Plaintiff, Applicant)
Donald Francis Rannard (1st Defendant, Respondent)
Community Association DP270210 (2nd Defendant)
Consumer Trader & Tenancy Tribunal (3rd Defendant)FILE NUMBER(S): 165/10 COUNSEL: B DeBuse (Plaintiff, Applicant)
C D Freeman (1st Defendant, Respondent)
Submitting Appearances filed (2nd & 3rd Defendants)
JUDGMENT
1 By an Amended Summons Commencing an Appeal filed on 12 May 2009 the plaintiff, Nulama Village Pty Limited, seeks an order setting aside the orders of the Consumer Trader & Tenancy Tribunal (“CTTT”) in proceedings SCS 08/01841 made on 14 October 2008.
2 The orders appealed from were made by the CTTT under s 80 of Division 4 of the Community Land Management Act 1999 (NSW) (the “Management Act”).
3 The first defendant in these proceedings is Donald Francis Rannard, the applicant in the CTTT Proceedings. The second defendant is Community Association DP 270210 (the “Community Association”). The third defendant is the CTTT.
4 Save as to costs, the second defendant and the third defendant have filed submitting appearances.
5 The plaintiff brings its Appeal pursuant to s 108 of the Management Act as a party which made written submissions on the first defendant’s application to the CTTT and also because the plaintiff was a person ordered to refrain from doing a specified act as a consequence of the orders made by the CTTT. There is no doubt therefore that the plaintiff has standing to bring the Appeal: Riana Pty Limited v The Owner Strata Plan No. 22336 (2007) NSW SC 1033.
6 As a starting point, the plaintiff originally filed its summons on 12 November 2008 and was therefore one day out of time in terms of complying with Part 50, Rule 50.3 (a) of the Uniform Civil Procedure Rules 2005.
7 UCPR 50.3 (c) allows the Court to extend the time for the summons to be filed. The first defendant formally submitted that such order ought not be made because he submitted the Appeal was hopeless. In all the circumstances, particularly having regard to what follows in this judgment and the fact that when the plaintiff filed the summons it was only one day late and was also an unrepresented litigant, I propose to extend the time for the filing of the summons by the plaintiff up to and including 12 November 2008, such order being made nunc pro tunc (Currabubula Holdings Pty Limited v State of New South Wales (2000) NSW SC 232 at 87).
8 Under the Crimes (Appeals & Review) Act 2001 (the “Appeal Act”), the plaintiff is entitled to bring this Appeal on a question of law alone: s 52 (1). To the extent that the Appeal involves a question of fact or a question of mixed law and fact, the plaintiff needs leave to appeal and has sought that leave.
9 The background to the appeal is as follows.
10 The property known as Nulama Village is a village for over 55’s and is located at Manning River Drive Taree.
11 In June 2000 the Community Association was constituted under the Community Development Land Act 1989 (NSW) (the “Development Act”) by registration of a community plan. As part of the registration of the community scheme, Community Management statement DP270210 (the “CMS”) was lodged. This was required under s 5 (4) of the Development Act.
12 Before lodgement, the CMS (exhibit B) was executed by Nulama Pty Limited (Receiver and Manager Appointed) (“N Pty Limited”) and Comstone Holdings Pty Limited(“Comstone”). The consent of a mortgagee, Beneficial Finance Corporation Limited (Beneficial Finance”), was evidenced by that company’s execution under seal of the CMS as well.
13 Presently, the relevant parties to the CMS are the Community Association, the owners of the neighbourhood and strata lots within the community scheme and the plaintiff, as managing proprietor of the community scheme.
14 The first defendant, Mr Rannard, is the owner of lot 16 in the strata plan of the community scheme.
15 The plaintiff is also the owner of lots 3-9 in the community scheme and lot 26 of the strata plan within the community scheme.
16 At the time of the hearing before the CTTT, the relevant By-Laws in the CMS were as follows:
“ BY LAW 1 THEME
1.3 The Managing Proprietor shall at the request of the proprietor or occupier of a Neighbourhood or Strata Lot within the Community Scheme provide or arrange for the provision of Support Services to that person.
1.4 Each proprietor or occupier of a lot shall pay the Prescribed Fee to the Managing Proprietor in respect of the provision of Support Services to that person.
1.8 Each proprietor of a Neighbourhood or Strata Lot within the Community Scheme shall, prior to or upon completion of the sale or transfer of that Lot, pay the Prescribed Amount to the Managing Proprietor. The sale or transfer of any such Lot in the Community Scheme shall not be completed unless the Managing Proprietor confirms in writing that the Prescribed Amount has been paid and the Managing Proprietor shall provide such confirmation to a proprietor upon the Prescribed Amount being paid to it or shall provide such confirmation to a proprietor upon completion of sale or transfer upon receipt of a bank cheque providing for payment of the Prescribed Amount.
1.11 This By-Law and By-Laws 20, 21, 29, 36, 37, 38, 39 and 40 of this Management Statement may not be amended or revoked without the written consent of the Managing Proprietor.
BY-LAW 19 - PROVISION OF SERVICES BY COMMUNITY ASSOCIATION
19.1 The Community Association may agree to provide services to the proprietor or occupier of a Lot in accordance with section 22 of the Management Act.
19.2 The Community Association may contract with the Managing Proprietor to provide any service to the proprietor or occupier of a Lot in accordance with this By-Law.
19.3 Persons authorised by the Community Association and the Managing Proprietor shall have access over the Community Parcel for the purpose of providing services in accordance with this By-Law.
19.4 The proprietor or occupier of a Lot shall pay to the Community Association the cost of services provided to that proprietor or occupier in accordance with this By-Law.
19.5 The Community Association may not profit from the provision of any service to the proprietor or occupier of a Lot.
BY-LAW 20 - ON GOING SERVICE CONTRACT
The rights and obligations of the Managing Proprietor which are conferred and imposed by this Management Statement shall commence and become enforceable upon the registration of the Community Plan and, the entitlements and obligations set out in these By-Laws regarding the provision of and payment for Support Services, use of the Community Centre and payment of the Prescribed Amount shall be an ongoing service agreement to which the Managing Proprietor for the time being is a party and which shall not be terminated at the end of the First Annual General Meeting in accordance with section 24 of the Management Act.
