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[2026] NSWSC 511
Supreme Court of NSW
2026-05-13
Pike J
Original judgment source is linked above.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Ausbao (286 Sussex St) Pty Ltd v The Owners – Strata Plan No. 100777 (No 2) [2026] NSWSC 511
Hearing dates: 8 May 2026
Date of orders: 13 May 2026
Decision date: 13 May 2026
Jurisdiction: Equity - Real Property List
Before: Pike J
Decision: See paragraph [84]
Catchwords: STRATA TITLE — contracts — mixed-use building — strata management statement — building management committee — scope of authority delegated to strata manager — whether strata manager validly convened meetings — whether secretary could override strata manager — construction of strata management statement and agency agreement — declaratory relief — whether declarations retained practical utility — meetings and resolutions valid
Legislation Cited: Conveyancing Act 1919 (NSW), Division 3B of Part 23
Strata Schemes Development Act 2015 (NSW), ss 9 and 105
Cases Cited: Ausbao (286 Sussex St) Pty Ltd v The Owners – Strata Plan No. 100777 [2025] NSWSC 1565
The Owners – Strata Plan No 100777 v Ausbao (286 Sussex St) Pty Ltd [2026] NSWCA 61
Texts Cited: Nil
Category: Principal judgment
Parties: Ausbao (286 Sussex St) Pty Ltd (Plaintiff)
The Owners – Strata Plan No. 100777 (First Defendant)
Bright & Duggan (Second Defendant)
Representation: Counsel:
C N Bova SC / A Mohseni (Plaintiff)
Solicitors:
Dentons (Plaintiff)
File Number(s): 2025/00416737
Publication restriction: Nil
Located on Bathurst Street, Sydney is a mixed use building (Building) comprised of two stratum lots.
At all material times the plaintiff (Ausbao) was the registered proprietor of one stratum of the lots, 2/1256275, known as the Hotel Component of the Building.
At all material times, the defendant owned the remaining stratum lot, known as the Residential Component of the Building (the Owners).
By letter dated 19 September 2025, from the Owners’ solicitors to the strata manager of the Building, copied to Ausbao, the Owners sent a Dispute Notice pursuant to clause 5.4 of the Strata Management Statement (SMS) in relation to the Building. The Dispute Notice contended, amongst other things, that a meeting convened by the strata manager on 11 September 2025 was invalid.
By statement of claim filed on 29 October 2025, Ausbao commenced these proceedings seeking inter alia, declarations that the Dispute Notice was invalid and of no effect and declarations that the general meetings held on 11 September 2025 and 25 September 2025 were validly convened and that the resolutions passed in those meetings were valid.
By motion filed 1 December 2025, the Owners sought a permanent stay of the proceedings on the grounds that the parties had agreed to resolve the dispute the subject of the Dispute Notice by expert determination, pursuant to clause 5 of the SMS.
I heard that motion on 11 December 2025 and dismissed it on 18 December 2025 for reasons then given: see Ausbao (286 Sussex St) Pty Ltd v The Owners – Strata Plan No. 100777 [2025] NSWSC 1565 (my earlier judgment).
An amended statement of claim was then filed on 13 February 2026 (ASOC), joining a second defendant, Bright & Duggan Pty Ltd (Bright & Duggan).
The following relief was sought in the ASOC:
1 Declaration that the Dispute Notice issued by the First Defendant on 18 September 2025 is invalid and of no effect.
2 Declaration that the Determination Notice issued by the First Defendant on 25 September 2025 is invalid and of no effect.
3 The First Defendant, by itself, officers, and agents, be enjoined from taking steps under the purported Dispute Notice and Determination Notice to appoint an expert for determination under clause 5 of the Strata Management Statement.
3A Declaration that on the proper construction of the Agency Agreement, the Second Defendant is the agent of the Plaintiff and the First Defendant as members of the Building Management Committee.
3B Declaration that on the proper construction of the Agency Agreement, the Plaintiff and the First Defendant have delegated to the Second Defendant full authority to convene meetings of the Building Management Committee and to prepare notices, agendas and minutes for those meetings.
4 Declaration that the general meetings of the Building Management Committee on 11 September and 25 September 2025 were validly convened and that the resolutions passed in those meetings are valid.
5 Costs.
The Owners sought leave to appeal from my earlier judgment. That application for leave to appeal was dismissed with costs by the Court of Appeal on 16 April 2026: see The Owners – Strata Plan No 100777 v Ausbao (286 Sussex St) Pty Ltd [2026] NSWCA 61 (C****ourt of A****ppeal judgment).
On 24 April 2026 I made orders granting leave to the Owners to withdraw the defence to the ASOC which had been filed on 11 March 2026. The previous day, the Owners had written to Ausbao, withdrawing the relevant notices. On 30 April 2026, the Owners filed a submitting appearance save as to costs.
On 6 May 2026, Bright & Duggan filed a submitting appearance, save as to costs.
On 8 May 2026 I heard the proceedings on a final basis. Only Ausbao appeared. Christian Bova SC and Aryan Mohseni appeared for Ausbao. I also had the benefit of written and oral submissions.
During the course of the hearing, Ausbao made it clear that in light of the letter from the Owners dated 23 April 2026 (which I extract below), the claims for relief in paragraphs 1 and 2 of the ASOC (as extracted above) were not pressed. This was for the simple reason that the relevant notices in respect of which declaratory relief had been sought had been withdrawn.
For the reasons set out below, I am satisfied that the other declaratory relief sought in the ASOC should be granted. I will make directions to permit the question of costs to now be determined.
I set out below the relevant facts. They are taken largely from my earlier judgment.
As set out above, the Building is a mixed use building which was subdivided by the creation of two “Stratum Lots” under Division 3B of Part 23 of the Conveyancing Act 1919 (NSW). Subdivision of this land can include one of the stratum lots being further subdivided to create a strata scheme under the Strata Scheme**s Development Act 2015 (NSW) (Development Act). This is brought into effect by the registration of a “strata plan” under s 9(1) of the Development Act. If this occurs, a SMS must also be registered at the same time as the strata plan. This is what occurred with the subdivision of the Building.
