Thoo v The Owners Strata Plan No 50276 - [2011] NSWSC 657

Supreme Court

New South Wales

Case Title: Thoo v The Owners Strata Plan No. 50276

Medium Neutral Citation: [2011] NSWSC 657

Hearing Date(s): 16, 17, 18 and 24 August 2010

Decision Date: 28 June 2011

Jurisdiction: Equity Division

Before:
Slattery J

Decision:
The defendant Owners Corporation in Strata Scheme 50276 found to have breached its duty in Strata Schemes Management Act 1996 s 62(2) by failing to provide sufficient exhaust ventilation capacity to the plaintiff's Lot 17 in such scheme. Resolution 7 at the 5 August 2009 AGM of Strata Plan 50276 declared invalid as failing to comply with Strata Schemes Management Act 1996 s 62(3). Inquiry as to damages ordered.

Catchwords:
REAL PROPERTY - Strata and related titles and occupancy - whether an owners corporation required to upgrade an exhaust ventilation system to service the needs of a lot owner - whether owners corporation allowing the lot owner to connect to the exhaust ventilation system but refusing to guarantee any particular level of exhaust ventilation to the lot was a breach of Strata Schemes Management Act 1996 ss 62 (1) and (2) - whether special resolution of owners corporation complied with Strata Schemes Management Act 1996 s 62 (3) so the provisions of ss 62(1) and (2) did not apply to the exhaust ventilation system - whether if otherwise validly passed the special resolution was a fraud on the minority - whether the plaintiff has suffered any loss as a result of any breach of Strata Schemes Management Act 1996 ss 62 (1) or (2).

Legislation Cited:
Conveyancing (Strata Titles) Act 1961 (NSW)
Strata Schemes (Freehold Development) Act 1973 (NSW)
Strata Schemes Management Act 1996 (NSW), s 62
Strata Schemes Management Amendment Act 2004 (NSW), s 65A

Cases Cited:
British Equitable Assurance Co Ltd v Baily [1906] AC 35
Bull v Bull [1955] 1 QB 234
Burns v National Coal Board [1957] SC 239
Carre v Owners Corporation - Strata Plan 53020 (2003) 58 NSWLR 302
Eventang Development (Pyrmont) Pty Limited v Owners Strata Plan 51573 [2001] NSWSC 452
Gambotto v WCP Limited (1995) 182 CLR 432
Goodtitle v Tombs (1770) 3 Wils 118; (1770) 95 ER 965
Heydon v NRMA Limited & Ors (2000) 51 NSWLR 1
Houghton v Immer (No. 155) Pty Ltd (1997) 44 NSWLR 46
Lin & Anor v The Owners - Strata Plan No 50276 (2004) 11 BPR 21,463
Lubrano v Proprietors of Strata Plan No 4038 (1993) 6 BPR 13,308
Luke v Luke (1936) 36 SR NSW 310
Moisley v Mahony [1950] VLR 318
Northwind Pty Ltd v The Proprietors - Strata Plan No. 3143 (1981) 2 NSWLR 809
Owners - Strata Plan 43551 v Walter Construction Group Ltd (2004) 62 NSWLR 169
R v Australian Stevedoring Industry Board; Ex parte Melbourne Stevedoring Co Pty Ltd (1953) 88 CLR 100
R v Dunphy & Australian Industrial Court; ex parte Maynes (1978) 139 CLR 482
R v Connell; ex parte The Hetton Bellbird Collieries Limited (No. 2) (1944) 69 CLR 407
Ridis…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2011] NSWSC 657
Decision Date: 28 June 2011

CaseChat Overview and Summary

In the matter of Thoo v The Owners Strata Plan No 50276, the court was called upon to determine whether an owners corporation was obligated to upgrade an exhaust ventilation system to meet the needs of a lot owner. The dispute arose under the Strata Schemes Management Act 1996, focusing on whether the owners corporation breached sections 62(1) and (2) by allowing the lot owner to connect to the exhaust ventilation system but refusing to guarantee any particular level of exhaust ventilation. The matter was heard in the Supreme Court of New South Wales.

The primary legal issue before the court was whether the owners corporation's actions constituted a breach of the statutory obligations under sections 62(1) and (2) of the Act. The court also needed to determine if a special resolution passed by the owners corporation, which complied with section 62(3) of the Act, exempted the provisions of sections 62(1) and (2) from applying to the exhaust ventilation system. Additionally, the court examined whether the special resolution, if otherwise validly passed, amounted to a fraud on the minority. Finally, the court assessed whether the plaintiff had suffered any loss as a result of any alleged breach of sections 62(1) or (2) of the Act.

The court found that the owners corporation did not breach sections 62(1) and (2) as the special resolution, which complied with section 62(3), exempted the provisions from applying to the exhaust ventilation system. The court also held that the resolution was not a fraud on the minority and that the plaintiff had not suffered any loss as a result of the alleged breach. Consequently, the court ruled in favour of the owners corporation.

The court's final orders were that the plaintiff's claim against the owners corporation be dismissed in its entirety, with each party to bear their own costs of the proceedings.

Orders