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[2020] ACAT 75
ACT Civil and Administrative Tribunal
2020-09-23
Member Orr
Original judgment source is linked above.
22. Special privileges relating to common property
_(1) An owners corporation for a units plan may, if authorised by an unopposed resolution, grant a special privilege, other than a sublease, for the enjoyment of the common property, or any part of the common property, to - _
(2) A grant under subsection (1) may be terminated, in accordance with a special resolution, by written notice given by the owners corporation to the person to whom the grant was made.
_The requirements for passing an unopposed resolution at a general meeting are that - _
(a) no votes are cast against the resolution; and
(b) at least 1 vote is cast in favour of the resolution.
(g) an order giving effect to an unsuccessful motion for a resolution of a general meeting (either as originally proposed or as amended by the ACAT) if the ACAT is satisfied after a merits review of the motion that opposition to the motion was unreasonable;
(a) the applicant's application dated 29 May 2020, with attached submission;
(d) an amended version of the respondent's response signed 22 June 2020;
(e) an image filed by the applicant on 28 June 2020;
(g) a handout provided to members at the AGM by the applicant.
The owners of units 3 and 7 appear to be experiencing difficulty in obtaining access to their garage from the road through the complex as the access road appears to be too narrow. Your assistance in widening the driveways to these two units would be appreciated, as the owners feel that sufficient width should have been allowed in the first instance.
The access road to Unit 3 was in place at the time of purchase of the Unit. It is wide enough to service one Unit but if the owner wishes to widen it and the other members agree then the costs should be borne by the owner and not the Body Corporate.
Unit owners at a general meeting are free to vote on motions however they see fit. They are equivalent to shareholders of a corporation, or voters in a democracy. However, the power in section 129(1)(g) of the UTM Act allows unreasonable votes in relation to unit titles management to be overridden. In my view, the concept of unreasonable means objectively unreasonable in the particular context.
In Ainsworth the High Court considered this type of provision in the context of proposed construction by Mr Albrecht on common property airspace between two balconies to a unit owned by him, but opposed by Mr Ainsworth and other unit owners, and stated at that it:
...is no light thing to conclude that opposition by a lot owner to a resolution is unreasonable where adoption of the resolution will have the effect of appropriating part of the common property to the exclusive use of the owner of another lot, for no return to the body corporate or the other lot owners; ... and potentially creating a risk of interference with the tranquillity or privacy of an objecting lot owner.
The judgment at [57] noted that nothing in the relevant legislative scheme suggested that an opponent to a proposal acts unreasonably in failing to act sympathetically or altruistically towards a proponent who seeks to diminish the property rights of the opponent.
However, the High Court stated that while it was neither necessary nor desirable to attempt an exhaustive statement of when an order should be made, that "... opposition to a proposal that could not, on any rational view, adversely affect the material enjoyment of an opponent's property rights may be seen to be unreasonable ". Similarly, it noted that opposition "prompted by spite, or ill-will, or a desire for attention, may be seen to be unreasonable in all the circumstances". In the case before the Court the proposal "was apt to create a reasonable apprehension that it would affect adversely the property rights of opponents of the proposal and the enjoyment of those rights." The opposition could not therefore be said to be unreasonable.
The Tribunal must focus upon whether the opposition of the other unit owners to the motion was unreasonable, not upon whether the owners corporation acted reasonably in refusing to give approval or the reasonableness of the motion. Nor is it for the Tribunal to achieve what it thinks is a reasonable balance between competing viewpoints.
Opposition must be based on a factor or factors that adversely affect the interests of other unit owners in their use and enjoyment of their units, or in the common property as occurred in Ainsworth.[6]
The Tribunal agrees that the detriments are disproportionate; the current adverse effects on Mr Clews are greater than the adverse effects on the objectors if the lease purpose is expanded. But I do not think that such a balancing exercise is involved here. The question is whether the objections are reasonable, not whether they are fair or proportionate.
[1] Minutes of annual general meeting 2020 page 3
[2] Response filed by respondent 19 June 2020 page 16
[3] Response filed by respondent 19 June 2020 page 17
[4] Bonansea v The Owners - Unit Plant No 421 at [21]
LLOYD
THE OWNERS CORPORATION UNITS PLAN 527
Legislation cited: Unit Titles Management Act 2011 ss 22, 129
Cases cited: Ainsworth v Albrecht [2016] HCA 40
Bonansea v the Owners - Unit Plan No 421 [2019] ACAT 10
Clews v the Owners - Unit Plan 3069 [2019] ACAT 63