Santed Pty Ltd v Paradise Palms Leisure Villas
[2011] QCATA 204
•22 July 2011
| CITATION: | Santed Pty Ltd v Paradise Palms Leisure Villas [2011] QCATA 204 |
| PARTIES: | Santed Pty Ltd (Applicant) |
| v | |
| Paradise Palms Leisure Villas CTS 7509 (Respondent) |
| APPLICATION NUMBER: | APL 008-11 |
| MATTER TYPE: | Appeals |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Judge Kingham Deputy President Susan Gardiner, Member |
| DELIVERED ON: | 22 July 2011 |
| DELIVERED AT: | Brisbane |
ORDERS MADE: | The appeal is dismissed. |
| CATCHWORDS : | APPEAL – BODY CORPORATE – appeal from adjudicator’s decision - where Body Corporate refused to rezone a Lot and grant exclusive use of communal property – where specialist adjudicator heard dispute - where appeal only on question of law where no question of law raised – where appeal dismissed Queensland Civil and Administrative Tribunal Act2009 ss 269, 276, 289(1)-(2) Body Corporate and Community Management Act 1997 pt 9 ch 6 Body Corporate and Community Management (Standard Module) Regulation 2008 s 72 Canada (Director of Investigation and Research) v Southam Inc [1997] 1 SCR 748 cited Collector of Customs v Agfa-Gevaert Ltd (1995) 186 CLR 389 applied Santed Pty Ltd v Body Corporate Paradise Palms Leisure Villas CTS 7509 [2008] QCCTBCCM 18 cited |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to s 32 of Queensland Civil and Administrative Tribunal Act2009 (QCAT Act).
REASONS FOR DECISION
Deputy President:
I have had the benefit of reading the reasons of Ms Gardiner in draft. I agree with her reasons and her conclusions, and the order she proposes.
Member Susan Gardiner:
Santed Pty Ltd owns Lot 10 in the Paradise Palms Leisure Villas Community Title Scheme. Santed originally exercised the management rights for this scheme and Lot 10 was the community sports facility. Santed Pty Ltd no longer acts as manager and this lot has not been used as a sports facility since 2006.
In 2007 Santed unsuccessfully attempted to convert the use of Lot 10 to residential use with an additional allocation of an exclusive use car park by way of motions to the Body Corporate.
Santed appealed this refusal to an Adjudicator under the Body Corporate and Community Management Act 1997 and after failing to overturn the decision in that forum, finally appealed to the then Commercial and Consumer Tribunal.[1] This appeal was also unsuccessful.
[1]The predecessor to QCAT – see Santed Pty Ltd v Body Corporate Paradise Palms Leisure Villas CTS 7509 [2008] QCCTBCCM 18.
Further motions concerning Lot 10 were put to an Extraordinary General Meeting of the Body Corporate on 4 December 2009 again seeking a change to residential use, exclusive use of spaces for patios, a car space and carport, payment to the body corporate of compensation and consent to construct the carport.
These motions were defeated and in April 2010, Santed applied to the Commissioner for Body Corporate and Community Management for an order that the Body Corporate consent to Santed’s application for a change to the development approval for the site in the terms of motions considered at the EGM held in December 2009.
The matter was referred to adjudication by a departmental adjudicator[2] and the adjudicator’s decision was delivered on 25 November 2010. The adjudicator’s decision dismissed Santed’s application.
[2]Body Corporate and Community Management Act 1997, pt 9 ch 6.
On 6 January 2011 Santed appealed this decision to the QCAT Appeal Tribunal.[3] The appeal can only be on a point of law.[4]
[3]Queensland Civil and Administrative Tribunal Act 2009 s 289(1).
[4]Queensland Civil and Administrative Tribunal Act 2009 s 289(2).
The distinction between questions of law and fact are at times blurred and Courts have found it traditionally difficult to formulate a ‘satisfactory test of universal application.’[5] A useful explanation is encapsulated in the following passage from a decision of the Supreme Court of Canada.[6]
Briefly stated, questions of law are questions about what the correct legal test is; questions of fact are questions about what actually took place between the parties; and questions of mixed law and fact are questions about whether the facts satisfy the legal tests.[7]
[5]See Collector of Customs v Agfa-Gevaert Ltd (1995) 186 CLR 389, 394.
