The Owners - Unit Plan No 396 v Uren & Blundell
[2017] ACAT 100
•4 December 2017
ACT CIVIL & ADMINISTRATIVE TRIBUNAL
THE OWNERS – UNIT PLAN NO 396 v UREN & BLUNDELL (Appeal) [2017] ACAT 100
AA 26/2017 (UT 2/2017)
Catchwords: APPEAL – rule of procedure – point not taken or conceded in the primary proceeding cannot be taken for the first time on appeal unless a point of construction or law – whether original Tribunal erred when finding opposition to a motion for approval of proposed extension to a dwelling in a units plan was unreasonable– meaning of ‘unreasonable’ for the purposes of the Unit Titles (Management) Act 2011 – reasons for decision not to be overly scrutinised for error – rights of unit holders to object to erecting or altering a structure not confined to an adverse effect on property rights – appeal dismissed.
Legislation cited: ACT Civil and Administrative Tribunal Act 2008 s 79
Administrative Decisions (Judicial Review) Act 1989 s 6Unit Titles (Management) Act 2011 ss 129, 161 Schedule 4 r 4
Cases cited:Ainsworth v Albrecht [2016] HCA 40
Associated Provincial Picture Houses Ltd vWednesbury Corp [1948] 1 KB 223
Banque Commerciale SA v Akhil Holdings Ltd [1990] HCA 11
Coulton v Holcombe [1986] HCA 33
Electricity Commission of NSW v Yates (1993) 30 NSWLR 351
Floro v The Owners Units Plan 630 [2017] ACAT 4
Re Betty Lennell v Repatriation Commission WA [1982] FCA 7
O'Brien v. Komesaroff [1982] HCA 33
Meaney v The Owners Corporation Units Plan 40 [2013] ACAT 72
Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6
Re the Hospital Benefit Fund of Western Australia Inc and Department of Health, Housing and Community Services
[1992] AATA 205
The Owners Units Plan 768 v Lokusooriya [2013] ACAT 80
Uren & Anor v The Owners Units Plan No 396 [2017] ACAT 51
Water Board v Moustakas [1988] HCA 12
Tribunal: Presidential Member G McCarthy
Date of Orders: 4 December 2017
Date of Reasons for Decision: 4 December 2017
AUSTRALIAN CAPITAL TERRITORY )
CIVIL & ADMINISTRATIVE TRIBUNAL ) AA 26/2017
BETWEEN:
THE OWNERS – UNITS PLAN NO 396
Appellant
AND:
CHRISTOPHER DAVID UREN
First Respondent
REBECCA VIVIENNE BLUNDELL
Second Respondent
TRIBUNAL: Presidential Member G McCarthy
DATE:4 December 2017
ORDER
The Tribunal orders that:
1.The appeal is dismissed and the orders under appeal are therefore confirmed.
………………………………..
Presidential Member G McCarthy
REASONS FOR DECISION
1.Units plan No 396 comprises of six residential premises, each well separated, in the Canberra suburb of Bruce. The respondents own unit 3, where they live with their three children.
2.This appeal arises from an order of the Tribunal made on 6 July 2017 giving effect, after amendment, to an unsuccessful motion moved at a special general meeting of the appellant for approval of the respondents’ proposed extension and other works at unit 3. I heard the appeal on 26 October 2017. Mr Christensen appeared for the appellant. Mr Jenkins appeared for the respondents.
Background
3.The default rules of an owners corporation are set out in Schedule 4 to the Unit Titles (Management) Act 2011 (the UTM Act). The rules include rule 4 which states:
4Erections and alterations
(1) A unit owner may erect or alter any structure in or on the unit or the common property only—
(a)in accordance with the express permission of the owners corporation by unopposed resolution; and
(b)in accordance with the requirements of any applicable territory law (for example, a law requiring development approval to be obtained for the erection or alteration).
(2) Permission may be given subject to conditions stated in the resolution.
4.At the appeal hearing, Mr Christensen submitted that rule 4 of the default rules is not applicable and that rule 4(e) of the rules in the schedule to the Unit Titles Act 1971, which applied when the appellant came into existence, continues to apply notwithstanding commencement of the UTM Act. Rule 4(e) states that a unit holder may not:
except in accordance with express permission contained in a unanimous resolution of the Corporation and in accordance with the provisions of any law in force in the Territory applicable in the circumstances, erect or alter any structure in or on his or her unit.
5.The submission contradicted the submission of Mr Smith, the owner of unit 5, who appeared for the appellant at the original hearing. Mr Smith submitted that rule 4 in the Schedule to the UTM Act applied.[1]
[1] Transcript of proceedings, 6 June 2017, page 18, line 37 - page 19, line 30
6.Whether rule 4 or rule 4(e) applies depends on whether the appellant has amended its rules since rule 4(e) was in force and, if not, whether rule 4(e) no longer has any effect because it is inconsistent with the UTM Act.[2] I did not receive any evidence or submissions on either of these issues. Also, for the purposes of the appeal, it does not matter whether current rule 4 or its predecessor, rule 4(e), is the operative rule because in each case the respondents needed an “unopposed” or “unanimous” resolution in order to erect or alter a structure in or on their unit. I proceeded therefore on the basis that current rule 4 applies.
[2] Unit Titles (Management) Act 2011, section 161
7.On 19 November 2014, the respondents sought approval from the other unit holders for construction of an extension to their home but did not obtain an unopposed resolution in favour of the proposed works as required under rule 4(1)(a) of the rules. Three unit holders voted against part of the proposal, namely construction of an additional bedroom.
