Vie Management Pty Ltd ATF the Doriean Family Trust v Body Corporate for Gallery Vie CTS 37760
[2014] QCAT 660
•16 December 2014
| CITATION: | Vie Management Pty Ltd ATF The Doriean Family Trust v Body Corporate for Gallery Vie CTS 37760 [2014] QCAT 660 |
| PARTIES: | Vie Management Pty Ltd ATF The Doriean Family Trust (Applicant) |
| v | |
| Body Corporate for Gallery Vie CTS 37760 (Respondent) |
| APPLICATION NUMBER: | OCL090-14 |
| MATTER TYPE: | Other civil dispute matters |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Member Hughes |
| DELIVERED ON: | 16 December 2014 |
| DELIVERED AT: | Brisbane |
ORDERS MADE: | Upon the undertaking of Vie Management Pty Ltd ATF The Doriean Family Trust and Albert James Doriean as to damages, the Body Corporate for Gallery Vie CTS 37760 is restrained from taking any further action in reliance upon the remedial action notice dated 26 June 2014 or the notice of right of termination dated 2 October 2014 until the validity of both notices has been determined by the Tribunal. |
| CATCHWORDS: | INTERIM INJUNCTION – whether balance of convenience justifies terms to encompass financier’s appointment of receiver and manager – where contractual arrangements between caretaker and financier give right to financier to appoint receiver and manager – where appointment of receiver and manager prejudices caretaker – whether balance of convenience justifies terms to prevent costs thrown away by body corporate in convening extraordinary general meeting to resolve to terminate agreements – where any costs thrown away outweighed by caretaker’s significant loss of business – where extraordinary general committee meeting convened at behest of body corporate in any event – where body corporate changed terms of proposed consent orders to encompass extraordinary general meeting – where costs thrown away due to body corporate’s own actions Body Corporate and Community Management Act 1997, s 126 Australian Coarse Grain Pool Pty Ltd v Barley Marketing Board of Queensland (1985) 157 CLR 605 Beachcomber Management Pty Ltd ATF Kafritsas Family Trust v Body Corporate for the Surfers Beachcomber CTS 10411 [2014] QCAT 453 Chras Straker Pty Ltd as trustee for Dianne Crea Family Trust and Anor v Orsay Holdings Pty Ltd [2011] QCAT 676 |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers pursuant to section 32 of the Queensland Civil and Administrative Tribunal Act 2009.
REASONS FOR DECISION
What is this Application about?
Caretakers who dispute pending termination of their Caretaking Agreements may apply to the Tribunal for orders to protect their position until the dispute resolves.
Vie Management Pty Ltd ATF The Doriean Family Trust is the caretaker of Community Titles Scheme 37760. It wants an injunction to restrain the Body Corporate for Gallery Vie CTS 37760 from taking steps to terminate its Caretaking Agreements until the Tribunal determines the dispute.
The Body Corporate wants to terminate the Agreements because it claims the Caretaker overcharged for electricity. On 26 June 2014, the Body Corporate sent a Remedial Action Notice requiring the Caretaker to repay $27,115.54. The Caretaker did not pay. On 2 October 2014, the Body Corporate sent a Notice of Right of Termination to the Caretaker’s financier.
The Body Corporate acknowledged a serious question to be tried[1] favouring an injunction.[2] However, the Body Corporate submitted the balance of convenience favours an order in its terms.
[1]Chras Straker Pty Ltd as trustee for Dianne Crea Family Trust and Anor v Orsay Holdings Pty Ltd [2011] QCAT 676 at [10], citing with approval Australian Coarse Grain Pool Pty Ltd v Barley Marketing Board of Queensland (1985) 157 CLR 605.
[2]Respondent’s Submissions In Opposition To The Applicant’s Interim Orders Application dated 12 December 2014 at paragraph 7.
Is an interim injunction appropriate in terms proposed by the Caretaker or the Body Corporate?
A legally qualified member of the Tribunal may grant an interim injunction if just and convenient.[3]Justice and convenience[4] requires an order sufficient to protect the Caretaker’s position for the duration of the proceeding.[5]
[3]Queensland Civil and Administrative Tribunal Act 2009 ss 59(1) and (4).
