THOMAS and OWNERS OF REFLECTIONS WATERFRONT APARTMENTS STRATA PLAN 58085

[2012] WASAT 215

JURISDICTION     :   STATE ADMINISTRATIVE TRIBUNAL

STREAM:   COMMERCIAL & CIVIL

ACT: STRATA TITLES ACT 1985 (WA)

CITATION:   THOMAS and OWNERS OF REFLECTIONS WATERFRONT APARTMENTS STRATA PLAN 58085 [2012] WASAT 215

MEMBER:   MR C RAYMOND (SENIOR MEMBER)

HEARD:   3 OCTOBER 2012

DELIVERED          :   29 OCTOBER 2012

FILE NO/S:   CC 559 of 2012

BETWEEN:   ANTHONY THOMAS

Applicant

AND

OWNERS OF REFLECTIONS WATERFRONT APARTMENTS STRATA PLAN 58085
Respondent

Catchwords:

Strata Titles Act 1985 (WA) ­ Whether respondent failed to make documents available for inspection ­ Consideration of what constitutes inspection of documents

Legislation:

Strata Titles Act 1985 (WA), s 43, s 43(5), s 90, s 90(b)

Result:

Application dismissed

Summary of Tribunal's decision:

The applicant commenced proceedings seeking a number of orders designed to require the respondent to enforce the by­laws of the strata company and an order requiring the respondent to make available for inspection certain documentary records.
The applicant, as an owner of a lot in the scheme, gave notice pursuant to s 43 of the Strata Titles Act 1985 (WA) requiring the respondent to make available certain listed documents in relation to the period December 2010 to December 2011.
All matters in issue, save in relation to the inspection of documents, were settled in mediation.  The applicant was provided inspection of documents on a number of occasions, but ultimately, a position was reached when the applicant was permitted only a brief opportunity to identify documents which it was arranged would be copied by the respondent and provided to him.  The respondent then decided that it would not provide the copy documents, and the matter was listed for a hearing in relation to whether it was obliged to do so.
During the course of the evidence and submissions at the final hearing, it became apparent that the real issue was whether or not a proper opportunity to inspect had been provided.  As the respondent had elected not to attend the hearing, it was therefore not aware that the issue had changed from a claim to require the respondent to provide copies of the documents, to one requiring, in effect, a further and proper inspection of identified documents.  The hearing was accordingly adjourned in order to give the respondent notice of the proposed amendment and an opportunity to object to it.  The respondent did not object to the amendment.
The Tribunal found that on a proper construction, s 90 of the Strata Titles Act 1985 required that the inspection afford an opportunity to carefully and critically inspect documents, and that this had not occurred.  Further, that the applicant had a genuine reason for wishing to inspect the documents.  However, the invoices in question fell outside the period in respect of which the applicant sought inspection.
The application was therefore dismissed.

Category:    B

Representation:

Counsel:

Applicant:     In person

Respondent:     N/A

Solicitors:

Applicant:     N/A

Respondent:     N/A

Case(s) referred to in decision(s):

Clough and The Owners of Bengara Flats Strata Plan 5500 [2010] WASAT 15

REASONS FOR DECISION OF THE TRIBUNAL: 

Introduction

1. Mr Thomas is the owner of Lot 34 on Strata Plan 58085.  The respondent is the body corporate in respect of that strata plan.

2. Mr Thomas is not happy with the way the body corporate functions and, in particular, as far as he is concerned, the way in which the council of owners fails to enforce the by­laws and is selective in the information passed on to owners.  The council of owners, to quote from a letter from the strata manager dated 20 September 2012 addressed to the Tribunal, consider Mr Thomas to be a 'vexatious serial pest'.  As conveyed in that letter, the council of owners make clear that they will comply with their precise statutory obligations to Mr Thomas and no more.

3. This letter was written following Mr Thomas making formal application to the Tribunal on 11 April 2012, which resulted in a number of directions hearings and a mediation.  All matters were resolved at mediation save for the issue of inspection of documents.  The respondent had provided Mr Thomas with inspection of documents on a number of occasions and, ultimately, all that remained was a dispute about whether the respondent was obliged to provide copies of certain invoices to Mr Thomas.  It was this issue that was listed for final hearing.  The council of owners declined to avail itself of the opportunity to file submissions on behalf of the respondent in relation to that outstanding issue.