BY-LAW 25 - RIGHT TO RECOVER MONEY
The Community Association and the Managing Proprietor may recover any moneys owing to either of them under the By-Laws as a debt.
BY-LAW 29 - LIABILITY OF MANAGING PROPRIETOR
29.1 The Managing Proprietor is not, with respect to use of the Community Parcel for the delivery of Support Services to the proprietors or occupiers of Lots, liable for damage to or loss of property or for injury to any person on or near the Community Parcel due to any cause other than the wilful misconduct, negligence or fraud on the part of the Managing Proprietor or any servant or agent of the Managing Proprietor.
29.2 The Managing Proprietor shall not be required by the By-Laws to provide any Support Service to the proprietor or occupier of a Lot which it may not lawfully provide, and the Managing Proprietor shall not be liable for the failure to provide any such service.
The Prescribed Fee notified by the Managing Proprietor in respect of the provision of a Support Service shall be determined by the Managing Proprietor subject (sic) that any such Prescribed Fee shall not exceed the greater of:-BY-LAW 37 - PRESCRIBED FEE
(b) The rates charged by commercial providers of similar services in the locality.(a) One hundred and twenty percent (120%) of the sum of the direct and indirect costs incurred by the Managing Proprietor in relation to the provision of that service; and
38.1 For the purposes of determining the Prescribed Amount, the purchase price of a Neighbourhood or strata Lot is:-
BY-LAW 38 - SALE OR TRANSFER OF LOTS
(a) in the case of an arm’s length purchase of a Lot, the purchase price paid by the proprietor of that Lot in consideration for the transfer of the Lot to that proprietor;
(c) in the case of a Strata Lot created in respect of a Residence existing on the Community Parcel at the time when the Community Plan is registered, the purchase price paid before the registration of the Community Plan for or in respect of the acquisition of an equitable interest in and the right to occupy that Residence by the person to whom the Strata Lot is transferred by the Original Proprietors or any antecedent of that person, plus, in each such case, an allowance based upon the actual costs incurred by the proprietor of structural alterations to the Lot which had been approved or acknowledged by the Managing Proprietor.(b) in the case of a transfer of a Lot from the executor or administrator of a deceased proprietor, the gift or non-arm’s length purchase of a Lot, the market value of the Lot at the time of transfer;
38.2 For the purpose of determining the Prescribed Amount, the sale or transfer price of a Neighbourhood or strata Lot is:-
(b) in the case of a transfer of a Lot by the executor or administrator of a deceased proprietor to a beneficiary of that proprietor, the gift or non-arm’s length sale of the Lot, the market value of the Lot at the time of transfer,(a) in the case of an arm’s length purchase of a Lot, the price received by the proprietor of that Lot after deduction of selling agent’s commission if any in consideration for the sale or transfer of the Lot;
less, in each such case, an allowance based on the actual cost of refurbishment of the residence comprised within the Lot in accordance with By-Law 39.
38.3 For the purposes of this By-Law, the market value of a Neighbourhood or Strata Lot is the value determined by a registered valuer appointed by the Managing Proprietor.
38.4 The transfer of a Neighbourhood or Strata Lot to the executor or administrator of a deceased proprietor of that Lot shall be deemed not to be a sale or transfer for the purposes of payment of the Prescribed Amount.
38.5 The transfer of a Neighbourhood or Strata Lot to the executor or administrator of a deceased proprietor to a third party (including a transfer by the executor or administrator to themselves in their personal capacities) shall be deemed to be a sale or transfer of that Lot and for the purposes of calculating the Prescribed Amount the executor or administrator shall be deemed to have acquired the Lot at the purchase price paid or deemed to have acquired the Lot at the purchase price paid or deemed to have been paid by the deceased proprietor for such Lot.
38.6 The transfer of a Neighbourhood or Strata Lot by a mortgagee in possession shall be deemed to be a sale or transfer by the proprietor of that Lot. For the purpose of determining the Prescribed Amount the mortgagee in possession shall be deemed to have acquired the Lot at the purchase price paid or deemed to have been paid by the proprietor of the Lot.
38.7 For the purposes of determining the Prescribed Amount the purchase price paid or deemed to have been paid by the joint tenants of a Neighbourhood or Strata Lot shall be deemed to be the purchase price paid or deemed to have been paid by any survivor of them.
BY-LAW 40 - DEFINITIONS, INTERPRETATION & GENERAL
‘Managing Proprietor’ means Nulama Village Pty Limited (A.C.N. 084 754 727) and, in succession, any other corporation nominated by the managing proprietor for the time being which by deed assumes the functions of the managing proprietor under this Management Statement.
‘ Prescribed Amount’ means the sum of money equivalent to thirty percent (30%) of any excess of the sale or transfer price of a Neighbourhood or Strata Lot within the Community Scheme sold or transferred by the proprietor of that lot over the purchase price of that Lot or, in the event of an agreement in that regard, such amount as is agreed upon by the proprietor of a Lot and a Managing Proprietor.
‘ Support Services ’ includes, without limitation, the provision of meals, painting and maintenance, cleaning, laundry, transportation, garbage collection, mail delivery, lawn mowing and gardening, lifting of heavy objects and domestic services generally, and nursing services provided by a registered nurse.”‘ Prescribed Fee ’ in relation to the provision of a Support Service by the Managing Proprietor means the fee notified by the Managing Proprietor by fixing a schedule of such fees to the notice board from time to time.
(Emphasis added)
17 In his application to the CTTT Mr Rannard sought orders under ss 80 and 81 of the Management Act for the revocation of CMS By-Laws 1-8, 37, 38 and 39 on the grounds that they were “not in the best interests of the Lot owners and are invalid as they do not relate to the management of the (Community Association)” (exhibit F, Annexure ‘U’).
18 S 80 of the Management Act enables the CTTT to revoke or vary a provision of a management statement for a Community Association if the CTTT considers the provision not to be in the best interests of the members of the Community Association or the proprietors of neighbourhood lots or strata lots within the scheme to which the management statement relates. S 81 empowers the CTTT to revoke so much of a community management scheme as the CTTT considers to be invalid.
