Camara [2025] QBCCMCmr 128 (22 April 2025)

ADMINISTRATOR - whether to appoint an administrator at a duplex that is not operating lawfully.

Act, ss 4(a), 276(4), 278, 301; Standard Module, ss 13(5), 86(6), 160(3)(a).

1. Henry Wheeler of Strata Dynamics is appointed administrator of Camara for three months with the powers of the body corporate committee and its executive members necessary to prepare and chair the annual general meeting for 2025.
2. Mr Wheeler's appointment will be on the terms attached to his letter of 31 October 2024, adjusted pro rata for a three month appointment.

1. Mr Wheeler may obtain a sinking fund forecast on behalf of the body corporate if he considers it necessary to prepare a sinking fund budget.
2. Mr Wheeler may include a motion on the agenda of the 2025 AGM proposing his appointment as body corporate manager if he wishes.
3. If a motion to appoint a body corporate manager is included on the agenda, two versions of the administrative fund budget must be prepared: one that includes expenditure on a body corporate manager, and one that does not, with one or the other to be ruled out of order contingent upon whether a body corporate manager is to be engaged.
4. Mr Wheeler may levy owners according to their contribution schedule lot entitlements to recover his fees and, if necessary, the cost of a sinking fund forecast.
5. Mr Wheeler will open a bank account in the name of the body corporate that can be operated by Mses Andrews and MacGinley acting jointly pursuant to section 151 of the Act.
6. The financial year for Camara will be 1 June to 31 May henceforward.

• [1] Camara is a duplex that is not operating in accordance with statutory requirements. It does not hold annual general meetings (AGMs), it has no administrative fund or sinking fund budgets, owners do not pay contributions, and insurance has been a running battle resulting in several applications to this office.[1]
• [2] An extraordinary general meeting was held last year in an attempt to correct the situation, but Ms MacGinley of lot 1 voted every motion down. She says that was because she was not consulted about the meeting and she objected to the involvement of Strata Dynamics, who facilitated the meeting and were proposed to be appointed body corporate manager for three years.
• [3] Ms Andrews of lot 2 now seeks orders in the following terms:

I am seeking an order from an Adjudicator that is just and equitable in the circumstances to resolve the dispute within the context of a community titles scheme. The specific outcomes I request include:

1. Convening an Annual General Meeting (AGM): In accordance with the Body Corporate and Community Titles Act 1997, Division 2, Section 204 (180), it is essential to hold an AGM for our Body Corporate.

2. Establishing an Administration and Sinking Fund: To create a viable body corporate for the benefit of the lot owners and to ensure the protection of the properties, an administration and sinking fund must be established.

3. Body Corporate Records: As required by the Body Corporate and Community Titles Act 1997, Division 2, Section 204 (180), proper records must be maintained.

4. Bank Account for the Sinking Fund: In line with the provisions of the Act, Section 150, a bank account must be set up for the sinking fund. Additionally, the Body Corporate budget should include maintenance and insurance expenses as specified in Chapter 3, Part 1, Division 1, Section 96, and Part 3, Division 1, Section 204 (180).

5. Functioning Body Corporate: It is imperative to establish a functioning body corporate that upholds the duties and responsibilities concerning common property as outlined in Division 2, Section 152 of the Act.

6. Appointment of an Administraitor Given the absence of a functioning body corporate and records, I request that Henry Wheeler from Strata Dynamics PTY LTD be appointed as the Body Corporate Administrator for Camara to ensure proper management and compliance.

• [4] Ms Andrews submitted a letter from Henry Wheeler of Strata Dynamics consenting to be appointed administrator for three months to convene a general meeting "for the purposes of setting budgets & levies, appointing a Strata Manager and appointing a Body Corporate Committee...under the terms and conditions of the attached Administration Agreement for a period of three months only". The attached agreement was for a three year appointment and cited annual fees, but I assume the intention is that the fees would be calculated pro rata for the proposed three month appointment.

