Re Greenway Park Developments Pty Ltd

[1992] QCA 430

IN THE COURT OF APPEAL	[1992] QCA 430
QUEENSLAND

C.A. No. 140 of 1992

BETWEEN:

GREENWAY PARK DEVELOPMENTS PTY. LTD.

Appellant

- and -

JOHN CRIDLAND, REGISTRAR OF TITLES

First Respondent

- and -

THE PROPRIETORS, "PADDINGTON PLACE",

GROUP TITLES PLAN NO. 984

Second Respondent

JOINT JUDGMENT OF THE PRESIDENT AND de JERSEY J.

Delivered the eleventh day of December, 1992

The appellant, Greenway Park Developments Pty. Ltd., was the original registered proprietor of all of the lots created by registration of Group Titles Plan No.984, and is still the registered proprietor of one lot on the plan. By an instrument dated 24 March 1983, it purported to lease that lot to the Proprietors "Paddington Place" Group Titles Plan No.984, which is the Body Corporate constituted by the registration of that plan, and a respondent to this appeal. The term of the lease is 99 years and provides for use of the lot as a "community recreational centre, library and swimming pool". The rent is substantial, $20,000.00 for the first year, subject to adjustment for subsequent years. The lease has not yet been registered. When it was lodged for registration on 27 May 1992, the Registrar of Titles issued a requisition, asking "what is the authority for the Body Corporate to accept the lease of the lot within the parcel ?"

The appellant applied to a judge in chambers for declarations that the Body Corporate had the necessary authority and that the lease is registrable, but the application was dismissed.

Relevant provisions of the Building Units and Group Titles Act 1980, were amended in 1988; see Act No.23 of that year. However, the primary judge held, correctly in our view, that it is the Act in force at the time when the lease was entered into, the Building Units and Group Titles Act 1980, to which reference must be made to determine whether, in 1983, the Body Corporate had power to enter the lease. There is nothing in the subsequent amendments, including transitional provisions, which would validate the lease retrospectively if it were initially invalid.

The simple proposition for the appellant is that the power of the Body Corporate to enter the lease is to be found in sub-s.37(1)(d) of the Act as it stood in 1980, a provision which is repeated in sub-s.37(2)(b) of the amended Act. By sub-s.37(1)(d) of the 1980 Act, a body corporate may acquire and hold any personal property. The appellant contends that, technically, a leasehold is "personal property" and relies upon the references in the sub-s. to "hold" and "any" as supportive of its view. The word "any" is said to emphasise the comprehensive range of "personal property" intended to be encompassed in the sub-s. and the word "hold" is said to be especially apposite to leaseholds.

While the considerations advanced by the appellant are of some force, they are not decisive. The word "any" does little but indicate that, whatever the meaning of "personal property" within the Act, all kinds of such property are included within sub-s.37(1)(d). The word "hold" affords little assistance, for if one thing is clear it is that "personal property" in sub.s.37(1)(d) is not confined to leases, and thus "hold" is accepted by the draftsman as suitable for use in relation to other kinds of personal property, such as ordinary goods. Finally, while in the historical development of the law leases have been characterized as "chattels real" and thus personalty, the modern tendency has been to differentiate leases, or chattels real, from "pure personalty" and to treat the law relating to leases as an element of the law of real property.

In these circumstances, whether or not a lease is personal property within the meaning of a particular statute is most likely to be determined by reference to the context provided by other provisions of that Act.

Before searching for other references in the Act to personal property or leases, it is useful to notice briefly the concept of a body corporate under the Act: see, especially Part IV "Management", Division 1 - "Bodies Corporate". By sub-s.27(1) when a plan is registered the proprietors of the lots in a parcel are incorporated into a body corporate which, as a creature of statute, has the powers, authorities, functions and duties defined and limited by the Act. By sub-s.27(3) it is provided that, subject to the Act, a body corporate has the powers, authorities, duties and functions conferred or imposed upon it by or under the Act or by-laws and the body corporate is required to do all things necessary for the enforcement of the by-laws and the control, management and administration of the common property. Although it is, of course, necessary to see what other powers, authorities, duties and functions are conferred or imposed on a body corporate by other provisions of the Act or by the By-laws, the general provisions to which reference has been made (see also sub- s.27(2)) indicate that a body corporate is fundamentally concerned with the effective use and enjoyment of the parcel, both the individually owned lots and the jointly owned common property. This factor influences the meaning to be given to the language used in such provisions as s.37 "Miscellaneous powers of body corporate" and s.38 "Duties of body corporate". Thus, for example, there is nothing to suggest that a body corporate is intended to have such powers as a power to carry on a business unrelated to the parcel, with ancillary powers, for example, to acquire title to land for such a purpose.