19 Relevantly, the following sections of the Management Act provide:
“ Section 3 Definitions
Community Management Statement means a statement that is registered with a community plan as a statement of the By-laws and other particulars governing participation in the community scheme.
Management Statement means a community management statement, a precinct management statement or a neighbourhood management statement.
By-Laws means:Tribunal means the Consumer, Trader and Tenancy Tribunal established by the Consumer, Trader and Tenancy Tribunal Act 2001.
(b) In relation to a strata scheme – By-Laws in force for the scheme under the Strata Schemes Management Act 1996.(a) In relation to a scheme other than a strata scheme – By-Laws included in the management statement enforced for the scheme, or
(1) The corporation that:
Section 5 Community association
(b) has for its corporate name ‘Community Association D.P. No “ (the number inserted being that of the deposited plan),(a) is constituted under the Community Land Development Act 1989 by the registration of a community plan as a deposited plan, and
(2) The corporation has for its members:
is a community association for the purposes of this or any other Act.
(a) the proprietor of each community development lot in the community plan that has not become subject to a subsidiary scheme, and
(b) the precinct association constituted if such a development lot becomes subject to a precinct scheme, and
(d) the strata corporation constituted if such a development lot becomes subject to a strata scheme.(c) the neighbourhood association constituted if such a development lot becomes subject to a neighbourhood scheme, and
(5) A community association has the functions conferred or imposed on it by Schedule 1, by other provisions of this Act and by any other Act.(1) The Tribunal may, by order, revoke or vary a provision of the management statement for an association if the Tribunal considers the provision not to be in the best interests of :80 Order by Tribunal relating to variation of management statement
(b) the proprietors of neighbourhood lots or strata lots within the scheme to which the management statement relates.(a) the members of the association, or
(2) Application for an order under this section may be made by:
(b) the proprietor of a neighbourhood lot, or a strata lot, within the scheme, to which the management statement relates.(a) a member of the association, or
81 Order by Tribunal revoking invalid part of management statement(3) Application for an order under this section may be made by any person (including a mortgagor as well as a first mortgagee or covenant chargee) entitled to vote at a meeting of the association to which the management statement relates.”(2) The Tribunal may, by order, revoke so much of a management statement as the Tribunal considers to be invalid.
20 The decision of the CTTT was delivered by Senior Member Paull. The CTTT reasons for decision incorporate its orders which were as follows:
“Pursuant to section 80(1) of the Community Land Management Act 1989
(a) I revoke clauses 1.8, 37 and 38 of Community Management Statement DP 270210 (the CMS).
(c) I vary clause 1.5 of the CMS by deleting the words “the Prescribed Fee” and inserting instead the words “a fee”.”(b) I vary clause 1.11 of the CMS by deleting the numbers “37” and “38” from that clause.
21 Mr Rannard was unsuccessful in his challenge to By-Law 39.
22 In the CTTT’s reasons the following findings were made:
1. PURSUANT TO s 80 (1) (b) I FIND THAT CLAUSES 1.8 and 38 ARE NOT “IN THE BEST INTERESTS” OF THE PROPRIETORS OF THE NEIGHBOURHOOD OR STRATA LOTS AND I REVOKE THOSE CLAUSES
In coming to this finding, I was persuaded by the following:
1. The combined effect of clauses 38 and 1.8 of the CMS is that a lot owner cannot sell or transfer his or her lot unless he or she pays Nulama Village the “prescribed amount”.
2. The “prescribed amount” is, in broad terms, defined as 30% of anything in excess of the sale price or transfer price of a lot over the purchase price paid by the owner of that lot; or such amounts as the lot owner and Nulama Village may agree upon.
3. There is nothing in the CMS that explains why Nulama Village is entitled to this fee and what, if anything, Nulama Village must provide in return for this prescribed amount.
4. There is nothing in the CMS or anything else before me that show that Nulama Village is required to provide any money, goods, facilities or services in kind, as a result of receiving this prescribed amount.
5. What is more, Nulama Village has the right to hold up the sale or transfer of a lot until it receives this prescribed amount.
6. Without any indication in the CMS (or indeed in anything else before me) as to the reason why Nulama Village is entitled to this fee I can only assume its purpose is to provide Nulama Village with an income.
7. There is no basis as to why Nulama Village is entitled to derive an income from any profit a lot owner happens to chance upon in selling or transferring of his or her lot.
8. What is more, these clauses cannot be amended or revoked without Nulama Village’s written consent (cl 1.11) (As this clause was not the subject of the proceedings as conducted by Mr Renaud’s (sic) solicitor, I make no comment as to whether it falls foul of sections 80 and 81 of the CLM Act).
10. In other words, a lot owner may be forced to pay 30% of the profit from the sale or transfer of his or her lot to a person of whom he or she has no knowledge, before he or she can proceed with that sale or transfer of that lot.9. Even more startling is the fact that the CMS explicitly provides that the prescribed amount may be payable to an undisclosed third party “nominated” by Nulama Village” for the time being, which, by deed, assumes the functions of Nulama Village under the CMS.
In light of this finding it was not necessary for me to consider these clauses under s 81 of the CLM Act.
2. PURSUANT TO s 80 (1) (b) I FIND THAT CLAUSE 37 IS NOT IN THE BEST INTERESTS OF THE PROPRIETORS OF THE NEIGHBOURHOOD OR STRATA LOTS AND I REVOKE THAT CLAUSE.
In coming to the above finding, I was persuaded by the following:
1. Clause 37 cannot be considered in isolation but must be read in conjunction with clauses 1.3, 1.5 and 19 of the CMS. The thrust of these clauses is that the Community Association MAY agree to provide the lot owners with a variety of “support services” ranging from personal services such as domestic and nursing services, to repair and maintenance services to their lots.
2. In so doing, the Community Association MAY contract with Nulama Village to provide the service.
3. Although the lot owner pays the Community Association for the cost of the services and the Community Association may not profit from the provision of these services, Nulama Village determines the “prescribed fee” for the services.
5. The only restriction on what the lot owners pay Nulama Village is the formulae set out under clause 37 of the CMS that the “prescribed fee” cannot exceed 20% of:4. Thus, while the lot owners are not obliged to take up the support services, if they find themselves in the position of wanting such services, they are compelled to pay Nulama Village for that service.
