Tipene and the Owners Of Strata Plan 9465
[2016] WASAT 101
•17 AUGUST 2016
TIPENE and THE OWNERS OF STRATA PLAN 9465 [2016] WASAT 101
| STATE ADMINISTRATIVE TRIBUNAL | Citation No: | [2016] WASAT 101 | |
| STRATA TITLES ACT 1985 (WA) | |||
| Case No: | CC:1952/2015 | 19 MAY 2016 | |
| Coram: | MR D AITKEN (MEMBER) | 17/08/16 | |
| 28 | Judgment Part: | 1 of 1 | |
| Result: | Application dismissed | ||
| B | |||
| PDF Version |
| Parties: | KEVIN MICHAEL TIPENE SHELLEY ACUSHLA TIPENE SANTOS EZCARAY SANDRA NAREE NIXON GRAHAM THOMAS NIXON THE OWNERS OF STRATA PLAN 9465 JOHN RICHARD LONGFORD CLIVE HENRY ANNEAR HELEN MARGARET HUNTER LAWRENCE JOHN HUNTER BIORACH PTY LTD |
Catchwords: | Strata titles Boundaries of lots and part lots Whether removal of external walls and roof of a building and construction of new walls and a roof in different locations can be approved under s 7 of Strata Titles Act 1985 (WA) Whether requirements of s 7B of Strata Titles Act 1985 (WA) and reg 34 of Strata Titles General Regulations 1996 (WA) were complied with Whether Tribunal has a discretion not to make an order under s 103F of Strata Titles Act 1985 (WA) |
Legislation: | Strata Titles Act 1966 (WA), s 5(5) Strata Titles Act 1985 (WA), s 3, s 7, s 21, s 103F, s 132, Div 2A Pt II Sch 3 Strata Titles General Regulations 1996 (WA), reg 34, reg 37AA(1)(b), reg 46, Sch 3 |
Case References: | Finance Facilities Pty Ltd v Commissioner of Taxation (1971) 127 CLR 106 Tipene and The Owners of Strata Plan No 9495 [2013] WASAT 186 Tipene v The Owners of Strata Plan 9485 [2015] WASC 30 Topic and The Owners of Raffles Waterfront Strata Plan 48545 [2016] WASAT 27 |
Orders | 1. The application is dismissed. |
Summary | The proceeding concerned a strata scheme in which there are nine townhouses contained in two separate buildings. The applicants are the owners of four townhouses contained within one building and the respondents are the owners of five townhouses within the other building.,When the strata scheme was created the lots consisted of just the townhouses and there was a sizeable area of common property around each building. Subsequently, by a merger resolution, an area of the common property surrounding each lot was merged into that lot and the boundaries of the part lots comprised by the buildings were changed to the external surface of the buildings, with the result that each lot was comprised of a number of part lots.,The applicants applied to the strata company for approval under s 7(2) of the Strata Titles Act 1985 (WA) for approval for proposed building alterations to their lots, which required a resolution without dissent to be passed. The respondents voted not to approve the proposal and the applicants applied to the Tribunal under s 103F of the Act for an order declaring that the approval be deemed to have been given, because it should have been given and had been unreasonably withheld.,The proposed building alterations involved the removal of the external walls and roof of the building in which the applicants' townhouses are contained, and the construction of new walls and a roof in different locations.,The Tribunal decided that:,1) The lots in the strata scheme were comprised of the aggregate of a number of part lots, each of which is a separate cubic space fixed in whole or part by the external surfaces of the buildings.,2) The proposed building alterations would destroy the structures that define the cubic spaces that form each part lot, and the lots comprised of those part lots would then cease to exist.,3) Sections 7 and 103F of the Strata Titles Act 1985 do not permit any alteration or extension of a structure that affects the boundary of a lot or a part lot.,4) Therefore, the proposed building alterations did not come within s 7(2) of the Strata Titles Act 1985 and the application under s 103F of the Act must be dismissed.,In case that the decision is wrong, the Tribunal also considered and decided the following questions:,1) Whether the applicants had complied with the requirements of s 7B(1) of the Strata Titles Act 1985 and reg 34 of the Strata Titles General Regulations 1996 (WA) regarding the information that was required to be provided with the application for approval under s 7 of the Act. The Tribunal decided that the applicants had not done so.,2) Whether the respondents had unreasonably withheld approval for the proposed building alterations. The Tribunal decided that the respondents had not done so.,3) Whether the Tribunal has the discretion to not make an order under s 103F of the Strata Titles Act 1985 if it decides that approval should have been given under s 7 of the Act, but was unreasonably withheld. The Tribunal decided that it does not have the discretion not to make an order under s 103F of the Strata Titles Act 1985 if it decides that the approval should have been given and was unreasonably withheld. |
JURISDICTION : STATE ADMINISTRATIVE TRIBUNAL ACT : STRATA TITLES ACT 1985 (WA) CITATION : TIPENE and THE OWNERS OF STRATA PLAN 9465 [2016] WASAT 101 MEMBER : MR D AITKEN (MEMBER) HEARD : 19 MAY 2016 DELIVERED : 17 AUGUST 2016 FILE NO/S : CC 1952 of 2015 BETWEEN : KEVIN MICHAEL TIPENE
- SHELLEY ACUSHLA TIPENE
SANTOS EZCARAY
SANDRA NAREE NIXON
GRAHAM THOMAS NIXON
Applicants
AND
THE OWNERS OF STRATA PLAN 9465
JOHN RICHARD LONGFORD
CLIVE HENRY ANNEAR
HELEN MARGARET HUNTER
LAWRENCE JOHN HUNTER
BIORACH PTY LTD
Respondents
Catchwords:
Strata titles Boundaries of lots and part lots Whether removal of external walls and roof of a building and construction of new walls and a roof in different locations can be approved under s 7 of Strata Titles Act 1985 (WA) Whether requirements of s 7B of Strata Titles Act 1985 (WA) and reg 34 of Strata Titles General Regulations 1996 (WA) were complied with Whether Tribunal has a discretion not to make an order under s 103F of Strata Titles Act 1985 (WA)
Legislation:
Strata Titles Act 1966 (WA), s 5(5)
Strata Titles Act 1985 (WA), s 3, s 7, s 21, s 103F, s 132, Div 2A Pt II Sch 3
Strata Titles General Regulations 1996 (WA), reg 34, reg 37AA(1)(b), reg 46, Sch 3
Result:
Application dismissed
Summary of Tribunal's decision:
The proceeding concerned a strata scheme in which there are nine townhouses contained in two separate buildings. The applicants are the owners of four townhouses contained within one building and the respondents are the owners of five townhouses within the other building.
