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

APPOINTMENT OF ADMINISTRATOR- whether circumstances warrant the appointment of an administrator

1. I declare that:
   1. There is no valid committee for the Body Corporate for Hampton Industrial Court;
   2. There was no valid annual general meeting held for the body corporate's 2024-2025 financial year;
   3. There were no valid contributions levied on lot owners for the 2024-2025 financial year;
   4. There was no valid decision of the body corporate to issue Magistrates Court proceedings M3889/25; and
   5. There was no valid decision of the body corporate to engage Grace Lawyers to act for the body corporate.
2. Ms Christine Kolenc is appointed as administrator to call, hold and chair a general meeting ('the meeting') of the Body Corporate for Hampton Industrial Court within 3 months of the date of this order, and shall hold the appointment until the end of the meeting.
3. The meeting will be deemed the annual general meeting for the 2024-2025 financial year and will not be invalid simply because it has not been held within the required statutory period.
4. The administrator must give at least 14 days written notice inviting owners to submit motions for inclusion on the agenda of the meeting and nominations for committee positions.
5. Unless otherwise provided for in this order, the meeting must be called and held in accordance with the Act and the Standard Module.
6. The administrator's fees and outgoings for this appointment must be met by the body corporate as per the administrator's agreement proposed under cover of letter dated 17 April 2025.
7. The administrator is entitled to have possession and control of all body corporate records and documents, and access to any financial institution account in which body corporate funds are held, for the duration of their appointment.

• [1] This application concerns the administration of the body corporate.
• [2] Hampton Industrial Court is a small community titles scheme comprising 4 lots. The applicant alleges the body corporate has failed substantively to comply with its statutory obligations and seeks that an administrator be appointed for the scheme.[1]
• [3] This is a matter that may be resolved by an adjudicator within the Act's dispute resolution provisions. As an adjudicator, I may make an order that is just and equitable in the circumstances to resolve a dispute about claimed contraventions of the Act, including where appropriate, ordering the appointment of an administrator.[2]
• [4] The applicant seeks orders to the following effect:
  1. A declaration that -
     1. There is no valid committee of the body corporate;
     2. There was no valid annual general meeting (AGM) of the body corporate held for the 2024-2025 financial year;
     3. There are no valid contributions levied on owners for the 2024-2025 financial year;
     4. There was no valid decision of the body corporate to issue Magistrate Court proceedings M3889/25; and
     5. There was no valid decision of the body corporate to engage Grace Lawyers to act for the body corporate.

b. In the event that it is declared that there is no valid committee, an order that Christine Kolenc (the Administrator) be appointed as administrator of Hampton Industrial Court CTS 6270 until a committee is elected or appointed for the scheme.[3]

c. An order that Travis West hand over all the books and records of the body corporate as well as all of the body corporate's property including body corporate funds in his possession or control (including but not limited to the funds in bank account BCB 084004 Account 047831565) to the Administrator.

• [5] In determining this application, I will consider each of the claimed contraventions, and whether the circumstances warrant the appointment of an administrator. If so, I will consider the extent of the powers that the administrator should be given.

• [6] In relation to the constitution of a valid committee, the applicant says:
  1. Since it acquired its lot in 2021, the body corporate has not held an AGM;
  2. The applicant has never received any formal notice of general meetings, including the opportunity to nominate for the committee;
  3. Mr Travis West has represented himself as the body corporate chairperson despite the fact there have been no committee elections and no appointment of Mr West as the chairperson;
  4. There is no secretary, treasurer, other committee members, or any elected committee.
• [7] The body corporate does not refute these claims.
• [8] An email from Mr West to all owners on 11 May 2025 appears to indicate that the proposal to appoint an administrator to hold an AGM and formally elect a committee has been agreed by all owners.
• [9] Section 7 of the Standard Module requires there to be a committee for the body corporate unless the body corporate engages a body corporate manager under Part 5 to carry out the functions of the committee. There is no suggestion that there is a Part 5 body corporate management engagement.
• [10] Section 13(1) of the Standard Module provides that the members of the committee must be chosen at each AGM. I accept the applicant's submission that, at least since it became an owner, there has been no AGM held nor any election of a committee.
• [11] In the circumstances, I am satisfied there is no valid committee for the body corporate.

Was a valid AGM held for the 2024-2025 financial year?

• [12] Section 83 of the Standard Module requires that an AGM be called and held within 3 months after the end of each of the scheme's financial years.
• [13] The applicant says the only meeting it has been given notice of was the meeting held on 15 October 2024, however there was no agenda proposing motions to be considered. The 'notes' from the meeting show decisions were made in relation to works that needed to be done at the scheme. There is no indication the meeting was in any way an AGM for the purposes of the Act that included the setting of budgets, contributions, or the election of a committee.
• [14] The body corporate does not assert that an AGM has been held.
• [15] I am satisfied there has not been a valid AGM held for the body corporate's 2024-2025 financial year.