8.Notwithstanding this outcome, the respondents applied for, and on 2 February 2016 obtained, planning approval from the ACT Planning and Land Authority (ACTPLA) to add a new (fourth) bedroom to the south-east corner of their home; add a new entry porch; conduct internal refurbishment of the existing bathroom and ensuite; and carry out associated landscaping, paving and site works. The approved works included construction of a new window for an existing bedroom described in the plans as “Bed 3”.
9.By obtaining planning approval, the respondents complied with rule 4(1)(b) of the rules.
10.On 26 June 2016, for the purpose of complying with rule 4(1)(a), the respondents again sought approval from the owners corporation at a general meeting of the unit holders for construction of the works as approved by ACTPLA. However, again, the respondents did not obtain an unopposed resolution approving the proposed works. Three unit holders opposed the respondents’ motion for approval of the works.
11.On 31 January 2017, the respondents applied to the Tribunal for an order under section 129(1)(g) of the UTM Act giving effect to the respondents’ unsuccessful motion that the owners corporation approve the proposed works. Section 129(1)(g) states:
The ACAT may make the following orders:
..
(g) an order giving effect to an unsuccessful motion for a resolution of a general meeting (either as originally proposed or as amended by the ACAT) if the ACAT is satisfied after a merits review of the motion that opposition to the motion was unreasonable;
12.On 6 July 2017, the Tribunal made an order giving effect to the respondents’ unsuccessful motion, although in a form amended by the Tribunal.
13.On 3 August 2017, the owners corporation appealed the decision of the Tribunal (hereafter the original Tribunal) to the Appeal Tribunal alleging that the original Tribunal erred in law by reference to eight separate grounds. The Appeal Tribunal has jurisdiction to hear an appeal “on a question of fact or law”.[3] At hearing, the appellant pressed seven of the eight grounds. I deal with each in turn.
[3] ACT Civil and Administrative Tribunal Act 2008, section 79
1. The original Tribunal erred in law in finding that the decision by ACTPLA on the respondents’ planning application was a merits review for the purposes of section 129(1)(g) of the UTM Act
14.Ground 1 draws on the requirement in section 129(1)(g) that for the Tribunal to make an order giving effect to an unsuccessful motion it must be satisfied “after a merits review of the motion” that opposition to the motion was unreasonable.
15.Mr Christensen submitted that it was not permissible under section 129(1)(g) for the original Tribunal simply to adopt ACTPLA’s approval of the proposed works as “a merits review” for the purposes of section 129(1)(g), and that the original Tribunal needed to conduct its own merits review of the motion before proceeding to consider whether opposition to the motion was unreasonable. Mr Christensen submitted that by not conducting a merits review of the motion, as a precondition to making an order under section 129(1)(g), the original Tribunal acted unlawfully.
16.At paragraph 19 of its reasons for decision, the original Tribunal said:
In this case, a merits review of the proposal had been conducted by ACTPLA and the parties were agreeable to the Tribunal accepting the ACTPLA approval as its merit review process. Where the proposal has not previously been tested in a merits review process conducted by a relevant government agency, the merits review to be undertaken by the ACAT under section 129(1)(g) may need to be more thorough, and canvass comparative issues in a detailed manner. (emphasis added)
17.It is clear from paragraph 19 that the original Tribunal recognised the need for a merits review of the motion. To fulfil this need, it adopted and accepted ACTPLA’s approval as “its” merit review process.
18.The original Tribunal stated that the parties were agreeable to the Tribunal proceeding in that way. That statement is borne out by the transcript of the proceedings before the original Tribunal. The presiding member said:
All right. So what I'd be proposing is that as [a] matter of practicality, whether the parties would allow us to proceed with essentially just - essentially adopting that the merits review - that there is merit in the proposal, essentially. And we move on to the guts of the argument, which is about whether the opposition by three members of the body corporate is unreasonable.
19.In response to that proposal, Mr Smith appearing for the owners corporation said:
There are elements of the evidence that forms part of the witness statement[s] and the facts and contentions that we would need to draw on, I think, in---
20.The exchange between the presiding member and Mr Smith then continued as follows:
Tribunal: No, no, no. You're obviously going to have to draw on things like sunlight and - or whatever is relevant. What I'm saying is that we don't need to go through, for example, the expert evidence about---
Mr Smith: Yes.
Tribunal: About the building and so on.
Mr Smith: I would agree that ACTPLA has ---
Tribunal: Could we just ---Mr Smith: It’s merits review, and then another has been performed by Ms Ravarian, and we have criticised it, but essentially, it's been done. [4]
[4] Transcript of proceedings, 6 June 2017, page 44, line 23; page 45, line 2
21.The presiding member then said:
And so would it be possible to focus depending on obviously the outcome of the law- the ruling on the law that - can we just focus on the issue of the unreasonableness? Which means to say, in some cases with the witnesses, we may need to pull them up and say, "But really, this goes to the merits, not to - not to the question of reasonableness that we want to deal with." If we can do that, then I think we’ve got a chance of finishing today. Or we may have to adjourn, but -so is - can I get - is there agreement on that as a way of proceeding?