When the strata scheme was created the lots consisted of just the townhouses and there was a sizeable area of common property around each building. Subsequently, by a merger resolution, an area of the common property surrounding each lot was merged into that lot and the boundaries of the part lots comprised by the buildings were changed to the external surface of the buildings, with the result that each lot was comprised of a number of part lots.
The applicants applied to the strata company for approval under s 7(2) of the Strata Titles Act 1985 (WA) for approval for proposed building alterations to their lots, which required a resolution without dissent to be passed. The respondents voted not to approve the proposal and the applicants applied to the Tribunal under s 103F of the Act for an order declaring that the approval be deemed to have been given, because it should have been given and had been unreasonably withheld.
The proposed building alterations involved the removal of the external walls and roof of the building in which the applicants' townhouses are contained, and the construction of new walls and a roof in different locations.
The Tribunal decided that:
- 1) The lots in the strata scheme were comprised of the aggregate of a number of part lots, each of which is a separate cubic space fixed in whole or part by the external surfaces of the buildings.
2) The proposed building alterations would destroy the structures that define the cubic spaces that form each part lot, and the lots comprised of those part lots would then cease to exist.
3) Sections 7 and 103F of the Strata Titles Act 1985 do not permit any alteration or extension of a structure that affects the boundary of a lot or a part lot.
4) Therefore, the proposed building alterations did not come within s 7(2) of the Strata Titles Act 1985 and the application under s 103F of the Act must be dismissed.
- 1) Whether the applicants had complied with the requirements of s 7B(1) of the Strata Titles Act 1985 and reg 34 of the Strata Titles General Regulations 1996 (WA) regarding the information that was required to be provided with the application for approval under s 7 of the Act. The Tribunal decided that the applicants had not done so.
2) Whether the respondents had unreasonably withheld approval for the proposed building alterations. The Tribunal decided that the respondents had not done so.
3) Whether the Tribunal has the discretion to not make an order under s 103F of the Strata Titles Act 1985 if it decides that approval should have been given under s 7 of the Act, but was unreasonably withheld. The Tribunal decided that it does not have the discretion not to make an order under s 103F of the Strata Titles Act 1985 if it decides that the approval should have been given and was unreasonably withheld.
Category: B
Representation:
Counsel:
Applicants : Mr R Rowick
Respondents : Dr J Schoombee
Solicitors:
Applicants : Richard Rowick Barrister & Solicitor
Respondents : CWS Lawyers
Case(s) referred to in decision(s):
Finance Facilities Pty Ltd v Commissioner of Taxation (1971) 127 CLR 106
Tipene and The Owners of Strata Plan No 9495 [2013] WASAT 186
Tipene v The Owners of Strata Plan 9485 [2015] WASC 30
Topic and The Owners of Raffles Waterfront Strata Plan 48545 [2016] WASAT 27
Introduction
1 This proceeding concerns the strata scheme known as 2 Douglas Avenue & 2 Jubilee Street, South Perth (Strata Scheme). The Strata Scheme is comprised of a parcel of land situated on the corner of Douglas Avenue and Jubilee Street, South Perth on which there are nine townhouses, contained in two separate buildings. One building is single storey (Single Storey Building) and contains five townhouses, and the other building is two-storey (Two Storey Building) and contains four townhouses.
2 The Strata Scheme was created by the registration of Strata Plan 9465 (Strata Plan) on 19 August 1981 under the Strata Titles Act 1966 (WA) (1966 Act), with nine lots and common property.
3 The 1966 Act was repealed and replaced by the Strata Titles Act 1985 (WA) (ST Act), and pursuant to s 132 and the transitional provisions in Sch 3 of the ST Act, the Strata Scheme continued, with modifications to it made by those transitional provisions.
4 When the Strata Scheme was created, the boundaries of the lots were the centres of the walls, floors and ceilings of the buildings: s 5(5) of the 1966 Act. Upon the commencement of the ST Act, those boundaries changed to be the inner surface of the walls, the upper surface of the floors and the under surface of the ceilings of the buildings: cl 3(1)(a) of Sch 3 of the ST Act. There was a sizeable area of common property around each building.
5 A merger by resolution was passed on 7 August 1997 under Pt II Div 2A of the ST Act and registered on 1 October 1999 (Merger Resolution) which merged an area of common property surrounding each lot into that lot, and changed the boundaries of the parts of the lots which were formed by the buildings to the external surfaces of the buildings, and in the case of common walls between lots, to the centre plane of those common walls, as provided by s 3AB of the ST Act.
6 The applicants, Mr Kevin Tipene, Ms Shelley Tipene, Mr Santos Ezcaray, Ms Sandra Nixon and Mr Graham Nixon, are the registered proprietors of Lots 6, 7, 8 and 9 on the Strata Plan, being the lots which contain the four townhouses in the Two Storey Building. The respondents are The Owners of Strata Plan 9465 (Strata Company), which is the strata company for the Strata Scheme, and Mr John Langford, Mr Clive Annear, Ms Helen Hunter, Mr Lawrence Hunter and Biorach Pty Ltd, who are the registered proprietors of Lots 1, 2, 3, 4 and 5 on the Strata Plan, being the lots which contain the five townhouses in the Single Storey Building. The Strata Company did not participate in the proceeding, and in these reasons the term 'respondents' refers to Mr Langford, Mr Annear, Ms Hunter, Mr Hunter and Biorach Pty Ltd.
7 In February 2011, the applicants applied to the Strata Company under s 7 of the ST Act for approval to demolish the Two Storey Building and construct four new townhouses in its place. That approval was not given, and in February 2012 the applicants applied to the Tribunal seeking an order under s 103F of the ST Act for that approval. In November 2013, the Tribunal decided that it did not have jurisdiction under s 103F, because the demolition of the Two Storey Building did not fall within s 7, and the Tribunal dismissed that application: Tipene and The Owners of Strata Plan No 9495 [2013] WASAT 186. The applicants appealed that decision to the Supreme Court, but in January 2015, the Court refused leave to appeal and the appeal was disallowed: Tipene v The Owners of Strata Plan 9485 [2015] WASC 30 (Tipene).
