Re Building Units and Group Titles Act 1990

The case before the Supreme Court of Queensland involves a dispute over the exclusive use of a reception area in the Cairns Aquarius building, managed under the Building Units and Group Titles Act 1990. The proprietors of Cairns Aquarius, the applicant, seek to revoke the exclusive use rights granted to the respondent, the previous manager, who owns lot 3. The crux of the dispute lies in the interpretation of by-law 25, which grants exclusive use rights to the proprietor of lot 3 and conditions those rights on the existence of a management agreement. The respondent argues that by-law 25 cannot be revoked without its consent, while the applicant contends that the by-law permits the revocation of the exclusive use rights under certain conditions.
The court was required to determine whether the by-law could be interpreted to allow the termination of the exclusive use rights without repealing the by-law, as claimed by the applicant. This involved examining the language of by-law 25 and its compatibility with the provisions of the Building Units and Group Titles Act 1980, specifically sections 30(7) and 30(9). The court had to balance the literal meaning of the by-law with the practical implications of allowing the respondent to retain exclusive use rights despite the termination of its management agreement.
The court found that by-law 25, although poorly drafted, could be interpreted to grant a defeasible right to exclusive use, which could be terminated by a resolution of the Body Corporate when the specified condition (the cessation of the management agreement) was met. The court emphasised that by-law 25 permitted the Body Corporate to revoke the exclusive use rights by ordinary resolution, effectively terminating the right without repealing the by-law. This interpretation was supported by the purpose of the by-law, which was to grant rights incidental to the management of the building. The court rejected the respondent's argument that the by-law could not be revoked without its consent, noting that the by-law itself provided for the defeasance of the exclusive use rights under certain conditions. The court also addressed the respondent's concerns about the discoverability of changes to the by-law, concluding that the statutory duties to record and inspect resolutions would suffice.
The court ruled in favour of the applicant, declaring that the Body Corporate could revoke the exclusive use rights granted by by-law 25 by ordinary resolution. The respondent was ordered to pay the applicant's costs.