The Building was subdivided into two stratum lots, Lots 1 and 2 of DP 1256275.
On 16 March 2020, Strata Lot 1 was further subdivided by registration on that date of Strata Plan 100777 and the SMS. Both documents were executed and registered by Ausbao as the then owner and developer of the Building.
This created a “strata scheme” under the Development Act in respect of Strata Lot 1 with 95 strata lots together with an Owners Corporation (the Owners). The strata lots were then developed and sold as residential apartments. Ausbao remained the registered proprietor of Lot 2. There is presently a hotel operating on Lot 2 known as “Crowne Plaza Hotel”.
In simple terms, the Owners comprise the 95 owners of residential units in the Building and Ausbao owns Stratum Lot 2 where the hotel operates in the Building.
Under s 105 of the Development Act and, upon registration, pursuant to clause 1.1 of the SMS, the SMS took effect as an agreement under seal between the Members, the Occupiers of Stratum Lots, and the Owners and Occupiers of Strata Lots.
Clause 1.3 makes it clear that the Building has two components: the Residential Component and the Hotel Component, each being a Member.
Clause 2.5 requires the Members to establish the Committee (Committee), which is responsible for managing and operating the Building. Each Member must appoint a Representative to attend and vote for them at meetings.
Clause 2.3 provides:
2.3 Who assists the Committee perform its functions?
The Committee has the power to appoint various persons to assist it to perform its functions. For example, the Committee may:
(a) appoint a Strata Manager to assist in the management of 60 Bathurst and perform secretarial and financial functions;
(b) appoint a Facilities Manager to supervise the operation of 60 Bathurst including the operation, maintenance, repair and replacement of the Shared Facilities; and
(c) enter into contracts with various Service Providers for the operation, maintenance, repair and replacement of the Shared Facilities.
7.1 The Strata Manager
(a) The Committee may appoint a Strata Manager to assist it to perform its functions under this Statement.
(b) The Committee may require the Strata Manager to:
(i) ensure the proper operation, maintenance, repair, renovation and replacement of the Shared Facilities;
(ii) effect and maintain the Insurance on behalf of the Members;
(iii) implement decisions made by the Committee;
(iv) prepare a plan for any refurbishment works or any other Works;
(v) carry and maintain licences required by law to be a strata managing agent;
(vi) carry out or arrange for the carrying out of maintenance, repair and replacement of a Shared Facility, collect from the Members the maintenance, repair, renovation or replacement costs of a Shared Facility.
(c) If the Committee appoints a Strata Manager, it must enter into an agreement with the Strata Manager which clearly sets out the terms of appointment and the functions delegated to the Strata Manager.
2.7 What are the functions?
In addition to its functions and powers elsewhere in this management statement, the functions and powers of the Committee are:
(a) to comply with its obligations and perform its functions according to the Conveyancing Act, Management Act (if applicable) and the Development Act (if applicable) and this management statement;
(b) to make decisions about the matters in this management statement;
(c) to convene and hold meetings and Emergency Meetings;
(d) to determine Administrative Fund contributions and the Capital Works Fund contributions to meet the costs for performing the functions of the Committee;
(e) to operate, maintain, renew and replace Shared Facilities (subject to this management statement);
(f) to deal with and make decisions about Shared Facilities according to this management statement;
(g) to effect insurances according to the Conveyancing Actor the Management Act (whichever is applicable) and this management statement;
(h) to monitor the performance by Members, Owners and Occupiers of their obligations under the Conveyancing Act, the Management Act (if applicable) and the Development Act (if applicable) and this management statement;
(i) to monitor the performance of the Strata Manager;
(j) to monitor the performance of the Facilities Manager;
(k) accept, process and make decisions about Applications according to part 8 of this management statement; and
(l) to perform ancillary functions to carry out the functions necessary and perform the obligations of the Committee.
Clause 2.12 requires the Committee to appoint as Officers, a Secretary, a Treasurer and a Chairperson.
The representative of the Owners as Member of the Committee is Wayne Spicer (Mr Spicer) who was appointed as Secretary of the Committee.
Clause 2.17 sets out the functions of the Secretary:
2.17 The Secretary
In addition to the functions elsewhere in this management statement, the functions of the Secretary are:
(a) to convene meetings and Emergency Meetings;
(b) to prepare and distribute notices, agendas and minutes for meetings and Emergency Meetings;
(c) to serve notices for the Committee;
(d) to answer communications sent to the Committee;
(e) to perform administrative and secretarial functions for the Committee;
(f) to keep records (other than records which the Treasurer must keep) for the Committee according to this management statement and the Management Act (if applicable); and
(g) to make the books and records of the Committee available for inspection according to clause 2.20.
Clause 3 deals with meeting procedures and voting rights. A quorum for a meeting is a representative of all Members, although, if no quorum is present, the meeting must be adjourned. At any adjourned meeting, the quorum is the representative of one Member if all Members are not present within 15 minutes after the meeting is due to commence: clause 3.1 to 3.5. The effect of clause 2.8 is that, if all Members are present, all must vote for a resolution to be passed, otherwise a deadlock results.
Clause 3.13 permits the Committee, at any time and from time to time, to delegate any of its powers, authorities, duties or functions to the Strata Manager or the Facilities Manager.
By agreement commencing 23 October 2023, the Members (being Ausbao and the Owners) appointed Bright & Duggan as strata manager (the Agreement).
Clause 2.1 and 2.2 of the Agreement provides:
2.1 The members:
(a) appoints the agent as the agent for the BMC; and
(b) subject to Clause 2.2 and 2.3, delegate the agreed services and additional services to the agent,
from the commencement date for the agreed services fee and the additional services fee, until the agreement is terminated in accordance with Clause 5.