8 In November 2015, the applicants submitted an application to the Strata Company for approval under s 7 of the ST Act 'for proposed building alterations on [L]ots 6, 7, 8, and 9 on Strata [P]lan 9465' (Approval Application).
9 Under s 7 of the ST Act, that approval must be given by a resolution without dissent being passed by the Strata Company. The Approval Application was put to the Annual General Meeting of the Strata Company on 14 December 2015 (2015 AGM) and it was not passed due to the objection to it by the respondents.
10 The applicants are seeking an order under s 103F of the ST Act declaring that the approval sought in the Approval Application be deemed to have been given under s 7 of the Act.
11 Section 103F(3) of the ST Act provides that the Tribunal may make an order under s 103F if it is satisfied that the approval should have been given under s 7 of the Act and that it has been unreasonably withheld.
The issues to be determined
12 The issues to be determined by the Tribunal are:
1) Should approval have been given to the Approval Application under s 7 of the ST Act?
2) Has approval been unreasonably withheld by the respondents?
3) If both of the above issues are determined in the affirmative, should the Tribunal make an order under s 103F(2) of the ST Act, or does it have the discretion not to do so?
The evidence
13 The parties put various documents into evidence (Exhibits 1 - 10), which included witness statements by Mr Tipene and Mr Langford.
14 Mr Tipene and Mr Langford also gave oral evidence at the hearing.
15 During the hearing, the Tribunal attended a view of the Strata Scheme. During that view, it was observed that the Two Storey Building has some design features which are germane to the Approval Application. Firstly, the upper storey concrete slab overhangs the outer walls of the ground floor storey of the building. Secondly, the outer walls of the upper storey slope inwards from bottom to top and they are cladded with concrete roof tiles.
The Approval Application
16 The Approval Application, which is dated 26 November 2015, states that the applicants apply to the Strata Company for approval 'for the current buildings to be renovated on [L]ots 6, 7, 8 and 9 as shown on the attached building plans' (Proposal) and sets out information to address the requirements of reg 34(2)(a) to reg 34(2)(f) and reg 34(3) of the Strata Titles General Regulations 1996 (WA) (ST Regulations).
17 The Approval Application was accompanied by a document entitled 'The proposal' and another document entitled 'Plans and finishes'.
18 The proposal document states as follows:
Carry out works (the Works) on the four townhouse portions comprising lots 6, 7, 8 and 9 on Strata plan 9465.
It is proposed that the Works be carried out on all townhouses at the same time in a manner compliant with regulations as prescribed by the City of South Perth.
The Works will include:
a) the evacuation of occupants and removal of personal effects;
b) the compulsory rodent de-infestation over the prescribed time of approximately 3 to 4 weeks;
c) continuity of utility supplies to Lots 1-5 of the strata scheme and safety in casement of overhead power lines;
d) repairs to, and where required, replacement of the damaged concrete slab on the second floor level;
e) replacement of the roof and sidings to the second floor level;
f) all interior and exterior paint works;
g) internal fit-out and electrical works;
h) re-landscaping of the external areas.
The Works will comprise of concrete slabs, double brick masonry to all walls, [Colorbond] roofing and aluminium joinery.
The exterior brickwork will be rendered with a dyed render in keeping with the overall look of the entire strata scheme.
The Works have been designed in conformity with local policy and guidelines.
The plans conform with the current height restriction of 7m.
It is anticipated that the Works will commence approximately mid-2016 and should be completed at or around the end of 2017.
19 The plans and finishes document consists of four pages, which are described as 'ground storey plan', 'upper storey plan', 'elevations' and 'proposed site plan'.
The objection by the respondents
20 The minutes of the 2015 AGM record that the respondents voted 'not in favour' of the Approval Application, for the reasons read out to the meeting and attached to the minutes, and therefore a resolution without dissent was not obtained.
21 A copy of a document entitled 'Objection to proposal for alterations on Lots 6, 7, 8 and 9 on Strata Plan 9465' signed by the respondents and dated 14 December 2015 is attached to those minutes. It states two grounds for not approving the proposed building alterations:
• Firstly, that in the opinion of the respondents, the proposed alterations will or may affect the boundary of a lot and therefore they are not permissible under the ST Act (first ground of objection).
• Secondly, that the proposed alterations will result in a structure that is visible from the outside of the applicants' lots that is not in keeping with the rest of the development (second ground of objection).
Applicants' contentions
22 The applicants' contentions may be summarised as follows.
23 The applicants contend that they are entitled to seek approval under s 7(2)(b) of the ST Act to alter or extend the 'boundary walls' of the building within their lots, namely, the Two Storey Building.
24 The applicants say that the extensions and alterations for which they have sought approval are to extend the building on each of their lots into the space within their lot which surrounds the building. They say that those works will involve moving the external walls of the ground storey of the building from their current position to the outer edge of the upper storey concrete slab and also straightening the angled external walls on the upper storey, so that they are perpendicular to the outer edge of that slab. They also say that most of the existing brickwork and concrete slabs will be retained, in addition to the common walls between each of their lots, but they acknowledge that due to existing concrete cancer damage to the upper storey concrete slab, they may be required to replace or repair that slab.
25 The applicants contend that the first ground of objection given by the respondents for refusing to approve the Proposal is not a ground on which the respondents may refuse to give approval under s 7(4)(c) and s 7(5) of the ST Act.
26 The applicants say that the only relevant ground relied on by the respondents for refusing to approve the Proposal is the second ground of objection, which is a ground on which an approval may be refused under s 7(5)(b)(i) of the ST Act. The applicants accept that the Proposal will result in a structure that is visible from outside the applicants' lots. However, they dispute the respondents' contention that the resulting structure will not be in keeping with the development.
27 The applicants contend that the Tribunal, in determining what is 'in keeping' with the development, should have regard to the following factors:
• The existing buildings are separate and distinct structures with the Single Storey Building fronting on to a park and the Two Storey Building fronting on to Jubilee Street.