4. During the final hearing on 3 October 2012, which was not attended by any representative for the respondent, it became apparent that the real issue is whether or not a proper inspection had been provided to Mr Thomas in relation to the invoices.  Consequently, Mr Thomas applied for an amendment to the application to seek an order in particular terms requiring the respondent to make available for inspection all invoices relating to Impex Cleaning Service from February 2012 to September 2012, inclusive, and allow him to make copies thereof.  As the respondent was not present, an order was issued on that day reflecting the proposed amendment and that the application would be amended in the stated terms unless the respondent objected in writing on or before 18 October 2012, setting out in full the basis of such objection.  In the event of any objection being made, it was directed that the application be determined on the documents, subject to further order.  The respondent has not lodged any objection and therefore the application is amended in the terms stated in the order of 3 October 2012.

The issues for determination

1. In the circumstances, the outcome of the proceedings will depend on the determination of the following issues:

   1)Has the respondent wrongfully failed to make available for inspection by Mr Thomas a document that he is entitled to inspect under the Strata Titles Act 1985 (WA)?

   2)If the answer to 1) is in the affirmative, is Mr Thomas entitled to an order from the Tribunal that the respondent make available the invoices to him?

2. All references to legislation in these reasons for decision are to the Strata Titles Act 1985 (WA).

The attendance for inspection of the invoices

1. By letter dated 26 January 2012, Mr Thomas gave notice to the respondent in compliance with s 43 requiring inspection of:

   … the complete Strata Company records for the period December 2010 to December 2011 under [s 43(1)(b)] and [s 43(2)]. …

   …

   In addition I require copies of the following:

   1.To include all financial statements.

   All Bank Statements which needs to show names of contractors payments made to [sic].

   Income and Expenditure Statements.

   Bank statements to show who the payments were made to.

   All incoming and outgoing invoices.

   All invoices submitted by the Strata Manager for Non­Standard Fees.

   Aged Arrears statement.

   Copies of breach notices.

   Incident register[.]

   Cheque books[.]

   Copies of all correspondence including Emails and Facsimiles.

2. The respondent has never put in issue the right of Mr Thomas to inspect the records of the strata company.  Mr Thomas was afforded the opportunity to carry out an inspection of the documents on more than one occasion, although from time to time there were issues between the parties about the process being followed.  On the last inspection, which was held on a date which has not been specifically identified, Mr Thomas and Ms Robinson, who was assisting as his agent, were allowed access to a compact disc (CD) under the control of an unidentified young lady employed by the respondent's strata manager.

3. Mr Thomas' evidence, which is confirmed by Ms Robinson, is that the young lady informed them that she would run through the documents on the CD as displayed on her computer screen so that they could identify the invoices in which Mr Thomas was interested and that she would then provide a hard copy of the identified documents.  On that understanding, the young lady flicked through the many documents recorded in the CD, noting those which Mr Thomas wanted to have copied.  This was done at a speed which did not allow Mr Thomas to absorb the content of each invoice.  The young lady left to make the copies but returned to advise that she had been instructed that the respondent was not obliged to provide copies and would accordingly not do so.

4. As the respondent, in its wisdom, decided not to attend the hearing, this evidence is not contested and I accept it.  It was in these circumstances, and when Mr Thomas had difficulty pointing to any provision of the legislation to support a proposition that a strata company is obliged to make copies for an owner exercising a right of inspection, that it became apparent that the real issue was whether or not what had occurred constituted compliance with the respondent's obligation to make available for inspection the requested documents.

5. Section 90 provides as follows:

   Order to supply information or documents

   Where, pursuant to an application for an order under this section, the State Administrative Tribunal considers that the strata company for the scheme to which the application relates, or the administrator for that scheme, or the chairman, secretary or treasurer of that strata company has wrongfully ­

   (a)withheld from the applicant information to which he is entitled under this Act; or

   (b)failed to make available for inspection by the applicant or his agent a record or document that under this Act he is entitled to inspect,

   the State Administrative Tribunal may order that strata company, administrator, chairman, secretary or treasurer to supply or make available the information or to make so available the record or document, as the case may require, to the applicant.

