Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048; Proprietors of Unit Plan 2004/048 v Proprietors of Development Unit Plan 04/22
[2019] NTSC 75
•3 October 2019
CITATION:Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048; Proprietors of Unit Plan 2004/048 v Proprietors of Development Unit Plan 04/22 & Anor [2019] NTSC 75
PARTIES (APPEAL): PROPRIETORS OF DEVELOPMENT UNIT PLAN 04/22
v
PROPRIETORS OF UNIT PLAN 2004/048
PARTIES (CROSS-APPEAL): PROPRIETORS OF UNIT PLAN 2004/048
v
PROPRIETORS OF DEVELOPMENT UNIT PLAN 04/22
AND:
VALUE INN PTY LTD
TITLE OF COURT: SUPREME COURT OF THE NORTHERN TERRITORY
JURISDICTION: SUPREME COURT exercising Territory jurisdiction
FILE NO:LCA 56 of 2017 (21560402)
DELIVERED: 3 October 2019
HEARING DATE: 9 October 2018
JUDGMENT OF: Blokland J
CATCHWORDS:
APPEAL – nature of appeal from Local Court – limited to question of law –
erroneous finding of fact will amount to an error of law only if finding made
by irrational trier of fact acting arbitrarily – findings of fact reasonably open
on the evidence – appeal dismissed.
APPEAL – Unit titles – mixed development – payment of body corporate
levies – whether certain levies validly raised against member of body
corporate – whether Local Court in error not allowing claim for debt and
damages whether Local Court in error to hold – levy invalid as levies
wrongly included certain expenses – no error on part of Local Court.
APPEAL – Unit titles – mixed development – payment of body corporate
levies – whether expenses incurred for certain items in accordance with the
Unit Titles Act (NT) – whether Local Court in error by failing to find
Expenditure by body corporate in accordance with the Unit Titles Act –
whether Local Court in error by failing to find expenditure incurred is in
same proportion as unit entitlement under Unit Titles Act – whether
expenditure related to common property – whether certain expenditure was
incurred by body corporate or likely to be incurred – Local Court not in
error by finding certain expenditure not proven to be an expense of the
appellant – appeal dismissed.
JURISDICTION – whether Local Court has jurisdiction to order declaratory
relief when statute conferring jurisdiction does not expressly provide for
remedy by way of declaratory relief – held Local Court possesses
jurisdiction for relief sought.
APPEAL – appeal against refusal to order declaratory relief – nature of
discretionary remedy – appeal dismissed.
COSTS – CROSS-APPEAL whether Local Court in error by ordering each
party bear their own costs – assessment of relative success of parties –
position of party defending claim – cross-appeal allowed in part.
COSTS – Non-party costs – non-party exercised control over proceedings –
costs awarded against non-party.
Unit Titles Act 1975 (NT) ss 25(3), 25(6), 26ZR(1), 26ZI, 26ZT, 30(2),
34(a), 34(b), 36(1), 36(3), 36(4), 106(g), 106(h), 106(j).
Unit Titles Regulations 2002 (NT) regs 15(1), 15(2), 15(3).
Local Court Act 2015 (NT) ss 12, 13(1), 14, 15(1)(b).
Local Court (Civil Procedure) Act 1989 (NT) s 19(1).
Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd [2003] FCA 325;
Berlyn v Brouskos [2002] VSC 377, 134 A Crim R 111; Byrnes v Davie
[1991] 2 VR 568; Bowen Investments Pty Ltd v TabCorp Holdings Ltd (No
2) [2008] FAFC 107; Dodds Family Investments Pty Ltd v Lane Industries
Pty Ltd [1993] FCA 259; Edward Grant Smith [2002] NTSC 63, 12 NTLR
155; Evans Deakin Pty Ltd v Sebel Furniture Ltd [2003] FCA 282;
FPM Constructions Pty Ltd v Council of The City of Blue Mountains
[2005] NSWCA 340; Griffin v Australian Broadcasting Corporation (No
2) [2011] NSWCA 145; Hockey v Fairfax Media Publications Pty Ltd (No
2) [2015] FCA 750, (2015) 237 FCR 127; House v The King (1936) 55
CLR 449; Jacklin v Proprietors of Strata Plan No 2795 (1975) 1 NSWLR
15; KG v Firth [2019] NTCA 5; Knight v FP Special Assets Ltd (1992) 174
CLR 178; Mashane Pty Ltd v Owners Corporation RN 328577 [2013] VSC
417; Mayfair Trading Co Ltd v Dreyer (1958) 101 CLR 428; Peninsula
Group v Registrar-General for the Northern Territory (1996) 136 FLR 8; Re
Application for a Declaration of Paternity by ‘K’ and re the Estate of Re
Wykeham Terrace [1971] 1 Ch 204; Rushton (QLD) v Rushton NSW [2004]
QSC 74; Sattel & Ors v The Proprietors Be Bee’s Tropical Apartments
Building [2001] QCA 560; Simonetto and Anor v Dick [2014] NTCA 4;
Tracey Village Sports and Social Club v Walker (1992) 111 FLR 32;
Veetemp Australasia Pty Ltd v GRD Group NT Pty Ltd [2012] NTSC 93;
Vestris v Cashman (1998) 72 SASR 449; Waters v P C Henderson
(Australia) Pty Ltd Unreported CA (NSWCA) Kirby P, Mahoney and
Priestley JAA (6 July 1994); Wilson v Lowery (1993) 4 NTLR 79; Zuchiatti
Pty Ltd v Ferrara (1976) 1 BPR 9199, referred to.
David Wright, Remedies (The Federation Press, 2nd ed, 2014).
GE Dal Pont, Law of Costs (LexisNexis Butterworths, 4th Edition 2018).
Kanaga Dhamananda and Anthony Papamatheous (eds) Perspectives on
Declaratory Relief (Federation Press, 2009).
REPRESENTATION:
Counsel:
Appellant (First Cross-Respondent): T Liveris
Respondent (Cross-Appellant): M Crawley SC
Second Cross-Respondent: B O’Loughlin
Solicitors:
Appellant (First Cross-Respondent): Minter Ellison Lawyers
Respondent (Cross-Appellant): MSP Legal followed by Maria Savvas
Second Cross-Respondent: Piper Ellis Lawyers
Judgment category classification: B
Judgment ID Number: BLO1907
Number of pages: 71
IN THE SUPREME COURT
OF THE NORTHERN TERRITORY
OF AUSTRALIA
AT DARWINProprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048; Proprietors of Unit Plan 2004/048 v Proprietors of Development Unit Plan 04/22 & Anor [2019] NTSC 75
No. LCA 56 of 2017 (21560402)
BETWEEN:
PROPRIETORS OF DEVELOPMENT UNIT PLAN 04/22
Appellant
AND:
PROPRIETORS OF UNIT PLAN 2004/048
Respondent
PROPRIETORS OF UNIT PLAN 2004/048
Cross-Appellant
AND:
PROPRIETORS OF DEVELOPMENT UNIT PLAN 04/22
First Cross-Respondent
AND:
VALUE INN PTY LTD
Second Cross-Respondent
CORAM: BLOKLAND J
REASONS FOR JUDGMENT
(Delivered 3 October 2019)
Introduction
This is an appeal from a decision of the Local Court delivered on 12 October 2017 (‘the appeal’) and a cross-appeal from the subsequent costs decision made on 16 May 2018 (‘the cross-appeal’).
Before the Local Court, the parties to the appeal were in dispute about the non-payment of body corporate levies by the respondent (the defendant in the Local Court proceedings). The action in the Local Court raised some questions regarding the scope of the duties, functions and powers of a corporation under Part V, Division 2 of the Unit Titles Act 1975 (NT) (‘Unit Titles Act’), in particular, whether the exercise of certain duties or powers and contributions determined fell within ss 33, 34 and 36. The matter was initially commenced in the Local Court as a claim for debt or damages.[1] On 3 May 2017 the appellant (then plaintiff) amended the Statement of Claim, principally to seek 20 declarations in respect of individual charges it claimed to have incurred or would be required to incur in the exercise of its duties.
Following a hearing, the learned trial Judge published Reasons for Judgment on 12 October 2017 (‘Reasons for Judgment’) and made the following orders:
1. The Plaintiff’s claim for debt and damages is dismissed;
2. The Plaintiff’s application for declarations as per paragraphs (e), (g), (i), (k), (l), (m), (n), (o), (q), (r), (s), (t), (u), (v) and (w) is refused.[2]
3. The Plaintiff’s application for declarations as per paragraphs (d), (f), (h), (j) and (p) is granted.[3]
In short, the Local Court made declarations to the effect that the expenditure incurred by the appellant for fire equipment, fire service – contract, grease trap maintenance, insurance and body corporate management fees was in accordance with s 36 of the Unit Titles Act, but otherwise dismissed the appellant’s claims including the claim for debt or damages and the majority of the claims for declaratory relief. More specifically, the appellant had sought to enforce recovery of amounts payable by notice as a debt under s 36(6) of the Unit Titles Act. The appellant was unsuccessful in its claim for debt, broadly because the Judge found the claim covered charges which were wrongly included and because the appellant did not produce sufficient evidence to establish the proper amount which should have been levied.[4] The appellant submits it relied on the Local Court’s general power for remedies in damages and at equity for declaratory relief, however the pleadings specified claims that the contributions assessed were determined by the plaintiff under s 36 of the Unit Titles Act. Save for those specified above, most items were held not to be properly included as expenses under s 36 and therefore not recoverable or not appropriately the subject of declarations.[5] While the respondent was successful in its challenge to most of the levies raised, it unsuccessfully asserted there had been a conflict of interest which in turn had led to a breach of fiduciary duty on the part of the plaintiff. The respondent argued a contributing factor to the wrongful allocation of expenses was due to a suggested conflict of interest or because of the diverse positions held by Mr Christopher Foy.[6]
The appellant filed a notice of appeal in the Supreme Court on 9 November 2017, which was amended on 5 June 2018. The Amended Notice of Appeal lists 18 grounds of appeal set out later in these reasons and seeks orders[7] setting aside the orders of the Local Court and in lieu of those orders to have judgment entered for the appellant, effectively in the terms sought in the Further Amended Statement of Claim filed in the Local Court on 3 May 2017.