22.In answer to that proposal, Mr Smith said “Yes”.[5]
[5] Transcript of proceedings, 6 June 2017, page 45, lines 5 - 14
23.In my view, the appellant cannot agree to the way in which the presiding member proposed to proceed on the issue of merits review, allow the hearing to proceed in that manner, and then contend on appeal that the presiding member erred by proceeding as he proposed. It is a settled rule of litigation procedure that a party cannot take on appeal a point not taken at the initial hearing, unless the appeal point is one of construction or of law. [6]
[6] Coulton v Holcombe [1986] HCA 33; O'Brien v Komesaroff [1982] HCA 33; Electricity Commission of NSW v Yates (1993) 30 NSWLR 351
24.In Water Board v Moustakas, the High Court said:
13. More than once it has been held by this Court that a point cannot be raised for the first time upon appeal when it could possibly have been met by calling evidence below. Where all the facts have been established beyond controversy or where the point is one of construction or of law, then a court of appeal may find it expedient and in the interests of justice to entertain the point, but otherwise the rule is strictly applied.
14. In deciding whether or not a point was raised at trial no narrow or technical view should be taken. …
15. It is necessary to look to the actual conduct of the proceedings to see whether a point was or was not taken at trial, especially where a particular is equivocal. ….[7]
[7] Water Board v Moustakas [1988] HCA 12 at [13]
25.In Banque Commerciale SA v Akhil Holdings Ltd, the High Court commented on the rule established in Water Board v Moustakas as follows:
Some aspects of that rule appear to derive from public policy considerations directed to ensuring the finality of litigation. On the other hand, some aspects of the rule may have their genesis in estoppel by election in the conduct of litigation, although, if so, the relevant consideration is not that the other party is put in a worse position but that he or she may have been so placed. See, for example, Moustakas, at p 212; p 197 of ALR, where the refusal to allow the appellant to raise a new case was rested on "the possibility that the (other party) may, if it had been raised below, have wished to call evidence in response to it". So far as the rule may derive from public policy, the relevant consideration is that the case sought to be made on appeal is a new or different case from that which emerged at the trial.[8]
[8] Banque Commerciale SA v Akhil Holdings Ltd [1990] HCA 11 at [12]
26.The observations of the High Court in Banque Commerciale SA are apposite. If the appellant had wished to make submissions or lead evidence about the need for merits review, or who should conduct it or what the outcome of the merits review process needed to be, it could have done so. Evidence could have been led, and challenged, accordingly. The original Tribunal could have ruled on the issue, including its role. None of these things occurred. Mr Smith acknowledged in relation to merits review “it's been done”.
27.In my view, the appellant cannot now on appeal litigate the issue.
28.I have nevertheless considered whether it was legally open for the original Tribunal to proceed in the manner it did, particularly where Mr Christensen submitted (in effect) that the original Tribunal erred in law by not conducting “a merits review” and so misunderstood (and failed to carry out) a condition precedent to it making its order. The submission, in substance, goes to the original Tribunal’s jurisdiction.
29.I am not persuaded that the original Tribunal erred in the way submitted. Nothing in section 129(1)(g) required the original Tribunal to conduct a merits review of the motion. The section merely required that the merits review be done before the original Tribunal considered the question whether opposition to the motion was unreasonable. Section 129(1)(g) is silent as to the manner by which “a merits review” be done, or who does it.
30.All that is required, when section 129(1)(g) is read as a whole, is that a merits review has been done, either by the Tribunal or by someone else (which the Tribunal then adopts as a merits review of the motion for the purpose of section 129(1)(g)). In this case, I see no reason why the original Tribunal could not adopt ACTPLA’s approval process as a merits review of the motion for the purpose of considering the respondents’ application for an order under section 129(1)(g).
31.The outcome of the merits review would ordinarily become a point of reference for determining whether opposition to a motion was unreasonable. But that is not to imply that because a merits review indicates that the motion has merit, opposition to it is unreasonable.
32.I reject the submission that the original Tribunal erred in law by adopting the process that it did. In my view, Mr Smith’s recognition and acceptance that merits review had been done was appropriate and sensible.
33.Ground 1 is not made out.
2. The original Tribunal erred in law by analysing the appellant's reasons for objections individually, without considering them as a whole, or cumulatively
34.In support of the alleged error, Mr Christensen referred to paragraph 29 of the original Tribunal’s reasons for decision where the presiding member lists the seven grounds of opposition to the respondents’ motion, and that the presiding member dealt with them separately without considering the grounds as a whole.
35.In support of his submission that the presiding member should have considered the objections as a whole, Mr Christensen relied on paragraphs 13(j) and (l) of the appellant's statement of facts and contentions before the original Tribunal that, he said, imply reliance on the alleged cumulative detriment to the other unit holders. Paragraphs 13(j) and (l) stated:
13.(j) The owners of three adjoining units consider the proposed extension is sufficiently to detrimental to their amenity and interests to decline the approval required under Section 4(1)(a) of Schedule 4 of the UTM Act 2011
13(l) While modest in size, the proposed extension has negative implications to individual unit owners and to the Owners’ Corporation collectively. ..
36.Mr Christensen also relied on Mr Smith's closing oral submission:
There is nothing unreasonable in any owner voting so as to protect their own interests associated with the enjoyment of their property - whether it would be to prevent a loss of available sunlight, a loss of privacy, a worsened outlook or the worsening of parking and vehicle manoeuvring conditions.[9]
37.In my view, ground 2 suffers from the same procedural flaw as ground 1.