That being so, even assuming that "personal property" within the meaning of sub-s.37(1)(d) includes leaseholds, it is by no means immediately obvious that the respondent Body Corporate has power to acquire and hold a leasehold of an area within or without the parcel for whatever purpose it chooses, such as, in this instance, a "community recreational centre, library and swimming pool". However, it is unnecessary to decide that question.

There are a number of other references in the Act to "personal property" which, at best for the appellant, give little support to the view that leases were intended to be included. Sub-s.38(1)(b)(ii), for example, obliges the body corporate to maintain properly "any personal property vested in the body corporate". Sub-s.38(1)(k) refers to raising money for the acquisition of personal property, and sub- s.38(1)(l) refers to the proceeds of "the sale or other disposal of any personal property of the body corporate". Other provisions refer to the purchase, acquisition, sale and disposal of personal property.

Perhaps more importantly, there are other specific provisions in the Act dealing with the power of the body corporate to take a lease. Thus, for example, sub- s.37(1)(f) empowers a body corporate to "accept or acquire a lease ... for the purposes of providing moorings for vessels." Such a provision would be unnecessary if sub- s.37(1)(d) bore the meaning contended for by the appellant.

Another specific power for a body corporate to accept a lease is to be found in sub-s.21(1) which provides:

"21. Acquisition of additional common property.

(1) A body corporate may, pursuant to unanimous

resolution, accept -

...

(b)  a lease of land, not being a lot within the parcel, whether or not it abuts on the parcel,

for the purpose of creating additional common
property."

Such a provision can only add to the power under sub- s.37(1)(d) asserted by the appellant if, by some process which is not obvious, sub-s.37(1)(d) is read down so as not to include power from a body corporate to take a lease outside the parcel or to take a lease for the purpose of creating additional common property. However, the appellant advanced no such suggestion; on the contrary, it was at the heart of the appellant's case that sub-s.37(1)(d) provides the respondent Body Corporate with an unqualified power to accept a lease, whether or not part of the parcel, and whatever purpose of its use. This approach makes both sub- s.21(1)(b) and sub-s.37(1)(f) either unnecessary or, in the former case, perhaps inconsistent with sub-s.37(1)(d). It is evident that, if possible, such a construction of the Act should be avoided.

In summary, while historically "personal property" may technically include a lease of real property, there are sufficient indications in the Building Units and Group Titles Act 1980 to indicate that leases are not "personal property" within the meaning of that Act.

Accordingly the primary judge correctly concluded that the respondent body corporate lacked authority to enter into the lease relied upon by the appellant in 1983. The appeal should therefore be dismissed, with costs to be taxed.

IN THE COURT OF APPEAL

QUEENSLAND

C.A. No. 140 of 1992

Before the Court of Appeal

The President
Mr Justice Pincus

Mr Justice de Jersey

BETWEEN:

GREENWAY PARK DEVELOPMENTS PTY. LTD.

Appellant

- and -

JOHN CRIDLAND, REGISTRAR OF TITLES

First Respondent

- and -

THE PROPRIETORS, "PADDINGTON PLACE",

GROUP TITLES PLAN NO. 984

Second Respondent

JOINT JUDGMENT OF THE PRESIDENT AND de JERSEY J.

Delivered the eleventh day of December, 1992

MINUTE OF ORDER:	Appeal dismissed with costs to be taxed
CATCHWORDS:	Home and Commercial Units. Building Units and Group Titles Act. Applicant purported to lease lot to Body Corporate - whether lease "personal property" within s.37(1)(d) - whether body corporate lacked authority to enter into the lease.
Counsel:	Mr H. Weld for the Appellant Mr B. Clark for the First Respondent Mr D.A. Savage for the Second Respondent
Solicitors:	Messrs. Munro Thompson t/a for Messrs. Walsh Halligan Douglas for the Appellant
Crown Solicitor for the first Respondent
Messrs. Mallesons Stephen Jacques for the Second Respondent

Hearing date: 2nd November, 1992
IN THE COURT OF APPEAL

QUEENSLAND

C.A. No. 140 of 1992

BETWEEN:

GREENWAY PARK DEVELOPMENTS PTY. LTD.

Appellant

- and -

JOHN CRIDLAND, REGISTRAR OF TITLES

First Respondent

- and -

THE PROPRIETORS, "PADDINGTON PLACE",

GROUP TITLES PLAN NO. 984

Second Respondent

The President
Mr Justice Pincus
Mr Justice de Jersey

Judgment delivered on the eleventh day of December, 1992. Reasons prepared by the President and de Jersey J. jointly, Pincus JA separately. All concurring as to the order.

APPEAL DISMISSED WITH COSTS TO BE TAXED

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 140 of

1992

BETWEEN:

GREENWAY PARK DEVELOPMENT PTY. LTD.