If successful on appeal, the appellant seeks orders that the respondent pay its costs of the Local Court proceedings and the appeal and that costs of the appeal be recoverable as a debt in accordance with ss 45 and/or 46 of the Unit Titles Act.
At the costs hearing in the Local Court, both the plaintiff and the defendant claimed costs. The defendant submitted in the Local Court that if it was successful in its claim for costs, those costs should be paid by a third-party, the Gamble Group of Companies, relevantly Value Inn Pty Ltd and not the plaintiff. This is largely because the defendant is a member of the plaintiff and so would be paying a portion of its own costs through its membership of the plaintiff should costs be awarded against the plaintiff. Additionally, the defendant argued the Gamble Group and/or Value Inn Pty Ltd were effectively behind the proceedings, and were motivated to recover from the respondent the expenses it had incurred.[8]
On 16 May 2018, the Local Court published its decision on costs,[9] making the following orders;
1. Each party bear their own costs of proceedings.
2. The defendant’s claim for costs against the Gamble Group of Companies and/or Value Inn Pty Ltd is dismissed.
3. The costs of the defendant’s application for costs against the non-party be costs in the cause.
The respondent filed a cross-appeal against orders 1 and 2 of the costs decision. The grounds asserted in the cross-appeal are that the Local Court erred in law in assessing the relative success of the parties, in distinguishing Value Inn Pty Ltd from the Hostel for the purposes of s 45 of the Unit Titles Act, in failing to determine at all the claim by the defendant that Value Inn Pty Ltd should pay the plaintiff’s costs and by failing to order that Value Inn Pty Ltd pay the costs of the plaintiff and the defendant.[10]
The respondent as cross-appellant seeks to have the costs orders of the Local Court set aside and substituted with orders that Value Inn Pty Ltd, the second cross-respondent, pay the costs of the appellant and the respondent in the Local Court proceedings and that Value Inn Pty Ltd pay the costs of the appeal. Value Inn Pty Ltd, as second cross-respondent, filed a Notice of Contention on 3 October 2018, disputing the alternative ruling of the Judge to the effect that had the respondent been successful in its claim for costs, Value Inn Pty Ltd, although a non-party, should pay those costs. An amended Notice of Contention was filed on 5 October 2018, further particularising a number of the errors alleged on behalf of Value Inn Pty Ltd.[11]
Background
In 2004, Coorong Investments Pty Ltd registered a development plan and disclosure statement on the title of Lot 7536, 52 Mitchell Street, Darwin (‘the building’) and constructed a mixed development on the site. The building development plan is comprised of three building lots and common property. The building is a single structure and the building lots are numbered 7540, 7541 and 7542. Lot 7540 (the respondent) comprises of six retail units on the ground floor of the building. Lot 7541 is a hostel known as the Melaleuca Lodge and consists of the first floor above the retail area and a four-storey residential building. There are 106 units in the hostel. The hostel is leased to Value Inn Pty Ltd. Lot 7542 is a basement which was originally intended to be an underground carpark but later became a nightclub. Lot 7542 is owned by Gamble Group Pty Ltd ATF the Doug Gamble Family Trust No 2 and Brimsnuck Trust, as tenants in common. The three lots were referred to in the Local Court as ‘the Retail’, ‘the Hostel’ and ‘the Basement’ respectively. A development Parcel Lot 7539 was also created which consisted of all the land which was previously Lot 7536 as well as Lots 7540, 7541 and 7542. The Proprietor of the Development Parcel Lot became the Proprietors of Building Development Plan 04/022 (the appellant).[12]
When the building development plan was registered, a body corporate, the appellant, was created, and at times will be referred to in these Reasons as ‘the DVP’, consistent with the terminology adopted by the Judge and the parties. When titles were issued to the three parts of the development, body corporates were also created for all three lots. The respondent is the body corporate for the Retail shop area (‘the Retail Body Corporate’). The three body corporates are each members of the DVP for the purposes of the Unit Titles Act and are entitled to one vote and representation at the meetings of the DVP. The DVP bears responsibility for the common property shared by each of the three buildings within the development.[13] The DVP is not the owner of the development itself. Each building within the lot has their own common property and there is the shared common property of the development.
The DVP has certain responsibilities under the Unit Titles Act including control, management and maintenance of the common property. The DVP owns the shared common property, principally comprising a car park area and some of the walk-ways.[14] The shared common property also includes the roof, floor slabs, walls and columns where those parts of the structure form the division between separate buildings. The DVP’s duties include paying all expenses relating to that common property. The income from the DVP is derived solely from the levies paid to it by its members. Those levies are determined by the management committee of the DVP.
At the appellant’s Annual General Meeting (‘AGM’) on 24 September 2014, the appellant accepted and approved a budget for the 2014/15 financial year, being the amount that it would require by way of contributions from its members under s 36 of the Unit Titles Act. Following the AGM, the appellant issued notices of contributions to members. It sent two notices to the respondent dated 8 October 2014,[15] a notice dated 17 November 2014,[16] and a notice dated 11 February 2015.[17] The notices were each for a sum of $9,276.00, which was claimed to be the respondent’s quarterly unit entitlement contribution as determined by the appellant under s 36 of the Unit Titles Act. Further notices of contribution in the same sum were issued to the respondent on 10 June 2015 and 12 August 2015.[18] At the time of the proceedings below, the respondent had not paid the contributions issued to it for the 2014/15 or 2015/16 financial years. The appellant argued before the Local Court and this Court that the DVP’s budget items were all for expenses it had incurred or will reasonably be expected to incur in the performance of its duties and functions under the Unit Titles Act and in any event the respondent’s contribution towards the expenses was to be assessed in the same proportion as its unit entitlement established under the Act.
The respondent effectively complained that it was asked to pay a disproportionate amount of the common expense, although the principal contention was that many of the expenses claimed did not relate to common expenses at all or were not expenses incurred or reasonably expected to be incurred by the DVP. A number of irregularities in the historical processes leading to the raising of levies were noted by the Judge which will not be dealt with further in these reasons.[19] It is understood that prior to the DVP’s appointment of Sterling Management Services Pty Ltd (‘Sterling’) in 2014, the respondent had been agitating for a breakdown in the insurance costs for the DVP. The respondent was reportedly concerned that the DVP’s insurance policy had been included in the insurance policy of the Gamble Group of Companies. The policies included property, public liability and consequential loss insurance for several properties and businesses owned by the Gamble Group. The respondent had also challenged the cost of the fire management services and grease traps as not being proper expenses payable by the DVP, suggesting those costs ought to be borne solely or predominantly by the Hostel. The dispute concerning those and other expenses led to the litigation before the Local Court.
The trial Judge identified that it had been agreed the notices of contribution included expenses relating to building maintenance, fire equipment, electricity, grease traps, rubbish removal, sewerage, water usage, management fees, printing and stationary and insurance.[20] It was also agreed that the notices of contribution remained unpaid and were approved by the appellant at its annual general meetings, with the defendant dissenting.[21]
The trial Judge further identified that while the parties did not agree that all of the expenses were properly incurred by the appellant or included in the notices of contribution, the respondent had paid some monies to the DVP based on its own assessment or calculation of the appropriate apportionment of the proper expenses of the DVP. Her Honour characterised the principal issue being whether each of the expenses included in the calculation of body corporate levies were properly included as expenses that were reasonably incurred in the performance of the duties and functions by the appellant, or reasonably expected to be incurred. The appellant submits that by virtue of the declarations sought in the Local Court, a further issue involved the question of whether the contributions payable by members of the DVP for each expense is to be in the same proportion of the member’s unit entitlement under the Unit Titles Act.
Building development plans are provided for in Part IVC of the Unit Titles Act. Pursuant to s 26ZI(1), a registered proprietor of an estate in fee simple may lodge a building development plan of subdivision with the Registrar-General. The building development plan of subdivision must comply with various requirements[22] otherwise it will not be registered.[23] One such requirement is that building development plans of subdivisions are accompanied by a schedule of building lot entitlements (‘schedule of entitlements’) prepared in accordance with the Unit Title Regulations (NT).[24] The schedule of entitlements sets out an aggregate building lot entitlement for all lots and an entitlement for each building lot.[25] The building lot entitlement for a building lot is a whole number that represents, as nearly as practicable, the proportion that the value of the lot bears to the aggregate value of all of the lots by reference to the unimproved capital value at the date of certification.[26] Once a building development plan is registered, the schedule of entitlements cannot be altered otherwise than under Parts VIII or IVC of the Unit Titles Act.[27] While here there was a unit entitlements schedule set by the development Plan, the costs for certain services were not divided between the members of the DVP on the basis of those unit entitlements until the appointment of a body corporate manager to the DVP in 2014/2015.[28]
The DVP holds the common property on trust for the members, as tenants in common, in undivided shares proportional to the building lot entitlements of their building lots, for the reasonable use and enjoyment by members.[29] Common property is defined in s 4(1) of the Unit Titles Act as ‘so much of a parcel as is not within a unit’. Under s 30(2) and s 34 of the Unit Titles Act, the appellant is responsible for the control, management and administration of the common property.[30] The appellant must properly maintain and keep in a state of good repair the common property and all chattels in its possession, custody or control.[31] The appellant submits it must also maintain equipment used in respect of easements created for access to services such as water and electricity, pipes, communications cables and sewerage.[32] Such services which are related to the management and maintenance of the common property are the responsibility of the corporation and therefore in this instance, the payment for such services are properly incurred by the DVP. That is, charges which relate to the common property and maintenance of those utilities, such as pipes and cables, which exist to provide services to the common property. There was no evidence before the Local Court the DVP incurred a service liability for the provision of a number of services, the subject of its unsuccessful claims. The cost of maintenance of services which are unrelated to the common property or otherwise are unrelated to the preservation of the fabric of the premises is the obligation of the dominant tenement.[33]
Under s 36 of the Unit Titles Act, the appellant says it is obliged to determine the amount it will require by way of contributions from its members in order to perform its functions, duties and powers[34] and that those contributions are to be proportionate to unit entitlements pursuant to s 36(3) of the Act.[35] The contributions must come from the members of the DVP.
