Sattel & Ors v Proprietors Be-Bees Tropical Apartments [2000] QCA 496

[1] THE COURT: The appellant purported to institute an appeal against a judgment of Jones J which appeal was, after outlines had been delivered, set down for hearing on 29 November 2000. On 28 November the respondents to the appeal filed an application for an order that the appeal be struck out or dismissed on the ground that, it was said, the appellant had failed to "comply with s 259 of the Body Corporate and Community Management Act 1997". We granted that application, dismissing the appeal, and reserved our reasons.

[2] The respondents, Messrs Sattel and others, instituted an action in the Supreme Court in which they sought declarations relating to a caretaking agreement as well as damages for breach of contract and other relief. The appellant was sued as a body corporate constituted under the provisions of the Building Units and Group Titles Act 1980. The complaint the respondents made against it was that it had wrongfully repudiated certain agreements said to have been made between the appellant and the respondents. During the hearing of that action the learned trial judge decided that, for reasons which need not be explained here, it would be convenient to deal with the action only in so far as certain declaratory relief was sought, leaving any question of damages to be determined in the District Court; the action then proceeded to judgment on that basis.

[3] Jones J declared that, with certain exceptions, one of the agreements mentioned in the pleadings was valid and enforceable and declared that it had been terminated by the respondents' acceptance of the appellant's repudiation of the agreement. His Honour remitted the case to the District Court at Cairns for assessment of damages, by which was meant assessment of any damages that might have been suffered by the respondents.

[4] By its notice of appeal the appellant sought an order that the action be dismissed. The point the respondents, for whom Mr Carrigan appeared, raised against the competency of the appellant's proceedings depends on the interpretation of s 259(1) of the Body Corporate and Community Management Act 1997. The appellant did not come into existence under that Act, but under its predecessor, the Building Units and Group Titles Act 1980. The 1997 Act contains provisions having the effect of bringing existing bodies corporate under that Act. The substantive provisions of the 1997 Act came into force on 13 July 1997. Sections 275 and 276, which we do not here quote, have the effect that on that date a "community titles scheme" being a "basic scheme" was established for the relevant plan, which was registered under the 1980 Act. The expression "basic scheme" is in effect defined by s 11(5) of the 1997 Act, but it is not necessary to explain its content. The critical provision is s 259 of the 1997 Act, which reads as follows:

"(1) The body corporate for a community titles scheme may start a proceeding only if the proceeding is authorised by special resolution of the body corporate.

(2) However, the body corporate does not need a special resolution to -

(a) bring a proceeding for the recovery of a liquidated debt against the owner of a lot included in the scheme; or

(b) bring a counterclaim, third-party proceeding or other proceeding, in a proceeding to which the body corporate is already a party; or

(d) start a proceeding for an offence under chapter 3, part 5, division 4".

[5] It is accepted that there was no relevant special resolution. Section 92 of the 1997 Act reads in part as follows:

"(1) A decision of the committee is a decision of the body corporate.

(2) Subsection (1) does not apply to a decision that, under the regulation module, is a decision on a restricted issue for the committee".

The regulation module is a document entitled "Body Corporate and Community Management (Standard Module) Regulation 1997"; see s 22(1) of the 1997 Act and reg 3(1) of the 1997 Regulation. Counsel for the appellant relied to some extent upon reg 26 of the 1997 Regulation which says, among other things, that:

"A decision is a decision on a restricted issue for the committee if it is a decision -

(i) a proceeding to recover a liquidated debt against the owner of a lot; or

(ii) a counterclaim, third party proceeding or other proceeding in relation to a proceeding to which the body corporate is already a party ...".

[6] It will be noticed that reg 26 just quoted may not harmonise well with the terms of s 259(2) of the 1997 Act, in that the latter includes pars (c) and (d) which are not to be found in reg 26(e); although counsel for the appellant sought to gain some advantage from this lack of conformity, it does not appear to have much if any bearing on the central issue. That is whether the need for a special resolution did not arise, because the institution of the appeal falls within the description "other proceeding, in a proceeding to which the body corporate is already a party" in s 259(2)(b). It was argued for the appellant that the appeal against Jones J's judgment is a proceeding in the same proceeding as was before Jones J, the latter being one to which the body corporate was already a party.