6. The Macquarie Dictionary (5^th ed, 2009) contains the meaning of the following relevant words:

   Inspect … 1. to look carefully at or over; view closely and critically: to inspect every part.  2. to view or examine formally or officially. …

   Inspection … 1. inspection, especially careful or critical inspecting or viewing. …

   Examine … 1. to inspect or scrutinise carefully, inquire into or investigate. …

7. These dictionary definitions inform the meaning of the phrase contained in s 90(b) 'to make available for inspection'. This means that there must be a sufficient opportunity to examine, to look carefully over, or to view closely and critically the documents. The respondent has not made available the invoices in question for inspection within the meaning of that phrase as used in s 90 because there was no opportunity to examine the documents in this sense.

Is Mr Thomas entitled to an order for inspection of the invoices?

1. Section 43 conveys in clear language that upon application made in writing to a strata company by a proprietor or mortgagee of a lot, or by a person authorised in writing by such proprietor or mortgagee, and on payment of the prescribed fee (if any), the strata company shall do one or more of the following things thereafter set out, as are required of it in the application. The provisions which then follow include making available for inspection by the applicant or his agent, and for the exercise of the rights conferred by subsection 5, certain specified records and documents, including 'any other record or document in custody or under the control of the strata company'. Under s 43(5), a person entitled to inspect a document made available under this provision, may take extracts from, or make a copy of, the document. It may be observed that there is no obligation to provide the person with a copy.

2. If a strata company fails to comply with its obligation under s 43, a remedy is provided by s 90 as set out above under the previous heading. If all the criteria of s 90 are met, the Tribunal has a discretion whether or not to make an order to make available the relevant documents. An applicant for relief under s 90 does not have an absolute right: see Clough and The Owners of Bengara Flats Strata Plan 5500 [2010] WASAT 15.

3. In this case, Mr Thomas has raised his concerns about the way in which the council of owners are managing the strata company and points to the allegations about failure to enforce by­laws. In particular, he emphasised the lack of information which he contends is communicated to owners within the scheme. As a result, he has no confidence in the council of owners and in the information which is provided. It is for this reason that he wishes access to documentation which enables him to form a view concerning expenditure items raised in the budgets of the respondent. I am satisfied that Mr Thomas has a genuine reason for wishing to inspect the relevant records and that there is no discretionary reason for declining the type of order sought. However, the written application to the respondent in compliance with s 43 requested inspection of all of the listed records for the period December 2010 to December 2011. It can be inferred that Mr Thomas has been given proper inspection of all of these documents, because he has raised no ongoing issue in relation to them. The ongoing issue now relates to the described invoices for the period February 2012 to September 2012, which is beyond the ambit of the s 43 application.

Conclusion

1. The manner in which inspection of the invoices was provided to Mr Thomas did not constitute compliance with s 90, because Mr Thomas was not given an opportunity to carefully or critically inspect or examine the documents.

2. Mr Thomas has a genuine reason for wishing to examine the records of the respondent, and it appears likely that he will wish to continue this practice, until such time as he develops some confidence in the way in which the respondent is being managed and in the reliability of information provided to owners.  However, his application for inspection of the documents was limited to a period concluding in December 2011.  The documents currently sought are beyond that date, and no complying application has been made to the respondent in respect thereof.  The respondent has therefore not unlawfully failed to make available for inspection the documents required to be made available for inspection.  For this reason alone, the application must be dismissed.

3. This outcome is not as disadvantageous to Mr Thomas as it might first appear. The Tribunal has determined that Mr Thomas has a genuine reason for wishing to inspect the documents and all that Mr Thomas need do is to apply in writing pursuant to s 43 to do so.

4. In the letter dated 20 September 2012 addressed to the Tribunal on behalf of the respondent, to which reference has already been made, it was stated that the council of owners had a duty and an obligation to minimise the costs of it being involved in applications before the Tribunal.  In the circumstances, one would expect that there is no obstacle to Mr Thomas being given proper inspection of the invoices in question.

5. The respondent would do well to cooperate with Mr Thomas, so that he is provided with sufficient information such that his various concerns should reasonably be satisfied.  If the respondent follows that course, and it is apparent that Mr Thomas should be satisfied and therefore does not have any good reason for requiring continuing inspection of documents, then that would be a basis on which to properly oppose inspection in the future, recognising that the Tribunal has a discretion whether or not to order that documents be made available for inspection.

Order

1. For the above reasons an order will issue in the following terms:

   1.The application is dismissed.

I certify that this and the preceding [22] paragraphs comprise the reasons for decision of the State Administrative Tribunal.

___________________________________

MR C RAYMOND, SENIOR MEMBER