[6]Canada (Director of Investigation and Research) v. Southam Inc [1997] 1 S.C.R. 748.
[7]Canada (Director of Investigation and Research) v Southam Inc [1997] 1 SCR 748 at [35] per Iacobucci J.
Santed, in its notice of appeal, seeks to reverse the decision of the learned adjudicator, identifying the following errors of law:
a) Failing to have regard to the conciliation agreement dated 20 April 2009;
b) Making a finding that:
(i) Santed failed to provide sufficient information on the future use of Lot 10;
(ii) The impact statement provided by Santed did not address the effect of the proposal on the zoning of Paradise Palms Leisure Villas.
(iii) The EGM was conducted fairly to Santed or the meeting properly considered Santed’s motions;
c) Failing to consider whether the Body Corporate reasonably considered Santed’s evidence and the lack of evidence rebutting Santed’s evidence;
d) That the Body Corporate failed to list motions 5 and 6 in the alternative. The adjudicator found that this error voided these motions[8] and did not further consider the reasonableness of the opposition to these motions by the Body Corporate;
[8]Body Corporate and Community Management (Standard Module) Regulation 2008 s 72.
e) Failing to find the EGM void for irregularity as:
(i) Unfinancial members were permitted to vote;
(ii) The Body Corporate did not include the materials submitted by Santed accompanying voting papers;
(iii) Or alternatively, finding material was submitted with the voting paper;
f) Making an order beyond the power of the adjudicator in dismissing the application contrary to s 270 of the Body Corporate and Community Management Act 1997;
g) Finding the opposition of the Body Corporate was reasonable given the findings of the Tribunal previously in the matter in 2007.
The Conciliation Agreement
Santed’s first ground concerns the conciliation agreement dated 20 April 2009. Santed submits that the conciliation agreement constituted an agreement between the parties as to the information the Body Corporate required to be provided to it to approve the proposal. Santed provided no legislative basis for this submission nor has it referred the Tribunal to any case law to support this submission.
The learned adjudicator’s reasons to not have regard to the conciliation agreement are not specifically enunciated.
The conciliation agreement before the adjudicator and provided with the appeal documents is dated by the applicant (S Sutton) as 8 April 2009. It is unsigned by the Body Corporate. It is signed by the conciliator and dated by her on 20 April 2009. This is not evidence of a concluded agreement - it is not signed by the Body Corporate. The follow up letter from Santed to the Body Corporate dated 8 October 2009 referring to the conciliation document as an agreement (also before the adjudicator and referred to in his reasons) is also not evidence of a concluded agreement. Although not explained by the learned adjudicator specifically, after examining the documentary evidence there is insufficient evidence to show a conciliation agreement was reached between the parties without a document signed by the Body Corporate being produced.
Even if it were a completed agreement, the terms of the document show the applicant (Santed) agreeing to submit plans to the Body Corporate and after that, the Body Corporate agreeing to submit motions to either an AGM or an EGM, with the parties agreeing to act in good faith. There is no term that even comes close to Santed’s submission that the document ‘constituted an agreement between the Appellant and the Respondent as to the information which the Respondent required to be provided to it to approve the Appellant’s proposal’ (emphasis added).
The forum for a decision on each of the proposals by Santed is the EGM. While there may have been an agreement between the parties concerning process for the EGM by way of a conciliation agreement, such an agreement cannot decide the outcome of an EGM yet to be held by limiting the parties to only producing particular documents for consideration at the EGM. On both views expressed above, the decision of the learned adjudicator to not have regard to the conciliation agreement discloses no demonstrated or discernible error of law and, on that basis, Santed’s first submission must fail.
The findings that Santed failed to provide sufficient information on the future use of Lot 10 and that Santed’s impact statement did not address the effect of the proposal on zoning (grounds (b) (i) and (ii) above)
In support of these grounds, Santed states that the learned adjudicator made findings that: the Committee was concerned about the Body Corporate being in breach of the original development conditions; Santed’s material before the EGM was not clear as to whether Lot 10 would be subdivided; and the owners had concerns about an intent to subdivide Lot 10.
Santed then submits that none of these findings was open on the evidence, particularly where the adjudicator had found that neither the committee nor the owners had shown a justifiable basis for opposing the motion seeking Body Corporate consent to the Council for a material change of use of Lot 10. Santed says that having found this as a matter of fact, the adjudicator erred in law by embarking on consideration of matters not open on the evidence.