• The existing buildings vary significantly in height, building style, colour and appearance, and there is little consistency in style or design between the existing buildings.
• Window and door frames are constructed from various materials, including wood and aluminium, with no consistency between the townhouses.
• There is no existing policy on acceptable colours or styles to assist in determining what is 'in keeping' with the development.
28 The applicants say that the fact that, after the works referred to in the Proposal have been carried out, the Two Storey Building will be 'substantially new' whilst the Single Storey Building is old, does not mean that the Two Storey Building will not be in keeping with the rest of the development. The applicants say that the age of a structure, alone, does not determine whether it is in keeping with the rest of the development.
29 The applicants say that the proposed aluminium joinery will be consistent between each townhouse and will be in keeping with the existing aluminium joinery and will present a more uniform appearance to the development. They also say that the proposed brickwork and coloured render will blend well with the existing structures, and that the replacement roof will be significantly similar to the existing roof because the replacement roof is to be constructed from the same material as the existing roof and will have the same elevation. Furthermore, they say that due to the entirely flat skillion style of the roof, it will not be visible from the street or area surrounding the outside of each lot and will only be visible when viewed from above.
30 The applicants contend that the respondents' refusal to grant approval to the Proposal unreasonably and significantly impinges on the applicants' ability to enjoy their respective lots due to a number of factors. They say there is water ingress which is occurring inside their townhouses due to poor drainage, which has caused decay in the upper storey concrete slab and joinery, and damage to internal plasterwork and floor coverings in their townhouses. They also say that there is the risk of significant injury to the occupants of their townhouses due to falling concrete tiles; that there is horizontal cracking to the ground storey brickwork; that there is inadequate insulation throughout their townhouses; and that there is a risk from deteriorating asbestos cladding and lining used in the construction of the townhouses which is exacerbated by water ingress and associated deterioration. The applicants say that if left untreated, the continued water ingress will worsen the existing concrete cancer in the upper storey slab and potentially cause serious structural problems to the applicants' townhouses, which may render them uninhabitable and will severely impact the financial value of them.
31 The applicants contend that, having regard to the matters referred to above, the Tribunal should find that consent was unreasonably withheld by the respondents, and should grant an order, under s 103F of the ST Act, that approval for the purposes of s 7(2) of the Act be deemed to have been given by the Strata Company.
32 The applicants say that they are not proposing and will not, in any event, undertake a demolition of the Two Storey Building, and they deny the assertion by the respondents that the Proposal entails a 'de facto' demolition of the Two Storey Building.
33 The applicants say that the decision in Tipene related to a total demolition of the Two Storey Building and should be distinguished from the Proposal in this proceeding, which is not for the total demolition of the Two Storey Building. The applicants say that the temporary removal of boundary walls is permitted under the ST Act, and refer to the comment by Corboy J at [105] of Tipene that '[i]t may be that lot owners can approve an alteration that temporarily affects the boundaries of a lot or lots under s 7', although that was obiter dictum because Corboy J stated that it was unnecessary to decide that question in Tipene.
34 The applicants contend that the words 'alteration' and 'extension' in s 7(2)(b) of the ST Act should be given their ordinary meaning and can only be taken to mean an extension or alteration to the exterior of a proprietor's lot. The applicants say that the Proposal is clearly for an exterior alteration or extension of a structure on their respective lots and it is within s 7 of the ST Act.
35 The applicants say that the Proposal was put to the Strata Company in the form required by s 7B of the ST Act and reg 34 of the ST Regulations. The applicants deny the contention of the respondents that, as part of the Proposal, they were required to provide the building inspection reports prepared by Abode Consulting dated 29 November 2012.
36 The applicants contend that the word 'may' in s 103F(3) of the ST Act should be interpreted as 'must' and that if the Tribunal is satisfied that consent should have been given under s 7 but was unreasonably withheld, then the Tribunal must make an order under s 103F declaring that the approval required under s 7 is deemed to have been given by the Strata Company. The applicants rely on the reasoning of Windeyer J in Finance Facilities Pty Ltd v Commissioner of Taxation (1971) 127 CLR 106 (Finance Facilities) in support of that contention.
Respondents' contentions
37 The respondents' contentions may be summarised as follows.
38 The respondents say that the Approval Application was incomplete, defective and misleading, because it did not address any structural issues, except a brief reference to the possible replacement of the upper storey concrete slab. The respondents further say that, despite the applicants having a report which indicates that there is a high probability that the Two Storey Building needs to be demolished, the works in the Proposal were described as a renovating exercise.
39 The respondents say that the first ground of objection did not need to be raised at the 2015 AGM and could have just been raised when this proceeding was commenced, but they decided to give notice to the applicants of the fundamental deficiencies underlying the Approval Application. The respondents say that the first ground of objection is relevant to the fundamental 'lack of competency' of the Approval Application and the corresponding lack of jurisdiction for the Tribunal to make the order sought by the respondents in this proceeding.
40 The respondents say that each of the respondents' lots are comprised of three or four interrelated part lots, two of which are comprised of buildings (being the cubic spaces on the ground storey and the upper storey of the Two Storey Building) and then one part lot or two part lots outside the Two Storey Building. The respondents say that the boundaries of the part lots which are fixed by the Two Storey Building are fixed in a different way to the boundaries of the part lots on the land outside the Two Storey Building.
41 The respondents say that the applicants appear to be relying on a novel and fallacious approach, namely, that there is somehow one overarching cubic space on each of the respondents' lots, having as its base the whole ground-level area of both the Two Storey Building and the part lot or two part lots which are external to that building, and extends vertically from 2 metres below the top of the ground storey concrete slab level to 7 metres above that level.
42 The respondents point out that, in Tipene at [77], it is stated that a lot in a strata scheme is not an interest in land as such but an interest in a defined three-dimensional space. The respondents say that the part lots which sit on a land base outside the buildings have defined footprints on the Strata Plan and they do not displace or envelop the specifically defined building part lots.
43 The respondents say that the applicants, in line with their fallacious approach, posit incorrectly that a height restriction of 7 metres applies to each of their lots, whereas the physical top of the Two Storey Building constitutes the horizontal boundary of the upper storey part lot and the airspace above that is common property.