2.2 The extent of authority for agreed services and additional services that has been delegated is stated in Schedule A1, being either:
(a) full authority with no limitations;
(b) full authority subject to limitations as disclosed in Schedule A2; or
(c) no authority, in which case there is no delegation.
Where a selection has not been indicated on Schedule A1 or either (a), (b) or (c), then the extent of authority that has been delegated is FULL AUTHORITY WITH NO LIMITATIONS.
(The Committee is defined as the “BMC” in the Agreement.)
Schedule A1 – entitled “Dates and Functions” includes “Meeting Process” – “arranging and undertaking administrative duties in relation to meetings (including convening, chairing, etc.)”. The option “Full authority subject to limitations as disclosed in Schedule A2” is crossed. Schedule A2 does not contain any limitations which appear to be related to meetings.
Clause 5 of the Agreement deals with termination and provides:
5.1 After the expiry of the term, the agreement will automatically continue until terminated in accordance with this Clause 5.
5.2 The agreement may be terminated at any time with the mutual consent of the parties.
5.3 Either party may terminate the agreement after the expiry of the term by giving to the other part not less than 3 months written notice.
5.4 Any notice to terminate under this agreement can only be given by the members if authorised by a resolution of the members.
5.5 Despite this Clause 5 and without affecting any of its other rights, the agreement may be terminated with immediate effect by written notice given by:
(a) the members:
(i) if the agent is in breach of the agreement and fails to remedy that breach within 28 days after the members serves a written notice on the agent providing particulars of the breach; or
(ii) where the agent is an individual, the agent is declared bankrupt; or
(iii) where the agent is a corporation, the agent is wound up or placed in administration or liquidation; or
(iv) if the agent ceases to hold an *agent’*s licence; or
(b) the agent if:
(i) the members are in breach of the agreement and fails to remedy that breach within 28 days after the agent serves a written notice on the members providing particulars of the breach; or
(ii) an order affecting the building is made by the certifying authority for the building, the Supreme Court or the Registrar-General; or
(iii) the members fail to pay any moneys owed under this agreement after the agent serves a written notice on the members providing particulars of the amount outstanding; or
(iv) the members fail to comply with any law or fails to provide adequate instructions or prevent the agent from carrying out its obligations under this agreement after the agent serves a written notice on the members providing particulars of the breach.
On 12 August 2025, Jenny Goodwin of Bright & Duggan (Ms Goodwin) wrote to the representatives of each of the Members seeking to obtain a suitable date for the annual meeting of the Committee, “to resolve governance motions and determine NFY budget”.
On 29 August 2025, Mr Spicer responded that “11th September works for lot 1 to discuss financials for [Committee]”. Ms Goodwin replied that the meeting was not confined to financials “but also various governance motions prescribed under the SMS”. Ausbao had already indicated that the 10 and 11 September were suitable for it. On 4 September 2025, Ms Goodwin circulated an Annual BMC Meeting Agenda for 11 September 2025. Item 8 on the Agenda was for renewal of the Agreement with Bright & Duggan.
On 5 September 2025, the solicitors for the Owners wrote to Bright & Duggan as follows:
My client has forwarded your email below to me.
Thank you for including the additional motions on the Agenda. However, my client believes that a number of the motions require some re-drafting.
Please stand by while this re-drafting occurs.
Finally, in the light of the above, I am instructed that it is premature to hold the proposed meeting on 11 September 2025. A more suitable date will be provided, together with the amended Agenda, shortly.
Let me know if you have any questions.
Ms Goodwin responded later that day, copying Ausbao’s representative, to the effect that notice of the meeting had already been served, thus the motions could not be reissued and the meeting will proceed.
On 10 September 2025, the Owners’ solicitor sent another letter to Bright & Duggan, copy to Ausbao’s representatives. The letter stated:
I confirm that I act for The Owners – Strata Plan No 100777 (the Owners) in connection with the various rights and obligations of the Owners, including relevantly as the Residential Component Member under the Strata Management Statement (SMS) and in relation to the BMC.
In particular, I refer to your most recent attempt to call a meeting of the BMC by way of your email to Wayne Spicer, the Secretary of the BMC, dated 12 August 2025 (sent at 2:18pm).
Please note that the response from Wayne Spicer on 29 August 2025 was not an agreement to that general meeting but rather an agreement “to discuss financials for BMC”. Indeed, this is something which Mr Spicer has sought for some time. In any event, under the SMS (clause 2.17) Mr Spicer as Secretary is reposed with the authority and power to perform functions pertaining to meetings, including convening meetings and preparing and distributing agendas for meetings. In these matters, Bright & Duggan act on instructions from Mr Spicer.
Further, I note that my email to you dated 5 September 2025 indicated that it was the view of the Secretary that “it is premature to hold the proposed meeting on 11 September 2025” and further that “a more suitable date will be provided, together with the amended Agenda, shortly”. In other words, authority to convene the meeting and distribute the Agenda was not provided to you as agent.
Finally, notwithstanding the direct instruction to you to not proceed with the proposed meeting you responded by way of email dated 5 September 2025 effectively refusing to follow that instruction. To make matters worse, you have on 9 September 2025 spent BMC moneys despite not being authorised to do so.
The above actions have occurred notwithstanding my emails to you dated 4 and 16 July 2025 as well as the email from Wayne Spicer to you dated 25 February 2025 sent at 5:17pm setting out how the principles of agency operate in these circumstances (the Emails). Copies of the Emails are enclosed with this letter.
It is of serious concern to my clients that you are acting against the instructions of Mr Spicer and refusing to comply with requests made by the Secretary and providing argumentative responses attempting to justify your conduct. This raises questions as to your current and ongoing suitability to act as the strata agent for the BMC.