38.I am not persuaded from any aspect of the submissions, written or oral, that the original Tribunal should have understood a submission that it should look at the aspects of detriment cumulatively, as well as individually, in the sense that even if the opposition to the motion by reference to one aspect of detriment might be unreasonable it was not unreasonable when all aspects of alleged detriment are taken together. The proposition was simply not put. The appellant cannot on appeal contend that the original Tribunal erred by not considering the objections in a way that it was never asked to consider them.
39.Ground 2 has a second difficulty. In answer to my inquiry, Mr Christensen could not produce any authority to support the proposition that the original Tribunal should have considered the objections cumulatively, even if that had been submitted at the original hearing. The appellant alleges error, and it is therefore for the appellant to prove. It has not done so.
40.In any event, I am not persuaded that it would have been appropriate. It might in some cases be unreasonable to oppose a motion for approval of an occasional event (for example a party), but reasonable to oppose it where the event will be frequent or regular. But that is not this case. I see no proper basis for concluding that two unrelated reasons for objecting to a proposal, each found to be unreasonable, become reasonable when considered together. There is simply no connection.
41.Ground 2 is not made out.
[9] Transcript of proceedings, 6 June 2017, page 154, lines 43; page 155, line 2
3. The original Tribunal failed to take, as a starting point, that the owners in the strata complex had entered into a compact to maintain the property in the same state as at entry except by the consent of all owners without dissent
42.Mr Christensen submitted that the original Tribunal erred by starting with the proposition that the respondents’ proposal had merit, evidenced by ACTPLA’s approval of it, and then considering whether the appellant’s objection was unreasonable in that context rather than in the context, or from a starting point, that a unit holder cannot erect or alter any structure in or on his or her unit otherwise than with the unopposed (or unanimous) resolution of the owners corporation.
43.Mr Christensen relied on the High Court’s decision in Ainsworth v Albrecht in which the Court stated:
The adjudicator was being asked to override rights attached to the property of the lot owners with respect to the common property. The requirement of a resolution without dissent is itself an acknowledgment that the by-laws function as terms of the charter of rights and duties which bind those who acquire lots in a community titles scheme under the BCCM Act. Other provisions of the BCCM Act which also require a resolution without dissent of a body corporate can be seen to be variations on the theme that the charter of rights and duties established between lot owners in relation to the use and enjoyment of their community title under the community management statement should, generally speaking, not be altered save with the consent of all parties to the compact. Just as parties to a contract cannot, generally speaking, be obliged to give up contractual rights without their consent, so lot owners cannot be required to give up their property rights without consent to another lot owner save pursuant to Item 10 of Sched 5. (footnotes omitted)[10]
[10] Ainsworth v Albrecht [2016] HCA 40 at [59]
44.In Ainsworth v Albrecht, the Court was considering a circumstance where an adjudicator appointed under the Body Corporate and Community Management Act 1997 (Qld) (the BCCM Act) performed a role similar to the original Tribunal in this case. The adjudicator was appointed to resolve a dispute between the lot owners in a community titles scheme as to whether the rights of lot owners to the common property of the scheme should be varied to allow one lot owner the exclusive use of part of the common property, meaning the airspace between two existing balconies. The lot owner wished to extend the deck on the upper level of his property into the common property airspace.
45.The adjudicator concluded that the opposition of other lot owners to the proposal was unreasonable. On appeal, the Queensland Civil and Administrative Tribunal (QCAT) disagreed. On further appeal the Court of Appeal of the Supreme Court of Queensland agreed with the adjudicator. On further appeal, the High Court agreed with QCAT.
46.In my view, the case needs to be understood in its factual context. In paragraph 58, preceding paragraph 59 relied on by Mr Christensen, the High Court said:
The unreasonableness of the opposition to the first respondent's proposal is to be determined in a context in which lot owners voting in respect of the proposed resolution are exercising their right to vote as an aspect of their proprietary rights as owners of lots included in the Scheme.
47.That is not this case. The respondents’ proposed works are entirely within the boundary of their own unit. There is no suggestion that any of the other unit holders are being asked to give up any of their proprietary rights over the common property or their own units.
48.That is not to imply that it was unreasonable per se for other unit holders to object to the respondents carrying out works on their own land, but simply to observe the determinative factor in Ainsworth v Albrecht.
49.The High Court acknowledged that in other circumstances an adjudicator (or the original Tribunal in this case) holds a broad discretion. The Court said:
Item 10 of Sched 5 [which equates with rule 4] is intended to operate in respect of a broad range of resolutions which are required to be passed without dissent. It must, therefore, be understood that it is neither necessary nor desirable to attempt an exhaustive statement of the circumstances in which such an order may be made.[11]
50.I am not persuaded that the original Tribunal took the “starting point” to be that the proposed works had merit, and considered the question whether the appellant’s objections to it were unreasonable in that context. In my view, the contrary proposition is more apparent. Paragraph 19 of its reasons show that the original Tribunal was anxious to put aside the whole question of whether the proposed works had merit and to focus instead on whether other unit holders’ objections were unreasonable.
51.It is also clear in my view that the original Tribunal was well aware that to erect or alter a structure ordinarily requires an unopposed resolution. The original Tribunal’s reasons for decision refer to Ainsworth v Albrecht, The Owners Units Plan 768 v Lokusooriya[12] and Floro v The Owners Units Plan 630,[13] each of which notes that unanimous approval is ordinarily required. The substantive issue for the original Tribunal, which I am satisfied it clearly understood, was whether “opposition to the motion was unreasonable”. The original Tribunal notes that to be the test in its reasons.[14]
52.Ground 3 is not made out.