44 The respondents refer to the description of a 'boundary building' in Tipene at [51] as a building that forms the boundaries or part of the boundaries of a lot, and the respondents contend that the Tribunal does not have jurisdiction under s 103F of the ST Act, where proposed works entail the destruction of a 'boundary wall'. The respondents also refer to the statement at [73] of Tipene in support of that contention.
45 The respondents say that the works proposed in the Approval Application 'fall foul of these restrictions in a big way' because they expressly envisage the replacement of the roof and the external walls of the upper storey of the Two Storey Building and the repositioning of that roof and those external walls at different locations, as well as the demolition of the ground storey external walls and the replacement of them with walls at different locations. The respondents also say that, in all probability, the upper storey concrete slab is going to be demolished and replaced.
46 The respondents say that the works proposed in the Approval Application go beyond alterations or extensions which are permissible under s 7 of the ST Act, as they involve practically a total or near total demolition of the current structures, with the inevitable loss of the boundary walls and the construction of new ones in different locations. The respondents say that this scenario was essentially considered in Tipene and was decided against the applicants.
47 The respondents say that the carrying out of the proposed works will result in a structure that is visible from outside each of the respondents' lots that is not in keeping with the rest of the development, because an entirely new building would be created in contrast with the 40-year-old townhouses in the Single Storey Building. The respondents say that they cannot be said to have acted unreasonably in raising the second ground of objection, given that an entirely new building is proposed to be erected at the rear of the Strata Scheme, and only sketches and outline plans were provided to them with the Approval Application.
48 The respondents say that, even if the Tribunal is satisfied with the matters set out in s 103F(3)(a) and s 103F(b) of the ST Act, the Tribunal has the discretion to refuse the application, which it should exercise because the Approval Application was incomplete, misleading and open-ended and there are structural concerns and related matters such as the 'scrambling' of current unit entitlements and insurance difficulties.
The relevant provisions of the ST Act
49 Section 7 of the ST Act provides, relevantly:
…
(2) The proprietor of a lot shall not cause or permit -
(a) any structure to be erected; or
(b) any alteration of a structural kind to, or extension of, a structure,
on his lot except -
…
(d) … with the prior approval, expressed by resolution without dissent, of the strata company.
…
(4) Where an application is made to a strata company in accordance with section 7B -
…
(c) a proprietor may vote -
(i) against a resolution to approve the application; or
(ii) in support of a resolution to refuse approval of the application,
on any ground that is permitted by subsection (5), but not otherwise; and
(d) a vote referred to in paragraph (c) is of no effect unless the person casting the vote discloses as a ground for his vote one or more of the grounds permitted by subsection (5).
(5) The grounds on which approval may be refused are -
(a) that the carrying out of the proposal will breach the plot ratio restrictions or open space requirements for the lot ascertained in accordance with section 7A(3); or
(b) in the case of a lot that is not a vacant lot, that the carrying out of the proposal -
(i) will result in a structure that is visible from outside the lot and that is not in keeping with the rest of the development; or
(ii) may affect the structural soundness of a building; or
(iii) may interfere with any easement created by section 11 or 12;
or
(c) any other ground that is prescribed.
…
50 Section 7B(1) of the ST Act provides, relevantly:
A proprietor who wishes to obtain an approval of a proposal that comes within section 7(2) or 7A(2) shall serve an application on the strata company or the other proprietor, as the case may require, and in the application shall set out details of the proposal and such other information as may be prescribed.
51 Regulation 34 of the ST Regulations contains the prescribed information for the purpose of s 7B(1) of the ST Act.
52 Regulation 34 provides, relevantly:
(1) The prescribed information for the purposes of section 7B(1) are plans and specifications for the construction of the improvements and the prescribed information specified in subregulation (2), (4), (5) and (6) as applicable.
(2) In the case of a strata plan the following information is prescribed, subject to subregulation (3) -
(a) the plot ratio restrictions and open space requirements in relation to the parcel; and
(b) the pro rata entitlements of or requirements for the lot ascertained in accordance with section 7A(3); and
(c) if the application is approved, the area of the structure, including the area of all existing and proposed structures to be taken into account for the purposes of calculating the restrictions and requirements; and
(d) whether or not the carrying out of the proposal will breach the plot ratio restrictions or open space requirements for the lot ascertained in accordance with section 7A(3) and if it does the percentage and area by which such pro rata entitlement or requirement is exceeded; and
(e) the location and dimensions of the proposed structure upon its completion in relation to any existing structure on the lot or to the boundaries of the lot; and
(f) any contravention of the by-laws of the strata company, whether of a permanent or temporary nature, which is likely to occur during or as a result of the erection, alteration or extension of the structure, and any proposed manner of dealing with that contravention.
…
(4) If the area of the structure, upon its erection, alteration or extension, would not be required to be taken into account for the purposes of calculating the plot ratio restrictions and open space requirements in relation to the parcel, the prescribed information includes a statement to that effect and the reason why it would not be required to be taken into account.
(5) In the case of a lot on a strata plan that is not a vacant lot, as is defined in section 7(6), the following additional information is prescribed -
(a) full details of the materials to be used in the structure or the alteration or extension of a structure; and
(b) the colours of those parts of the structure that will be visible from outside the lot; and
(c) the method of construction to be used in and an estimated work plan for the erection, alteration or extension of the structure; and
(d) any likely interruption to or interference with any easement created by section 11 or 12, whether of a permanent or temporary nature, and any proposed manner of dealing with that interruption or interference.
…
53 Section 103F of the ST Act provides, relevantly:
(1) A proprietor of a lot who has applied for but not obtained an approval under section 7B may apply to the State Administrative Tribunal for an order under this section.
(2) An order under this section is an order declaring that the approval required under section 7 or 7A, as the case may be, is to be deemed to have been given by the proprietor or the strata company.
(3) On the making of an application under subsection (1), the State Administrative Tribunal may make an order under this section if satisfied that the approval -
(a) should have been given under section 7 or 7A, as the case may be; but
(b) has been unreasonably withheld,
by the proprietor or the strata company.
…
Should approval have been given under s 7 of the ST Act?
54 The starting point in deciding whether approval should have been given under s 7 of the ST Act is to consider whether the Proposal falls within s 7(2). If the Proposal does not fall within s 7(2) then approval cannot be given to the Proposal under s 7 and the application for an order under s 103F must fail because the requirement of s 103F(3)(a) cannot be satisfied.