Notwithstanding receiving the Emails you have breached a number of the principles detailed in the Emails and not only acted unilaterally but contrary to direct instructions. This is a most serious matter. No doubt Bright & Duggan is aware of the following basic principles as between principal and agent. However, given your repeated pattern of conduct, they are set out as follows:
“Where an agency is created by contract the agent’s overriding duty is to comply with its terms; the duty is one of obedience …implied into every contract of agency are terms requiring the agent to act in accordance with the instructions contained in the express authority or given subsequently by the principal, to act honestly and in good faith, to exercise proper or reasonable care and skill in discharging the duties as agent and to act for the benefit of the principal (fidelity).” (emphasis added) (Law of Agency, 3rd Ed., Dal Pont [2014] at [10.1]).
Your conduct can only be described as extraordinary given the main obligation of an agent is to follow the instructions of their principal. It is properly characterised as disobedient.
You are once again reminded of the principles set out in the Emails and above, and directed not to attempt to hold the proposed meeting on 11 September 2025 given it will not only be invalid but will give rise to a dispute as to it’s validity and the members of the BMC will unnecessarily expend time and money arguing over this issue.
Finally, my client is currently finalising the Agenda for the required BMC meeting and will revert to you shortly with it.
Please confirm in writing (copied to the representatives of the Hotel Component Member) as soon as possible that you will comply with my client’s instructions as set out above.
Bright & Duggan BMC Management Agreement
I understand that the BMC Management Agreement with Bright & Duggan will expire on 23 October 2025. In the light of the above unacceptable conduct by Bright & Duggan and the subsequent alienation of the Owners, I am instructed that the Owners will not accept a renewal of the BMC Management Agreement with Bright & Duggan. In short, my client requires that another strata management firm be appointed to assist the BMC.
Lot 2 Representative
Clause 4.1 of the SMS provides that “Members must provide the Committee with the following contact details:
(a) their current address and the current addresses for their Representative and Substitute Representative; …”
Clause 4.2(a)(i) of the SMS provides that “The Members must:
(i) comply promptly with their obligations under this Statement and the Act; …”
Please find attached the following emails:
1. email exchange between myself and Alex Liu; and
2. unanswered emails from myself to Anant Tawde.
The above emails sought to identify the information required to be provided to the BMC pursuant to clause 4.1
My client requires that you provide any documents you have indicating who the authorised Representative for Lot 2 is.
In the event that the Hotel Component Member (Lot 2) opposes the position taken by the Residential Component Member with respect to the proposed BMC meeting on 11 September 2025, my client will activate the dispute resolution procedure under the SMS and will refuse to recognise that a valid and properly convened meeting is called.
My client is disappointed that matters have reached this point and that needless time and costs have been incurred.
Please contact the writer if you have any questions.
(Emphasis added.)
As referred to in this letter, and as attached to it, there had been correspondence as early as February 2025 between Mr Spicer and Bright & Duggan about how it was said the principles of agency operate in the circumstances.
The Owners’ representatives did not attend the meeting on 11 September 2025. Accordingly, a quorum was not present and the meeting was adjourned to 25 September 2025.
A further email was sent by the Owners’ solicitor to Bright & Duggan on 15 September 2025:
We note that you have not responded to our letter of 10 September 2025 and proceeded in further defiance of the Secretary of the BMC’s instructions not to hold the purported annual meeting of the BMC on 11 September 2025. During my conversation with Nick Stephenson on 11 September 2025 I simply reasserted the content of our letter of 10 September 2025 and Mr Stephenson indicated he would revert to me.
Our client does not accept that either the purported meeting of 11 September 2025 or its purported adjournment to 25 September 2025 (which you have unilaterally nominated without regard to the Secretary’s authority in these matters or his availability as Representative of the Residential Component) as valid or properly convened meetings.
We are preparing a Notice of Dispute to be served on the Hotel Component Member in relation to the invalidity of the purported meeting and its adjournment and will include this email and your email of 12 September 2025.
Our client reserves its rights, including as against Bright & Duggan for breach of the agency agreement and unlawfully exceeding its authority.
RE: Building Management Committee of 60 Bathurst Street Sydney (“the BMC”)
- We refer to the matter above and past correspondence, namely our letter dated 10 September 2025 (“the Letter”).
Background
- The Letter sets out our client’s position, namely that our client’s representative to the BMC, Mr Wayne Spicer, is also the secretary of the BMC (“the Secretary”). According to the terms of the strata management statement for the BMC (“the SMS”), various powers reside with the Secretary, including the power to call meetings.
- Whilst the Secretary’s powers may be delegated to another, e.g. a strata management agent, the delegate exercises the power of the Secretary, meaning the Secretary may withdraw instructions at any time and in respect of any decision.
- You disagree, stating, in effect, that your agency agreement (“the Agency Agreement”) with the BMC contains an irrevocable delegation. This contention is disputed by our client.
Dispute Notice
- As there is a dispute in respect of the BMC, SMS, and Agency Agreement, our client accordingly exercises their right pursuant to clause 5.4 of the SMS and issues a dispute notice in respect of the foregoing, enclosed (a copy of which has been served on Ausbao). Accordingly, the parties to the dispute must pursuant to clause 5.4 proceed as follows:
a. pursuant to clause 5.5 Ausbao is to nominate by 22 September 2025 a person to resolve the dispute;
b. pursuant to clause 5.6 our client and Ausbao must meet by 25 September 2025 to attempt resolution;
c. if the matter cannot be resolved at the meeting pursuant to clause 5.6, then our client and Ausbao must, pursuant to clause 5.7 agree by 02 October 2025 on an appropriate expert to resolve this dispute.
Upcoming General Meeting
- In respect of the upcoming Annual Building Management Committee Meeting (“AGM”) schedule for 25 September 2025 at 3:00pm, which agenda (“the Agenda”) was circulated 12 September 2025, our client’s position is:
a. the AGM is to be chaired by the Secretary; and
b. as the BMC is not subject to the Strata Schemes Management Act 2015 (NSW), the procedures in respect of meetings pursuant to Schedule 1 does not apply to the AGM.