[11] Ainsworth v Albrecht [2016] HCA 40 at [63]
[12] The Owners Units Plan 768 v Lokusooriya [2013] ACAT 80 at [19]
[13] Floro v The Owners Units Plan 630 [2017] ACAT 4 at [29]
[14] Uren & Anor v The Owners - Units Plan No 396 [2017] ACAT 51 at [17d]
4. Once the original Tribunal found that over-looking and privacy are valid objections, the Tribunal erred by failing to find that those objections were not unreasonable
53.In my view, ground 4 misrepresents the original Tribunal’s statements about overlooking and privacy. At paragraph 22 of its reasons for decision, relied upon by the appellant, the original Tribunal did no more than note the issues in dispute before proceeding to consider them. Paragraph 22 states:
The Tribunal agrees that the High Court in Ainsworth v Albrecht was discussing property rights, however this does not restrict the applicability of its discussion of ‘unreasonable’ opposition in the specific context of the UTM Act. In context, and considering the primary role of the ACAT in unit title dispute resolution, in my opinion the ACAT can have regard to the real issues in dispute between unit title holders in an owners corporation, including privacy, visual amenity, noise and other disturbances.
54.The original Tribunal accepted that overlooking and privacy can be “real issues”, as a matter of principle, and then proceeded to consider the substance of those issues (or objections) later in its decision.
55.The appellant submitted that when considering those issues the original Tribunal erred by substituting its own opinion about the nature and extent of the overlooking and privacy, rather than looking at whether the appellant’s objections were unreasonable. The submission reflected the observations of the High Court in Ainsworth v Albrecht. The majority said:
The issue for the adjudicator was whether the votes of dissenting lot owners were unreasonable, not whether the decision of the Body Corporate was reasonable.[15]
[15] Ainsworth v Albrecht [2016] HCA 40 at [27]
56.In separate reasons for decision, Nettle J made the same observation. He said:
Contrary, therefore, to the adjudicator’s reasoning, the “central question” was not whether the Body Corporate had acted reasonably, but whether the adjudicator was satisfied that the motion had not been passed because of opposition that in the circumstances was unreasonable.[16]
[16] Ainsworth v Albrecht [2016] HCA 40 at [71]
57.I accept that views may differ as to whether an objection is unreasonable: unreasonableness has an inescapably qualitative element. But I am satisfied that the original Tribunal applied the correct test by considering the question objectively, rather than substituting its own opinion about whether the proposed development should be refused or allowed. The presiding member found that the objectors’ concerns about traffic, parking and noise were “on an objective basis” not “a reasonable grounds for objection.[17] In relation to the concerns of units 4 and unit 5 about overlooking and privacy, he found there was “objectively … no reasonable basis for this objection”.[18] In relation to the proposed window facing unit 4, he found “on an objective basis, it would not be reasonable for unit 4 to object to a modest window.”[19] In relation to unit 4’s objection on the grounds of loss of the amenity of afternoon sunlight, the presiding member found, “objectively there was no reasonable basis for this objection”.[20]
[17] Uren & Anor v The Owners - Units Plan No 396 [2017] ACAT 51 at [35]
[18] Uren & Anor v The Owners - Units Plan No 396 [2017] ACAT 51 at [41] and [53]
[19] Uren & Anor v The Owners - Units Plan No 396 [2017] ACAT 51 at [44]
[20] Uren & Anor v The Owners - Units Plan No 396 [2017] ACAT 51 at [49]
58.The original Tribunal’s approach followed the approach stated by Nettle J in Ainsworth v Albrecht. His Honour said:
As already stated, the adjudicator’s task was to determine whether she was satisfied that it was objectively unreasonable for the seven Viridian owners … to oppose the motion.[21]
[21] Ainsworth v Albrecht [2016] HCA 40 at [103]
59.The original Tribunal, perhaps, could have added for completeness that having found there was, objectively, no reasonable basis for any of the grounds for objection to the motion, it was therefore satisfied that opposition to the motion was unreasonable. However in my view that is implicit, and is not a basis to find error.
60.The courts have repeatedly warned against an over-zealous scrutiny of a tribunal’s reasons for decision. In Re Betty Lennell v Repatriation Commission WA, the Federal Court comprised of Northrop, Toohey and Sheppard JJ said:
A court exercising supervisory jurisdiction over an administrative tribunal ought not lightly interfere with its decisions even if the court feels that the tribunal's language may have a degree of looseness. Certainly it ought not to indulge in an exercise which over-zealously picks the tribunal up in the way it has expressed itself. That is particularly so when it appears properly to have understood the legal principles which it is to apply.[22]
[22] Re Betty Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6; Lennell v Repatriation Commission WA [1982] FCA 7
61.In Minister for Immigration & Ethnic Affairs v Wu Shan Liang, the High Court, per Kirby J, made the same observation, stating:
The reasons under challenge must be read as a whole. They must be considered fairly. It is erroneous to adopt a narrow approach, combing through the words of the decision-maker with a fine appellate tooth-comb, against the prospect that a verbal slip will be found warranting the inference of an error of law.[23]
[23] Minister for Immigration & Ethnic Affairs v Wu Shan Liang [1996] HCA 6 at [10]
62.The appellant submitted that when deciding whether opposition to a motion was “unreasonable”, the original Tribunal should have applied the Wednesbury test of unreasonableness,[24] meaning in this case (it said) that the original Tribunal needed to be satisfied that opposition to the motion was so unreasonable that no reasonable unitholder could have opposed the motion.
