Judge Bolton’s comments in Wei-Xin Chen v Body Corporate for Wishart Village CTS 19482, Appeal 4080 of 2000, District Court Brisbane, 29 May 2001
The very detailed provisions of the standard module regulation to which I have referred above make it almost inevitable that from time to time there will be non-compliance. Equally though the provisions of the Act make it clear that non-compliance of an insubstantial nature will not be allowed to imperil the actions of bodies corporate or their committees, particularly in the instance of committees where actions are taken bona fide.
In general, in order to invalidate a vote, there must be some evidence of malpractice or mistake, something which gives rise for a real concern that the votes counted are not as cast by owners. Mere non-compliance with the legislation, if proven, will not necessarily invalidate the voting tally or the motion
Member Roney QC in Lovel also noted:
It does not appear from those reasons that His Honour was taken to any particular authority in expressing the conclusions that he did as to the operation of those provisions. Nor does the reference in [27] of His Honour’s reasons to the Act make it clear that the proposition discussed concerning non-compliance ‘of an insubstantial nature’ was based upon or referenced to any identified legal principle or authority. It appears to me that His Honour was really paraphrasing and identifying an example of one of the circumstances in which an Adjudicator might decide to declare a meeting or a resolution passed as valid, notwithstanding that there were irregularities. One of those might be that the non-compliance was of an insubstantial nature, however it does not follow that it is only in circumstances in which the non-compliance is in insubstantial nature that an Adjudicator might exercise any of the powers vested in Adjudicators to validate irregular acts.7
Lovel v The Body Corporate for The Reserve (No 2), [2018] QCATA 169
S. Barry, Adjudicator in Kirribilli Heights [2021] QBCCMCmr 293
86 I am not in the practice of making orders that simply require a party to comply with the legislative regime, when they are required by the legislation to comply with the legislative regime. Such orders are usually superfluous.
95 I remain unclear about any actual prejudice the applicant might have suffered from this course of events. Instead he relies on “potential to cause prejudice and unfairness to the lot owners of the scheme”, or in more detail:
The Applicant’s concern was that if the EGM was incorrectly called and conducted, any decision of the EGM may be challenged by disgruntled lot owners and the Applicant would be further disadvantaged by not having the matter resolved by a valid EGM.92
- [96] I note all other owners are silent.
- Whether non-compliance is ‘insubstantial’ or not is a matter of opinion an interpretation, but I think little turns on it here. I agree with the thrust of the arguments put by the Member Roney QC in Lovel, which in effect support the view that cases are factually dependent. The principle from Wei-Xin Chen, although still relevant, is often quoted too narrowly and out of context, a context identified in Lovel.
- [73] I think what is important here is that the committee voted to call the EGM in good faith, it did not just occur. Just because they did not go the extra step of formally authorising one of their number to call the meeting, will not cause me to void the meeting. The body corporate will know better next time.
- I am unsure what any order from me regarding this aspect of the dispute will achieve. As an owner and a non-voting committee member, the applicant holds rights within the legislation and no doubt the body corporate has been respecting those in the last year and will continue to do so in the future. My comments also apply to the supply of minutes of VOCs and meetings. If the body corporate was unaware of its legislative obligations, I am sure that is now not the case.
- The committee must also ensure that full and accurate minutes of each motion from its meetings are recorded.6
- Again, in regard to this aspect of this dispute, the situation was not ideal in the past and I can understand why the committee’s approach might have caused the applicant consternation, given the developing state between them. The question that needs to be generally asked (and one for the applicant) is if the committee does not take actions to try and bring the body corporate into compliance, would it then be criticised for its inaction?
60 I have discussed the committee’s response to this argument above and I agree with it. It dealt with these legacy lapses and the original decisions were made by committees with different members. This is noted in the minutes of the VOC and it is certainly not something the 2020 committee was trying to conceal from owners, the opposite in fact.
- I keep saying the situation was not ideal and I do not know what returning any of this for further decision making would achieve. The respondent argues the legislation does not appear to restrict this approach. It does not. The legislative regime is certainly extensive, but it fails to anticipate many issues. If committees ‘get it right’, so to speak, at first instance, this will not be necessary.
57 Suffice to say it is possible to ratify issues, it is not an ideal situation and one hopes that general resort to ratification is not necessary, and does not become a matter of practice for this or any other body corporate.
- ] The concerns held by the applicant are that due to the absence of records and compliance with the legislation, “the actions of the committee in managing the affairs of the body corporate put it beyond scrutiny”, as members “have developed a habit of ignoring the procedures required” by the legislation and “making decisions in ways that defy scrutiny.”55
- There are anomalies identified here, there were problems and there are mistakes conceded by the body corporate. I need to look at the facts as I can find them, apply the law and then decide whether it is just and equitable to make the order sought. In a general sense, I am not satisfied that the applicant has proved that he or his company has suffered prejudice that would cause me to intervene.