. the commercial rate charged for that service in the locality.. the “direct and indirect cost” incurred by Nulama Village in providing the service; AND
6. This “formulae” is at best vague and at worst, unworkable.
7. What is an “indirect” cost to Nulama Village? How does one determine the “commercial rates” paid for a similar “service” in that locality?
8. Even if one can determine these factors, which prevails, the going “commercial rate” or the 20% excess over and above Nulama Village’s “direct and indirect costs”? As I have said, the wording of the clause is so vague as to be unworkable.
9. Thus if the lot owners are in need of “support services”, they are committed to an agreement without knowing the true effect of that agreement.
10. The lot owner is not in a position to gauge the feasibility of the cost of the support service that he or she is paying and the value of that service. The lot owner is deprived of the ability to ensure that he or she receives support services on the open market on terms negotiated in a commercially competitive way.
11. Lot owners are entitled to ensure that if they need to avail themselves of the support services which the CMS provides for, they are getting the benefit of those services at the most reasonable terms commercially available. The current regime under these provisions does not allow for this.
12. In addition, as with clause 38 dealt with above, the CMS provide that the support services may be undertaken by an undisclosed third party “nominated by Nulama Village for the time being”.
14. What is more, this arrangement (under clause 20 of the CMS) is “ongoing” and clause 37 cannot be amended or revoked without Nulama Village’s written consent. (cl 1.11).”13. Thus the identity of the person who is to provide and who is to be paid for the support services can be decided with absolutely no input by the Community Association or the lot owners.
23 In this Appeal, the plaintiff relies on the grounds set out in paragraphs 1-9 (inclusive) and 15-17 (inclusive) set out in the Amended Summons.
24 Mr DeBuse of counsel appeared for the plaintiff. He relied and expanded upon his written outline of argument (undated) provided to the Court on 19 February 2010.
25 Mr Freeman of counsel appeared for the first defendant. He relied on his detailed written submissions in chief dated 20 October 2009 and his submissions in reply dated 22 February 2010.
26 The essence of the plaintiff’s submissions on appeal was that the CTTT had erred in law in a number of respects. First, it had misdirected itself as to the proper interpretation of s 80 of the Management Act. Secondly, the CTTT had taken into account a number of irrelevant matters in reaching its decision. Thirdly, it failed to take into account relevant considerations. Finally, it had no regard to evidence before it which was relevant to its determination.
27 As a first step in determining the issues raised in this Appeal, it is important to bear in mind the history of the community titles legislation.
28 The Court was referred to Neighbourhood Association DP 285249 vWatson (2008) NSW SC 876, in which Biscoe AJ at [34] noted that the community titles legislation, essentially comprising the Development Act and the Management Act, commenced on 1 August 1990. As his Honour further noted, the concept of community title, its historical context and potential use as well as the general scheme of the legislation was described in the Second Reading Speech by the minister for Natural Resources as follows:
“… Generally known as the community titles legislation, the bills will introduce a new form of land subdivision in New South Wales and will permit greater innovation in subdivision design and greater flexibility in residential, commercial and industrial development …
An ever-growing shortage of land available for residential occupation has discouraged developers from employing the traditional method of subdividing land into a grid pattern of rectangular blocks fronting a public road. There has been also a demonstrated demand for developments designed around a theme, such as retirement villages, tourist resorts, industrial parks and sporting complexes. As a consequence there was a clear need to devise an additional means of subdividing land which would combine elements of both conventional and strata subdivision and introduce the context of shared communal property into a land subdivision. The aim of the four bills to be considered today is, therefore, to introduce that much needed alternative system of land subdivision, which will be as innovative today as the strata title legislation was in 1961. The system proposed will enable a subdivision of land incorporating common property which may be developed in stages in accordance with a pre-determined theme .
… [T]he model proposed by this legislation offers sufficient flexibility to allow it to be used for low or medium density residential projects; large, mixed-use developments; small urban schemes; rural communes; and theme development specially designed to accommodate the specific needs of special interest groups. The legislation has been divided into two principal bills – the Community Land Development Bill, covering the procedure for establishing a scheme, and the Community Land Management Bill, governing the day-to-day management of schemes and the resolution of disputes. The remaining two bills make associated amendments to the Strata Titles Act and a number of other Acts.
The Community Land Development Bill will permit the creation in subdivisions of shared land known as association property. Individuals purchasing into a scheme will receive a separate title to their lots, which may or may not contain improvements, and will acquire an interest in the association property. Because amenities can be shared, residents will be able to acquire the use of facilities such as sporting and recreational complexes which would have been prohibitively expensive for an individual homeowner. The Common elements and communal facilities within a scheme will be shared and managed by the participants themselves. Management will be controlled by a body corporate, referred to in the legislation as an association, which will be constituted on registration of a plan and will be made up of the individual lot owners. The legislation has been designed to enable a development to be completed as a staged or non-staged scheme. Allowing developments to proceed in stages will make it possible for savings in initial development costs, as one stage can be used to finance the construction of later stages. With a reduction in initial development costs, purchase prices should be correspondingly reduced.
The Community Land Management Bill will complement this development flexibility by providing a range of options for the management structure which may operate within the scheme. When a staged scheme is embarked upon, the community will have two tiers of management. However, where the community is sufficiently large or complex, the developer may elect to interpose a further tier and thereby create three levels of management. Where it is not proposed to develop the land in stages, only one level of management – known as a neighbourhood association – will be created. An important feature of the legislation is the opportunity it will provide for a development or organizational theme to be introduced throughout a scheme . For example, a theme may simply be used to establish a uniform architectural or landscaped design or a development may be designed around a sporting theme, offering facilities such as a golf course or equestrian activities. Safeguards have been built into the legislation to ensure that a theme does not impose restrictions based on race or creed or on ethnic or socioeconomic groupings.