55 If the Proposal falls within s 7(2) of the ST Act, then the next step is to consider whether the Approval Application complies with the requirements of s 7B(1). If the Approval Application does not comply with s 7B(1) then the application under s 103F must fail because s 7B(1) provides that the Approval Application shall set out details of the proposal and the prescribed information, which indicates that it is mandatory for those details and information to be provided.
56 If the Approval Application falls within s 7(2) of the ST Act and complies with s 7B, then the next step is to consider whether the Strata Company should have given approval for the Proposal under s 7.
Does the Proposal fall within s 7(2) of the ST Act?
57 To come within s 7(2) of the ST Act, a proposal must be for the erection of a structure or a structural alteration to, or the extension of, a structure on a lot.
58 Clearly the Proposal involves the structural alteration and extension of the townhouses which are contained within the applicants' lots. However, clearly also, the Proposal involves the removal of the external walls and roof of the Two Storey Building.
59 In Tipene, at [93], Corboy J states that s 7 and s 103F of the ST Act do not permit any alteration or extension of a structure that affects the boundary of a lot.
60 A crucial question which therefore arises in respect of the Proposal is: what effect will the proposed building works have on the boundaries of the applicants' lots? To decide that question, it is necessary to identify the boundaries and dimensions of each of the applicant's lots.
61 In s 3(1) of the ST Act, a lot is defined as being one or more cubic spaces forming part of the parcel to which a strata scheme relates, with the base of each cubic space being designated as one lot or part of one lot on the floor plan forming part of the strata plan for that strata scheme (emphasis added). The provisions of the ST Act regarding the boundaries of those cubic spaces are convoluted.
62 Section 3(2)(a)(i) of the ST Act provides that, except where s 3AB or s 3(2)(b) applies, where the bases of walls in a strata scheme correspond substantially with lines on a floor plan, the vertical boundaries of the cubic spaces are the inner surfaces of those walls.
63 Where s 3AB of the ST Act applies, the boundaries of the cubic spaces are the external surfaces of the building shown on the floor plan, regardless of the location of the lines representing that building on the floor plan.
64 Section 3(2)(b) of the ST Act, read in conjunction with reg 37AA(1)(b) of the ST Regulations, provides that the boundaries of a cubic space which is external to a building may be described by reference to their location in relation to the building.
65 Section 3(2)(a) of the ST Act provides that where a strata plan creates a boundary of a lot which is external to a building, that boundary may be the parcel boundary.
66 It can be seen from all of the above provisions that the vertical boundaries of cubic spaces which constitute lots or part lots are formed by walls or some other part of a building, or some other structure, and in the case of a cubic space which is external to a building, a boundary can be the boundary of the parcel of land comprised in the strata scheme.
67 It was apparent during the view conducted by the Tribunal that the lines which show the upper storey of the Two Storey Building on the first floor plan in the Strata Plan do not accurately correspond with the external wall on the south-eastern side of the Two Storey Building. Pursuant to s 3AB of the ST Act, despite that inaccuracy in the Strata Plan, the boundary of part Lots 6, 7, 8 and 9 on the upper storey of the Two Storey Building is the external surface of that wall.
68 Each of the lots in the Strata Scheme consists of the aggregate of a number of part lots and each of those part lots is a separate cubic space.
69 Lots 1 and 5 consist of two part lots and Lots 2, 3 and 4 consist of three part lots. Each of those five lots contain one part lot which is the cubic space fixed by the external surfaces of the Single Storey Building. The other part lots are cubic spaces external to that building, fixed partly by the external surfaces of that building, partly by other physical structures (a wall and the line of the edge of the roof), and partly by the boundary of the Parcel. The horizontal boundaries of each of those part lots are discussed below.
70 Lots 6 and 9 consist of two part lots and Lots 7 and 8 consist of three part lots. Each of those four lots contain one part lot which is the cubic space fixed by the external surfaces of the Two Storey Building. The other part lots are cubic spaces external to that building, fixed partly by the external surfaces of that building, partly by another physical structure (a wall), and partly by the boundary of the Parcel. The horizontal boundaries of each of those part lots are discussed below.
71 The respondents contend that there are two part lots comprised within the Two Storey Building, with one part lot on the ground storey and one part lot on the upper storey. That might appear to be the situation because Sheet No. 4 of the Strata Plan shows a part lot on the ground floor and Sheet No. 5 shows a part lot on the first floor.
72 However, the Tribunal does not accept that contention for the following reasons. The definition of 'lot' in s 3(1) of the ST Act refers to the designation of a lot or part lot on the 'floor plan', which is defined in s 3(1) as being a plan with one or more sheets. Therefore Sheet No. 4 and Sheet No. 5 are part of the single floor plan contained in the Strata Plan. Where s 3AB of the ST Act applies, the boundaries of a cubic space are the external surfaces of the building occupying the area represented on the floor plan. In the case of the three-dimensional space comprised within the Two Storey Building for each of Lots 6, 7, 8 and 9, the area represented on the floor plan is the combination of Sheet No. 4 and Sheet No. 5. The different outlines of the external walls and areas on those two sheets reflect the shape of the Two Storey Building, because the external walls are in different locations on the ground storey and the upper storey. The boundaries of that three-dimensional space in each of those lots is the external surface of the roof, the external surface of the external walls, the underneath surface of the upper storey concrete slab where it is outside the external walls of the ground storey and the underneath surface of the ground floor concrete slab. All of those surfaces together comprise the external surfaces of the Two Storey Building. That means that the portion of the upper storey concrete slab which is inside those boundaries is within that single part lot, just as internal walls and other improvements are within that part lot.
73 It is implicit in the contentions of the applicants that they consider that the horizontal boundaries of the part lots which are comprised within the Single Storey Building and the Two Storey Building are the same as those of the part lots which are external to those buildings; in other words, that the lower horizontal boundaries are 2 metres below the level of the top of the ground floor concrete slab in each case, and that the upper horizontal boundaries are 3 metres above that level in the case of Lots 1 to 5, and 7 metres above that level in the case of Lots 6 to 9.