- Notwithstanding the foregoing and in the spirit of cooperation, our client will attend the AGM, vi coactus, and will vote against motions [8] to [28].
- By way of disclosure, our client will be attending with Mr Matthew Lo of our firm who will advise the Secretary at the AGM.
- Our client reserves their right to dispute the validity of the AGM being called and any motion resolved at the AGM.
- For the avoidance of any dispute arising from the AGM we request an official audio and/or visual recording of the AGM be made. Our client also seeks to exercise their right to make their own audio and/or visual recording to the AGM.
- We reserve our rights.
The Owners-Strata Plan 10777
and
Ausbao (286 Sussex St) Pty Ltd
DISPUTE NOTICE
(Issued by the Owners Corporation pursuant to s 5.4 of the Strata Management Statement - 60 Bathurst Street)
(a) Description of Dispute
- This dispute concerns a high rise building located at 58-60 Bathurst Street, Sydney (60 Bathurst Street) that is a mixed-use building shared by a residential apartment complex of 95 apartments and a hotel presently operated by Shokai Sydney Hotel Management Pty Limited under the business name “Crown Plaza Sydney Darling Harbour”.
- 60 Bathurst Street has been subdivided into a Residential Statum (Lot 1 in the Stratum Plan) (Residential Component) and Hotel Statum (Lot 2 in the Stratum Plan) (Hotel Component). The Residential Component has been further subdivided into a strata scheme which is represented by an owners corporation, being The Owners – Strata Plan 10777 (Owners Corporation). The Hotel Component is registered in the name of the developer of 60 Bathurst Street, Ausbao (286 Sussex St) Pty Ltd (Ausbao).
- Pursuant to s 99 of the Strata Scheme Development Act 2015 (Development Act), a Strata Management Statement for 60 Bathurst Street was registered on 16 March 2020 (SMS) [see Tab 1, Attachment A]. Under s 105 of the Development Act and upon registration, the SMS has effect as an agreement under seal between, inter alia, the Residential Component and the owner of Lot 2 (being the Hotel Component).
- By the definition of “member” in the SMS, each of the Owners Corporation and Ausbao are “Members” of a committee established under clause 2 of the SMS known as “the building management committee” (BMC) and must appoint a “Representative” to attend and vote for them (clause 2.2). Each Member (not in default) is entitled to through their Representative to vote and each have one vote (clause 3.10). The BMC is responsible for operating and managing 60 Bathurst on behalf of the Members, including in relation to any “Shared Facilities” as defined in the SMS (clauses 2.2, 2.7). Relevantly, decisions of the BMC may only be made according to the SMS, at a properly convened meeting of the BMC and by Ordinary Resolution or Unanimous resolution as defined in the SMS (clause 3.15).
- A dispute has arisen between the Residential Component Member and the Hotel Component Member in relation to the validity of an Annual General Meeting (AGM) purportedly convened on 11 September 2025 by the appointed strata managing agent, Jenny Goodwin of Bright and Duggan (Agent) (Purported 11 September 2025 Meeting). The meeting was apparently and purportedly held on 11 September 2025, and not achieving a quorum because the Residential Component Member did not attend, has again been purportedly adjourned to 25 September 2025.
- The Representative of the Residential Component is Mr Wayne Spicer who is the validly appointed and current Secretary of the BMC pursuant to clause 2.12 - 2.14. The functions of the Secretary must be performed according to the SMS (clause 2.16) and include the following functions in clause 2.17:
a. to convene meetings and Emergency meetings;
b. to prepare and distribute notices, agendas and minutes for meetings and Emergency meetings;
c. to serve notices for the BMC;
d. to answer communications sent to the BMC; and
e. to perform administrative and secretarial functions for the BMC.
(b) Provisions of the SMS or the law that apply to the dispute
- The relevant provisions of the SMS that apply are:
a. 1.1,1.2 and1.3;
b. 2.1 to 2.9, 2.12, 2.14, 2.16, 2.17;
c. 3.1 to 3.6, 3.10to 3.13, 3.15to 3.17;
d. 4.1, 4.2;
e. 5;
f. 6; and
g. 7.1
- The relevant sections of the Development Act are:
a. ss 99,100,101,105; and
b. Schedule 4- Strata Management Statements, items 1, 2 and 5.
(c) The Position of the Residential Component
- The position of the Residential Component Member is as follows.
Invalidity of Purported 11 September 2025 Meeting and Purported Adjournment
a. The Residential Component Member contends that the Agent in defiance of the Secretary’s express instructions on 29 August 2025 has acted without authority by:
i. refusing to permit the Secretary to amend an Agenda and arrange for the convening of an annual meeting of the BMC when no restriction at law or in the SMS prevented the Agenda from being amended;
ii. proceeding to convene the Purported 11 September 2025 Meeting and ignoring correspondence from the Secretary and the Residential Component Member not to do so;
iii. purporting to adjourn the Purported 11 September 2025 Meeting to 25 September 2025 in further and continued defiance of the Secretary’s instructions, including without consulting the Residential Component Member as to whether the adjourned date is suitable; and
iv. at all material times, the Hotel Component Member has been copied to relevant correspondence and has not responded or communicated (orally or in writing through its Representative) and by apparently attending the Purported 11 September 2025 Meeting consented to the invalid and improper BMC meeting process undertaken by the Agent;
b. accordingly, the Purported 11 September 2025 Meeting and its purported adjournment to 25 September 2025 are invalid and of no effect;
c. The Residential Component Member will attend the purported adjourned meeting on basis that it does not waive its position as to the invalidity of the Purported 11 September 2025 Meeting and makes no admission as to its validity in order to protect its position given that the compulsory dispute resolution process will occur after 25 September 2025 (a further consequence of the Agent acting unilaterally and without consulting the Secretary as to when the purported adjourned date should occur).
Contact information to be provided by the Hotel Component Member
d. The Hotel Component Member Representative has refused to communicate with the Residential Component Member Representative and to provide contact information as required in clause 4.1 of the SMS in breach of its obligations in the SMS. The Hotel Component Member should provide such information forthwith.
