SCA (QLD) LEGISLATION and POLICY COMMITTEE BCCM Review 2013

Transcription

1 SCA (QLD) LEGISLATION and POLICY COMMITTEE BCCM Review 2013 No. AREA SUB-AREA PROBLEM PROPOSED SOLUTION 1 By-laws Towing Recent decisions require that a contravention notice must be served before a car can be towed and the towing fee cannot be charged to the offender. Savvy occupiers know that they can park in visitor car spaces as it is simply too difficult for the BC to do anything about it, and when action is taken the vehicle can temporarily be moved by the owner. The concern is most vividly demonstrated where a car sits for weeks in the visitor s car space and cannot be moved because nobody knows who owns it. The issue is not merely one of inconvenience for other occupiers, but can be a safety issue, where cars are unlawfully parked in front of hydrants, or other fire safety equipment. A limited exception to the prohibition on by-laws requiring the payment of money. In short, car parking fines. A model by-law can be drawn and included in the BCCM Act and a statutory cap on fines introduced. In addition, or in the alternate, the bylaw enforcement process must be streamlined to enable timely action for breaches requiring immediate action. 2 By-laws Pets Bodies corporate cannot validly adopt a no pets policy. Amend the Act to enable bodies corporate to make Restrictive by-laws by resolution without dissent. 3 By-laws Smoking Bodies corporate cannot validly adopt a no smoking policy. Amend the Act to enable bodies corporate to make Restrictive by-laws by resolution without dissent. SCA (QLD) LEGISLATION and POLICY COMMITTEE BCCM Review 2013 Page 1

2 4 Adjudication proceedings Abuse of proceedings Defamation and costs. At present, an owner has the ability to write highly defamatory comments in an Application being effectively immune from the normal consequences of defamation. These powers are being abused by owners who freely write scandalous and spurious allegations in lengthy applications. Section 329 extends a similar privilege to adjudication proceedings as exists in the Supreme Court. Unlike the Supreme Court however, under section 243 copies of an application must be given to each person whose name appears on the Body Corporate roll as the owner of a lot included in the scheme. Section 243 of the Act ought be amended such that the notice required to be provided to owners of lots within the scheme is a notice in a prescribed form confirming that an application has been made and providing information as to how a copy of the application may be obtained by the owner (but at no cost to the owner). Accordingly, and at worst case, savvy owners may use adjudication proceedings to publish defamatory material directed at fellow owners, a caretaking service contractor, committee of the body corporate or a body corporate manager at the cost of the body corporate and without fear of legal consequences unless the application includes false or misleading information. 5 Layered schemes Amalgamation The effect of Section 83 of the Act is that once a layered arrangement has been created it may never be amalgamated into one scheme. For example in a layered arrangement with two levels and 3 subsidiary schemes any two of the subsidiary schemes may be amalgamated together but not all three with the principal scheme. This leads to a situation where a layered scheme once created may never be collapsed into a single scheme, despite the wishes of the owners Section 83 ought be amended so that a layered scheme may be amalgamated into a single scheme. The amalgamation would be subject to any required planning approvals and incidental amendments to deal with reconciliation of ownership of BC property and bylaws would be required. 6 Layered Schemes Standing There are an increasing number of instances where an owner in a subsidiary body corporate has a grievance with the PBC but cannot get redress unless he or she can motivate the subsidiary body corporate to take action against the PBC. Definition of dispute expanded to include a dispute between an owner in a subsidiary scheme and the principal body corporate. The problem also exists in reverse as it is very difficult for a PBC to enforce its by-laws against an owner in a subsidiary Body Corporate. SCA (QLD) LEGISLATION and POLICY COMMITTEE BCCM Review 2013 Page 2