These submissions are linked to the submissions by Santed on the reasonableness of the decision and the procedure of the EGM generally (below) and will be addressed when considering those grounds. It is noted however that Santed simply makes these bald submissions and does nothing to support these submissions by references to the evidence before the learned adjudicator to assist this Appeals Tribunal to understand Santed’s submission more fully.
The Procedure of the EGM
A number of Santed’s grounds of appeal listed above go to the conduct of the EGM and the motions before it (see grounds (b) (iii), (d) and (e) listed above).
The meeting was plagued with problems from the start, with issues from both parties. The reasons of the learned adjudicator raise irregularities or concerns on a number of fronts, the main points being:
a) Generally, the way the motions were put in the notice of the EGM;
b) Specifically, the way motions 5 and 6 were put to the meeting;
c) The voting by unfinancial members on motions requiring an ordinary resolution.
The adjudicator’s role is to investigate the application to decide whether it would be appropriate to make an order on the application. In doing so, the adjudicator must observe natural justice, act quickly and with as little formality and technicality as is consistent with a fair and proper consideration of the application.[9] The learned adjudicator is not bound by the rules of evidence. The order of the adjudicator must be just and equitable in the circumstances to resolve the dispute.[10]
[9]Queensland Civil and Administrative Tribunal Act 2009 s 269.
[10]Queensland Civil and Administrative Tribunal Act 2009 s 276(1).
In order to provide the parties with a decision that is both just and equitable in the circumstances and resolves the dispute thereby providing finality for the parties from this EGM, the learned adjudicator has carefully and systematically dealt with each of the procedural issues that arose concerning the meeting procedure.
The learned adjudicator addressed each of the main irregularities. The adjudicator noted that although the notice of the EGM was not questioned, he considered it appropriate to investigate whether the motions the subject of the application were in accordance with the legislation. This action is clearly open to him under the Act.[11] Upon examination, the learned adjudicator concluded that motions 5 and 6 were void because they were not put on the voting paper as a motion with alternatives.[12] This finding is also open to him under the Act.
[11]Queensland Civil and Administrative Tribunal Act 2009 s 269.
[12]Body Corporate and Community Management (Standard Module) Regulation 2008 s 72(5).
The adjudicator carefully examined the voting by unfinancial members of the Body Corporate on ordinary motions to see if the voting by these members materially affected the outcome of the vote overall. Having concluded that it did not, the learned adjudicator proceeded to find that the motions were defeated on those votes cast by lot owners who were financial at the time of the meeting. Given the adjudicator’s noted function to provide to the parties a decision that is both just and equitable in the circumstances and resolves the dispute, these findings by the learned adjudicator disclose no error of law.
The learned adjudicator also addressed other issues raised by Santed, finding that the appointment of a returning officer; that unsubstantiated material was published contrary to the legislation; that the chairperson requesting a vote on a motion/s had an effect on the outcome; or that Santed’s nominee’s ability to speak at the meeting and the recording of votes cast for Lot 10 on motions not the subject of the application before the adjudicator; not to be relevant in the circumstances of this decision. These findings by the learned adjudicator disclose no error of law.
Overall, in light of the requirements of the Act, the findings of the learned adjudicator concerning the conduct of the meeting disclose no demonstrated or discernible error of law and, on that basis, Santed’s submissions must fail.
The Reasonableness of the Decision of the Body Corporate
The learned adjudicator addressed the reasonableness of the Body Corporate in declining the proposals put to it. Santed raises this submission in support of a number of its grounds of appeal, specifically (grounds (b)(i), (c) and (g) above). Santed relies on:
a) The uncertainty of the material submitted by Santed both to the EGM and later in response to a request for submissions by the learned adjudicator in not appearing to specify whether Lot 10 was intended to be subdivided;
b) Failing to consider whether the Body Corporate reasonably considered Santed’s evidence and the lack of evidence rebutting Santed’s evidence; and
c) Finding the opposition of the Body Corporate was reasonable given the findings of the Tribunal previously in the matter in 2007.