[7] In making this contention, counsel for the appellant conceded that the judgment of Jones J was final and not interlocutory; the point is not absolutely clear: Hall v Busst [1960] HCA 84; (1960) 104 CLR 206 and Computer Edge Pty Ltd v Apple Computer Inc [1984] HCA 47; (1984) 54 ALR 767. The judgment of Jones J was final at least in the sense that his Honour finally disposed of the case so far as the Supreme Court was concerned; further proceedings, if there were to be any, had to be taken in another court. It was argued for the appellant that if we upheld the respondents' objection, that would imply the necessity for obtaining a special resolution as authority to institute an appeal from any interlocutory order. That does not appear to be so; to hold that an appeal against an order finally determining the only issues falling for determination in this Court is not a proceeding "in" the proceeding before the primary judge does not commit one to holding that no appeals on procedural points arising in the trial may be instituted unless authorised by special resolution.

[8] A rather similar point arose in General Accident Fire and Life Assurance Corporation Ltd v Foster [1972] 3 All E R 877, which was decided on the basis that an interlocutory appeal to the Court of Appeal was "clearly a separate proceeding for the purpose of considering the effect of" a certain statutory provision: see p 881e-f. The alternative view was that the appeal was merely part of the proceedings at first instance. Since the point went by concession, the authority is of no great weight here. More assistance is to be obtained by attention to the words of s 259(2) of the 1997 Act. The expression "counterclaim, third party proceeding or other proceeding, in a proceeding", when the latter proceeding is an action at first instance, would not bring to mind an appeal against a judgment in the action, particularly one of the present character which disposes finally (subject to the possibility of an appeal) of the only substantive issue before the Court for determination. The mention of a counterclaim and a third party proceeding is rather against the appellant's contention; and one would not describe an appeal to a higher court, attacking the result of a judgment delivered at first instance, as being one "in" the original proceeding. Also the exclusion by par (c) of an appeal against an adjudicator's order does not help the appellant; the assumption on which par (c) is based is that such an appeal would not be within par (b).

[9] The Queensland Court of Appeal was, as was pointed out during the hearing, established as a division of the Supreme Court of Queensland: see s 16 of the Supreme Court of Queensland Act 1991. But the same Act treats the Court of Appeal as a distinct institution: see in particular Pt 3 of the Act. In our opinion the institution of the appeal was beyond the appellant's power.

[10] It was suggested on behalf of the appellant that, if we took this view, the appeal should be adjourned so that, if so advised, the appellant could attempt to obtain a special resolution ratifying what was done. It appears to us that, where a party having no right to do so purports to begin an appeal in this Court, on the deficiency being brought to the Court's attention the appeal would ordinarily be dismissed or struck out. The circumstances of the present case, so far as they appear from the record, do not suggest that this is a case where justice requires that any other course be followed.

[11] The foregoing are the reasons, which we undertook to give, for the order made dismissing the appeal. We reserved the question of costs. The respondents, had they considered the matter, must have known or believed that there was no special resolution authorising the appeal, for they are themselves the owners of a lot. It appears, however, that the appellant's difficulty did not occur to the respondents' legal advisers until very recently and the point was notified to this opponent only the day before the hearing. Had the matter been drawn to the appellant's attention earlier, perhaps there could have been a considerable saving of time and effort in preparing outlines of argument and preparing for oral argument, on the substantive issues. On the other hand, it was the appellant which wrongly instituted the appeal.

[12] In our view the appellant should have a partial order for costs. The appeal has, as we have mentioned already, been dismissed. We would order in addition that the appellant pay half of the respondents' costs of and incidental to the appeal, to be assessed.