Resolutions to replace the Agent with a new strata management agent
e. In view of the untenable nature of the Agent’s position, the Hotel Component Member should join with the Residential Component Member to resolve as soon as practicably in a properly convened meeting of the BMC to immediately appoint a new Strata Management Agent and to inform the Agent that:
i. The BMC seeks that the Agent agree to immediately terminate the BMC Management Agreement or, otherwise, the BMC give 3 months’ notice of termination upon its expiry under clause 5.3 of the Strata Management Agreement;
ii. The BMC resolve to immediately appoint a new Strata Managing Agent from either of:
- Capstone Strata Pty Ltd;
- Premium Strata Pty Ltd,
upon provision of their reasonable proposed terms and conditions for so acting.
(d) Facts and circumstances relied on by the Residential Component
- There is a history of the Agent refusing to comply with requests and instructions given by the Secretary of the BMC, Mr Spicer, as to the convening of meetings of the BMC and the preparation of agendas for BMC meetings. See Tab 2 of Attachment A in respect of arrangements for a BMC meeting earlier this year. Such conduct, it is contended, exceeds the Agent’s delegated authority which does not nor cannot exceed nor replace the Secretary’s authority as reposed in clause 2.17(a) to (e) of the SMS. As between principal and agent, the following basic legal principle applies:
“Where an agency is created by contract the agent’s overriding duty is to comply with its terms; the duty is one of obedience ... implied into every contract of agency are terms requiring the agent to act in accordance with the instructions contained in the express authority or given subsequently by the principal, to act honestly and in good faith, to exercise proper or reasonable care and skill in discharging the duties as agent and to act for the benefit of the principal (fidelity).” (emphasis added) (Law of Agency, 3rd Ed ., Dal Pont [2014] at [10.1]).
- Between 4 and 16 July 2025, further correspondence between Mr Kerin on behalf of the Secretary and the Residential Component Member (Owners Corporation) and the Agent continued. Again, the Agent defied instructions given on behalf of the Secretary evidencing a misconception of the Agent’s role and function and a preparedness to act against the Secretary’s directions and without instructions. See Tab 3, Attachment A.
- During that time efforts were also made to no avail by Mr Kerin on behalf of the Secretary and Residential Component Member to engage constructively and directly with the apparent Representative of the Hotel Component Member, Mr Anant Tawde. See Tab 4, Attachment A.
- On 12 August 2025, Ms Goodwin initiated consideration of the annual meeting of the BMC. Mr Spicer responded by email on 29 August 2025 indicating that the date was suitable for Lot 1 (the Residential Component Member) “to discuss financials for BMC” (underlining added). Ms Goodwin then unilaterally proceeded to prepare and circulate by email on 4 September 2025 a broader and unauthorised agenda which she then refused to amend in accordance with the Secretary’s instructions conveyed by Mr Kerin in an email sent the next day. Ms Goodwin’s course of conduct was against the Secretary’s instruction.
- By email of 5 September 2025, Ms Goodwin wrongly stated and without authority in response to Mr Kerin:
We note the notice of this meeting has already been served to the members, and thus, these motions cannot be reissued at this time.
We further note that both lots agreed and confirmed their availability for the scheduled meeting date. The meeting will proceed as noted within the issued agenda.
- The Notice was not sent to the Residential Component Member in accordance with clause 6 of the SMS and was only circulated by email and the service requirements were not satisfied. The Residential Component Member does not waive compliance with clause 6. This constitutes another ground for invalidity.
- The Agent’s usurpation of the Secretary’s function in these exchanges is evident. No draft agenda was issued for the Secretary’s approval when it was plain that the Secretary was limiting matters for consideration “to discuss financials” and was far from deciding on an agenda, and had not approved the motions in the Notice proposed by Ms Goodwin. The principle in respect of delegated powers of a strata managing agent under a strata management statement is analogous with those principles in respect of a strata manager pursuant to the Strata Schemes Management Act 2015 (NSW), which can be stated as follows:
“The functions of a strata managing agent depend on the delegation they are given by the owners corporation appointing them ... Notwithstanding the delegation, the owners corporation, committee and any officer (as the case may be) may continue itself to exercise any of its functions, unless the strata manager has been appointed pursuant to an order of the Tribunal. This explanation of the delegation makes clear the fundamental proposition that a strata managing agent is a servant of the owners corporation and not its master.” (emphasis added) (Strata Law in New South Wales, Peden and Muddle, (2021) at [3.290]).
- Further, Ms Goodwin refused impermissibly to change the agenda wrongly asserting that it could not be changed when an agenda at common law has no such legal status and there is no such restriction in the SMS which provides in clause 3.1 that “the Committee may meet to conduct its business, adjourn and otherwise regulation Meetings and Emergency Meetings as it thinks fit.” Further, the motions attached to the Notice unilaterally prepared by Ms Goodwin were not required2 and certainly were susceptible to amendment which she has refused to do. Notably, Mr Spicer did not approve the purported Agenda items in 8 to 11 in which the Agent unilaterally sought renewal of its agency agreement without any alternative agent being proposed despite the obvious and recent history of acrimony with the Residential Component Member.
- On 10 September 2025, Mr Kerin wrote to the Agent setting out the Residential Component Members’ complaints about the convening of the Purported 11 September 2025 Meeting and the “Agenda” imposed by the Agent, indicating that the Agent’s contract renewal would not be supported and requesting that the Hotel Component Members Representative provide contact information as required in clause 4.1 of the SMS. Mr Kerin’s letter unequivocally directed the Agent not to attempt to hold the meeting because it was invalid and would give rise to a dispute. See Tab 5, Attachment A.
- No substantive written response to this letter has been provided by the Agent or the Hotel Component Member.