74 The Tribunal does not accept that contention for the following reasons. There is a notation on the ground floor plan in the Strata Plan which states:
Stratum of lots 1 – 5 (inc) extends between 2 metres below and 3 metres above the upper surface of the lowest level of the ground floor of the respective main unit situated thereon. Stratum of lots 6 – 9 (inc) extends between 2 metres below and 7 metres above the upper surface of the lowest level of the ground floor of the respective main unit situated thereon.
- That notation might give the impression that the horizontal boundaries of all of the part lots, including those part lots which are comprised within the Single Storey Building and the Two Storey Building, are 2 metres below the upper surface of the ground floor of each townhouse and 3 metres above that surface in the case of the townhouses within the Single Storey Building, and 7 metres above that surface in the case of the townhouses within the Two Storey Building. However, when the provisions of s 21F and s 21Q of the ST Act and the Merger Resolution are considered, it is clear that the notation is only referring to the common property areas outside the townhouses which were merged into the lots.
75 The Merger Resolution states, relevantly:
The Owners of (name of scheme) 2 Douglas Avenue & 2 Jubilee Street, South Perth Strata Plan No 9465 hereby certify that on the 7.8.97 the following resolutions were passed as a *resolution without dissent …
1. **That in relation to the lots or parts of the lots which are buildings shown on the strata plan, the boundaries are to be fixed by reference to the external surfaces of those buildings, as provided for by section 3AB of the Strata Titles Act 1985.
**Where 2 lots have a common or party wall, or have buildings on them which are joined, the centre plane of that wall or the plane at which they are joined, is the boundary.
2. That the strata plan be amended as follows:
…
**(c) to merge land that is common property into a lot or lots on the strata plan–
*(i) as depicted on the sketch plan tabled for the purposes of this resolution; …
…
*(b) 3 metres above and 2 metres below the upper surface of the lowest level of the ground floor of the respective main unit situated thereon for Lots 1-5 (inc) and 7 metres above and 2 metres below for Lots 6-9 (inc)[.]
77 Resolution 1 of the Merger Resolution is the resolution under s 21F of the ST Act to merge the buildings which had been part of the common property into the part lots which at that time were comprised within those buildings. Resolution 1 changed the boundaries from the internal surfaces of the walls, the lower surfaces of the ceilings and the upper surface of the floors to the external surfaces of the buildings in accordance with s 3AB.
78 Resolution 2(c) of the Merger Resolution is the resolution under s 21Q(1)(c) of the ST Act to merge the common property areas adjoining the buildings into the lots in the Strata Scheme. The footnotes to Form 33 state that if a resolution in the terms of 2(c) of the form is included then a resolution in the terms of 3 must also be included. The reason for that footnote is to ensure that in the case of resolution 2(c), the requirements of s 21Q(4) are met.
79 In Tipene at [73], Corboy J states:
A lot in a strata scheme is a statutory construct created in relation to a three-dimensional space. The dimensions of that space are fixed by the surfaces of the walls, floors and ceilings of a building or parts of a building or by other physical features of the building in the case of structural cubic spaces. A lot is not an abstraction defined, for example, by what is depicted or described on the floor plan forming part of the strata plan for a strata scheme. A floor plan merely describes the cubic space and does so by reference to the physical structures that bound the space. It is the space created by those structures that constitutes the lot in a strata scheme.
80 Then, at [92] of Tipene, Corboy J states that the demolition of, for example, a party wall that forms the boundary between two lots will 'destroy' one part of the structure that defines the cubic spaces that form the lots, and that the lots would cease to exist as statutory constructs once the wall had been demolished.
81 As the applicants have pointed out, in Tipene at [105], Corboy J states that it may be that lot owners can approve an alteration that temporarily affects the boundaries of a lot or lots under s 7 of the ST Act, although he did not have to decide that question in that proceeding.
82 An example of such an alteration was considered in Topic and The Owners of Raffles Waterfront Strata Plan 48545 [2016] WASAT 27, where the original floor tiling in the kitchen of a strata lot had been removed and replaced. The Tribunal decided that, in those circumstances, where only a section of the floor which formed the lower horizontal boundary of the lot had been affected, there had not been the destruction of that boundary.
83 The Proposal in this proceeding does not propose the temporary removal of the parts of the Two Storey Building which form the boundaries of the applicants' part lots; in particular, the external walls on both the ground storey and the upper storey. The applicants are proposing to permanently remove those walls and then construct new walls in different locations. In the case of the ground storey, the new walls are proposed to be further out than the existing walls, to sit underneath the edge of the upper storey concrete slab. In the case of the upper storey, the new walls are proposed to be vertical in place of the existing sloping walls.
84 The statement by Corboy J at [73] of Tipene, which is set out above, is applicable to each of the part lots which comprise the applicants' lots. The dimensions of those part lots are fixed by the outer surfaces of the Two Storey Building and it is the space created by those structures that constitute each of the part lots.
85 The removal of the external walls and roof of the Two Storey Building which form the boundaries of the part lots will destroy the structures that define the cubic spaces that form each part lot, and those part lots will cease to exist.
86 As Corboy J stated at [85] of Tipene, the lots comprised of the various part lots will have gone and there will be no cubic spaces capable of forming those part lots and, hence, lots.
87 The Tribunal accepts the contention of the respondents that each of the lots in the Strata Scheme is not one single 'super cube'. Each lot consists of a number of cubic spaces, having boundaries that are predominantly formed by parts of the buildings, and if any of those boundaries are destroyed by the removal of those parts of the buildings then the cubic spaces will be destroyed and the part lots will cease to exist.
88 As Corboy J stated at [93] of Tipene, s 7 and s 103F of the ST Act do not permit any alteration or extension of a structure that affects the boundary of a lot and, hence, a part lot. Therefore, the Proposal does not come within s 7(2).
89 The decision that the Proposal does not come within s 7(2) of the ST Act is sufficient reason to dismiss the proceeding without the need to consider the other issues.
90 However, in case that decision is wrong, the Tribunal will now consider and decide the other issues.
Does the Approval Application comply with s 7B(1) of the ST Act?
91 Section 7B(1) of the ST Act provides that a proprietor who wishes to obtain an approval of a proposal that comes within s 7 shall serve an application on the strata company which shall set out details of the proposal and such other information as may be prescribed. Regulation 34 of the ST Regulations specifies that prescribed information.