… The legislation proposed marks a significant advance in land development. By offering a further means of subdivision, traditional concepts of land development can give way to more imaginative and sympathetic approaches to land use. The legislation will promote higher-density housing without loss of amenity and will encourage cheaper accommodation by reducing initial development costs. Commercial development will also be advantaged by providing an appropriate legislative base for projects such as tourist complexes and industrial parks.”To ensure that purchasers are made aware of any matters that will affect the day-to-day maintenance of a community, a developer will be required to prepare a management statement to accompany each stage of the scheme. This statement will bind the developer and the individual owners buying into a scheme and will be available for public inspection . The statement will set out the rules governing the use of association property including any access ways, and the use of any facilities which may be erected on the communal land. It will provide details of how services such as water and electricity are to be maintained and the insurance cover taken out by the association.
[Emphasis Added]
29 The evidence establishes that the Nulama Village was to be a subdivision of land incorporating common property. Its theme was retirement living for persons aged 55 years and over and, importantly, the retirement village was to be developed over stages.
30 The plaintiff did not become involved in the Nulama Village until 1998. I have used the word ‘involved’ because a complete history of the development of Nulama Village was not before the Court. However, from the documents in evidence I have endeavoured to piece together the following.
31 On 14 September 1985 N Pty Ltd entered into a Deed of Trust (the “Trust Deed”) with Hyscope Pty Limited (“Hyscope”) and Fonstan Pty Limited (“Fonstan”). The Trust Deed established a unit trust known as the Village Unit Trust (the “Trust”). Under the Trust Deed, (exhibit A), N P/L was called “the Developers”, Hyscope was called “the Managers” and Fonstan was called “the Trustees”. It should be noted that N P/L is completely separate from and an unrelated corporate entity to the plaintiff.
32 The Trust Deed recited that N P/L was the registered proprietor of the “Trust Property” which was defined as the land described in the first schedule to the Trust Deed, being the land in Certificate of Title Folio Identifier No. 37/700518.
33 The Trust Deed also recited that N P/L was establishing a retirement village on the Trust Property.
34 The Trust Deed recited that Hyscope was to deposit $1,100 with Fonstan as trustee to be held as part of the “Trust Fund” as defined in the Trust Deed.
35 The second schedule to the Trust Deed was a copy of the Development Consent given by the Greater Taree City Council for the development of a retirement village for “aged persons …” incorporating 200 self-contained villa units, a 50 bed hostel and a craft/recreation centre. This development consent was not to become operational until the council received documentary evidence of the proposed means of administration, management and transfer of the aged persons’ units.
36 The Trust Deed provided for the Trust Fund to be divided into units, the intention apparently being that upon acquisition of a unit, the holder would become entitled to sole occupancy of the residence identified in the documents attached to the application.
37 Further, at the same time as a unit in the trust was acquired, N P/L would transfer to Fonstan as trustee a transfer of that part of the “Trust Property” owned by N P/L calculated to be its value (clause 8).
38 N P/L also covenanted to continue to construct residencies. After 31 residences had been completed, N P/L was obliged to construct a recreation complex. After 100 residences were completed, N P/L was obliged to construct a village centre. No later than 4 years after construction began, N P/L was obliged to construct a serviced apartment block. Outdoor recreation facilities were also be completed.
39 Unit holders were obliged to pay Hyscope a share of expenses such as rates, maintenance and so on incurred by it in its managerial capacity. Its duties to provide support services in this regard were set out in the Trust Deed.
40 Under the Trust Deed, additional services such as domestic assistance and nursing services could be provided by Hyscope at a cost to the individual resident. The method of calculating the cost in each case was set out in the Trust Deed.
41 The Trust Deed also provided for the transfer, transmission and redemption of units in the Unit Trust. These provisions are extremely cumbersome and neither counsel sought to provide the Court with a strict legal analysis of their operation. For present purposes, I note the description given to these provisions by Mr Hall set out in paragraph [47] of this judgment. It can also be said that the intention of the parties to the Deed was supportive of a staged development funded at least in part from a percentage of the proceeds of sale or redemption of a unit in the Unit Trust.
42 At some point in time, unclear on the evidence, but it would appear from Mr MacMeecham’s statutory declaration dated 28 June 2000 (exhibit C), before 7 June 1996, Comstone Holdings replaced Fonstan as the Trustee of the Unit Trust. In that declaration, Mr MacMeecham also said:
“3. On 7 June 1996 the Trust Deed was amended to provide Comstone Holdings Pty Limited with the power and authority to restructure the Title of the Village Unit Trust including the right to convert the Title to Strata Title.”
43 Although the Trust Deed recited that N P/L was the registered proprietor of the land, the precise position concerning ownership is unclear. This is demonstrated by the material in exhibit “C”.
44 In a letter dated 5 May 1997, Mr G W Hall, a partner of Price Waterhouse, stated he had been appointed by Beneficial Finance as receiver and manager of N P/L and Project Facilities Incorporated Pty Ltd (“PFI”) on 2 March 1992. He recorded that the land of the retirement village was owned by N P/L as tenant in common with Comstone. Mr Hall also recorded in his letter that Hyscope had been replaced as the “manager” under the Deed by PFI some time prior to 1992.
45 The purpose of Mr Hall’s letter to L J Hooker, Taree, was to achieve a sale of the interest that N P/L had in the Nulama Retirement Village. Mr Hall sent with his letter a valuation and a contract for sale which included an “amended Village Unit Trust Deed”.
46 Mr Hall recorded further background information in this letter, including the fact that the Department of Consumer Affairs had become involved (presumably because of the financial difficulties that N P/L was in) and proposed that the land be converted to strata title and that there had been Court proceedings amongst N P/L, Hyscope and Fonstan concerning redemption of units in the Unit Trust.
47 In particular, Mr Hall stated:
“The retirement village was envisaged to contain 200 self-care units, with hostel and community facilities, only 33 villas were constructed, of which three are unsold.
The legal structure of the village is unique and governed by the VUT. Retirees wishing to purchase a villa subscribe for units in the VUT which entitles them to use and occupy a particular villa. Each time a villa was sold, Nulama conveyed a number of shares as tenants in common in the whole of the development site to the trustee (now Comstone).
Only six hectares of the total 17 hectare site can be built upon, the balance of the 11 hectares if flood prone. To build on the six hectares some filling will be required to raise the level above the one in 100 year flood level.”The property is connected to town water, sewer, electricity and telephone. I understand the services were originally provided to support an anticipated population of the Village of approximately 300 people. Details of extent to which the infrastructure has been developed is not known to me but I expect that such information will be available from research of council information.