- On 12 September 2025, the Agent wrote to Mr Spicer and Mr Tawde adjourning the Purported 11 September 2025 Meeting because of an absence of a quorum and purporting to adjourn the meeting as an “Emergency” BMC meeting to be held on 25 September 2025. See Tab 6, Attachment A.
- On 15 September 2025, Mr Kerin responded to the letter disputing the validity of the purported meeting.
(e) Copies of correspondence and documents mentioned in this Dispute Notice
- Attached as Attachment A to this Dispute Notice is an indexed bundle of documents behind numbered tabs.
- The Residential Component relies on the documents set out in Attachment A.
(f) Nominated persons with authority to resolve the dispute on behalf of the Residential Component
- The Residential Component Member nominates Mr Wayne Spicer to resolve the dispute on its behalf and, through the Owners Corporation, has engaged separate legal representation. Mr Christopher Kerin of Kerin Benson Lawyers acts for the Owners Corporation in this dispute.
On 2 October 2025, Ausbao’s solicitors wrote to the Owners’ solicitors asking “what are the precise questions that your client proposes to ask the expert to answer?”. The letter also stated that without prejudice to Ausbao’s position that it did not accept the validity of the Dispute Notice, it nominated the Hon. James Stevenson SC to be appointed as the expert.
A further letter was sent by Ausbao’s solicitors on 2 October 2025. The response from the Owners’ solicitor dated 9 October 2025 was as follows:
- We refer to your letter of 02 October 2025.
- We do not accept your contentions as the inadequacy of the Dispute Notice. Indeed, as is evident from paragraph 7 of your letter, your client is capable of identifying at least one issue in dispute being the validity of the purported meetings. We have every confidence that your client can identify and understand the other matters in dispute.
- The Dispute Notice is not to be read as, nor is it required to be in the form of, a pleading. We also note (again) that the request you have made is not a requirement under clause 5 of the Strata Management Statement. Further correspondence on this matter needlessly incurs costs and delays resolution of the dispute between the parties so as to frustrate the management of the building.
- Nevertheless, to move the matter forward we respond to your client’s request as set out below.
- As we have previously indicated, our client relies on the whole of the Dispute Notice and intends to provide the expert determiner with further updating material as to relevant events that have occurred since the preparation of the Dispute Notice.
- Our client proposes that the parties pose the following questions to the expert appointed to determine the dispute without limitation to the expert’s role and function to determine the dispute under clause 5 of the Strata Management Statement:
a. In the events that have happened, whether the purported general meetings of the Building Management Committee on 11 September and 25 September 2025 are invalid, and the actions taken and resolutions purportedly made at those meetings are of no effect;
b. Whether the Hotel Component Member is in breach of clause 4.1 of the Strata Management Statement by failing to provide the contact details in subclauses 4.1(a) to (c) and should provide the Building Management Committee with such details forthwith;
c. In the events that have happened, including at the purported meeting of 25 September 2025, whether the Building Management Committee should decide to:
i. terminate the Agency Agreement entered into with Bright & Duggan with the consent of Bright & Duggan on an agreed date (pursuant to clause 5.2) and/or that written notice of 3 months’ termination be given to Bright & Duggan (pursuant to clause 5.3); and
ii. immediately appoint a new strata managing agent for the Building Management Committee, being either:
- Capstone Strata Pty Ltd; or
- Premium Strata Pty Ltd,
to commence on an agreed date and on the terms and conditions, or such other reasonable terms and conditions as may be negotiated, as provided to the Secretary of the Building Management Committee, Mr Wayne Spicer, by Capstone Strata Pty Ltd on 15 September 2025 and Premium Strata Pty Ltd on 10 September 2025 (copies enclosed).
- We do not propose to respond to any further complaints from your client regarding the Dispute Notice.
- We otherwise await your response to our letter sent to you on 03 October 2025 (dated 02 October 2025 by typographical error) regarding the appointment of the Honourable James Stevenson SC as expert determiner.
The proceedings were then commenced by Ausbao. Following this, the stay motion was filed by the Owners and dismissed on 18 December 2025 for the reasons set out in my earlier judgment. The ASOC was filed joining Bright & Duggan. A defence was filed by the Owners. The Court of Appeal dismissed the Owners’ application for leave to appeal on 16 April 2026.
On 23 April 2026, the solicitors for the Owners wrote to Ausbao’s solicitors in the following terms:
We refer to the matter above and inform you that our client:
- withdraws their Dispute Notice dated 18 September 2025;
- withdraws their Determination Notice dated 25 September 2025;
- approves the minutes of the BMC general meeting of 25 September 2025 (will circulate signed copy of those minutes shortly); and
- will seek leave to withdraw their Defence filed 11 March 2026 and to file a submitting appearance for the remainder of the Proceedings.
On 24 April 2026 I granted the Owners leave to withdraw their defence. Submitting appearances, save as to costs, were then filed by both defendants.
On 7 May 2026, Ausbao’s solicitors wrote to the Owners’ solicitors requesting the signed minutes referred to in the earlier letter dated 23 April 2026, being the minutes of the BMC general meeting of 25 September 2025. No response had been received regarding that request by the time of the hearing before me.
The principal remaining issue – given that prayers 1 and 2 of the ASOC are no longer pressed now that the relevant notices have been withdrawn – concerns the declarations sought in paragraphs 3A and 3B of the ASOC. Those declarations concern the scope of the agency of Bright & Duggan under the Agreement.
A further issue is whether, given the content of the 23 April 2026 letter, there remains any utility in making the declarations sought in paragraphs 3A and 3B of the ASOC. If there were no utility in making the declarations, there would be no utility in considering the underlying issue of the scope of the agency.
In my view, there is utility in doing so. The Owners contend that Bright & Duggan is in breach of the Agreement and have reserved the right to sue Bright & Duggan. Any such breach may also give rise to an entitlement to terminate.
The Agreement is also ongoing. The question of whether Bright & Duggan remains subject to the direction of the Secretary, or has full authority within the terms of the Agreement, is likely to assist the parties in their future dealings.