Were valid contributions levied on owners for the 2024-2025 financial year?

• [16] Section 160(1) of the Standard Module provides that a body corporate must, by ordinary resolution, adopt an administration fund budget and a sinking fund budget for each financial year. Section 162(1)(a) provides that the body corporate must, by ordinary resolution fix, on the basis of its budgets, the contributions to be levied on each lot for the financial year.
• [17] The applicant says the body corporate has not adopted any budgets since it has been an owner there. Rather, it submits that Mr West simply gives notice to owners of the amounts that he determines should be paid as levies and issues invoices accordingly. The applicant has provided a copy of the relevant invoices and says the amounts invoiced were never subject of any ordinary resolution passed at any general meeting.
• [18] An invoice issued on 15 May 2024 relates to body corporate fees for the 2024/25 financial year. The amount payable was set at $2,275 per lot. Costs for the body corporate were estimated at $9,100, made up of:
  • Insurance $6,600
  • Electricity $600
  • Gardening $1,400
  • General $500
• [19] Another invoice was then issued on 24 June 2024 for an additional quarterly levy of $1500 with a stated purpose of covering the increased insurance costs and to build on existing body corporate funds.
• [20] While the majority of owners may have been agreeable with these contributions, the legislation requires the contributions to be approved by ordinary resolution and to be based on the adopted budgets. There is no evidence of any budget having been adopted at an AGM, nor any contributions fixed on that basis. Accordingly, I am satisfied the contributions levied for the 2024-2025 financial year were not struck in accordance with the legislation.

Was there a valid body corporate decision to engage Grace Lawyers to act for the body corporate and to issue Magistrate Court Proceedings M3889/25?

• [21] The applicant says it requested Mr West to provide the minutes of all supporting documentation regarding the appointment of Grace Lawyers and the commencement of the Magistrates Court matter.[4] It asserts that the reason the body corporate has failed to produce these documents is because the relevant minutes and records of valid body corporate resolutions do not exist. Additionally, the applicant says that in issuing Magistrates Court proceedings and engaging Grace Lawyers, the body corporate exceeded the relevant limit for committee spending, which, at $200 per lot is $800 for the scheme. The applicant argues that the costs claimed on the proceedings for legal and filing costs are $1,494.09 such that even if there was a valid committee, the cost to carry out the proposal was above the spending limit and was therefore ultra vires pursuant to section 172(1) of the Standard Module.
• [22] The body corporate has not responded specifically to these assertions.
• [23] Given my finding that there is no valid committee for the body corporate, and there being no record of any general meeting resolutions, I am of the view that the engagement of Grace Lawyers and the issuing of Magistrates Court proceedings have not been properly authorised by the body corporate. The body corporate may wish to consider ratifying these decisions at the next available general meeting.
• [24] I will now turn to whether an administrator is warranted.

• [25] The applicant submits that the body corporate is so dysfunctional that it cannot operate properly within the statutory framework and that it is necessary to appoint an administrator. Specifically, it says as there is no validly constituted committee there is accordingly no valid way now for the body corporate to call a general meeting other than through the appointment of an administrator. The applicant wants the administrator to be given all the powers and obligations of the body corporate necessary to:

a. Prepare and adopt budgets for each financial year, commencing from the 2024-2025 financial year;

b. Decide to engage a person to do work the administrator considers necessary to assist the Administrator prepare a budget for a financial year that complies with section 160 of the Standard Module;

c. Fix a contribution to be levied on lot owners under section 162 of the Standard Module;

d. Fix a discount and/or a penalty under section 164 of the Standard Module;

e. Call and conduct an AGM for the 2024-2025 financial year, giving owners notice to submit motions and nominations for committee membership;

f. Meet the body corporate's maintenance, insurance, by-law enforcement, and all other statutory obligations until a committee is appointed.

• [26] The applicant has proposed that Ms Christine Kolenc be appointed as the administrator. Ms Kolenc has consented to the appointment on the terms set out in the agreement as attached to the application.
• [27] The body corporate submits that the scheme is not so dysfunctional that an administrator is required. Rather, it suggests the contrary is true in that the body corporate has:
  1. met expenses as they arise;
  2. taken out proper insurance policies; and
  3. maintained common property.
• [28] In the event that an administrator is appointed, the body corporate submits that the powers and duration of such an appointment should be relevant to the level of functionality of the body corporate. It says the powers proposed by the applicant are unnecessarily broad and disproportionate to the circumstances of the scheme. The body corporate says the administrator would only be required for a short period with the focus being the calling of a general meeting to elect a committee and engage a body corporate manager, after which the body corporate can fix budgets, determine contributions and do all other things under the guidance of the body corporate manager. I note in particular the body corporate submits that the agenda of the ordered general meeting must include a motion for the appointment of BC Systems (in terms of the proposed administration agreement) to assist the committee in ensuring that the body corporate meets the statutory requirements.