48 Mr Hall envisaged that, in any sale the agent might procure, it might be necessary to change the Trust Deed and provide residents “with a different form of title”.
49 Next, on 16 November 1998, Comstone and the plaintiff entered into a deed which recited that Comstone was the registered proprietor of a 51226/100000 share in the land and N P/L was the registered proprietor of a 48774/100000 share in the land. The deed also recorded 30 villas had been sold, 3 remained unsold and there were two available sites on which 4 villas were yet to be constructed. In this respect, Clause 2 of this deed relevantly provided:
“2. Subdivision
(b) The Strata Plan must comprise the thirty (30) sold villas, the three (3) unsold villas and the two undeveloped sites for four further villas within the one Strata Plan.”(a) The Developer agrees that it will at its own cost obtain all necessary consents and cause to be prepared, executed and registered plans of Community Title Subdivision and Strata Subdivision for the land the developed land together with the creation by instrument of all relevant and necessary easements, covenants, development contracts and management statements to enable the existing villa units, the three unsold villas and the two undeveloped villa sites for four further villas to be subdivided to Strata Title as part of the Community Title Subdivision prior to completion. The community Title Subdivision shall be generally in accordance with the plans which are annexure “A” to this Deed.
50 This deed also recorded that the plaintiff had entered into a contract on that date with N P/L “to purchase the land”. This contract was said to be conditional upon the plaintiff obtaining registration of a community title subdivision and a strata title subdivision of the developed land, including the 3 unsold villas and the 2 undeveloped sites for the further 4 villas. Upon registration of the strata plan, Comstone was to “transfer to the unit holders the title to the villa unit to which each respective unit holder is entitled” under the Unit Trust. The schedule of those unit holders referred to in the deed is part of exhibit ‘C’. Of course, Mr Rannard, the first defendant, was not amongst them because he did not acquire his lot until 2003.
51 Under this deed, it was agreed that the By-Laws to be registered with the Strata Plan were to be “the Standard By-Laws applicable to Retirement Village Schemes a copy of which is attached hereto and marked with the letter ‘D’”. Annexure ‘D’ is in evidence on this appeal as exhibit B and is the CMS itself. The CMS was also referred to in this deed.
52 The evidence (exhibit C) establishes that a draft of the CMS incorporating the By-Laws was the subject of discussion between the plaintiff and the plaintiff’s solicitor, Mr Spicer, on the one hand and Mr Barraclough, a solicitor acting for residents. The clear inference to be drawn is that those parties then agreed on the terms of the CMS.
53 The deed of 16 November 1998 also recorded that the Unit Trust would be wound up “on Completion of this Deed”. Completion of the Deed was dependent upon completion of the contract for sale of the land between N P/L and the plaintiff. There were special conditions included in the contract for sale between N P/L and the plaintiff entered into on 16 November 1998 (exhibit E).
54 The following special conditions of the contract for sale of land are informative of what was to occur:
“ 38. Development approval
(a) The purchaser from the date of completion will have the benefit of development approval relating to the property (the “Approval”). The vendor discloses that it has not complied with the terms of the Approval in that the Community Centre has not been constructed and other requirements of the Approval have not been met. The vendor may not have paid all application and professional fees associated with obtaining the Approval. The purchaser is solely responsible for all bonds, contributions and/or any costs that are required to be paid as a condition of the Approval.
(b) The vendor on completion will deliver to the purchaser all consents and associated plans in its possession and a letter addressed to the local municipal council authorising such council to deal in future with the purchaser and its nominees in connection with the Approval.
(c) The benefit of all fees paid by the vendor to the council will pass to the purchaser on completion. The vendor will provide any letters to the council in relation to any fees and the Approval required by such council to pass the benefit of the Approval to the purchaser.
(d) The vendor is not aware of any outstanding notices in respect of the property issued prior to the date of this contract. Notwithstanding any other provision of this contract to the contrary, the purchaser acknowledges that the vendor will not be required to comply with any outstanding notices in respect of the property. The vendor will not have any obligation for any notice issued after the date of this contract. The purchaser acknowledges that on completion of this contract, the purchaser must comply with and will be responsible for all outstanding notices in respect of the property.
(e) The purchaser acknowledges that it is not entitled to realise any objection, requisition or claim for compensation, delay completion or rescind this contract in relation to any non-compliance with any notice or the Approval by the vendor, and the purchaser will not raise any requisition, objection, claim for compensation, delay completion or rescind this contract in respect of any matter the substance of which is disclosed by any such notice …
Subdivision
(c) The Strata Plan of subdivision prepared by the purchaser must comprise the subdivision of three unsold villas and thirty sold villas (the “ Retirement Village ”) within one strata plan.”(f) The purchaser will at its own cost obtain all necessary consents and cause to be prepared, executed and registered, plans of Community Title Subdivision and strata subdivision (the “Subdivision Plans”) for the property together with the creation by instrument of all relevant easements and covenants to enable the residential units on the property to be subdivided to strata title prior to completion …
55 The Community Title Plan and Strata Plan were registered on 5 June 2000. Upon registration, Certificates of Title to the lots in the Strata Plan were issued to Comstone.
56 On 28 June 2000, the “minutes of meeting” of Comstone (exhibit C) record:
“4. It was resolved that Comstone Holdings Pty Limited will transfer the Strata Title Lot to the owners of ordinary units in the Village Unit Trust to which each respective owner is entitled pursuant to their right to occupy a residential unit by virtue of their ownership of an ordinary unit in the Village Unit Trust.
6, It was resolved that following the vesting of the trust property, Comstone Holdings Pty Limited retire as Trustee of the Village Unit Trust and that the Village Unit Trust thereby be wound up.”5. It was resolved that upon registration of the Transfers referred to in the previous resolution all of the trust property will thereby vest in the beneficiaries of the trust who are entitled to the trust property.
57 Although there is no concrete evidence that the Unit Trust was wound up, that seems most likely to have occurred once the Community Plan and Strata Plan were registered at the Land Titles Office and the individual residents/lot owners in the Strata Plan were issued with Certificates of Title.