The appellant contends that the only qualification to the requirement that contributions are made in accordance with unit entitlements is in relation to expenditure for specified liabilities yet to be incurred by the corporation and by unanimous resolution of the corporation before the determination to require the contribution from members is made.[36] Thus, there is no warrant to import notions of any ‘benefit principle’ which is relevant to other statutory regimes.
In support of these submissions, the appellant referred to the decision of Holland J in Jacklin v Proprietors of Strata Plan No 2795:[37]
The legislation takes the common property as a whole and treats each proprietor as having an undivided beneficial interest in every part of it, whether or not that part is susceptible of any use or enjoyment by that proprietor or of greater use or enjoyment by that proprietor than by any other. Similarly, with respect to the provision of funds for the repair and maintenance of all or any part of the common property, the legislation provides for only one fund with contributions to be levied proportionately on all proprietors irrespective on any individual proprietor’s use and enjoyment thereof. Thus, the ownership and the financial burden of common property is to be held and shared by all proprietors in common in shares according to their respective unit entitlements. Consistently with this approach, the duty of control, management, administration, repair and maintenance of common property is imposed by the legislation upon the body corporate. This duty is necessarily owed to each and every proprietor. In my opinion, there flows from the scheme of the legislation as an incident of proprietorship of a lot a right in each proprietor to have the body corporate’s duty performed in relation to all of the common property at the cost and expense of all proprietors in proportion to unit entitlements. As the duty is not only to repair and maintain but also to control, manage and administer, the right of each proprietor includes a right to have the whole administration of repairs and maintenance of common property carried out by the body corporate by its servants and agents.
The appellant points out that in contrast to s 49(2) of the Owners Corporations Act 2006 (Vic) there is nothing in the Unit Titles Act that applies a principle of ‘the unit which benefits more, pays more’. It was submitted that other than a resolution of the type specified in s 36(4), the appellant was not permitted to issue notices of contributions to members on any comparative benefit analysis.
Cleary it is the terms of the Unit Titles Act which are to be applied, however it is not apparent that the Local Court proceeded on any erroneous principle sourced outside of the Unit Titles Act as appears to be suggested by the appellant. For example when discussing the fire equipment charges, her Honour discussed the ‘benefit principle’, referring to the comparable Victorian legislation and cases.[38] It was accepted there was no equivalent general requirement in the Unit Titles Act, eventually resolving that issue by reference to the construction of ss 36 and 45 of the Unit Titles Act.[39] The ‘benefit principle’, although referred to and discussed, was not germane to the Local Court decision. What her Honour noted, correctly in my view, was that s 45(2) distinguishes expenses which are recoverable based purely on the unit entitlement schedule and those which come within s 45(1), and apportions the debt between the units which wholly or substantially benefit from the ‘act’ as defined in s 45(3), excluding those units which did not benefit from the ‘act’.[40]
The appellant also drew attention to Peninsula Group v Registrar-General for the Northern Territory,[41] where Kearney J described the nature of strata titles and common property:
In general terms, the essence of ‘strata titling’ under the Act is a strata subdividing of the land and the buildings on it; into units and common property. The units are capable of separate ownership, their owners having the beneficial ownership and use of the common property…
Again, speaking generally, the essential characteristic of a ‘unit’ under the Act is that it is one of several distinct and separately occupied portions of a building or buildings on one area of land, defined parts of which – the ‘common property’ – may lawfully be used in common by the occupants …
There is nothing in the Reasons for Judgment which indicates the Local Court was unaware of the nature of common property, nor the general scheme and intent of the Unit Titles Act. Further, Kearney J’s description of how the Act operates is accepted here, but the problem for the appellant is that many of the claimed expenses, either did not relate to the common property or its maintenance or otherwise were not expenses which could be levied against its members in compliance with the Unit Titles Act.
In the end the problem the appellant had at the hearing for many of the matters in contention was principally one of proof, including proof as to the validity of the subject levies, decisions made by various officeholders as to the DVP’s expenses, whether those officeholders were authorised in certain instances to act on the DVP’s behalf, and importantly, whether certain expenses had been incurred or were to be incurred. What was required to be considered was whether the expenses included in the calculation of body corporate levies were properly included as expenses reasonably incurred in the performance of the duties and functions of the appellant with respect to the ‘common property’ as defined by the Unit Titles Act.
The respondent agrees that the legal basis for the claims relied upon by the DVP was ss 34 and 36 of the Unit Titles Act. However, it emphasises that s 36 only allows the DVP to seek contributions from its members on account of expenditure it has incurred or may reasonably expect to incur in performing its duties or functions which relate to the common property or to provide relevant services to the common property. The obligations have been described in other contexts as ‘[centred] on the preservation of the fabric of the premises’.[42] An examination of the relevant parts of the Unit Titles Act demonstrates that to be the case. Before the Local Court, broadly, the respondent pointed out it had paid some monies to the DVP which on its own assessment was thought to be appropriate, however argued the processes leading to the incurring of expenses was flawed. The respondent accepted the appellant may have an equitable remedy for some contribution of its expenses from the respondent, however submitted a number of the expenses claimed were not expenses that the DVP was liable for and so could not pass those expenses onto its members.
The principal parts of the Unit Titles Act referred to in these proceedings are:
25 Easements created by this Act
(1)In this section:
proprietor, in relation to the common property, means the corporation.
tenement means a unit or the common property, as the case may be.
(2) On and after the registration of the units plan, the proprietor of each tenement (in this section called the dominant tenement) shall be deemed to have over each other tenement (in this section called the servient tenement) such of the rights specified in subsection (3) as are necessary for the reasonable use and enjoyment of the dominant tenement.
(3)The rights referred to in subsection (2) are:
(a) rights of support, shelter and protection afforded by the servient tenement at the time of the registration of the units plan;
(b) rights for the collection, passage and provision of water, sewerage, drainage, garbage, gas, electricity and air, and other services of whatsoever nature (including telephone, radio and television services), through or by means of pipes, wires, cables, ducts, or other reasonable means; and
(c) such ancillary rights as are necessary to make the rights referred to in paragraphs (a) and (b) effective, including rights of entry by the proprietor of the dominant tenement and his agents, servants and workmen at all reasonable times on the servient tenement for the purpose of:
(i) inspecting, maintaining or repairing the servient tenement; or
(ii) inspecting, maintaining, repairing, replacing, renewing or restoring any pipes, wire, cable, duct or other material.
(4) A right created by this section shall be deemed to be an easement appurtenant to the dominant tenement in relation to which it is enjoyed.
(5) An easement created by this section subsists notwithstanding that the same person is the proprietor of both the dominant and servient tenements.
(6) A person exercising a right under an easement created by subsection (3)(b) or (c) is liable to make good any damage done in the course of exercising that right.
[…]
34 General duties
A corporation shall, subject to this Act and the Regulations:
(a)be responsible for the enforcement of its articles and the control, management and administration of the common property;
(b)keep in a state of good repair and properly maintain the common property and all chattels in its possession, custody or control; and
(c)maintain in good repair and proper order and, if renewal is reasonably necessary, renew, all pipes, wires, cables, ducts, and apparatus and equipment of any kind used, or intended, adapted or designed for use, in the provision of services in respect of which easements are created by section 25.
[…]
36 Contributions by members of the corporation
(1)A corporation shall, from time to time, determine the amount that it will require by way of contributions from its members to discharge expenditure that it may reasonably be expected to incur, or has incurred, by reason of the performance of the duties and functions and the exercise of the powers imposed or conferred on it by this Act.
(2)A corporation shall, in a determination made under subsection (1), specify the time within which, and the manner in which, contributions so determined are to be paid by its members.
(3)Subject to this section and section 36A, the contribution payable in respect of each unit is such amount as bears to the total amount referred to in the determination the same proportion as the unit entitlement of the unit, as at the date of the determination, bears to the aggregate unit entitlement of all the units as at that date.
(4)Where:
(a)a determination made under subsection (1) relates to expenditure to be incurred by the corporation in discharge of a specified liability; and
(b)before the making of that determination, the corporation has, by a unanimous resolution, resolved that contributions for that expenditure are payable in a proportion other than that specified in subsection (3),
The contribution payable in respect of each unit for that expenditure is such amount as is ascertained in accordance with that resolution.
(4A)If a determination under subsection (1) relates to expenditure to be incurred in discharge of a specified liability imposed on the corporation that has been calculated using a formula, the contribution payable in respect of each unit for that expenditure is to be determined having regard to that formula unless before the making of the determination the corporation has, by a unanimous resolution, resolved otherwise.
(5)The corporation shall cause notice of each determination made under subsection (1) to be given to its members and shall, in the notice given to a member, specify the amount payable by him in respect of his unit and the time within which, and the manner in which, that amount is payable.
(6)If an amount payable in respect of a unit is not paid within the period specified in the notice, that amount is recoverable as a debt due to the corporation from the person who was the proprietor of the unit on the date on which the notice was so given and from the person who is the proprietor of that unit on the date on which the action is instituted.
(7)The liability under subsection (6) is joint and several.
44 Special privileges relating to common property
(1)A corporation may, if authorised by a unanimous resolution or as otherwise prescribed, grant to a member, or any person who has derived an interest in a unit through a member, any special privilege (not being a lease) in respect of the enjoyment of part or parts of the common property.
(2)A grant under subsection (1) may be terminated by notice in writing given by the corporation to the grantee in accordance with a special resolution.
45 Recovery of certain repairs, &c.
(1)Where a corporation has performed any act which it was required or authorised by its articles or by or under this Act or any other law in force in the Territory to perform, and which related to one unit only or some of the units only, any money expended by the corporation in performing that act is recoverable by the corporation as a debt from the proprietor or proprietors, for the time being, of that unit or those units, as the case may be.
(2)Where the act referred to in subsection (1) related to some of the units only the amount recoverable from a proprietor in respect of a unit bears to the whole amount of the debt the same proportion as the unit entitlement of the unit bears to the aggregate unit entitlement of all those units.