[4]Ibid s 59(1).
[5]Ibid s 58(1)(a).
The Caretaker seeks to protect its Agreements with the Body Corporate – a major asset and source of income.
The Body Corporate proposed terms restraining action to terminate the Agreements from an Extraordinary General Meeting resolution on 16 December 2014. This is insufficient to protect the Caretaker’s position because it does not encompass the Caretaker’s financier taking steps to appoint a receiver and manager. Contractual arrangements between the Caretaker and financier give the financier the right to appoint a receiver and manager.[6] The financier has therefore already taken steps to appoint a receiver and manager without any resolution to terminate.[7]
[6]As recognised by the Body Corporate and Community Management Act 1997 s 126(2)(b).
[7]Notice to Body Corporate dated 15 December 2014.
The Body Corporate submits that it is prejudiced by terms preventing the Extraordinary General Meeting not proceeding because members have made arrangements and incurred costs to attend. The Body Corporate identifies these costs as its manager’s invoice for $2,050.85 to call the meeting, travel costs of two interstate lot owners and one lot owner rearranging work commitments.[8]
[8]Affidavit of Luke Christian Miller sworn 12 December 2014 at paragraphs 7 to 16.
These costs, although not insubstantial, do not outweigh the prejudice to the Caretaker. The terms of the injunction must be sufficient to prevent the prejudice to the Caretaker from relinquishing control of a major asset to a receiver and manager, with the consequential risk of devaluation, loss of income and the entire facility amount potentially becoming due and payable.[9]
[9]Beachcomber Management Pty Ltd ATF Kafritsas Family Trust v Body Corporate for the Surfers Beachcomber CTS 10411 [2014] QCAT 453 at [23].
Moreover, the Body Corporate Committee foreshadowed the Extraordinary General Meeting at its own behest.[10] In so doing, the Body Corporate resiled from its earlier commitment to ‘agree to consent orders restraining it from taking any further action in reliance upon the remedial action notice until such time as the validity of that notice has been determined by a body of competent jurisdiction’.[11]
[10]Letter Reichman Lawyers to Pevy Lawyers dated 31 October 2014.
[11]Letter Reichman Lawyers to Pevy Lawyers dated 28 October 2014.
Instead, the Body Corporate changed its commitment to ‘agree to consent orders restraining it from taking any action in reliance upon any termination resolution until after your client’s action has been determined’.[12] The Body Corporate did this subsequent to and irrespective of the Caretaker relying upon the Body Corporate’s earlier commitment to consent orders in those terms.[13]
[12]Letter Reichman Lawyers to Pevy Lawyers dated 31 October 2014.
[13]Letter Pevy Lawyers to Reichman Lawyers dated 29 October 2014.
The Caretaker’s failure to apply for consent orders by 12 November 2014 did not lead to the Extraordinary General Meeting. As early as 31 October 2014, the Body Corporate had already foreshadowed a Committee motion to call the meeting and changing the terms of the injunction to accommodate this.[14]
[14]Letter Reichman Lawyers to Pevy Lawyers dated 31 October 2014.
The Body Corporate knew or should reasonably have known that changing its position risked an application other than by consent that could take more time to prepare and file. Despite this and knowing it would likely incur costs, the Committee of the Body Corporate voted on 17 November 2014 to call the Extraordinary General Meeting.
Any costs thrown away by the Body Corporate arises from its change of position on the terms on 31 October 2014 and its Committee’s decision to call the meeting contrary to the terms to which it initially agreed. Its changed terms are not sufficient to protect the Caretaker’s position. Any prejudice to the Body Corporate therefore arises from its own actions.
To not grant an injunction in the Caretaker’s proposed terms risks significant loss of business for the Caretaker. Granting the injunction will not prejudice the Body Corporate because the Caretaker will continue its duties under the Agreement until a final determination of the dispute.
The Tribunal may require an undertaking about costs or damages.[15] The Caretaker agreed to this.[16]
[15]Queensland Civil and Administrative Tribunal Act 2009 s 59(6).
[16]Affidavit of Albert James Doriean sworn 5 December 2014 at paragraph 29.
The balance of convenience therefore favours an injunction in the terms proposed by the Caretaker, with the usual undertakings as to damages.
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