92 Clearly the applicants served the Approval Application on the Strata Company. What is in contention is whether the Approval Application sets out all of the information prescribed by reg 34 of the ST Regulations.
93 Regulation 34(1) of the ST Regulations provides that the prescribed information for the purposes of s 7B(1) of the ST Act includes plans and specifications for the construction of the improvements and the prescribed information specified in regs 34(2), 34(4), 34(5) and 34(6) as applicable. Regulations 34(4) and 34(6) are not applicable to the Proposal. However, regs 34(2) and 34(5) are applicable.
94 The Approval Application and the accompanying proposal document and accompanying plans and finishes document purport to provide all of that prescribed information. However, in the view of the Tribunal, they fail to do so in the following respects:
• They do not contain plans and specifications for the construction of the improvements, as required by reg 34(1) of the ST Regulations.
• They do not set out full details of the materials to be used, as required by reg 34(5)(a) of the ST Regulations.
• They do not set out the method of construction to be used and an estimated work plan, as required by reg 34(5)(c) of the ST Regulations.
95 The Proposal involves substantial demolition and structural building works. The proposal document and the four pages of the plans and finishes document do not provide anywhere near the details which would be required by a builder to be able to construct the proposed works and, therefore, they do not constitute plans for the construction of the proposed building works as required by reg 34(1) of the ST Regulations.
96 The Approval Application does not contain specifications, which is a standard construction document that sets out in detail the materials to be used in the construction of proposed building works. Therefore, the requirements of regs 34(1) and 34(5)(a) of the ST Regulations, that specifications are to be provided and full details are to be set out of the materials to be used, have not been met.
97 The Tribunal accepts the contention of the applicants that they were not required under s 7B(1) of the ST Act or reg 34 of the ST Regulations to provide the reports by Abode Consulting. However, under regs 34(1) and 34(5)(c), the applicants were required to provide details for the construction of the proposed building works, which requires engineering and structural details to be included and that has not been done.
98 In the Approval Application, in respect of the requirement of reg 34(5)(c) of the ST Regulations to provide information regarding the method of construction to be used, it simply states:
The renovation will be conducted using conventional building procedures.
- That provides no detail at all regarding the method of construction and does not satisfy the requirements of reg 34(5)(c).
99 The prescribed information which was omitted from the Approval Application is of such significance, considering the substantial nature of the proposed building works, that, in the view of the Tribunal, the Approval Application does not comply with s 7B(1) of the ST Act.
Has approval for the Proposal been unreasonably withheld by the respondents?
100 The Tribunal accepts that the factors which the applicants contend should be taken into consideration regarding whether the Proposal is in keeping with the development comprised within the Strata Scheme are relevant. The Tribunal also accepts the contention of the applicants that the fact that following a 'renovation' of the Two Storey Building, it might be 'substantially new' compared to the Single Storey Building, does not, of itself, mean that the Two Storey Building would not be in keeping with the Single Storey Building.
101 However, because the Approval Application did not contain all of the prescribed information, as has been detailed above, in the view of the Tribunal, it was not possible for the respondents to consider adequately whether the Proposal is in keeping with the development comprised in the Strata Scheme.
102 The Tribunal therefore accepts the respondents' contention that they have not acted unreasonably in raising the second ground of objection, given the significant scale of the proposed building works and that only sketches and outline plans were provided to them.
103 The Tribunal does not accept the contention of the applicants that the respondents' refusal to grant approval to the Proposal is unreasonable because that refusal significantly impinges upon the applicants' ability to enjoy their lots due to the deteriorated state of the Two Storey Building. That is not a relevant consideration for the purposes of s 103F of the ST Act. Section 103F is concerned with the question of whether approval should have been given to the Proposal under s 7, but has been unreasonably withheld under s 7. The fact that an existing structure might need to be repaired or replaced is not a relevant consideration under s 7. Therefore, that is not relevant to the determination by the Tribunal of an application under s 103F.
104 For the reasons above, the Tribunal has decided that the respondents have not unreasonably withheld approval for the Proposal.
Does the Tribunal have discretion to not make an order under s 103F of the ST Act?
105 The Tribunal accepts the contention of the applicants that, if the Tribunal is satisfied that approval should have been given under s 7 of the ST Act, but was unreasonably withheld, then the Tribunal must make an order under s 103F of the Act declaring that the approval required under s 7 is deemed to have been given by the Strata Company.
106 In Finance Facilities at 133, Windeyer J said that the use of the word 'may' in a statute, in reference to a person who holds an official position, is a word of permission or an authority to do something. In the situation which his Honour was considering, the scope of the permission or power given was circumscribed and he posed the question of whether the permitted power must be exercised if the conditions precedent for its exercise were fulfilled. Justice Windeyer said that the answer to that question does not depend on the abstract meaning of the word 'may', but whether the particular context of words and circumstance make it not only an empowering word, but indicate circumstances in which the power is to be exercised, so that 'may' becomes 'must'.
107 The context in which the word 'may' is used in s 103F of the ST Act is that it enables a proprietor of a lot who has applied under s 7B for an approval under s 7, but not obtained the approval, to apply to the Tribunal for an order under s 103F declaring that the approval is deemed to have been given. Section 7(4)(c) provides that a proprietor may vote to refuse an approval under s 7 on any ground that is permitted by s 7(5), but not otherwise. Therefore, an application for approval under s 7 can only be refused on one of the grounds set out in s 7(5). In those circumstances, if the Tribunal is satisfied under s 103F(3) that approval should have been given under s 7 and the approval has been unreasonably withheld, then the power of the Tribunal to make an order under s 103F must be exercised and the Tribunal does not have the discretion to refuse to make such an order.
Conclusion
108 For the reasons stated above, the Tribunal has concluded that approval should not have been given to the Approval Application under s 7 of the ST Act because:
1) the Proposal does not fall within s 7(2) of the Act; and
2) the Approval Application does not comply with s 7B(1) of the Act.
- For the reasons stated above, the Tribunal has also concluded that approval of the Proposal has not been unreasonably withheld by the respondents.
Order
109 The Tribunal therefore makes the following order:
1. The application is dismissed.
I certify that this and the preceding [109] paragraphs comprise the reasons for decision of the State Administrative Tribunal.
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MR D AITKEN, MEMBER
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