Santed submits that the learned adjudicator made an error of fact, finding that Santed’s motions were stated in the voting paper in the form submitted without amendment when discussing motions 5 and 6. The adjudicator found these motions to be void because they were not put on the voting paper as a motion with alternatives. The learned adjudicator found that the Body Corporate manager elected to present two separate motions (not motions in the alternative) and that this was an error by the Body Corporate.
Santed says that the Body Corporate was required to submit the motions in the manner provided by Santed and that this, coupled with allowing unfinancial members to vote and denying Santed the opportunity to speak to its motions resulted in the body corporate not acting reasonably. Santed submits the adjudicator should have found the meeting void and to not do so was an error of law. Santed relies on the decision of Batwing Resorts Pty Ltd v. Body Corporate for Liberty CTS 27241[13] per Member Dorney QC who stated
Even if the decision maker makes erroneous findings of fact, it does not follow that there is an error of law which vitiates the decision but the making of findings and the drawing of inferences without any evidence to support them is an error of law.
[13]Batwing Resorts Pty Ltd v. Body Corporate for Liberty CTS 27241 (2008) QCCTBCM 23.
This Appeal Tribunal adopts the learned member’s statement. This submission is made by Santed in the context of the conduct of the EGM. The Appeal Tribunal has already found previously in these reasons that that the conduct of the meeting discloses no demonstrated or discernible error of law.
Based on this finding, Santed’s submission in this appeal that “the adjudicator has found that the Respondent acted reasonably inferring that the Respondent acted reasonably in the conduct of the EGM” and “that finding is without evidence to support it and therefore is an error of law is not accepted.
Turning to the wider reasonableness consideration, in deciding there was a justifiable basis for the opposition to the motion on this occasion, the learned adjudicator found there was reasonable concern about the intention to subdivide Lot 10 and the allocation of two parts of common property to this lot under motion 4 as patio space.
In making this finding, the learned adjudicator first traversed the objective test of reasonableness and then the reasons for decision of the then Commercial and Consumer Tribunal, the first time this matter went on appeal. Santed’s current appeal should not be viewed in isolation, particularly where guidance was given to the parties on the first occasion. It is appropriate for the learned adjudicator on this appeal to review the comments of the first Appellate Tribunal and to consider this guidance, where relevant, in making his decision. However, it is guidance only and the adjudicator must make his decision based on the facts of this matter.
The learned adjudicator agreed that a report from an appropriate person in terms of the previous appeal decision had been provided.
The issue of uncertainly concerning the potential subdivision of the lot appears, in the learned adjudicator’s decision, as an important consideration in deciding if there was a justifiable basis for opposition to the motion. To echo the comments of the first appellate Tribunal, if there had been presented to the meeting a proposal that clearly stated Santed’s proposal thereby removing the uncertainty, it may have been the case that it was both properly open to and required of the learned adjudicator to determine that it would not be reasonable for the body Corporate to reject such a proposal.
The decision of the learned adjudicator as to the reasonableness of the Body Corporate in declining the proposals put to it discloses no demonstrated or discernible error of law and, on that basis, Santed’s submission on this ground must also fail.
Making an order beyond power in dismissing the application (s270 of the Body Corporate and Community Management Act 1997)
Santed makes no submissions to support this ground. It is not evident to this Appeals Tribunal how Santed alleges the learned adjudicator made an order beyond power in dismissing the appeal. Section 270 of the Act sets out the power of an adjudicator to make an order dismissing an application. One of the grounds for such a dismissal is that it appears to the adjudicator that the application is without substance (s 270(1) (c)).
Having satisfied himself, as disclosed in this reasons, that Santed’s application was without substance, the learned adjudicator is within power to dismiss the application. Santed’s ground of appeal under this section must also fail.
Conclusion
Santed can resubmit its motions to the Body Corporate at a time in the future. At all future meetings of the Body Corporate, care should be taken to ensure the procedural requirements of the Act are adhered to. This is the responsibility of all parties but in particular of the Body Corporate as the meeting convener. Santed must ensure its motions are clear, concise and without ambiguity, so that all eligible parties voting are able to understand the intent of the motions put to the vote. The decision of the learned adjudicator in this present application was made more complex by procedural issues on both sides. If all reasonable steps are taken, both the Body Corporate and Santed should be able to find a solution in the best interests of all parties concerned.
However, there being no question of law identified in this matter, this appeal must be dismissed.
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