- Much of what he argues concentrates on ‘potential’ prejudice and unfairness. If that was the measure in bodies corporate, we would never keep up with the number of dispute applications. If the applicant sought legal advice and incurred some costs, I agree that is unfortunate, but as the respondent says, he could have simply allowed the decisions to stand without complaint. I cannot avoid the observation that the EGM, for example, was called to deal with an AGM error identified by the applicant himself.
- I think what is important here is that the committee voted to call the EGM in good faith, it did not just occur. Just because they did not go the extra step of formally authorising one of their number to call the meeting, will not cause me to void the meeting. The body corporate will know better next time.
Body corporate manager, or committee members should have been aware of Kirribilli Heights [2021] QBCCMCmr 293 and taken action by VOCM to fix past errors in
24 “respondents claim “reauthorising decisions does not overcome the original failure”,the outcome the applicant requires also does not achieve that result. Instead, “ratifying the original failure” deals with the situation,35 and the body corporate is unsure of an alternative.
- “it is unfortunate that these decisions were not recorded closer to the time of the decisions being made.” The only course for the body corporate, it contends, was to follow the path that it chose, otherwise it would not have recorded “the decisions in any capacity” making it even less legislatively compliant, potentially causing further complaint from the applicant.
- meaningful submission taking issue with the content or consequences of the VOC resolutions. Accordingly, there is no identified prejudice or unfairness that has been caused and the Respondent ought not to be put to the unnecessary consequence of then having to reissue the VOC and EGM on the exact same terms, but just with notice and advice of the VOC being provided in advance.
- In the absence of any record of that committee’s decision and the date on which such a decision was made, the Applicant has been disadvantaged in its dealings with the body corporate because it was unknown whether or not the body corporate was acting with authority or not. In the absence of facts, the Applicant had assumed that the body corporate’s representatives were acting with the support of the committee, but faith and trust are hard to maintain when the committee officers wilfully disregard the rules under which they are supposed to operate
Response
that inconsequential and technical noncompliance ought not to invalidate decisions of the Respondent.” The outcome the applicant seeks will not assist him, says the respondent, and the body corporate in the circumstances was trying “to regularise (as best as possible) previous decisions that were made”, and the alternative “is hardly a better outcome.
Response
VOC dealt with “historical decisions” made by a previous committee and so the composition of the committee differed. It submits there is no restriction in the Accommodation Module preventing such an approach “particularly when the VOC minute specifically details who the committee members were for each resolution.” In any case, this should not result in voiding the VOC
- This is not to say the applicant does not raise valid concerns about how past committees have dealt with meetings and the body corporate is on notice that it must comply with the legislation. If sufficient non-compliance occurs again, it cannot plead ignorance.
112 This office cannot ultimately solve internal problems within schemes; instead this is a matter for owners. I agree with Carmody J, when he warned that in community titles disputes, “orders cannot change human nature or impose good will and cooperation where there is none.
Campbell v The Body Corporate for 70 Bowen St CTS 15330 & Ors [2019] QCATA 69, para 36.
- I am unable on the evidence presented to me to conclude that any lot owner, including the applicant, was prejudiced or disadvantaged. Indeed, the way that earlier decisions were made in the VOCs demonstrate greater irregularity (if such a description is possible) and it appears the body corporate in 2020 was attempting to regularise its decision making processes. It still did not get them quite right, but that does not cause me to interfere with the outcomes of their actions.
100 the respondent
Acknowledges that in the past it did not precisely comply with the decision making requirements of the Accommodation Module. However, the Respondent has subsequently recognised this and taken the only steps available to it to regularise those decisions. The Applicant takes issue with this course of action for technical reasons and provides no solution other than to seek to invalidate the remedying steps that were taken.9
- There is nothing to be achieved by me forcing the body corporate back to another general meeting. It must also be remembered the EGM was conducted a year ago. The applicant has not demonstrated any prejudice to me regarding this aspect of his arguments. I note that not a single other lot owner provided me with a submission about this dispute. No other owner is apparently troubled enough about this dispute to record concerns. I am not suggesting that is the end of the matter, but it is an issue I take into account. No other owner argues they have suffered prejudice by the events surrounding the VOC and EGM. Finality is important here. I am not approving the past conduct of the committee and the body corporate.
- It strikes me, like it usually does, that although the community titles legislative regime is voluminous, complex and apparently prescriptive, cases are often factually dependent and where possible, those hearing reviews are loathe to ‘fence in’ body corporate disputes.
- Flexibility is required in these disputes for a number of reasons, including issues such as legislative complexity, costs, and encouraging principles involved in self-management. Many of the disputes referred to us about meetings are simply pointless. This is not a carte blanche authority to act outside the legislation or for a committee or body corporate to act outside the legisaltion, it is a statement of reality. Conversely, enough adjudicator decisions invalidating motions or meetings exist (including from me), showing that not all transgressions will be excused.
84. The body corporate’s previous non-compliance is now on the record. My comments are also now on the record. Although not binding a subsequent adjudication application (hopefully that will not be necessary), the respondent may have difficulties explaining later non-compliance after what has occurred in the past.
To void need to demonstrate suffered prejudice and unfairness