• [29] The legislation authorises an adjudicator to appoint an administrator to perform the obligations of the body corporate, the committee, or a committee member.[5] The term of the appointment and the scope of the administrator's authority and powers are determined by the order.[6]
• [30] It is common for adjudicators to appoint an administrator on a short-term basis to conduct a general meeting where a body corporate has ceased to hold (or has never held) an AGM, or there is no longer a valid committee that is able to call a general meeting. In such circumstances, an administrator is required to convene a general meeting to put the body corporate back on a proper legal footing. Normally, 3 months is considered sufficient for this purpose.
• [31] In some circumstances, administrators can be appointed for a longer period to perform the functions of the body corporate or its committee. However, such appointments are rare. One of the objects under the Act is to balance the rights of individuals with the responsibility for self-management as an inherent aspect of community titles schemes.[7] The appointment of an administrator effectively removes from owners the power to manage the day to day affairs of the scheme and vests that power in the administrator. This is not a step adjudicators take lightly. An applicant would typically need to show that the administration of the body corporate has broken down irretrievably or is in significant disarray for such an appointment to be considered.[8] Furthermore, longer term appointments can have a significant cost impact on the body corporate.
• [32] In this case, given my earlier findings, it is clear that the body corporate is not currently functioning in accordance with the legislation. There being no valid committee, there is no-one authorised to convene a meeting. In the circumstances, I consider it necessary for an administrator to be appointed for the purpose of calling and conducting a general meeting which will be deemed the AGM for the 2024-2025 financial year. At this meeting, the body corporate can:
  1. adopt administrative and sinking fund budgets;
  2. fix levy contributions;
  3. elect a committee; and
  4. consider any other motions submitted by owners.
• [33] I note the body corporate says the meeting should be confined to electing a committee and engaging a body corporate manager, however I see no reason why the agenda should not also include the setting of budgets and levy contributions as required by the legislation. These are statutory motions that the body corporate must consider at each AGM.[9] They should not be delayed any further. Following the meeting, the elected committee can then propose future budgets and levies and do all other matters it considers necessary for the proper function of the body corporate. In regard to the engagement of a body corporate manager, this is a matter for owners to decide at the meeting, noting that a body corporate does not have to engage a body corporate manager. The committee may perform the administrative functions itself. If an owner wishes to propose the engagement of a body corporate manager, they may submit a relevant motion for inclusion on the agenda. I will not order that the agenda must contain such a motion.
• [34] I do not consider the circumstances of the scheme warrant the appointment of an administrator with broader powers or for a longer period beyond convening an AGM. While the body corporate has not been functioning strictly in accordance with the legislation, it appears to me that the owners including those purporting to represent the committee, have acted in good faith. There is no indication that the body corporate is so dysfunctional that it will not be able to operate properly within the statutory framework so as to warrant a longer term appointment. Here I reiterate the words of the adjudicator in Lochaber Mews:[10]

The appointment of an administrator is not warranted simply because of a view that owners do not have sufficient knowledge or expertise about the body corporate legislation or other matters to manage the scheme themselves, or do not want to spend the time or effort organising matters themselves. If owners require this sort of information or assistance they can choose to engage a Body Corporate Manager or individual owners can seek legal or other advice from a range of sources. The appointment of an administrator should only be contemplated when there is no alternative.

• [35] Finally, the applicant also seeks an order that Travis West hand over all the books and records, and body corporate funds in his control. The administrator will of course need access to this material to prepare for the AGM and to perform her duties. I have included an order to this effect. After the AGM, the administrator can pass the records onto whoever is appointed as secretary at the AGM.

• [36] I note that the body corporate has no objection to the administrator proposed by the applicant. In the circumstances, I am satisfied it is appropriate to appoint Ms Christine Kolenc for a period of up to 3 months to convene an AGM. I have also made ancillary orders to facilitate that appointment.

[1] The applicant also initially sought interim orders which I dismissed on 2 May 2025 in Hampton Industrial Court [2025] QBCCMCmr 143

[3] The applicant has requested that the administrator be given a broad range of powers which I will detail in the discussion below.

[4] For a background to the Magistrates Court matter, see my interim decision in Hampton Industrial Court [2025] QBCCMCmr 143

[5] See section 278 and Item 23 of Schedule 5 of the Act

[8] Lochaber Mews [2017] QBCCMCmr 123

[9] See definition of 'statutory motion' in Schedule 1 of the Standard Module