[24] The principle is drawn from a decision of the Kings Bench, per Lord Greene in Associated Provincial Picture Houses Ltd vWednesbury Corp [1948] 1 KB 223 at 230
63.Wednesbury unreasonableness involves unreasonableness in the exercise of a power of such a degree that it involves an error of law open for correction on application to a court for judicial review. It is recognised in section 6(2)(g) of the Administrative Decisions (Judicial Review) Act 1989 (ACT) as a ground upon which an administrative decision can be set aside on the grounds that the exercise of a statutory power “is so unreasonable that no reasonable person could have so exercised the power”.
64.Whether Wednesbury unreasonableness is the appropriate test arose in Re the Hospital Benefit Fund of Western Australia Inc and Department of Health, Housing and Community Services[25] where a Full Bench of the Administrative Appeals Tribunal (Cth) (the AAT) comprised of Justice O'Connor (President), Dr P A Staer and Associate Professor S D Hotop reviewed a decision of the Federal Minister for Health, Housing and Community Services to prevent a change to the rules of Hospital Benefit Fund of Western Australia Inc. The Minister’s power was exercisable if the Minister was of the opinion that the rule change would impose "an unreasonable or inequitable condition affecting the rights of any contributors".
[25] Re the Hospital Benefit Fund of Western Australia Inc and Department of Health, Housing and Community Services [1992] AATA 205
65.The AAT considered the question of what constitutes “unreasonable or inequitable” as follows:
84. The issue here is one of statutory unreasonableness. In such a case, the very narrow meaning of "unreasonable" that is appropriate in the context of judicial review of the exercise of broad discretionary power is inappropriate. That very narrow meaning - which has come to be known at common law as "Wednesbury unreasonableness" (the nomenclature comes from Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1947] EWCA Civ 1; (1948) 1 KB 223) - may be described as gross or manifest unreasonableness and has been adopted as a ground of judicial review in the Administrative Decisions (Judicial Review) Act 1977 (Cth), ss 5(2)(g), 6(2)(g):
"an exercise of a power that is so unreasonable that no reasonable person could have so exercised the power".
In the context of statutory unreasonableness, the term "unreasonable" should be given its ordinary, natural meaning: see, for example, Curragh Coal Sales Co Pty Ltd v Wilcox [1984] FCA 168; (1984) 1 FCR 461. So too should the term "inequitable".
85. The word "unreasonable" is defined in The Shorter Oxford English Dictionary as follows:
"1. Not having the faculty of reason; irrational. 2. Not acting in accordance with reason or good sense; ... 3. Not based on reason or good sense. 4. Going beyond what is reasonable or equitable; excessive."
The test of reasonableness or unreasonableness is an objective one and whether that test is satisfied or not will normally be a question of fact or degree depending upon the circumstances of the particular case: Re W (An Infant) (1971) AC 682 at 699; Thornton v Repatriation Commission [1981] FCA 76; (1981) 52 FLR 285 at 290-1; Gregory v Philip Morris Ltd (1988) 80 ALR 455 at 457.
66.In my view, the AAT’s reasoning in Re the Hospital Benefit Fund equally applies when determining the meaning of “unreasonable” for the purpose of section 129(1)(g). The test is whether the Tribunal is satisfied that opposition to the motion in issue was unreasonable, not “so unreasonable that no reasonable person could have opposed the motion”. Those further words or words of that kind are not present. Also, the focus in section 129(1)(g) is on the motion, not the person opposing it.
67.In Meaney v The Owners Corporation Units Plan 40[26] the Tribunal noted that “unreasonable” is not defined in the UTM Act and that its ordinary dictionary meaning should be applied. I agree.
68.I also note that there is no suggestion in Ainsworth v Albrecht that unreasonableness of a kind amenable to judicial review (ie Wednesbury unreasonableness ) is necessary for the purpose of an adjudicator (or the original Tribunal in this case) being satisfied that opposition to a motion is unreasonable. The High Court’s observations, noted at paragraph 49 above, are to the contrary.
69.The appellant relied upon paragraphs 48 and 51 of the High Court’s decision in Ainsworth v Albrecht to submit that it was no part of the original Tribunal’s function “to seek to strike a reasonable balance between competing positions” or “to determine whether the outcome of the vote of the general meeting … was a reasonable balancing of competing considerations”. Rather, its function was to determine whether the opposition of other unit holders to the proposal “was unreasonable”.
70.Those statements of the High Court about the function of the Tribunal when deciding whether to make an order under section 129(1)(g) of the Act must of course be followed. However, I am not persuaded that the original Tribunal misunderstood its function. There is no suggestion of it striving to strike a reasonable balance. Rather, the original Tribunal noted that the test for determining whether opposition was unreasonable is an objective test, not a subjective test’ and that it “must be satisfied that opposition to the motion was unreasonable”.[27] As noted in paragraph 57 above, it applied an objective test in relation to each ground of objection.
71.Ground 4 is not made out.
[26] Meaney v The Owners Corporation Units Plan 40 [2013] ACAT 72 at [38]
[27] Uren & Anor v The Owners - Units Plan No 396 [2017] ACAT 51 at [17d] and [17e]
5. The original Tribunal erred in finding that objections on particular grounds where that original Tribunal imposed solutions that require supervision and/or enforcement by the Tribunal were unreasonable
72.Ground 5 went to two issues: the adverse effect on the privacy of unit 4 arising from the proposed new window on the northern side of bedroom 3 of unit 3, and obstruction to access to unit 4 arising from vehicles (particularly construction worker vehicles) parking in the common areas of the access road and in the turning circle between units 3 and 4.