58 Page 41 of the CMS contains a Certificate of Approval. It certifies that the consent authority (presumably Taree City Council) has approved the “development described in Development Application No. 522/89” and that the terms of the CMS were “not inconsistent with that development as approved”.
59 The precise terms of the certifying authority’s approval of the development in Development Application No. 522/89 are not before the Court on this Appeal. Nevertheless, there is other evidence which is sufficient for present purposes.
60 In his letter to the CTTT dated 21 November 2008 (exhibit F, annexure ‘S’), Mr Durand recorded that the development approval, as amended, preserved the status of all prior development approvals under State Environmental Planning Policy (“SEPP”) 5. This required, for example, the construction ‘at the plaintiff’s cost’ of the Community Centre located on lot 7 DP 270210 which it owned. Upon construction, the Community Centre was to be made available for use by members of the Community Association. In his evidence (exhibit F, para 29), Mr Durand said that the completion of the Community Centre was a condition precedent to the obtaining of further approval for the plaintiff to construct 50 hostels and 163 self-care units approved under the DA on development of lots 3 to 7 which it owned in the Community Plan in DP 270210.
61 The Court gleans from the material in evidence that work on the Community Centre has stopped and the further staged development of the retirement village has ceased at this point because of various disputes between these parties which have been heard in the CTTT. This has left the plaintiff in a position where it can no longer obtain funds for the further development of the retirement village from sales of lots in the Strata Plan as a result of the decision made in the CTTT.
62 As a first step in considering the plaintiff’s Appeal it is necessary to give the proper characterisation to the By-Laws in question and the principles which apply to their interpretation: The Owners of Strata Plan No. 3397 v Tate (2007) 70 NSWLR 344 at 347.
63 The By-Laws in this case are part of the CMS. Relevantly, s 13 of the Management Act is an important guide to the interpretation of the CMS and the By-Laws because it provides:
(1) A community management statement is binding on:“ 13 Binding effect of management statement
(a)the community association, and
(c) each person who is the proprietor, lessee or occupier, or the mortgagee or convenant chargee in possession, of a development lot, neighbourhood lot or strata lot within the community scheme.(b) each subsidiary body within the community scheme, and
(4) Subsections (1) – (3) have effect as if, in each case:
(2)…
(3)…
(b) the persons so bound had executed the management statement under seal.(a) the management statement included mutual covenants to observe its provisions entered into by the persons bound by it, and
64 In Tate at 353-354, the Court of Appeal discussed how By-Laws may sometimes be characterised as delegated legislation, and thereby interpreted in accordance with the principles of Statutory interpretation (One.Tel Ltd v Australian Communications Authority (2001) 110 FCR 125) and sometimes they may constitute a statutory contract.
65 In this case, the provisions of s 13 of the Management Act are virtually in the same terms as the provisions of s 58 of the Strata Schemes (Freehold Development) Act 1973 which was discussed in Tate. In my opinion, the relevant By-Laws should be considered a statutory contract. In short, this is because of the mutual covenants contained in s 13 of the Management Act and the entitlement which flows to have those covenants and obligations enforced at law: North Wind Pty Ltd v Proprietors – Strata Plan 3143 (1981) 2 NSWLR 809.
66 As was pointed out in Tate at 357, not all principles of contractual interpretation apply to a statutory contract: National Roads and Motorists Association Limited v Parkin (2004) 60 NSWLR 224. Nevertheless, in my opinion, there can be no doubt that the CMS and By-Laws should be interpreted objectively by what they would convey to a reasonable person. Toll (FGCT) Pty Limited v Alphafarm Pty Limited (2004) 219 CLR 165.
67 In addition, whilst the CMS and By-Laws should not be interpreted as a business document, having regard to the theme of the development of Nulama Village as retirement living which engaged the owners and the developer (from time to time), there is also a clear commercial purpose underlying the CMS and By-Laws evident from the surrounding circumstances which I have adverted to above, namely, that in 1998 the plaintiff and the residents agreed on the content of the CMS and By-Laws with a view to progressing the development.
68 I now turn to consider the relevant By-Laws.
69 By-Law 40.1 defines “Prescribed Amount” in the manner set out earlier in this judgment. There can be no doubt that, in the case of a sale of a lot in the strata plan, upon its proper construction, it refers to an amount which is equivalent to 30% of the difference between the original purchase price of that lot and the sale price. Payment of the prescribed amount is only engaged when the sale price exceeds the purchase price.
70 The definition of “Prescribed Amount” needs to be read in conjunction with By-Laws 1.8 and 38. In a nutshell, under By-Law 1.8, in the case of a sale of a lot in the strata plan, the registered proprietor is required to pay the Prescribed Amount to the plaintiff on sale and transfer of the Lot. By-Law 38 sets out the mechanism for determining the Prescribed Amount by defining the purchase price in the case of an arms length transaction relating to the purchase of a lot in the strata plan as the actual purchase price paid in consideration for the transfer of the lot plus “an allowance” based upon the cost of any structural alterations made to that lot with the plaintiff’s approval or acknowledgement. Although “allowance” is rather broad, in my opinion it simply means that the cost of those alterations should be added to the original purchase price.
71 The reasons of the CTTT do not disclose a thorough analysis of the meaning of the above By-Laws. However, paragraphs 1 & 2 of the reasons of the CTTT demonstrate a clear understanding by the Senior Member as to how the above By-Laws were to operate. This is consistent with the Court’s analysis. Accordingly, no error of law on the part of the CTTT has been made in this respect.
72 On this Appeal, the plaintiff’s real complaint is the way in which the CTTT applied the provisions of s 80 of the Management Act to By-Laws 1.8 and 38.
73 In my opinion, the CTTT was in error in law in the way it applied the provisions of s 80 to the By-Laws in question. I now set out my reasons for coming to this conclusion.
74 First of all, a decision on “a question with respect to a matter of law” must be a decision on something which arose or was in issue or was debated in the proceedings before the CTTT; something which had to be decided in order to dispose of the proceedings, whether or not it was expressly referred to in the decision of the CTTT: Kalokerinos & Or v HIA Insurance Services Pty Limited (2004) NSW CA 312; Bahadoriv v Permanent Mortgages Pty Limited (2008) 72 NSWLR 44; Owners of Strata Plan 41100 v Penda & Sons Pty Limited (2009) NSW DC 59.