Appellant

AND:

JOHN CRIDLAND, REGISTRAR OF TITLES

First Respondent

AND:

THE PROPRIETORS, "PADDINGTON PLACE",

GROUP TITLES PLAN NO. 984

Second Respondent

JUDGMENT - PINCUS J.A.

Delivered the Eleventh day of December 1992

I have read the reasons of Fitzgerald P. and de Jersey J. and agree with the conclusion there reached; I will not repeat the explanation of the nature of the case which is set out in those reasons.

As was pointed out during the hearing, relevant provisions of the Building Units and Group Titles Act 1980 were amended in 1988; see Act No. 23 of that year. In my opinion, unless there was power for the body corporate to enter into the lease in question in 1983 when it was executed, its having done so must be held to have been beyond power. It cannot assist the body corporate to show that, after it executed the lease, the Act was changed in such a way as to make the transaction a permissible one; it is not suggested that any relevant change operated retrospectively. Reference was made to transitional provisions in s.5 of the Act; they do not appear to me to support the conclusion that the 1988 amendments are presently relevant. In my view, it is the Act in its form as at the date of the lease which must be scrutinised to determine whether the body corporate had the necessary power. However, it appears that treating the 1988 amendments as relevant would not alter the outcome of this case.

If the argument for the appellant is right, then the
1980 Act gives a body corporate two powers to enter into a
lease as tenant: under s.21(1) and under s.37(1)(d). Under
the former provision, that power is limited in three ways:
there must be a unanimous resolution, the leased land must
not be a lot within the parcel and the purpose must be that
of creating additional common property. None of these
restrictions applies in s.37(1)(d) and it would therefore
seem to follow that, on the appellant's argument, a body
corporate can enter into a lease of land as tenant without a
unanimous resolution, whether or not the land leased is a
lot within the parcel, and for purposes other than that of
creating additional common property.

It is not germane to the present discussion to consider what is the legislative policy underlying the restrictions on leasing in s.21(1). What matters is that the restrictions exist and tend to make one question whether the legislature could, in truth, have intended that there should co-exist, with that strictly limited power to take a lease, a power to do so untrammelled by any restriction whatever.

It was suggested during argument that because the limitations in s.21(1) include that the purpose must be the creation of additional common property, the provision does not throw light on the extent of powers exercised for other purposes. I do not think that is correct: the existence of s.21(1) makes it appear unlikely that there was intended to be another and unbounded power to lease land. Further, the paragraphs of s.38(1) referred to in the reasons of Fitzgerald P. and de Jersey J. do not assist the appellant.

Nevertheless, if s.37(1)(d), entitling the body corporate to "acquire and hold any personal property" unequivocally, as was argued for the appellant, gives power to take leases, effect must be given to it. We were urged to apply what might be called the historical notion of personal property, depending on the ancient distinction between real actions and personal actions. It was said that the technical meaning of personal property includes chattels real and that one could see that such a meaning was intended, because of the use of the technical word "hold".

The expression "personal property" seems not often to be used currently in the sense in which the appellant insists it was used in this statute. One who, anxious for enlightenment on the topic of leases, attempts to obtain it from works on personal property will be disappointed;

whereas texts explaining the law of real property, including those on which the appellant relied, deal extensively with leases. We were referred to the Oxford Dictionary but it gives no modern example of use of the expression in the sense for which the appellant contends. Nor was the appellant's counsel able to give us any instance of its current use in that sense, except in explanations of the origins of the expression. In my opinion, the ordinary usage of the expression "personal property" at present appears not to be such as to include leases of land, but even if that were not so, the expression is at least ambiguous and is well capable of a meaning which excludes leases of land. If such an ambiguity exists, the considerations referred to above show that the narrower sense of "personal property" must have been intended. The appeal should be dismissed with costs.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 140 of

1992

Before the Court of Appeal
The President
Mr. Justice Pincus

Mr. Justice de Jersey

BETWEEN:

GREENWAY PARK DEVELOPMENT PTY. LTD.

Appellant

AND:

JOHN CRIDLAND, REGISTRAR OF TITLES

First Respondent

AND:

THE PROPRIETORS, "PADDINGTON PLACE",

GROUP TITLES PLAN NO. 984

Second Respondent

JUDGMENT - PINCUS J.A.

Delivered the Eleventh day of December 1992

Counsel:	H. Weld for the Appellant B. Clark for the First Respondent D. Savage for the Second Respondent
Solicitors:	Walsh Halligan Douglas t/a for Munro Thompson for the Appellant Crown Solicitor's Office for the First Respondent Mallesons Stephen Jaques for the Second Respondent
Hearing Date(s):	2 November 1992