73.The original Tribunal ordered that the motion for approval of the respondents’ proposed works be amended to address these adverse effects.
74.Implicit in the original Tribunal’s order that the motion be amended is its acceptance that opposition to the motion for these reasons was not unreasonable, even if views may differ. The Tribunal’s amendments were to address the substance of the objections in a manner that would cause continued opposition to be unreasonable.
75.The appellant contended that to impose amendments of the kind ordered was a balancing exercise, being something the Tribunal cannot do. I am not persuaded that the amendments were a balancing exercise. Regarding the need for the new window to be “modest in size”, it is clear from paragraph 44 of the original Tribunal’s decision that the proposed window, modest in size, was not to balance the competing interests of units 3 and 4, but to reduce the adverse effect on the privacy of unit 4 to such a degree that any continued objection to it would be unreasonable.
76.It is also clear from the words “(either as originally proposed or as amended by the ACAT)” in section 129(1)(g) that the Tribunal had power to amend the motion in such a way that opposition to it would be (or would become) unreasonable. I see no error in the original Tribunal’s approach.
77.The appellant also contended that the amendments to the motion would be “probably unenforceable”. The implication seemed to be that because the amendments would be or may be unenforceable, they would have no tangible benefit such that opposition to the motion was not unreasonable. I am not persuaded that the amendments are unenforceable. The Tribunal has set out in paragraph 44 the essential features of the proposed window in order to cause any continued objection to it to be unreasonable, and has left it for the respondents to put forward a proposed design by reference to those features. If agreement cannot be obtained about the proposed design, particularly from unit 4, the parties have liberty to apply to the Tribunal for the purpose of the Tribunal considering whether the proposed design minimises the effect on the privacy of unit 4 to such a degree that continued objection would be unreasonable.
78.There is no reason to think that with a design approved by the owners of unit 4, the respondents would then construct the window otherwise than in accordance with that design.
79.I make a similar observation about the original Tribunal’s amendment to the motion, per order 1(b), to address parking during construction of the extension. With the original Tribunal’s decision in place, there is no reason to think that the respondents will be anything other than diligent in the way they park their vehicles and in ensuring that all their invitees are aware of the condition and of the importance of complying with it. Further, in the event of any non-compliance or any ambiguity about compliance, the parties have liberty to apply to the Tribunal.
80.Ground 5 is not made out.
6. The Tribunal erred in finding that the basis of objection was “speculative” when a similar situation had arisen in the past in the complex
81.Ground 6 refers to paragraphs 33 - 35 of the original Tribunal’s decision, where the Tribunal considered the concern of the other unit holders that sometime into the future the proposed additional bedroom may lead to the rental of unit 3 to a large group as a “share home” with consequential problems arising from traffic, parking and noise. The appellant refers to the rental of unit 1 “some years earlier” where these problems arose.
82.The appellant submitted that the original Tribunal erred in its conclusion that this concern was “highly speculative” in relation to unit 3 because of the past experience in relation to unit 1. The implication seems to be that because the concern was not highly speculative, the objection to the fourth bedroom was not unreasonable and therefore the original Tribunal should not have made an order giving effect to the motion.
83.In my view, it was reasonably open for the original Tribunal to conclude that rental of unit 3 leading to problems of traffic, parking and noise was a highly speculative concern. As the Tribunal notes in its previous paragraph, the respondents live at unit 3 with their three children. They wish to construct a fourth bedroom in order to provide a separate bedroom for each child. There is no evidence to suggest they have an intention to rent unit 3.
84.I recognise the possibility that the respondents might in future for presently unforeseen reasons decide to rent the unit, or to sell it to someone who might rent it and that it might be used as a “share house” which might attract additional cars and perhaps noise depending on the lifestyle of those who rented it. However that observation can be made about any four-bedroom unit or house in Canberra, or unit 3 in its existing state if rented as a “share house”. Also, in relation to unit 3, I agree with the original Tribunal that the possibility of this chains of events occurring is at present highly speculative.
85.Also, in my view, to refuse to allow the respondents to add a fourth bedroom to their house merely to foreclose the possibility that an additional person may live in the unit sometime into the future when the respondents and their children no longer live there is, objectively, unreasonable.
86.Ground 6 is not made out.
7. The Tribunal erred in finding that a basis for objection, a particular amenity was subjective meant it was unreasonable
87.Mr Christensen explained that ground 7 referred to paragraph 49 of the original Tribunal’s decision which states:
While the Tribunal accepts that the owners of Unit 4 enjoy a particular amenity of afternoon sunlight during the equinoxes, it considers that this is a very subjective consideration. After considering the line of sight from Unit 4 to the proposed new extension, and the location of the existing garage on the property, the Tribunal is not satisfied about the likelihood or extent of any loss of amenity. In the Tribunal’s opinion, objectively there is no reasonable basis for this objection to the resolution.
88.Mr Christensen submitted that ‘amenity’ is inherently subjective, and that persons will often have different views about it. For example, he said, matters such as access to sun and shade, access to open areas and privacy can all affect a person’s sense of amenity. The importance of those issues can be very subjective, he said, but nevertheless real and tangible to the person.