I have set out above the relevant provisions of the SMS and the Agreement.
In my view, the relevant effect of those terms is clear.
The starting point is clause 2.3(a) of the SMS which empowers the Committee to appoint a “Strata Manager” to assist in the management of 60 Bathurst and perform secretarial and financial functions.
Clause 7.1 of the SMS also provides that “the Committee may appoint a Strata Manager to assist it to perform its functions under this Statement”. Clause 3.13 is to the same effect.
The “Committee” is made up of the Members – being Ausbao and the Owners. Each is required to appoint a representative to vote for it at meetings: see clauses 1.3, 2.2, 2.4, 2.5, 2.6 and 2.8.
“Strata Manager” is defined in clause 38.1 as “the strata managing agent for the time being appointed by the Committee under clause 7.1”.
The point of significance is that it is the Committee that appoints the Strata Manager to perform the functions of the Committee under the SMS.
The issue that then arises is: what are the functions of the Committee under the SMS?
Clause 2.7 of the SMS largely provides the answer as it sets out the functions and powers of the Committee. I have set it out in full above. These functions include in clause 2.7(c), the function “to convene and hold meetings and Emergency Meetings”.
It was that function which the Committee relevantly resolved to delegate to Bright & Duggan by entering into the Agreement.
The Agreement is between the Members and Bright & Duggan. It is the Members that together constitute the Committee.
Clause 2.1 of the Agreement provides that the members
(a) appoints (sic) the agent as agent for the BMC; and (b) ….. delegate the agreed services and additional services to the agent”.
The BMC is obviously a reference to the Committee – see the relevant definition in clause 11 of the Agreement. Each of the concepts in sub clause (b) is defined in clause 11 as “the functions and duties of the members”.
The position adopted by the Owners, to the effect that Bright & Duggan is subject to the direction of the Secretary, is based on clause 2.17 of the SMS, which is set out above. Whilst the functions of the Secretary include “to convene meetings and Extraordinary Meetings”, this is not a stand-alone function in the sense that the Secretary exercises the powers of the Committee on this issue, thus making the Secretary the principal of the agent Bright & Duggan under the Agreement. The proper construction of the SMS, in my view, is that the Secretary exercises the relevant functions when those functions have not been delegated by the Committee to a Strata Manager.
It is the Committee that has the power to appoint agents, not the Secretary. The power is in respect of the functions of the Committee, which includes convene and hold meetings. Clause 2.7(i) of the SMS provides that it is for the Committee (being the Members jointly), and not the Secretary, to “monitor the performance of the Strata Manager”.
Clause 2.10 of the SMS relevantly provides that the Secretary must perform the Secretary’s functions at the direction of the Committee.
These provisions all point against the Secretary having any free standing power to convene meetings or to exercise the powers of the Members under the Agreement by directing Bright & Duggan.
The Secretary is not a party to the Agreement.
If the Committee has validly delegated to an agent, being the Strata Manager, its function of convening and holding meetings, there is nothing for the Secretary to do in that regard.
The terms of the Agreement plainly provide that this function has been delegated to Bright & Duggan.
The “additional services” and “agreed services” delegated under clause 2.1(b) of the Agreement are defined in clause 11 to be set out in Schedules A1 and A2. Clause 2.2 provides that the extent of those delegations are as stated in the fourth column of Schedule A1.
Under Schedule A1, “Administrative duties” and “Meetings process” are delegated to the Agent with “Full authority subject to limitations as disclosed in Schedule A2”. Schedule A2 contains no limitations in respect of any function.
The function of “Meetings process” encompasses “full authority” for “arranging and undertaking administrative duties in relation to meetings (including convening, chairing etc)”.
The function of convening meetings and the like having been delegated to Bright & Duggan with full authority, there is nothing for the Secretary to relevantly do in relation to this function.
For these reasons I am satisfied that declarations sought in prayers 3A and 3B should be made.
In circumstances where the Owners have not provided Ausbao with the signed minutes of the meeting on 25 September 2025, notwithstanding what was stated in the 23 April 2026 letters, there is also utility in making the declaration sought in prayer 4 of the ASOC. The Defence filed by the Owners identified the reason for the invalidity of the meetings on 11 September and 25 September 2025 as the scope of the agency of Bright & Duggan to convene the meetings contrary to the instructions of Mr Spicer as Secretary.
The declarations sought in prayers 3A, 3B and 4 of the ASOC should be made.
Ausbao made it clear at the hearing that it will be seeking costs from the Owners. I will therefore make directions for submissions to be provided to me. Unless an oral hearing is sought, I will then determine the issue of costs on the papers.
The Court makes the following orders and declarations:
Declaration that on the proper construction of the Agency Agreement, the second defendant is the agent of the plaintiff and the first defendant as members of the Building Management Committee.
Declaration that on the proper construction of the Agency Agreement, the plaintiff and the first defendant have delegated to the second defendant full authority to convene meetings of the Building Management Committee and to prepare notices, agendas and minutes for those meetings.
Declaration that the general meetings of the Building Management Committee on 11 September and 25 September 2025 were validly convened and that the resolutions passed in those meetings are valid.
Direct the plaintiff to notify the defendants of these orders within 24 hours of the making of these orders.
Direct the plaintiff to file and serve any submissions and supporting material on the question of costs of the proceedings by 27 May 2026.
Direct the defendants to file and serve any submissions and supporting material on the question of costs of the proceedings by 10 June 2026.
Direct the plaintiff to file and serve any submissions and material in reply on costs by 17 June 2026.
Unless any party requests an oral hearing, the question of costs be determined on the papers.
Grant liberty to apply on 48 hours’ notice, setting out the relief sought, such liberty to include the timing of the defendants’ material as ordered in order 6 above.
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Minor amendments to [30], [69] and [70]
Ausbao (286 Sussex St) Pty Ltd
The Owners – Strata Plan No. 100777 (No 2)