75 In determining whether By-Laws 1.8 and 38 were in the best interests of the proprietors of the Neighbourhood or strata lots, it is apparent from the CTTT’s findings in paragraphs 1-10 on page 4 of its reasons that essentially it confined itself to the provisions of the CMS alone without regard to any other matters. In doing so, the CTTT misdirected itself on a matter arising in the proceedings. This misdirection constitutes the error of law.
76 In its approach to the interpretation of s 80 of the Management Act, the CTTT referred to the Macquarie dictionary definitions of “best” as the “most advantageous, suitable or desirable” and “interest” as “the relationship of being effected by something in respect of advantage or detriment”. This is a reasonable starting point.
77 The notion of “best interest” has been criticised as uncertain in the context of the welfare of a child: see Secretary, Department of Health and Community Services v J WB & SMB (Marion’s case) (1992) 175 CLR 218 at 270-274. On the other hand, it has been accepted in the area of Australian Corporations Law in the context of expressing the duty of directors to act in a bona fide way and in the best interests of a company: Equiticorp Finance Limited (In Liq) v Bank of New Zealand (1993) 32 NSWLR 50.
78 The context of “best interests” of the proprietors of neighbourhood lots or strata lots when used in the Management Act is different again. This is because the investigation under s 80 is guided and informed not only with reference to the terms of the statutory contract made by By-laws 1.8 and 38, but by the provisions of s 75B (2) as follows:
“(2) In any such investigation or in any proceedings before it for an order, the Tribunal:
(b) must act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms.”(a) is not bound by the rules of evidence and may inform itself on any matter in such manner as it thinks fit, and
79 In my opinion, s 75B (2) makes it clear that, in a case such as this, the CTTT should not merely have focussed on the wording of the By-Laws in question. The CTTT was required to make an objective determination, having regard to the merits of the case being made to it by the 1st Defendant. In doing so, the CTTT was obliged to act according to equity and in good conscience. Necessarily, that involved an investigation of the relevant surrounding circumstances, not only present but past, because, for example, it would not be in good conscience for the proprietor of a strata lot, having obtained a benefit in the past by virtue of the operation of the By-Laws, to submit that the CTTT should only focus on present circumstances whereby a proprietor might be required to make a payment to the Plaintiff.
80 It is clear that the CTTT took no account of significant matters relevant to the circumstances both past and present. These included:
(a) Consideration of the theme of the CMS
(b) Whether the By-Laws in question made it possible to save development costs and to use the proceeds of sale for further construction of the stage by stage development envisaged by the development consent.
(c) What benefits the lot owners have received from buildings and services constructed after registration of the Community Plan.
(d) What benefits are the lot owners likely to receive if the relevant By-Laws are not revoked.
(e) A consequence of registration of the Strata Plan was that ownership of the lots was converted to Strata Title. Has this made it easier for lot owners to sell or mortgage their lots; has it added to the value of their lots?
(f) The fact that the residents agreed to the By-Laws at the time.
(g) Once the CMS was registered at the Land Titles Office persons who purchased lots thereafter, including the first defendant, were on notice of its provisions.
(i) The extent to which completion of Nulama Village as required under the development consent will be to the advantage and benefit of lot owners.(h) Whether a revocation of the relevant By-Laws would be inconsistent with the terms of the development consent. If so, does it accord with equity and good conscience for the relevant By-Laws to be revoked.
81 It should not be assumed that the above constitutes an exhaustive list. Necessarily, after the matter is remitted to the CTTT for a rehearing, the scope of the CTTT’s investigation will be informed by the evidence before it.
82 The same analysis applies with respect to the approach taken by the CTTT towards By-Law 37. In addition, the following observations are pertinent:
(a) A proprietor of a lot is not obliged to obtain support services from the plaintiff; such a proprietor is free to engage a third party.
(b) Similarly, the Community Association is not obliged to contract with the plaintiff for provision of those services, as By-Law 19 makes clear.
(c) The prescribed fee becomes payable if a proprietor or the Community Association engage the services of the plaintiff or require the plaintiff to arrange for a third party to provide those services, but not otherwise.
(d) The definition of prescribed fee does create difficulties. However, it is tolerably clear that the intention of the By-Law is to ensure that the fee be no more than 120% of the “direct and indirect costs” incurred by the plaintiff in providing the service or the rates charged by commercial providers of similar services; in other words, the prescribed fee must not exceed the higher of the two amounts.
(f) It is a more difficult question to determine what are “direct and indirect costs”. However, it is not necessarily an impossible task. The question can only be answered by reference to the evidence. The CTTT made no reference to the evidence about this and in doing so erred in law because it made its determination in a vacuum. This is not to say, for example, that on a re-hearing, it would be open to find, on the evidence or lack thereof, that subclause (a) of By-Law 37 is unworkable.(e) The CTTT came to the conclusion that By-Law 37 was unworkable because itself asked how could “commercial rates” possibly be determined. Clearly, this is a matter for evidence. In this respect, courts frequently have evidence before them in personal injury cases about the cost of providing nursing services and domestic care. It would not be difficult to muster such evidence in the context of the cost of support services. This part of the prescribed fee provision is certainly workable.
83 It follows by reason of what I have set out above that the appeal should be allowed and that the proceedings be remitted to the CTTT for a re-hearing. In this respect, it has not been necessary for this Court to consider the question of the validity of the By-Laws in question. This is because the CTTT considered it unnecessary to do so in the first place in light of its determination. However, it may be necessary for this issue to be determined at the rehearing, depending upon the outcome of the application to revoke the By-Laws on the basis of s 80 of the Management Act.
84 Accordingly, the orders of the Court are:
1. Extend the time for the filing of the plaintiff’s Summons up to and including 12
November 2008.
2. Appeal allowed.
3. Set aside the orders of the Consumer Trader & Tenancy Tribunal in
proceedings SCS08/01841 made on 14 October 2008.
4. Remit the matter to the Consumer Trader & Tenancy Tribunal for a rehearing. 5. Direct that the exhibits be returned.
85 I will now hear the parties on costs.
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