89.Mr Christensen took me to pages 3 and 4 of a witness statement signed by the joint owners of unit 4 that formed part of the evidence before the Tribunal that, he said, demonstrated “some tangible loss of [their] amenity”. He referred to the statement in which the owners of unit 4 state that “the sun will be completely obscured by the proposed extension.”
90.From there, Mr Christensen submitted that where the original Tribunal accepted that the owners of unit 4 enjoy the amenity of afternoon sunlight during the equinoxes, the Tribunal erred by then concluding that because their enjoyment of this amenity was “a very subjective consideration” their objection to the proposed works was unreasonable.
91.With respect, Mr Christensen’s submission does not fairly reflect the original Tribunal’s reasoning. It found the objection to the motion for approval of the proposed works to be unreasonable not because unit 4’s enjoyment of afternoon sunlight during the equinoxes was a subjective consideration but because it was not satisfied “about the likelihood or extent of any loss of amenity” (emphasis added) arising from the works.
92.Put another way, the Tribunal was willing to acknowledge unit 4’s enjoyment of afternoon sunlight from their unit, even if they might attach more importance to it than others, but was not satisfied “after considering the line of sight from unit 4 to the proposed extension and the location of the existing garage” that the proposed extension would make any difference to their enjoyment of afternoon sunlight. It was for that reason that the original Tribunal found that unit 4’s objection to the works was unreasonable.
93.The appellant submitted with reliance on QCAT’s decision quoted in Ainsworth v Albrecht that the original Tribunal needed to be “affirmatively satisfied”[28] that objection to the motion was unreasonable, and that only to be “not satisfied” about the likelihood or extent of any loss of amenity does not meet this required positive standard. In my view, that approach incorrectly blends two different questions. The original Tribunal did not say it was “not satisfied” that opposition was unreasonable. It said that there was, objectively, no reasonable basis for opposition to the motion because it was not satisfied or persuaded that there would be any loss of amenity arising from the proposed works.
[28] Ainsworth v Albrecht [2016] HCA 40 at [84]
94.Ground 7 is not made out.
The respondents’ additional contention
95.Mr Jenkins submitted by way of an additional contention previously rejected by the original Tribunal that the appellant’s objections to the proposed works could only have been reasonable if they pertained to amenity arising from legitimate property rights which the objectors had some legal entitlement to preserve. It was then submitted that legitimate property rights are not innate, and must arise under common law, statute or contract.
96.Mr Jenkins submitted that where ACTPLA had approved the proposed works and where a landholder does not under general law have any right to an aspect or a view; to privacy; to freedom from overlooking or observation; or to light or solar access, and where there are no easements or contractual rights in favour of the objectors, it must follow (he said) that the objections to the proposed works were unreasonable.
97.Mr Jenkins submitted:
The Tribunal does not have a ‘roving’ jurisdiction guided only by notions of fairness and justice as between parties in a unit titles dispute. The Tribunal is required to determine matters according to law and uphold party’s legal rights, not to attempt to conciliate every grievance or complaint between disputing parties.
98.The submission that the Tribunal does not have a ‘roving’ jurisdiction and must determine matters according to law and uphold a party’s legal rights is of course correct.
99.The legal rights of each unitholder in a units plan include a right under rule 4 to object to any other unitholder erecting or altering any structure in or on that other unitholder’s unit or on the common property.
100.The legal right to object under rule 4 is not expressed as available or operative only in relation to the erecting or altering of a structure contrary to a unit holder’s legitimate property rights, and I see no reason why such an extreme limitation should be inferred. In Ainsworth v Albrecht, the High Court said:
Item 10 of Sched 5 [that equates with rule 4] is intended to operate in respect of a broad range of resolutions which are required to be passed without dissent. It must, therefore, be understood that it is neither necessary nor desirable to attempt an exhaustive statement of the circumstances in which such an order may be made. … Opposition prompted by spite, or ill-will, or a desire for attention, may be seen to be unreasonable in the circumstances of a particular case.[29]
[29] Ainsworth v Albrecht [2016] HCA 40 at [63]
101.In Ainsworth v Albrecht, Nettle J said:
It would require terms much different from and clearer than those in Item 10 of Sched 5 to substitute adjudicative discretion for a lot owner’s objectively not unreasonable exercise of self-interest.[30]
[30] Ainsworth v Albrecht [2016] HCA 40 at [101]
102.It is apparent that the UTM Act so values the interests of lot owners in preventing the erecting or altering of a structure that it is not permissible unless by unopposed resolution, subject only to proven unreasonableness.
103.The original Tribunal was correct to reject the respondents’ contention.
Conclusion
104.For these reasons, the appeal will be dismissed and the decision under an appeal will therefore be confirmed.
………………………………..
Presidential Member G McCarthy
HEARING DETAILS
FILE NUMBER:
AA 26/2017
PARTIES, APPELLANT:
The Owners - Units Plan No 396
PARTIES, RESPONDENT:
Christopher Uren and Rebecca Blundell
COUNSEL APPEARING, APPELLANT
Mr P Christensen
COUNSEL APPEARING, RESPONDENT
Mr D Jenkins
SOLICITORS FOR APPELLANT
Peter B Christensen, Lawyers
SOLICITORS FOR RESPONDENT
Howes Kaye Halpin
TRIBUNAL MEMBERS:
Presidential Member G McCarthy
DATES OF HEARING:
26 October 2017
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