Body Corporate and Community Management (Commercial Module) Regulation 2020 (Commercial Module)

INTERIM ORDERS - whether interim orders are warranted in the circumstances

Act, ss 242, 279; Commercial Module, s 56

1. From the date of this order, The Body Corporate for 7-9 Gibson Road Noosaville CTS 29830 must not take, nor authorise others to take on its behalf, any action (or, if applicable any further actions) to implement or enforce any of the resolutions purportedly passed at an extraordinary general meeting of the body corporate held on or around 2 December 2024.
2. The above interim order has effect until the earlier of: the issue by an adjudicator of a further interim or final order for the application, the application is withdrawn or otherwise ended, or 12 months have elapsed from the date of this order.

• [1] This application for interim orders is about an extraordinary general meeting (EGM) of the body corporate noticed for 2 December 2024 and decisions purportedly made at that EGM.
• [2] The motions to be considered at the EGM, and the corresponding resolutions, relate to a permanent transfer of common property to Lot 1, which is a dealing that requires a resolution passed by the body corporate without dissent. The applicant asserts that the EGM itself was not properly noticed or held. The applicant also challenges the validity of the motions proposed at the EGM and the body corporate's decisions at the EGM to pass the resolutions. The applicant is seeking final orders that the EGM was at all times void and that each of the resolutions purportedly passed at the EGM is void and unenforceable.
• [3] By this application, to maintain the status quo while the application for final orders is pending, the applicant seeks interim orders restraining the body corporate from taking any action to implement the challenged resolutions.
• [4] For the reasons that follow, I have made the interim orders sought.

• [5] The scheme known as 7-9 Gibson Road Noosaville CTS 29830 (Gibson Road) is located, as the name suggests, in Noosaville. Gibson Road is registered as a building format plan of subdivision on SP127822 and consists of 4 lots and common property. The community management statement (CMS) for Gibson Road shows the Commercial Module applies.
• [6] The applicant is the owner of Lot 2.
• [7] The respondent is the Body Corporate for Gibson Road.

• [8] An adjudicator has jurisdiction generally to make orders that are just and equitable in the circumstances to resolve a dispute between certain parties about a claimed or anticipated contravention of the Act or CMS, or about the exercise of rights or powers, or the performance of duties, under the Act or CMS.[1] The parties to the dispute are the owner of a lot and the body corporate. This is a combination of parties provided for in the Act.[2] This dispute concerns disputes about the performance of duties, exercise of powers, and purported decisions made by the respondent. It also includes claims of contraventions of the Act. I am thus satisfied it falls within the dispute resolution provisions of the Act and within the jurisdiction of an adjudicator.[3]
• [9] The Commissioner referred the application for interim orders to department adjudication under section 247(2)(b) of the Act. An adjudicator has the power to make an interim order "if satisfied, on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances to which the application relates."[4]
• [10] There is no statutory requirement to obtain comment from a respondent or affected party before an interim order is decided. In the circumstances, I did not seek a submission from the respondent because I was reasonably satisfied that I had sufficient material to make a decision on the application for interim orders. However, if there are matters not presently known me which would justify varying or cancelling the interim order, the respondent or an affected party may make such a request.[5]

• [11] The applicant explains there are 4 lots in this scheme, with a single corporate entity (HN Entity) owning Lots 1 and 3. This means the HN Entity holds 82.8% of the lot interest entitlements and is therefore the majority owner.
• [12] There is no body corporate manager for the scheme. The applicant says it appears that the HN Entity performs the administrative functions of the body corporate, including the preparation and distribution of meeting material.
• [13] The applicant says on or around 31 March 2025, it received a notice for the annual general meeting (AGM) of the body corporate scheduled for 16 April 2025. It says it first learned of the EGM purportedly held in December 2024 because the AGM notice included minutes of the December EGM.
• [14] It says the EGM minutes revealed that: only the owner of both Lots 1 and 3 voted at the purported EGM, and those owners purported to cause the body corporate to pass a series of resolutions (including resolutions without dissent) to authorise a transfer of a portion of the common property to the owner of Lot 1 in the Scheme.
• [15] The applicant claims there were procedural issues with the December EGM, including that:

(i) the applicant requested in writing in 2021 that the body corporate send notices for the lot to a specific email address or to a postal address > > (ii) the body corporate did not send notice of the December EGM to either of the addresses specified by the applicant, and > > (iii) although an EGM notice addressed to the applicant was sent to another email address, defective service cannot be cured by asking a recipient to forward the notice to the applicant; and

1. the EGM was held wholly electronically and in circumstances where,

(i) the applicant is not aware of any resolution of the body corporate authorising meetings to be held in that format, > > (ii) previous meetings were held in person and electronically, and > > (iii) and the applicant was prejudiced because it did not receive the necessary details to be able to attend electronically.