3 7 Layered Schemes Maintenance The maintenance obligations under section 159 of the Standard Module do not distinguish between the obligations of bodies corporate in a layered scheme in a single building created under a BFP. Amend section 159 so for a layered arrangement where there is more than one scheme in a building, the Principal Scheme is responsible for the maintenance obligations under s159(2). 8 Provision of documents to the Body Corporate Original owner obligations Section 79 of the Standard Module (e.g.) requires documents and materials to be handed over to the Body Corporate at the 1 st AGM. This provision does not specifically state that the developer must hand over a copy of the development approval to the Body Corporate, even though it can be implied from subsections (b) and (g). There are notable instances of Bodies Corporate recording new community management statements contrary to the terms of the development approval for their building, based on ignorance of its requirements. Amend Section 79 of the standard module, and corresponding provisions of the other modules, to require an original owner to hand over all development approvals relevant to the development work associated with the constructions of the building/s, creation of the lots, and the establishment of the scheme. Add Original Owner as a party to a dispute under section Exclusion of Corporations Act Access to other rights By virtue of section 32 of the Act, a Body Corporate may not have the right given to every other creditor to: issue a statutory demand to wind up an insolvent owner; receive a distribution in a winding up of a debtor. Section 32 places Bodies Corporate in a worse position than other creditors. Section 11 of the Strata Schemes Management Act 1996 (NSW) states the following in respect of the Constitution of the Owners Corporation: The owners constitute a BC; An owners corporation is declared to be an excluded matter for the purposes of s.5f of the Corporations Act. This ensures that neither the Corporations Act nor the ASIC Act will apply in relation to an owners corporation, but the owners cooperation rights as a creditor are not affected under the Corporations Act. SCA (QLD) LEGISLATION and POLICY COMMITTEE BCCM Review 2013 Page 3

4 10 Remuneration reviews Caretaking service contractors A. A review cannot be conducted after a transfer has been effected or if a limited market review of remuneration takes place pursuant to the terms of the caretaking service contract (usually as set by a developer) within the review period under Section 130 of the Act. This prevents owners of lots in a new community title scheme from being able to have the remuneration and duties independently reviewed. A. Amend Section 130 of the Act to ensure that the remuneration and duties review right survives both a transfer of the management rights and any private review pursuant to the terms of the management rights agreements which take place during the review period. 11 Debt recovery Recovery Costs B. Many bodies corporate are not aware of the review provisions and often miss an opportunity to utilise them. As confirmed in Body Corporate for Liberty CTS v Alotier & Anor [2009] CCT KA009-08, recovery costs reasonably incurred (see s145 of the Standard Module) do not fall within the definition of body corporate debt. There is currently no definition of what constitutes recovery costs reasonably incurred. As such it is open to the court to determine that such costs be granted to a Body Corporate pursuant to the relevant court s Scale of Costs, which may be as little as 50% (or even less) of the actual recovery costs reasonably incurred by a Body Corporate. Non defaulting owners, through payment of their contributions, are therefore out of pocket for the shortfall in recoupment of recovery costs. Defaulting owners should be forced to pay the costs of recovery, unless those costs are not reasonably incurred. B. Introduce an obligation to review prior to the end of the review period (problem - not consistent with red tape reduction). Amend the Regulation Modules to provide that prima facie a Body Corporate is entitled to its full costs incurred (as recovery costs reasonably incurred, and therefore as a body corporate debt ), unless the debtor proves that the costs were not recovery costs reasonably incurred, by way of a debtor applying for a costs assessment of those costs, pursuant to the provisions of Part 4 of Chapter 17A of the Uniform Civil Procedure Rules 1999, such costs assessment to be undertaken by a costs assessor. SCA (QLD) LEGISLATION and POLICY COMMITTEE BCCM Review 2013 Page 4

5 12 Titling SFP It is difficult for the body corporate to ensure consistency in maintenance and appearance of SFP lots. This is a particular problem where those SFP lots share common walls and roofs. 13 Titling Mixture of format plans Many schemes have a mixture of SFP and BFP lots. Different maintenance and insurance obligations makes these schemes difficult to manage. 14 BCM Term The term of engagement of a BCM is limited to 3 years and requires 2 quotes. 15 Termination Maintenance The termination of a scheme requires approval by resolution without dissent (but also requires each owner to enter into an agreement about termination issues so effectively it s a unanimous resolution); or an order of the District Court. As buildings reach the end of their life, termination may be the only commercially viable option. Amend the regulation modules so the maintenance obligations for SFP lots that share common walls are the same as the maintenance requirements for BFP lots. Insert a provision in the Act which deems mixed lots to be regulated as though they were all created under a BFP. Increase maximum term of BCM agreement to 5 years and abolish 2- quote requirement. Relax the requirement for approval of termination. 16 Application of BCCMA 17 Dispute Resolution Body Corporate managers have to be experts in a range of legislation where schemes are created under the Mixed Use Development Act, the Integrated Resorts Development Act, the South Bank Corporation Act, etc and regulated under the Building Units and Group Titles Act. Amend the various Acts so they are regulated by the relevant provisions of BCCMA and modules (or amend BUGTA to reflect the BCCMA). Service The cost of serving overseas owners is sometimes oppressive. Amend Act to provide that owners must give an Australian address for service, failing which documents can be served by being posted to the lot. SCA (QLD) LEGISLATION and POLICY COMMITTEE BCCM Review 2013 Page 5