(3)For the purposes of this section:
(a) act includes repairs and work; and
(b)an act shall be deemed to relate to a unit if, but only if, the act is wholly or substantially for the benefit of the unit or wholly or substantially the liability or the responsibility of the proprietor of the unit.
The relevant corporation, here the DVP, is responsible for the administration, management and maintenance of the common property. Section 36 of the Unit Titles Act requires any contribution levied against members of a corporation, such as a corporation in the position of the DVP, to be accurate and a reasonable reflection of the expenses it incurred or expected to incur in fulfilling its obligations in respect of the common property. The section allows expenses to be allocated in accordance with unit entitlements which are fixed at the commencement of the development.
In this development, 24 per cent was allocated to the respondent under s 36(3).[43] However, s 36(3) is not the only mechanism providing for calculation of expenses and levies. Section 36(4) provides for the circumstances of specified liability if the parties have agreed unanimously on a different proportion than under s 36(3). Further, under s 36(4A) in circumstances where the specified liability of a corporation is calculated in accordance with a formula, the apportionment between the unit holders is to be determined having regard to the formula, unless before making the determination, the corporation has unanimously resolved otherwise. Section 36(4A) was examined by the trial Judge in particular in relation to determining the liability for sewerage charges, however ultimately in that instance her Honour was unable to find a formula was proven.[44]
It may be observed here, as was relevant to a number of findings in the Local Court, the trial Judge acknowledged the DVP had duties and functions with respect to the maintenance of pipes, wires, cables, ducts and other hardware and was responsible for the charges it incurred to provide those services to the common property.[45] It would be a strange result if those obligations exist even if those items provide a service elsewhere, to other units other than to the common property. In the case of a service to a particular unit, the unit holder is liable for the expense. Section 25 of the Unit Titles Act, which deems an easement in favour of the dominant tenement for the various services or utilities which traverse the common property, does not operate in a manner to impose charges on the DVP, as the DVP is responsible for the common property and the services to the common property.
The appellant submitted that it is sufficient to establish an obligation on the DVP if the pipes and cables traverse the common property, even if for the purpose of providing a service elsewhere.[46] That is not the meaning or intent of s 25. It is, as the respondent submitted, an ‘end user’ (the dominant tenement) who has a deemed easement for the necessary pipes and other utilities over the other parts of the development. The cost of maintaining and repairing the pipes is an obligation of the dominant tenement – the end user. That cost is embedded in its accounts from the relevant provider. In any event, it cannot be assumed or accepted given the evidence and findings below, that the DVP did in fact incur service liabilities for pipes, cables and other structures materials that traversed the common property or elsewhere on the development.
The appeal
The grounds of appeal are as follows:[47]
1. That the learned Judge erred in finding that the expenditure incurred by the Appellant for sewerage is not expenditure in accordance with s 36 of the Unit Titles Act.
2. That the learned Judge erred in failing to find that the Respondent’s contribution to future sewerage expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Unit Titles Act.
3. That the learned Judge erred in finding that the expenditure incurred for water usage, other than that which relates to fire equipment, is:
(a) not expenditure incurred by the Appellant; and
(b) not expenditure in accordance with s 36 of the Unit Titles Act.
4. The learned trial judge erred in failing to find that the Respondent’s contribution to future water expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Unit Titles Act.
5. The learned Judge erred in finding that the expenditure incurred by the Appellant for electricity is not expenditure in accordance with s 36 of the Unit Titles Act.
6. The learned Judge erred in failing to find that the Respondent’s contribution to future electricity expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Act.
7. The learned Judge erred in finding it is unnecessary and refusing to declare that the Respondent’s contribution to future grease trap maintenance expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Unit Titles Act.
8. The learned Judge erred in finding it is unnecessary and refusing to declare that the Respondent’s contribution to future fire equipment and fire service – contract expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Unit Titles Act.
9. The learned Judge erred in finding that the expenditure incurred by the Appellant for rubbish and waste removal is not expenditure in accordance with s 36 of the Unit Titles Act.
10. The learned Judge erred in failing to find that the Respondent’s contribution to future rubbish and waste removal expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Unit Titles Act.
11. The learned Judge erred in finding it is unnecessary and refusing to declare that the Respondent’s contribution to future management fee expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Unit Titles Act.
12. The learned Judge erred in finding that there is no basis and refusing to declare that the Respondent’s contribution to future insurance expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Unit Titles Act.
13. The learned Judge erred in finding that the expenditure incurred by the Appellant for building maintenance is not expenditure in accordance with s 36 of the Unit Titles Act.
14. The learned Judge erred in failing to find that the Respondent’s contribution to future building maintenance expenditure incurred by the Appellant is in the same proportion as the Respondent’s unit entitlement established under the Unit Titles Act.
15. The learned Judge erred in finding that the Appellant’s claim cannot be recoverable as a debt against the Respondent.
16. The learned Judge erred in dismissing the Appellant’s claim for damages in circumstances where the learned Judge found that:
(a) expenditure for fire equipment, fire service – contract, grease trap maintenance, insurance and management fees was incurred and levied by the Appellant in accordance with the Unit Titles Act and otherwise recoverable from the Respondent; and
(b) some electricity and water chargers are proper expenses of the Appellant under s 36 of the Unit Titles Act.
17. The learned Judge erred in failing to order that the Appellant’s debt collection costs are recoverable from the Respondent as a debt under s 45 and/or s 46 of the Unit Titles Act.
18. The learned Judge erred in failing to make any order for interest in the Appellant’s favour.
The nature of the appeal
The jurisdiction of the Supreme Court on an appeal from the Local Court is limited to the question of whether or not there is an error of law.[48] This Court has no jurisdiction to correct factual errors, save for very limited circumstances outlined in the authorities.[49] An erroneous finding of fact or inference drawn will only amount to an error of law if the finding or inference could only have been made by an irrational trier of fact acting arbitrarily.[50] No error of law arises in circumstances where there is evidence which, if accepted, would support the court’s findings,[51] or if the conclusion reached was reasonably open on the facts found by the trier of fact.[52] Given the many observations made throughout the detailed Reasons for Judgment below as to the weak state of the evidence, it is abundantly clear the appellant’s case failed on the facts. In some instances there was reference to the form of the pleadings, however the matter was resolved overwhelmingly on its facts. As above, counsel for the appellant has raised a number of interesting matters concerning the application of the Unit Titles Act, however ultimately the appellant’s action below failed on the evidence. The failure of proof as a central issue is also apparent in the Local Court’s costs decision.[53]
The claims for debt and damages – grounds 15 and 16
It is convenient to deal with the asserted errors concerning the debt and damages claims as the reasoning engaged in with respect to those claims is to some extent indicative of the approach taken by the trial Judge. As the appellant correctly points out, s 36(6) of the Unit Titles Act provides that if an amount payable by a unit is not paid within the period specified in the notice, then the amount is recoverable as a debt due to the corporation. The trial Judge reasoned that ‘if the levies are not properly determined in the first place then they cannot be recoverable as a debt’.[54] In keeping with this reasoning the trial Judge also determined ‘Given my findings the determination for 2014/2015 body corporate levy includes items which are not properly included and therefore the levy cannot be recoverable as a debt’.[55]
In respect of the claim for damages, her Honour said:
The Defendant is only obliged to pay levies properly determined and given I have found the levies had not been properly determined the Defendant has not breached its obligation and the claim for damages must fail.[56]
Those conclusions must be correct. The claim for debt due was dependent upon the establishment of a valid determination of the levies. In general terms it was found a number of accounts were not in the name of the DVP, they were in the name of the Hostel and in some instances there was no evidence to show the DVP authorised anyone to incur the expenses on its behalf. It was also found the Hostel had been invoiced for the whole development in relation to some of the expenses claimed and the DVP distributed those costs to its members based on the unit entitlements.[57]
The case was not pleaded on the basis as appears to be suggested on appeal that the trial Judge should have found a debt for 24 per cent of particular expenses, or a series of specified liabilities. The Further Amended Statement of Claim[58] effectively tied the debt claim to levy notices totalling $55,656[59] as calculated by the appellant.[60] In any event, it is clear that the debt claim was contingent on establishing the validity of the levies given paragraphs 5 and 6 of the Further Amended Statement of Claim. Paragraph 5.2 pleads the respondent is to pay the contributions ‘as determined by the plaintiff to discharge expenditure that the plaintiff may reasonably be expected to incur, or has incurred, by reason of the performance of the duties and functions and the exercise of the powers imposed or conferred on it by the Act (Section 36)’. The appellant did not make good that claim.
Conflicts between the oral evidence and the budgets and accounts, in some instances showing the DVP did not pay certain accounts or that the account was not in the DVP’s name[61] contributed to findings that certain expenditure was not that of the DVP. A number of accounts were in the name of the Hostel without further authorisation for the DVP to deal with them. The Local Court found:[62]
[I]n relation to the water, sewerage and electricity…the Hostel has been invoiced for the whole of 52 Mitchell Street by the provider and the DVP has distributed all of those costs to the members based on unit entitlements.
The damages claim as pleaded relied on the appellant proving the respondent was obliged to pay the appellant’s contributions as determined by the appellant. By including water, sewerage, electricity and other expenses that it could not establish it had incurred or would incur, the levy was held not to be properly determined, therefore neither the debt nor damages claims could be made out.[63] It is the case that the Local Court found expenses for fire equipment, fire service-contract, grease trap maintenance, insurance, management fees and some electricity and water charges were proper expenses under the Act, but the case was pleaded on the basis of valid levies that covered a broad range of claimed expenses. That a case for damages may be made on a different basis does not assist the appellant. The damages claim was dismissed as there could be no finding of a breach of the respondent’s obligation to pay levies when those levies were not validly raised. The trial Judge did not rule out that there may be other remedies available to the appellant which were not properly raised on the pleadings. There was no application made in the Local Court to amend the pleadings to reflect a claim on any other basis. I see no error of law in respect of the decision to dismiss the debt and damages claims, nor the findings which underpin the decision.