• [16] For these reasons, the applicant is seeking final orders that the EGM was at all times invalid and void.
• [17] The agenda for the EGM shows owners were being asked to consider 2 motions. Motion 1 included 4 parts, each of which is related to a transfer of common property in exchange for part of Lot 1 and the consequential boundary realignment and updated CMS. Motion 2 related to authorising the owner of Lot 1 to lodge an application with the local council to demolish and relocate a toilet block to a new location.
• [18] The applicant asserts that both Motion 1 (and its 4 sub-parts) and Motion 2 purportedly considered at the December EGM should have been ruled out of order at the EGM by the chairperson. It says each of the motions was void for uncertainty for one or more of the following reasons:

1. the motions were not worded with sufficient clarity given the importance of the issue (disposal of common property) being proposed therein, for example, Motion 1(a) did not specify the details of the area of common property to be transferred to Lot 1 nor the details of the area of Lot 1 that was offered in exchange, and Motion 1(b) did not specify which documents the body corporate was authorising signatures for 2. the motions did not include sufficient information on critical details of what was being proposed for owners to make a decision, for example, for Motion 1(a), there were no details about, which party would bear the costs of the transfers of common property and part of Lot 1, the respective valuations of the land being exchanged, stamp duty payable, and any relevant conditions or consideration for the transfer (notably whether the owner of Lot 1 was required to install new common property bathrooms), 3. the motions and explanatory notes were deficient because they did not include documents necessary for owners to make informed decisions, among other things,

(i) Motion 1(a) failed to include copies of the current survey plan to allow comparison with the proposal for property exchange, > > (ii) Motion 1(d), which sought authorisation to record a new CMS, did not include a copy of the proposed new CMS, and > > (iii) Motion 2 did not provide any relevant documentation for, or any details of the proposal relating to the relocation of the toilet facilities, and

1. one of the motions (Motion 1(c)) was described as a motion by ordinary resolution whereas the legislation required it be passed by resolution without dissent.

• [19] In addition, the applicant says given the lack of detail in the motions and explanatory notes, the body corporate did not act reasonably in making decisions when it resolved to pass Motions 1 and 2.
• [20] The applicant seeks urgent interim orders that:
  1. the Body Corporate and/or its majority owner Calardu must not take any steps to implement or enforce any of the resolutions purportedly passed at the extraordinary general meeting held on 2 December 2024 until final determination of this matter by an adjudicator;
  2. if the Body Corporate and/or its majority owner Calardu has already taken any steps to implement or enforce any of the resolutions purportedly passed at the extraordinary general meeting held on 2 December 2024, then they must immediately cease such action and, if they have liaised with any external parties in taking action to implement the motions, they must notify such parties that they can no longer proceed until final determination of this matter by an adjudicator; and
  3. any further order the adjudicator considers just and reasonable in the circumstances.
• [21] In terms of urgency and balance of convenience, the applicant says the above orders sought are warranted and appropriate to maintain the status quo at the scheme until the application for final orders can be determined by an adjudicator.
• [22] The applicant says the body corporate will suffer no prejudice or disadvantage if the orders are made because the motions and resolutions do not involve any emergency or urgent works, nor do they seek to address a safety concern or hazard. However, if the interim orders are not made and the body corporate is able to implement the purported resolutions before the validity of the resolutions is properly determined, the applicant says its position will be significantly prejudiced. The applicant says once registered, it will be difficult and costly to reverse a transfer of common property to the owner of Lot 1 if the resolutions are ultimately determined to be void or invalid.

• [23] The only issue to decide at this time is whether an interim order is warranted.
• [24] Adjudicators are empowered to issue an interim order if satisfied "on reasonable grounds, that an interim order is necessary because of the nature or urgency of the circumstances to which the application relates."[6] If satisfied an order is necessary, adjudicators may make an interim order that is just and equitable. Adjudicators often make interim orders in the form of a temporary injunction (an order not to do something) to preserve the status quo pending a final determination of an application.
• [25] To determine if it is just and equitable to make an interim order, there must be some reason in law to make an order. For this, I must consider the substantive issues in dispute. The applicant must satisfy me that there are serious legal questions to be answered. At this stage, an applicant does not need to satisfy me on the balance of probabilities that their arguments will be ultimately successful.[7] Rather, I must be satisfied there is a sufficient likelihood of success on the legal issues presented to warrant making an interim order.
• [26] I must also consider the nature of the circumstances, and the practical reasons for and likely effects of an interim order. This is known as assessing the balance of convenience between the parties. To do this, I must consider the inconvenience or harm to the applicant if I do not make an interim order but it is later determined that the body corporate has contravened the Act. I must weigh that against the harm to the body corporate if I make an interim order and the applicant is later unsuccessful in its application for final orders.
• [27] Accordingly, to determine whether I am satisfied an interim order is warranted and appropriate, I will proceed to consider whether serious legal issues have been raised with sufficient likelihood of success. If so, I will consider the nature of the circumstances presented and weigh the balance of convenience and potential for harm to the respective parties.