• [5] An administrator can be appointed to carry out the functions of a body corporate that is too dysfunctional to comply with its statutory framework.[2] It is typically done on the least intrusive terms sufficient to address the evident dysfunction, preserving body corporate control over its own affairs to the greatest extent possible given that self-management is an inherent aspect of community titles schemes.[3]
• [6] Camara is clearly in need of third party assistance. As noted above, it is meeting few of its statutory responsibilities. It has a body corporate committee, but only because one exists by default at a scheme with only two lots.[4] It sometimes has insurance, and presumably has it now because no orders have been sought in relation to it, but that is only because successive owners of lot 2 have forced the issue.
• [7] Ms MacGinley disagrees that an administrator is required for such a small scheme. I wrote to her and sought further explanation, pointing out that the present owners have been unable to bring the scheme into compliance with the Act during six years of joint ownership. She did not reply.
• [8] It is evident that an administrator is required to address at least the following matters:
  1. calling and convening the 2025 AGM
  2. formulating administrative and sinking fund budgets and proposing contributions, and
  3. opening a body corporate bank account to receive contributions and meet expenses.
• [9] An ancillary order will be necessary to set the body corporate's financial year, as it is presently unknown. That will determine the period the budgets relate to and the timing of future AGMs. A financial year of 1 June to 31 May should suit the timing of the 2025 AGM, and will allow owners until 31 May to submit any motions to the administrator that they wish to have included on the agenda of this year's AGM.[5]
• [10] I will also make an ancillary order to empower the administrator to obtain a sinking fund forecast at the expense of the body corporate if necessary to formulate a sinking fund budget. There can be some complexity to preparing a sinking fund budget, particularly at a scheme like Camara where there are no records of historical expenditure or the condition of the common property. The budget must not only provide for expenditure in 2025-26, but also "reserve an appropriate proportional share of amounts necessary to be accumulated to meet anticipated major expenditure over at least the next 9 years after the financial year".[6] The administrator may require a sinking fund forecast for that purpose.
• [11] I will not make any orders with respect to keeping body corporate records or "upholding duties and responsibilities concerning common property", as a three month administrator appointment for the purpose of calling a general meeting lacks the scope to address these matters. They are ongoing responsibilities that will need to be managed by the committee, a body corporate manager, or an administrator if appointed to exercise the functions of the body corporate on a more enduring basis.
• [12] There is no guarantee that these orders will correct Camara's dysfunction. All motions at the 2025 AGM may be voted down again, leaving the body corporate with no financial capacity to meet its responsibilities. Or the essential statutory motions may pass, only for Mses Andrews and MacGinley to subsequently find themselves unable to cooperate with one another sufficiently to collect contributions, maintain the common property, take out insurance, and otherwise carry out the functions of the body corporate.
• [13] Those risks could be managed via a more intrusive administrator appointment. An administrator could be empowered to not only propose but also adopt budgets on behalf of the body corporate. They could also be empowered to exercise the powers of the body corporate for a longer term after the AGM; say, for six or twelve months.
• [14] But I will not make such orders at this stage. Camara has never had an administrator and should be given the chance to bring its affairs into order with a minimal intervention in the first instance. Ms MacGinley indicated she voted against all motions at last year's general meeting because she felt the meeting was imposed upon her unilaterally by Ms Andrews. She may feel differently about the AGM convened pursuant to these orders.
• [15] Ms MacGinley also objected to the proposed engagement of a body corporate manager at last year's meeting, and she still sees it as unnecessary now. Perhaps that was part of her reason for voting down the administrative fund budget, which included expenditure on a body corporate manager. To address that risk, if the 2025 AGM includes a motion to appoint a body corporate manager, I will direct the administrator to prepare two versions of the administrative fund budget; one that includes the proposed expenditure on a body corporate manager, and one that does not. If the motion to engage a body corporate manager is unsuccessful, the budget that includes expenditure on a body corporate manager could be ruled out of order, or vice versa.
• [16] If these measures are ineffective and Camara lapses back into dysfunction, either owner may seek a further administrator appointment on more comprehensive and enduring terms, or such other orders as seem necessary to bring the scheme into compliance with the Act.

[1] E.g. see Camara [2021] QBCCMCmr 113 & Camara [2018] QBCCMCmr 555.

[2] Act, ss 276(4), 278, 301; Surace V Commisso [2009] CCT KA002-09 at [44].