Grounds 1 and 2 – sewerage
The trial Judge found that sewerage expenses did not relate to the repair and maintenance of the common property and do not arise out of the appellant exercising its functions or duties.[64] Her Honour did acknowledge that the respondent had previously had the benefit of services provided to the common toilets of the Retail shops and had not paid for the services, to the appellant’s detriment.[65] This part of the judgment had no impact on the final result and should be seen in the context of historical matters between the parties. The sewerage was for toilets on the individual lots. The sewerage charges did not relate to the common property, nor was it shown that non-payment of the charges would affect the management or repair of the common property. Nor did the charges relate to the maintenance of relevant easements. Mr Phil Doyle’s[66] evidence illustrated the uncertainty about the accounts and confirmed there were no toilets on the common property. For example, in cross examination, part of his evidence was:
In relation to the sewerage charges when you took over managing the DVP? – Yes
Were you provided with any invoices from Power and Water, relating to sewerage? - I don’t believe so.
I think you said in your evidence yesterday, that there are no toilets on the common property, within the DVP – within 52 Mitchell Street. Is that right? – Yes that’s correct.
Do you have on your file, any invoices from Power Water, in relation to sewerage from – at some later point in time? – Well, no I don’t because you note in that first budget, I budgeted for sewerage and then after 12 months when we realised we weren’t receiving any bills for sewerage, then it became clear that the bills were going to the underlying Body Corporates – and there was no budget item. So therefore, there were no invoices paid.[67]
It was submitted that the provision of sewerage services to the Building is necessary to administer the common property in accordance with s 34. The appellant says that the fact the toilets are not situated on common property is not determinative of whether sewerage expenses are properly incurred, as the sewerage services are essential and incidental to their use.[68] It was submitted that the question is not to what degree each member of the appellant used and required sewerage services, but that the obligation for each member to contribute to the maintenance of the common property arises regardless of their level of use. Therefore, the respondent’s contribution to future sewerage service liabilities must be in accordance with unit entitlement proportions unless agreed otherwise by the appellant under s 36(4). These submissions may have weight if there was evidence the charges related in any way to the repair and maintenance of toilets or sewerage services on or delivered to the common property, or that they related to the preservation of the fabric of the premises, but there was not.
The respondent submitted that the evidence before the Local Court overwhelmingly supported the findings made. Bearing in mind the oral evidence, a brief part of which is set out above, the Local Court found as follows:[69]
The charges relate to sewerage service to each of the toilets at 52 Mitchell Street none of which are on the common property of the DVP. The fact that PowerWater charges that service to an address which is comprised of three lots is problematic. The sewerage charges were invoiced to Melaleuca on Mitchell and were paid by Redco Investments Pty Ltd and that organisation has recovered some of those costs from other members of the DVP through the body corporate fees […]
These […] are not charges that relate to the repair and maintenance of common property and [as] there are no sewerage services to the common property there is no evidence supporting a finding that non-payment of the sewerage charges would affect the management or good repair of the common property. These are not charges that arise out of the DVP exercise of its functions or duties.
In my view the trial Judge did not err by finding that the sewerage services to the building did not relate to the appellant’s duty to control, manage, administer, repair and maintain common property and was not incidental to those duties or functions. This was the responsibility of those entities invoiced for the services who could recover from Retail or others as required.
It was not shown the expenses claimed were incurred by the DVP. As the expenses incurred did not relate to the common property it was not open to make declarations as to future sewerage liabilities. The issue of declarations, including both the jurisdiction and the review of the discretion, is discussed later in these reasons.
It may be noted the Local Court also considered but rejected an argument put by the respondent that s 36(4A) of the Unit Titles Act, which provides for specified expenses calculated in accordance with a formula, applied. As was observed by her Honour, s 36(4A) relates to a formula in reference to the liability imposed on the corporation, not to a formula the corporation may have determined to charge its members. Given the uncertainty and fluctuations of the expenses between different years, the trial Judge could not find there was a particular formula. [70]
Grounds 3 and 4 – water
The trial Judge accepted that there were no separate water meters for each of the three members of DVP and found that water charges were not the responsibility of the appellant but of each of its three members.[71] Her Honour did find that water usage for the fire equipment on 52 Mitchell Street was ‘clearly a proper expense’ of the appellant’s but declined to make the declarations sought by the appellant in respect of water charges. The appellant says this amounted to error. The appellant contends that water services are also provided to the building by way of easements and are part of the appellant’s responsibility. It was highlighted that the appellant paid the invoices for the water services and the members of DVP approved water charges in budget determinations for the 2014/15 financial year and the 2015/16 financial year. The appellant alleges error in the finding that the water charges did not relate to the appellant’s duty to control, manage, administer, repair and maintain common property and argues the respondent’s contribution to future water service liabilities must be in accordance with unit entitlement proportions or s 36(4) of the Act.
The respondent relies on the following findings of the Local Court:
In relation to the water usage for the fire equipment located on the common property of the DVP that is clearly a proper expense attributable to the DVP and properly included in the determination for the calculation of the levy. Therefore I declare that specific charge to be a charge which has been levied under s 36 of the Act.[72]
In relation to the balance of the water charges there is no evidence to support a finding that these water charges were properly incurred by the DVP in the execution of its duties. [73]
The only original invoices before the Court for these services is the invoices for water charges for 30.7.14. Those invoices showed the water charges for 52 Mitchell Street for the month from 10 May 2014 to 10 June 2014 to 2015 and were addressed to Redco Investments Pty Ltd. [74]
It would have been an error in light of the evidence, to include all water charges as a properly incurred DVP expense for which 24 per cent should be paid by the respondent. There was evidence that the previous account (in 2013-2014) was in the name of the Hostel.[75] It was for the Hostel to pursue any other contributions it thought it was entitled to. In coming to the conclusion that the expense did not relate to DVP’s obligation to the common property it may be noted Mr Doyle agreed in evidence that the separate meter for the fire service was on the common property and the other was for consumption within the other body corporates. There was no evidence the water charges related to the repair and maintenance of any pipes running through the common property in relation to any easement for the provision of water to the specific lots, Retail, the Hostel and owners of Lot 7542.[76]
In my view the trial Judge did not err in respect of the findings on water usage charges. After consideration of the evidence, the relevant findings of fact were made which cannot be challenged on appeal save for limited circumstances outlined above which do not apply here. Her Honour did declare certain expenses to be legitimately those of the DVP, namely, the water usage for the fire equipment located on the common property. The same could not be said for the balance of the water charges, including anticipated future expenses.
Grounds 5 and 6 - electricity
As acknowledged by her Honour, the electricity charges raise similar issues as those with respect to sewerage and water. Consistent with the approach to other services, her Honour confirmed the DVP is only responsible for electricity supplied relating to its common property.[77] Her Honour acknowledged the difficulty of establishing what electricity relates to the common areas and what does not, however, she carefully examined the documentary evidence including material showing the electrical distribution boards and circuits relating to Melaleuca on Mitchell and associated notes and plans.[78] The evidence was unsatisfactory or insufficient to establish the electricity charges included in the levy to the respondent were properly levied under s 36 of the Unit Titles Act. For example, none of the electricity invoices were in evidence. Further, in his evidence Mr Foy acknowledged a number of circuits were for the areas marked as the ‘blue’ areas,[79] however the ‘blue’ areas are Hostel areas,[80] clearly not common property. There is no reason to disturb the finding of the Local Court:[81]
What is clear from the little evidence brought before the court is that Mr Foy, in his role as the manager of the hostel and the ‘Chairman’ of the DVP, had all accounts originally invoiced to Melaleuca on Mitchell and there were no separate accounts for DVP common property. He then budgeted for recovery of those costs on the basis of the unit entitlements.
The basis for the levy with respect to electricity was questionable. Given the way the accounts appeared in the evidence, it is perfectly understandable why the Local Court declined to make a declaration as to future liability for electricity. The Court was prepared to declare that electricity charges which relate to lighting the carpark area and any repairs of electrical cabling which run to these services are the responsibility of the DVP and a proper expense of the DVP.[82] Her Honour was obviously aware of those expenses which could properly be regarded as expenses to be levied on the members.
Grounds 9 and 10 – rubbish and waste removal
The appellant argued rubbish removal is a necessary expense for the DVP under the Act as it is necessary to preserve the fabric of the building and this is incidental to the maintenance of the common property. That would be the case if the service could be shown to be related to the common property. Her Honour found there was no evidence to support a finding that the rubbish removal was a service provided to the common property of the DVP.[83] The finding was made after a review of the evidence including a resolution at the AGM of 24 September 2014 to remove the rubbish charges from the budget and consequently the body corporate levy, and it was noted this recognised rubbish expenses were not properly included in past levies. The appellant disputes this finding. As a finding of fact, or a reasonable inference drawn, this argument must be rejected. It was an inference open to the Local Court. It may be an expense of this kind incurred in the future is shown to be required in the performance of the appellant’s obligations under the Act, however the expenses before the Local Court were not shown to be part of the DVP’s responsibility.
Grounds 13 and 14 – building maintenance
The findings of the Local Court were as follows:[84]
Building maintenance – while there is no evidence of upon what basis a budget item for building maintenance has been included in the expenses of the DVP it is clear that the DVP does have the responsibility to repair and maintain those common walls, floors and ceiling between the building lots 7540, 7541 and 7542. It is prudent that the DVP budgets for contingencies however it is not appropriate to include that in a body corporate levy pursuant to section 36. The DVP is empowered to determine a contribution from its member to “discharge expenditure that it may be reasonably expected to incur or have incurred”.
The question must be is budgeting for the contingency without any basis to expect repairs to the building will be required in that year a proper expense included in the determination. It (sic) my view that unless there is some evidence repairs will be required in the next year it is not properly included in the contribution from the members unless there is a resolution to create a sinking fund for those contingencies. It is evident from the budget prepared by Sterling that the amount included in that budget item is not based on any foreseeable repairs.
Further the budget does not attribute any amount to a sinking fund nor was there a resolution to create a sinking fund. In those circumstances the inclusion of an amount for repairs and maintenance in the 2014/2015 members contribution is not a proper expense that the DVP might be reasonably expected to incur in that year.