• [28] The application raises several legal issues about the calling and holding of the December EGM and challenges the validity of the motions considered and resolutions ostensibly passed at that meeting. It seeks orders that the EGM and/or the resolutions be declared invalid or void.
• [29] This application seeks final orders declaring void an EGM held, and resolutions made, more than 3 months ago. The applicant has represented it did not become aware that the EGM had proceeded and that the challenged resolutions had been made until around 31 March 2025. There is evidence that the applicant then took steps to try and resolve the dispute before filing this application.
• [30] As an initial matter, the Act imposes some time limits for making an adjudication application seeking certain orders. Relevantly here, section 242(1) of the Act provides that applications for an order declaring void a general meeting of the body corporate or a resolution made by the body corporate, must be made within 3 months of the date of the general meeting. However, the Act also provides that an adjudicator may, for good reason, waive the non-compliance with the time limit for making an application.[8]
• [31] I am satisfied at this preliminary stage that there is sufficient likelihood that an adjudicator may decide, in the circumstances and for the reasons proffered by the applicant, that there is good reason to exercise the discretion to waive non-compliance with the statutory time limits for bringing an application for such orders.
• [32] In terms of the substantive legal issues raised by the applicant about the EGM and the resolutions, I am satisfied for the purposes of an application for interim orders that the applicant has raised serious legal issues and that one or more of the legal questions raised have a sufficient likelihood of success for me to proceed. In reaching this view, I have had regard to the nature of the circumstances presented in the application. Specifically, that the EGM was called for the body corporate to consider whether to approve a dealing that involved a transfer, and therefore a permanent disposition, of part of its common property to the owner of Lot 1. As the applicant notes, "[d]isposing of common property is arguably one of the most serious things a body corporate can do."
• [33] In terms of the legal issues raised about alleged procedural defects in noticing and holding the EGM, although technical and minor defects in calling general meetings do not necessarily render general meetings invalid, adjudicators must consider whether such defects have resulted in prejudice or disadvantage.
• [34] For this reason, without having formed a view on the merits of each legal issue raised, I consider the application has raised an arguable case about technical defects and potential prejudice or disadvantage to the applicant for me to consider making an interim order.
• [35] Similarly, I am satisfied the applicant has raised serious legal questions about the sufficiency of the details in the motions and explanatory notes presented at the EGM and therefore whether the motions are valid and/or whether the body corporate acted reasonably in the circumstances in deciding to consider and pass those motions. At this preliminary stage, my view is that the applicant has a sufficient chance of succeeding on one or more of those claims for me to proceed to assess whether an interim order is warranted and appropriate.

Nature of the circumstances and balance of convenience

• [36] I consider the nature of the motions considered at the EGM - which proposed and were related to a transfer of common property - to be a relevant factor to be weighed when determining whether it is appropriate to make the interim orders sought.
• [37] I agree with the applicant that the balance of convenience and potential for harm favours making the first interim order sought. On the face of the application, the resolutions do not appear to involve any time sensitive issues for which the body corporate would suffer a disadvantage or harm if implementation of the resolutions is delayed by an interim order. Conversely, if the interim order is not made, and the body corporate proceeds to take steps to implement the resolutions but the applicant ultimately succeeds in obtaining orders that the EGM and/or resolutions are invalid, the applicant will be disadvantaged.
• [38] However, I am not prepared to make the second interim order sought. The second order sought would require the body corporate to notify third parties of this order and inform those parties that the body corporate is precluded from taking further steps. It is unclear at this point whether the body corporate or its agents have taken any steps to implement the EGM resolutions. Without knowing what actions (if any) have been taken to date in reliance on the EGM resolutions, and where no final determinations have yet been made as to the validity of those resolutions, I do not consider it appropriate to make such an interim order.

• [39] I have made an interim order for the reasons given above.
• [40] As I noted in the Preliminaries section above, if there are matters not presently known me which would justify varying or cancelling the interim order, the respondent or an affected party may make such a request.[9]
• [41] If the dispute is not resolved and the applicant does not withdraw the application, the application for final orders will remain to be determined. The application for final orders will be referred back to the Commissioner to progress under the Act.[10] The dispute may then be resolved by an adjudicator with the benefit of submissions from all affected parties.

[3] Sections 226, 228 and 276 of the Act

[5] Until a final order is made, an adjudicator has the power to extend, vary, renew, or cancel an interim order. See Section 279(2)(b) of the Act. I note also that the body corporate and all owners will be invited to give their views before final orders are issued. See id. at Section 243

[7] Although an applicant must identify a genuine legal issue to be decided, the granting of an interim order by itself does not indicate whether or not an applicant will ultimately be successful on their application for final orders.

[9] Until a final order is made, an adjudicator has the power to extend, vary, renew, or cancel an interim order. See Section 279(2)(b) of the Act