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

ANNUAL GENERAL MEETING - whether annual general meeting is invalid if held out of time.

Standard Module, s 83

1. The next annual general meeting for Sunny Ridge Gardens CTS 19295 will not be invalid solely because it is held more than 3 months after the end of the body corporate's financial year.

• [1] This is an application brought by the body corporate seeking a declaratory order that the annual general meeting (AGM) for Sunny Ridge Gardens will not be void despite being held out of time.
• [2] An adjudicator may make an order, including a declaratory order, that is just and equitable in the circumstances to resolve a dispute, about a claimed or anticipated contravention of the Act or the community management statement (CMS), or the exercise of rights or powers or performance of duties under the Act or the CMS.[1] An application for a declaratory order about the operation of the Act is also a 'dispute' even if there is no respondent or affected person for the application.[2]
• [3] I am satisfied that this matter falls within the legislative dispute resolution provisions.

• [4] In submitting this application, the body corporate has provided the following background.
• [5] The body corporate currently has a dispute with the Retirement Village Operator (RV Operator) in QCAT. The RV Operator is apparently operating on a 100 year agreement entered into at the establishment of the scheme. The agreement provides that the RV Operator is authorised to hold the powers of the caretaker, committee and body corporate manager. In 2023, the body corporate says it terminated the agreement and since then, the matter has been with QCAT for determination. An interim decision was made on 28 November 2023 in which QCAT ordered, amongst other things, that until the application is determined:
  1. the body corporate is restrained from terminating the agreement;
  2. the RV Operator is excused and restrained from performing the functions of a body corporate manager, caretaker, and committee under the agreement;
  3. the body corporate may delegate the functions of a body corporate manager to The Community Co.
• [6] A hearing with QCAT has now been scheduled to take place between 20-24 November 2025.
• [7] The body corporate says the AGM needs to be delayed until after the determination of the QCAT matter. In particular, the body corporate says an owner has submitted 2 motions to the AGM that would be required to be ruled out of order as they would conflict with QCAT's interim decision. The 2 motions propose that:
  1. the body corporate does not renew the appointment of The Community Co. following the completion of its contract on 30 November 2025; and
  2. SRG Management Services Pty Ltd (the RV Operator) be appointed to investigate the reinstatement of a body corporate fountain.
• [8] The body corporate says delaying the AGM until after QCAT has determined the matter will allow owners to consider these motions without conflicting with the current interim orders. Further, the body corporate says QCAT's final decision will have implications on the budget for the financial year, that is, whether the caretaker will continue under the current agreement, or whether the agreement will be terminated in which case a new caretaking agreement will be considered and budgeted for.
• [9] At lodgement of this application, the body corporate advised that the AGM is tentatively scheduled for 26 November 2025, pending the QCAT matter. However, the body corporate has since advised that as the QCAT member is likely to reserve their verdict after the hearing, it is likely that a decision may not be available for some weeks. On this basis, the body corporate requests that an "open ended decision" be made as to when the AGM is to be held, pending QCAT's determination.

• [10] Section 83 of the Standard Module requires an AGM to be called and held within 3 months after the end of the scheme's financial year. This time limit exists for several reasons, including ensuring regular accountability and enabling owners to make decisions about the operation of the scheme.
• [11] The body corporate advises that the end of financial year for Sunny Ridge Gardens is 31 July. This means their AGM must be held on or before 31 October each year.
• [12] The body corporate seeks to delay the AGM for 2 reasons. Firstly, it says there are owners' motions that have been submitted to the AGM which, if passed, would conflict with QCAT's interim order.
• [13] Section 98 of the Standard Module provides that the person chairing a general meeting must rule a motion out of order if, the motion, if carried, would -

(i) conflict with the Act, the regulation module, the by-laws or a motion already voted on at the meeting; or

(ii) be unlawful or unenforceable for another reason.

• [14] Presumably, the body corporate believes the motions, if carried, would be unlawful or unenforceable and therefore must be ruled out of order. However, it is unclear to me why the AGM should be delayed for this reason, or what detriment or inconvenience would be suffered if the motions are ruled out of order. If, following QCAT's decision, the motions remain relevant, the owner can submit them (or an amended version of them) for consideration at a subsequent general meeting.
• [15] I understand that the outcome of the QCAT matter will also have implications on the budget depending on whether the existing agreement is terminated. Rather than delaying the AGM, if the agreement is terminated, the committee could convene an extraordinary general meeting at which it may consider the engagement of a new caretaker, and at the same time, raise a special contribution to cover the cost of the new engagement if no provision has been made for it in the budget.[3] At this meeting, the body corporate could also consider owners' motions that were unable to be considered at the AGM.
• [16] There is no other reason given for delaying the AGM. It may be that the body corporate wants to avoid the expense and inconvenience of holding another general meeting following QCAT's decision. Given the uncertainty of how much longer QCAT's decision may take, I question this approach.
• [17] Having said that, an AGM held outside the prescribed time limit is not automatically invalid. To challenge the validity of an AGM, an aggrieved party would need to lodge an application and an adjudicator would need to make a finding, and order that the AGM is invalid. Moreover, the courts have said that insubstantial procedural irregularities (like the late calling of an AGM) should not imperil the actions of bodies corporate or their committees where they are taken in good faith.[4] Accordingly, adjudicators have consistently accepted that an AGM will not be invalid simply because it is not held within the legislative timeframe.
• [18] I note that by the date of making this order, the timeframe for holding the AGM has already passed. In the circumstances, I am prepared to order that the AGM will not be invalid simply because it is held out of time.
• [19] The effect of this order is not to give the body corporate an 'open-ended' period within which to hold the AGM, pending the QCAT matter. I am not permitting the body corporate to hold the AGM late, nor am I extending the statutory timeframe within which the AGM must be held. The order also does not prevent an aggrieved party from making an application for the AGM to be declared invalid on some other legal basis, or for the AGM to be held sooner. It is simply a declaration restating the legal reality that the meeting will not be invalid solely because it will be held outside the legislative timeframe. To be frank, the declaration is rather pointless.
• [20] Notwithstanding this order, the body corporate should still act promptly to hold its AGM as soon as possible. Given the uncertainty as to when the QCAT matter will be finalised, it may be that the AGM will need to proceed first and if necessary, the committee can call an extraordinary general meeting following QCAT's decision to deal with other matters.

[2] Section 227(2) of the Act

[3] See sections 135 & 162 of the Standard Module

[4] See Carroll and Ors v Body Corporate for Palm Springs Residences CTS 29467 [2013] QCATA 21 and Wei-Xin Chen v Body Corporate for Wishart Village CTS 19482 (Unreported, District Court of Queensland, Appeal 4080/2000, Bolton J, 29 May 2001)