The appellant takes issue with the finding that unless there was some evidence that repairs would be required in the next year, the proposed expenses were not properly included in contributions unless there was a resolution to create a sinking fund for such expenses or contingencies. The appellant points out there is nothing in the Unit Titles Act that requires expense items in the nature of building maintenance to be vested in a sinking fund. While it is the case there is nothing in the Act to that effect, the existence of a sinking fund would be a way to demonstrate that an expense was to be incurred prospectively when no expense in that category was incurred the previous year. I would not uphold these grounds.
Additional consideration of the grounds of appeal relating to declaratory relief: grounds 1 and 2 – incurred and future sewerage expenses; grounds 3 and 4 – incurred and future water expenses; grounds 5 and 6 – incurred and future electricity expenses; ground 7 – future grease trap maintenance expenses; ground 8 – future fire equipment and fire service contract expenditure; grounds 9 and 10 – incurred and future rubbish removal expenses; ground 11 – future management fees; ground 12 – future insurance fees; grounds 13 and 14 – incurred and future building maintenance expenses.
As above, the Judge granted the declarations sought in respect of expenditure incurred for fire equipment, fire service contract, grease trap maintenance, insurance and management fees. When the evidence established the expenses were properly incurred, levied and readily complied with the Unit Titles Act the Judge did not hesitate to grant the relief sought. Her Honour did not grant the balance of the claims for declaratory relief including the claims relevant to future expenses. Given the findings of fact, it is unsurprising that most of the applications for declaratory relief were not successful.
As a preliminary matter the respondent submitted the Local Court lacks jurisdiction to grant declaratory relief because the jurisdiction conferred on the Local Court by the Unit Titles Act does not confer such a power. If the Local Court does have jurisdiction, the respondent submitted it is confined to matters involving expenses incurred and does not extend to future liabilities.
Section 15(1)(b) of the Local Court Act2015 (NT) (‘Local Court Act’) provides:
15 Remedies that may be granted
(1) When exercising the jurisdiction conferred on the Court by s 13 or 13A, the Court may do either or both of the following:
(a) Grant any remedy or relief that may be claimed under that section
(b) Make a declaratory order of the rights of a party or parties to the proceedings.
(2) When exercising the jurisdiction mentioned in section 14, the Court may grant any remedy or relief that is provided for by the Act that confers the jurisdiction on the Court.
(3) However, the Court cannot issue a writ of certiorari, mandamus, prohibition or quo warranto.
(4) Proceedings in the Court are not open to objection on the ground that a party is seeking a declaratory order of rights.
Section 13(1) of the Local Court Act provides the Court has jurisdiction to deal with a claim for an amount of money[85] and s 13(2) grants jurisdiction to provide equitable relief:
The Court has jurisdiction to deal with a claim for equitable relief if:
(a) The value of the relief sought is not more than the jurisdictional limit; or
(b) The parties have given written consent to the Court dealing with the claim.
As to the Local Court’s jurisdiction under other laws, s 14 of the Local Court Act provides:
The Court’s civil jurisdiction also includes any other jurisdiction that:
(a)is conferred on the Court by another Act; and
(b)is not part of the Court’s criminal jurisdiction under section 19.
The jurisdiction to deal with matters under the Unit Titles Act at the relevant time was conferred by s 107. The section has since been amended but at the time relevantly provided:
The Court has jurisdiction in all applications made to it under this Act.
At the relevant time, under s 106(2) applications were to be dealt with by the Local Court ‘within its small claims jurisdiction as if the proceedings were proceedings under the Small Claims Act, and the Local Court Act and the Smalls Claims Act and the Rules made under those Acts shall apply accordingly’. The Small Claims jurisdiction has now been transferred to the Northern Territory Civil and Administrative Appeals Tribunal, however at the time the proceedings were properly before the Local Court. Section 106(4) lists a number of forms of available relief including giving judgment on a monetary claim, ordering the refunding of money and grants the power to the Court to make such ‘incidental or ancillary orders as it thinks fit’.[86] Section 106(10) provides the section ‘does not limit or derogate from any civil remedy at law or equity’.
While the Unit Titles Act does not expressly confer a power to grant declaratory relief on the Local Court, it would be a serious restriction on the jurisdiction of the Local Court to construe the conferral of jurisdiction in a manner that is not consistent with the Local Court’s general jurisdiction or the exercise of its ancillary powers to grant relief for matters within jurisdiction. This is particularly significant with regard to declarations made on the basis of the position between the parties, current at the time of the hearing and closely associated with the substantive relief. Different considerations may well apply in relation to declarations as to future rights or obligations which may militate against granting the relief, but those considerations do not go to the question of jurisdiction.
It is acknowledged the grant of the Local Court’s equitable jurisdiction under s 13 by itself does not provide a basis for the Court to grant declaratory relief. As to the relationship between equity and the declaration, it has been observed by the learned author David Wright:[87]
Although the declaration has historically been an equitable remedy, it no longer is. In Langman v Handover[88] the High Court accepted the view that it ‘cannot be successfully contended that a suit which asks merely for a declaration of a legal right is a suit for equitable relief.’ So while the declaration is not an equitable remedy, ‘the principles relating to the exercise of discretions for equitable remedies are a rich source of guidance, so long as it is appreciated that the modern jurisdiction is now much wider than the equitable origins and the accompanying discretions are not constrained by discretions applicable to the grant of withholding of exclusive equitable remedies’.[89]
Purely equitable defences therefore do not, per se, stand in the way of suits for declaratory relief, but the matters raised by them may impact upon the Court’s exercise of discretion.[90]
It is also appreciated that declaratory relief is usually the preserve of superior courts exercising inherent jurisdiction. The Northern Territory Local Court is however, vested with wide jurisdiction, including the jurisdiction to grant equitable relief which may be relevant to the application of principles necessary to regulate the discretion to grant declaratory relief.
Section 14(a) makes it clear the Local Court’s civil jurisdiction includes any other jurisdiction conferred by another Act. There are many statutes which confer jurisdiction on the Local Court. It could not have been intended on the one hand to confer jurisdiction on the Local Court for the purposes of dispute resolution under the Unit Titles Act and on the other restrict the remedies available to the Court to properly exercise the jurisdiction granted. A clear expression of such a limitation would be expected in the Unit Titles Act or the Local Court Act. The combined operation of ss 12-15 of the Local Court Act and s 106-107 of the Unit Titles Act allows the Court to grant remedies associated with the principal cause of action.
While it is concluded here the Local Court possesses jurisdiction to make the declarations sought, it is quite another matter whether the discretion should be exercised to grant the relief in a particular case. The findings in relation to sewerage, water, electricity, rubbish and waste removal and building maintenance, have been summarised above. In short, in relation to electricity, water and sewerage, it was found those expenses had not been incurred by the DVP. As a result it was obvious that no declarations as to current or future obligations should be made. In relation to rubbish removal, the finding was that the service was not provided to the common property of the DVP and in any event was an item removed from the previous budget. The building maintenance claim failed through lack of evidence. Logically there could be no declaration, current or with respect to future obligations based on those findings.
In relation to the grounds alleging error for refusing to declare that future contributions are to be in accordance with the unit entitlement proportion, in light of the findings, even those findings which favoured the appellant in terms of expenses properly incurred by the DVP, there is a real issue about whether it would have been appropriate to exercise the discretion to make declarations for the future in this particular case.
Broadly, the appellant relies on Angel J’s summary of the principles relevant to making declarations in Re Application for a Declaration of Paternity by ‘K’ and re the Estate of Edward Grant Smith deceased:[91]
In respect of the jurisdiction to grant declaratory relief, the High Court in Bass v Permanent Trustee Co Ltd,[92] agreed with the statement of Lord Goff of Chieveley in Re F (Mental Patient: Sterilisation),[93] that –
…a declaration will not be granted where the question under consideration is not a real question, nor where the person seeking the declaration has no real interest in it, nor where the declaration is sought without proper argument. eg. in default of defence or on admissions or by consent.
The appellant argued that when those conditions were fulfilled, the Local Court was in error not to grant the relief. In addition to those requirements, it is also to be remembered a declaration ‘is a formal statement by a court pronouncing upon the existence or non-existence of a legal state of affairs’.[94] As a formal pronouncement on the existence of a legal state of affairs between the parties, it is important that the legal issues are capable of being clearly resolved, which in turn may depend on material facts being settled or capable of being safely assumed.
Further, on appeal, the discretionary nature of the remedy must be firmly considered. The exercise of such a discretion is not to be interfered with unless error can be shown in either of the senses acknowledged in House v The King,[95] namely specific error or error by inference which has lead to an unreasonable or unjust decision. In House v The King their Honours said:[96]
The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed, and the appellate court may exercise its own discretion in substitution for his if it has the I materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.
It is tolerably clear why the Local Court did not make declarations as to liability for future expenses. Given the history of the status of the accounts and other findings pointing to disarray and how expenses were allocated it is perfectly comprehensible why declarations were not made to determine that charges in the future must be calculated according to unit entitlements. More importantly, there is also the possibility of a change in the way some expenses may be calculated such as moving to a specific liability basis or a formula.
With respect to grease trap maintenance expenses, the appellant points out the Local Court declared the expenditure incurred by the appellant was in accordance with s 36 of the Unit Titles Act, but declined to make a declaration in relation to future grease trap expenses.[97] Her Honour reasoned it was unnecessary to make the declaration.[98] The Further Amended Statement of Claim at paragraph 17(i) claims:
a declaration that the contribution payable by the defendant in respect of future “grease trap maintenance” expenses of the kind incurred by the plaintiff and levied in the notices is in the same proportion of the total as the defendant’s unit entitlement under the Act.
On one interpretation, all that is being sought is compliance with the Unit Titles Act, specifically s 36(3). In that case, the declaration is not necessary. More caution is however required before making such a declaration given it would need to be accepted the expenses incurred were correctly identified in the notice and that there would be no change to the basis on which the expenses would be calculated in the future, for example by specified liability. In all of the circumstances it was not an error to refuse the declaration in terms of future grease trap expenses.
For the same reasons it would be wrong to interfere with the refusal to grant declarations with respect to other instances where declarations as to future liabilities were sought, even when the finding was favourable in terms of current expenses. For example, future fire expenses,[99] future management fees[100] and future insurance fees.[101] I would not allow the appeal with respect to the refusal to grant declaratory relief.
Grounds 17 and 18 – debt recovery costs and interest
Given the failure of the appellant’s claims, the grounds alleging error through the Local Court failing to utilize ss 45 and 46 of the Unit Titles Act to recover the debt must fail. The levies were not valid hence the debt as formulated was not recoverable. Consequentially, neither were debt recovery costs.
For similar reasons there could be no award of interest.
The appeal will be dismissed.
The cross-appeal
As above the respondent to the appeal filed a cross-appeal with respect to two of the costs orders made by the Local Court on 16 May 2018. The first is the order that each party bear their own costs of the proceedings. The second is the dismissal of the application for non-party costs against the Gamble Group of Companies and/or Value Inn.
The Reasons for Judgment[102] on the question of costs set out why the Judge concluded that each party should bear their own costs. Further, her Honour set out particularly compelling reasons why, if the first conclusion on costs was in error, the Local Court would have ordered costs against Value Inn Pty Ltd, a non-party to the proceedings.
When determining the question of costs the Judge was exercising a judicial discretion. When reviewing the exercise of a discretion of this kind, an appeal court is constrained by the principles which govern the review of discretionary judgments, discussed above in the context of an appeal from a decision to decline discretionary relief.[103]
With respect, I agree with Barr J’s summary of the principles to be applied in these circumstances as set out in Simonetto and Anor v Dick.[104] Although his Honour dissented in the result, the principles he comprehensively set out, describe the approach to be undertaken when reviewing a costs decision on appeal. Relevantly at [93] and [94] his Honour said:
In determining a proper costs order, the trial judge was exercising a broad discretion which had to be exercised judicially…
However, I bear in mind that, subject only to the requirement that the trial judge exercise the costs discretion judicially, the matters to be taken into account by his Honour and the weight to be given to them was for him to determine. In this context, it does not matter whether an appellate court agrees or disagrees with the result to which the trial judge’s considerations led him. The questions which truly arise are whether the trial judge failed to consider any relevant matter in relation to costs; and whether he took into account some irrelevant matter. Where it is argued that a trial judge failed to give sufficient weight to a particular matter, in contrast to an assertion that the judge disregarded a matter altogether or took an irrelevant matter into consideration, an appellate court must be cautious not to substitute its own opinion for that of the judge in the absence of clear error, since that would be an inappropriate substitution of one discretion for another.
The principal complaint is that the Local Court erred in assessing the relative success of the parties. The Local Court determined that given there was partial success by both parties, the Court was to weigh up the nature of that success and how much time was spent in the hearing on the different issues. Her Honour described the various points of success and failure in respect of both litigants.[105] Both parties were criticised for failing to produce cogent evidence to support their respective cases. While those separate items were dealt with in some detail, particularly with respect to how much court time was required for a number of issues, there was not an assessment as to the relative overall success or otherwise of each party, especially when the failure of the plaintiff’s original claims are considered. This was not a case where each of the parties was successful or unsuccessful on approximately the same number of issues. The apportionment of costs must, as pointed out by the first cross-respondent be governed by fairness.[106] Fairness requires the assessment of the relative success of the parties. In the end the plaintiff succeeded on only a small proportion of its claims. While the defendant was unsuccessful in the defence of part of its case, it did not mount a counter claim and was largely successful in defeating the vast majority of elements of the plaintiff’s case. The original claims by the plaintiff were for the recovery of monies as a debt due or damages for failing to pay. Those claims were not successful. Although it did not appear to make a significant addition to the court time required at hearing, nor does it appear to have provoked further significant interlocutory steps, the Further Amended Statement of Claim added a claim under s 45 of the Unit Titles Act and sought 20 declarations of which 15 were dismissed along with the original claims for debt due and damages.
In Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd,[107] a case in which it could not be determined who the successful party was and the success for one party was partial, Finkelstein J said:[108]
The days when a plaintiff could, with impunity, mount an attack on several fronts, some with little prospect of success, in the hope of a direct hit and the recovery of all costs must be put behind us.
That consideration is apt here. Although it is inappropriate to resolve costs on an issue by issue basis, the plaintiff failed on its most significant claims, the original debt and damages claims as well as the majority of the applications for declaratory relief. In those circumstances, notwithstanding the defendant was not successful on every point or issue argued, the conclusion drawn here is that the discretion must have miscarried as clearly the defendant was the more successful litigant by a significant margin.
Further, it has long been recognised that greater latitude may be given to a defendant in these circumstances. This is by no means an immutable principle, however it is a factor relevant to the exercise of the discretion and does not appear to have been considered in any significant way below. In Hockey v Fairfax Media Publications Pty Ltd (No 2),[109] White J said that ‘[i]f a plaintiff makes unnecessary or unfounded claims, they can well be segregated and he may be penalised in costs; but a greater latitude is given to a defendant’. Professor Dal Pont in his work ‘Law of Costs’[110] explains why some latitude is given to defendants. A defendant who proves substantially successful in defending the suit should not be penalised in costs on issues upon which they failed to the same extent as the plaintiff, who is the party who elected to sue. Additionally, this should not be seen as an arbitrary rule fettering the costs discretion. In support of this position Dal Pont cites Allsop J’s remarks in Evans Deakin Pty Ltd v Sebel Furniture Ltd[111] where his Honour said this reasoning recognises that ‘the position and behaviour of the person brought to court unwillingly may need to be judged in that light’.
As indicated the appeal will be dismissed. The cross-appeal concerning costs below, will be allowed in part. As is evident from dealing with the substantive grounds, this is a situation where the defendant was substantially, albeit partially successful. There were however payments which should have been made by the defendant/cross-appellant according to the declarations that were granted by the Local Court. There were other observations made of the defendant’s lack of evidence in attempting to defend the matter. In all of the circumstances, it would not be unreasonable for the cross-appellant/defendant to pay its share of the DVP’s costs under the Unit Titles Act understood to be 24 per cent. Additionally, in my view, for the reasons outlined, this is a case where exceptionally a non-party, Value Inn Pty Ltd should pay the costs of the defendant/cross-appellant in the Local Court. I will not order Value Inn Pty Ltd pay the plaintiff’s costs in the Local Court. In the exercise of the discretion afresh, the orders for costs made by the Local Court will be quashed. As a consequence of exercising the discretion afresh, this includes the order that the costs of the defendant’s application for costs against the non-party be costs in the cause as such an order would be inconsistent with the orders to be made today.
Orders
1. The appeal is dismissed.
2. The cross-appeal is allowed in part.
3. The Notice of Contention is dismissed.
4. Orders a, b and c made by the Local Court on 16 May 2018 are quashed and in their place the following orders are made:
(i)The plaintiff is to bear its own costs of the proceedings in the Local Court, save that this order is not intended to prevent the plaintiff from recovering 24 per cent of its costs from the defendant, should the plaintiff proceed to recover that expense.
(ii)Value Inn Pty Ltd is to pay the defendant’s costs of the proceedings in the Local Court, including the costs of the application for costs against the non-party. For the avoidance of doubt, this does not include a contribution to the 24 per cent recoverable from the defendant by the plaintiff.
(iii)Failing agreement, costs are to be taxed at 100 per cent of the Supreme Court scale.
I have considered awarding costs on the appeal but believe the parties should have an opportunity to address the Court on the question of costs of the appeal. I will therefore hear counsel as to costs at a convenient time.
-----------------------
[1]Statement of Claim, 8 December 2015.
[2] These paragraphs related to the following claimed expenses: (e) future “fire equipment”; (g) fire service contract; (i) future grease trap maintenance; (k) future insurance expenses; (1) electricity; (m) future electricity; (n) and (o) water and future water charges respectively; (q) future management fees; (r) and (s) current and future rubbish and waste removal fees respectively; (t) and (u) current and future sewerage charges respectively; (v) and (w) current and future building maintenance.
[3] These paragraphs were applications for declarations for expenditure incurred for (d) fire equipment; (f) fire service contract; (h) grease trap maintenance; (j) insurance; (p) management fees.
[4] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018) at 1-2; Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 35 [221] - [222].
[5] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017).
[6] Mr Foy was described in various ways in the proceedings in the Local Court: He was the General Manager of Redco Investments and a director of Coorong Investments Pty Ltd, associated with The Gamble Group of Companies; He was a representative for the Gamble Group Pty Ltd, Manager of the Hostel and of Value Inn Pty Ltd; For a period Mr Foy was both managing the DVP and the Hostel and was the Basement’s (Lot 7542) representative on the DVP: Transcript of Proceedings, Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, 21560402, Fong Lim J, 9 – 11 August 2017) at 55. In the Local Court, counsel for the plaintiff said he acted as ‘effective[ly], the unofficial manager of the body corporate of the development plan between 2004 and 2014’: Transcript of Proceedings, Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, 21560402, Fong Lim J, 9 – 11 August 2017) at 9 (T Liveris).
[7] Amended Notice of Appeal, 5 June 2018 at 3.
[8] Proprietors of Unit Plan 2004/048, ‘Submissions of the Defendant on Costs’, Submission in Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048, 21560402, Local Court of the Northern Territory, 28 November 2017.
[9] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/48 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018).
[10] Notice of cross-appeal, 26 July 2018.
[11] On 9 October 2018 leave was granted for the Notice of Contention and Amended Notice of Contention to be filed out of time: Order of Blokland J in Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 and Proprietors of Unit Plan 2004/048 v Proprietors of Development Unit Plan 04/22 & Value Inn Pty Ltd (Supreme Court of the Northern Territory, LCA 56/2017, 21560402, 9 October 2018).
[12] See Exhibit P1 in Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/48 (Local Court of the Northern Territory, 21560402, commenced 9 August 2017) (‘Local Court Proceeding’): Certificate of Title, Vol 679, Folio 197.
[13] Depicted in Exhibit D5 in the Local Court Proceeding as the ‘purple area’.
[14] See Exhibit P5 in the Local Court Proceeding.
[15] For the first and second quarter of the financial year, each for $9276: Exhibit P1 in the Local Court Proceeding.
[16]For the third quarter of the financial year.
[17]For the fourth quarter of the financial year.
[18]For the first and second quarter of the financial year, 2014/2015 respectively.
[19]Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 3-4 [15]-[19].
[20] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 4-5 [25].
[21] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 5 [27].
[22] Unit Titles Act 1975 (NT) s 26ZI(2)-(3).
[23] Unit Titles Act 1975 (NT) s 26ZI(3)-(5).
[24] Unit Titles Act 1975 (NT) s 26ZI(3)(d).
[25] Unit Titles Regulations 2002 (NT) reg 15(1)-(2).
[26] Unit Titles Regulations 2002 (NT) reg 15(3).
[27] Unit Titles Act 1975 (NT) s 26ZT.
[28]Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 4 [19].
[29] Unit Titles Act 1975 (NT) s 26ZR(1).
[30] Unit Titles Act 1975 (NT) ss 30(2), 34(a).
[31] Unit Titles Act 1975 (NT) s 34(b).
[32] Unit Titles Act 1975 (NT) ss 25, 34(c).
[33] Which would seem to be reinforced by s 25(3) and (6) of the Unit Titles Act 1975 (NT).
[34] Unit Titles Act 1975 (NT) s 36(1).
[35] Section 36 of the Unit Titles Act1975 (NT) is outlined in full at pages 20 and 21 of this judgment.
[36] Unit Titles Act 1975 (NT) s 36(4).
[37] (1975) 1 NSWLR 15 at 24.
[38] Citing Mashane Pty Ltd v Owners Corporation RN 328577 [2013] VSC 417.
[39] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 23-16 [149]-[164]. Sections 36 and 45 of the Unit Titles Act 1975 (NT) are set out on pages 20-22 of these Reasons.
[40]Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 25 [157].
[41] (1996) 136 FLR 8 at 13.
[42] Sattel & Ors v The Proprietors Be Bee’s Tropical Apartments Building [2001] QCA 560, De Jersey CJ commenting on the Building Units and Group Titles Act 1980 (QLD) at [26].
[43] The 24 per cent was calculated on the basis that the Retail was 48 of 200 units, six per cent was allocated to the Basement and the remaining 70 per cent allocated to the Hostel.
[44] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 16-17 [93]-[100].
[45] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 14 [82].
[46] Proprietors of Unit Development Plan 04/22, ‘Appellant’s summary of submissions’, Submission in Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048, LCA56/2017, 21560402, Local Court of the Northern Territory, 25 September 2018 at [43], [53] and [60].
[47] Amended Notice of Appeal, 5 June 2018.
[48] Local Court (Civil Procedure) Act 1989 (NT) s 19(1).
[49] See example Wilson v Lowery (1993) 4 NTLR 79; Tracey Village Sports and Social Club v Walker (1992) 111 FLR 32 at 37-39 (Mildren J). See also, in a different context, KG v Firth [2019] NTCA 5 at 17 [23].
[50] KG v Firth [2019] NTCA 5 at 17 [23], citing Berlyn v Brouskos [2002] VSC 377; 134 A Crim R 111 at [30], [33].
[51] Wilson v Lowery (1993) 4 NTLR 79 at 84.
[52] Tracey Village Sports and Social Club v Walker (1992) 111 FLR 32 at 38.
[53] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/48 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018).
[54] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 7 [36].
[55] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 35 [221].
[56] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 35 [222].
[57] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 14 [82].
[58] Further Amended Statement of Claim, 3 May 2017.
[59]Further Amended Statement of Claim, 3 May 2017 at [11] and [12].
[60] Further Amended Statement of Claim, 3 May 2017 at [5]-[6], read with [14].
[61] See, eg, the evidence of Mr Doyle: Transcript of Proceedings, Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, 21560402, Fong Lim J, 9 – 11 August 2017) at 42-45.
[62] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at [82].
[63] Further Amended Statement of Claim, 3 May 2017 at [15], read with [5], [6] and [14].
[64] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 15 [91].
[65] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 17-18 [106]-[107].
[66] Mr Doyle was the manager of Stirling Management Services.
[67] Transcript of Proceedings, Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, 21560402, Fong Lim J, 9-11 August 2017) at 45.
[68] Proprietors of Unit Development Plan 04/22, ‘Appellant’s summary of submissions’, Submission in Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048, LCA56/2017, 21560402, Local Court of the Northern Territory, 25 September 2018 at 9 [46].
[69] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at [90]-[91]. ‘Redco Investments Pty Ltd’ referred to is part of the Gamble Group of Companies.
[70]Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 16-17 [96]-[102]. The relevant budget reconciliations are contained in Exhibit P1 in the Local Court Proceeding.
[71] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 18 [112]-[113].
[72] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 18 [109].
[73] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 18 [110].
[74] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 18 [112].
[75] Exhibit D3 in the Local Court Proceeding.
[76] Transcript of Proceedings, Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, 21560402, Fong Lim J, 9 – 11 August 2017) at 43-44.
[77] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 20 [123].
[78] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 20 [124]-[126].
[79] On Exhibit D5 in the Local Court Proceeding.
[80] Transcript of Proceedings, Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, 21560402, Fong Lim J, 9 – 11 August 2017) at 78-79.
[81] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 22 [135].
[82] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 22 [138].
[83] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 27 [169].
[84] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at 34-35 [216]-[218].
[85] The jurisdictional limit being $250,000 as set by s 12 of the Local Court Act 2015 (NT).
[86] Unit Titles Act1975 (NT) s 106(g), (h) and (j).
[87] David Wright, Remedies (The Federation Press, 2nd ed, 2014) at 277.
[88] (1929) 43 CLR 334 at 343.
[89] David Wright, Remedies (The Federation Press, 2nd ed, 2014) at 277 citing The Hon Justice Eric Heenan, ‘History of Declaratory Relief – A Distinct Remedy Beyond Equitable Affiliations’ in Kanaga Dhamananda and Anthony Papamatheous (eds), Perspectives on Declaratory Relief (Federation Press, 2009).
[90] Mayfair Trading Co Ltd v Dreyer (1958) 101 CLR 428 at 452-454; Zuchiatti Pty Ltd v Ferrara (1976) 1 BPR 9199 at 9207. See also the Hon. Justice Roderick Meagher, the Hon. Justice John Dyson Heydon and Mark Leeming, Meagher, Gummow and Lehane’s Equity: Doctrines and Remedies (LexisNexus Butterworths, 4th ed, 2002) at [19-155]; Peter Young QC, Declaratory Orders (Butterworths, 2nd ed, 1984) at [608]; Neil J Young QC, ‘Declarations and Other Remedies in Administrative Law’ (2004) 12 AJ Admin L 35 at 37.
[91] [2002] NTSC 63; 12 NTLR 155 at [19].
[92] [1999] HCA 9; 198 CLR 334.
[93] [1990] 2 AC 1 at 82.
[94] Sir Harry Woolf et al, Zamir and Woolf, The Declaratory Judgment (Sweet & Maxwell, 3rd ed, 2001) at 1.02 in Kanaga Dhamananda and Anthony Papamatheous (eds), Perspectives on Declaratory Relief (Federation Press, 2009) at 26-27.
[95] (1936) 55 CLR 449 at 504-505.
[96] (1936) 55 CLR 449 at 504-505.
[97] Ground 7.
[98] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 12 October 2017) at [148].
[99] Ground 8.
[100] Ground 11.
[101] Ground 12.
[102] Proprietors of Building Development Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018).
[103] Above at [71], setting out the relevant passage from House v The King (1936) 55 CLR 449 at 504-505.
[104] [2014] NTCA 4.
[105] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018) at [13]-[22].
[106] Veetemp Australasia Pty Ltd v GRD Group NT Pty Ltd [2012] NTSC 93 at [23]; Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd [1993] FCA 259 at [29]; Bowen Investments Pty Ltd v TabCorp Holdings Ltd (No 2) [2008] FAFC 107 at [5].
[107] [2003] FCA 325.
[108] Baulderstone Hornibrook Pty Ltd v Qantas Airways Ltd [2003] FCA 325 at [4].
[109] [2015] FCA 750; (2015) 237 FCR 127.
[110] GE Dal Pont, Law of Costs (LexisNexis Butterworths, 4th ed, 2018) at 215 [8.9].
[111] [2003] FCA 282 at [7].
[112] [2011] NSWCA 145.
[113] [1994] NSWCA 338; 254 ALR 328 (Kirby P, Mahoney and Priestley JJA).
[114] [2011] NSWCA 145 at [32]-[33].
[115] Griffith v Australian Broadcasting Corporation (No 2) [2011] NSWCA 145 at [19].
[116] [1991] 2 VR 568 at 568-569.
[117] GE Dal Pont, Law of Costs (LexisNexis Butterworths, 4th ed, 2018) at 215-216 [8.9].
[118] Proprietors of Building Development Plan No DVP 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018) at 13-14, [53].
[119] [1971] 1 Ch 204 at 208.
[120] Proprietors of Building Development Plan No DVP 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018) 6 at [24].
[121] Proprietors of Building Development Plan No DVP 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018) 12 at [46].
[122] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018) 13 at [52].
[123] Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018) 6-7 at [26]-[27].
[124] See, eg. Transcript of Proceedings, Proprietors of Development Unit Plan 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, 21560402, Fong Lim J, 9-11 August 2017) at 56-57.
[125] [2004] QSC 47 at [13].
[126] [2005] NSWCA 340 at [207].
[127] FPM Constructions Pty Ltd v Council of The City of Blue Mountains [2005] NSWCA 340 at [210].
[128] Vestris v Cashman (1998) 72 SASR 449 at 468 (Lander J).
[129] (1992) 174 CLR 178.
[130] Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 192 (Mason CJ and Deane J).
[131] Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 595.
[132] Proprietors of Building Development Plan No DVP 04/22 v Proprietors of Unit Plan 2004/048 (Local Court of the Northern Territory, Fong Lim J, 16 May 2018) at [13].
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