The Owners - Strata Plan No. 12289 v Donaldson

The Proceedings Below

1. The respondents commenced proceedings against the appellant in the Tribunal. In short, they sought: 1. an order that the Tribunal prescribe a change to the by-laws to enable the construction of the proposed works pursuant to s 149 of the Strata Schemes Management Act 2015 (NSW) (the "SSMA"); 2. an order that the appellant consent to the making of a development application in relation to the proposed works pursuant to s 232 of the SSMA; and 3. certain consequential orders.
2. For the purposes of the proceedings below, the parties sensibly agreed a number of facts. Included in those facts were the appellant's reasons for refusing the respondents' applications for a common property rights by-law. Eleven reasons were given. They were set out by a Mr Blair in his affidavit which was read in the proceedings.
3. After hearing the evidence and submissions, the Tribunal found that the appellant had unreasonably refused to make the by-law sought by the respondents and made an order that that by-law be made and registered. The Tribunal also ordered the appellant to consent to the proposed development application.
4. The appellant appeals from that decision of the Tribunal.
5. Sadly, the first respondent passed away on 10 December 2018. We were informed that he and his wife, the second respondent, owned Lot 5 as joint tenants. Hence, on his passing, the first respondent's interest in Lot 5 passed to the second respondent and is not an asset of the deceased estate. Thus, the second respondent is the sole remaining interested party to the proceedings. As there may be other consequences, including as to costs, the first respondent's estate should be substituted for the first respondent.
6. For the reasons that follow we are of the opinion that the appeal should be dismissed.

Amended Grounds of Appeal

1. The appellant sought leave to amend its Notice of Appeal. The respondents neither consented nor opposed that application.
2. It is appropriate to grant the leave sought by the appellant to proceed on the Amended Notice of Appeal (containing Amended Grounds of Appeal date stamped by the Tribunal's Registry as having been received on 7 June 2019) in order to facilitate the just, quick and cheap resolution of the real issues in dispute between the parties.
3. Ground 11 asserted a lack of jurisdiction in the Tribunal to hear the dispute. It is appropriate to consider that Ground first, followed by the remaining grounds.

Jurisdiction - Ground 11

1. On the appeal, but not before the Tribunal below, the appellant argued that the Tribunal lacked jurisdiction to hear the proceedings because the respondents were resident in Queensland (a fact conceded by the respondents), the appellant was "resident" in NSW [within the meaning of that term in s 75(iv) of the Commonwealth Constitution], and according to the holdings in Burns v Corbett [2018] HCA 15; (2018) 353 ALR 386 and Attorney General for NSW v Gatsby [2018] NSWCA 254; (2018) 361 ALR 570, the Tribunal lacked jurisdiction to hear the proceedings.
2. In short, the combined holdings of those cases is to the effect that the Tribunal has no jurisdiction to hear disputes between "residents" of different states.
3. The Tribunal cannot make a finding as to the scope of its jurisdiction insofar as it relates to federal jurisdiction. Leeming JA in Attorney General for New South Wales v Gatsby [2018] NSWCA 254 at [281] stated the position as follows: "Only a superior court can pronounce authoritatively on the limits of its own jurisdiction. At best, all that NCAT could do was to form and express an opinion, in accordance with what Brennan J had said, sitting as President of the Administrative Appeals Tribunal, in Re Adams and the Tax Agents' Board (1976) 12 ALR 239 at 242: 'An administrative body with limited authority is bound, of course, to observe those limits. Although it cannot judicially pronounce upon the limits, its duty not to exceed the authority conferred by law upon it implies a competence to consider the legal limits of that authority, in order that it may appropriately mould its conduct. In discharging its duty, the administrative body will, as part of its function, form an opinion as to the limits of its own authority. The function of forming such an opinion for the purpose of moulding its conduct is not denied to it merely because the opinion produces no legal effect.'"
4. In order to determine the appeal before us, we express the following opinion as to whether this dispute comes within the Tribunal's jurisdiction. We do not purport to determine the matter conclusively.
5. Although the point was not taken below it should be considered by us as it concerns jurisdiction. We note that, other than in relation to this point, the parties otherwise accepted that the Tribunal had jurisdiction to hear the proceedings and we perceive no other jurisdictional impediment.
6. The essential submission advanced by the appellant on this point of jurisdiction is that the appellant is a "resident" of NSW within the meaning of that term in s 75(iv) of the Constitution. If that submission is accepted, and given the respondents are residents of Queensland, it would follow that the Tribunal would not have jurisdiction to entertain the proceedings.
7. We do not agree with the appellant's submission that the appellant is a "resident" of NSW.
8. In The Australasian Temperance and General Mutual Life Assurance Society Ltd v Howe [1922] 31 CLR 290 the majority (Knox CJ, Higgins and Gavan Duffy JJ) held that the terms "resident" and "residents" in s 75(iv) of the Constitution refer to natural persons only and not to artificial persons or corporations.
9. The appellant argues that the majority's reasoning process in that case, in arriving at the holding referred to above, if applied to an owners corporation, brought into existence pursuant to the terms of the SSMA, should result in a holding that such an owners corporation is a resident for the purposes of s 75(iv) of the Constitution.
10. In advancing this submission the appellant makes the point that an owners corporation is not the same as a corporation incorporated pursuant to the terms of the Corporations Act 2001 (Cth). Indeed, owners corporations incorporated pursuant to the provisions of the SSMA are expressly declared by s 8(2) of the SSMA to be "excluded matter(s)" for the purposes of s 5F of the Corporations Act 2001 (Cth). Section 5F says that the Corporations Act does not apply to "excluded matter(s)".
11. The appellant's submission overlooks that the holding in Howe was that "resident" in s 75(iv) refers only to natural persons and does not include artificial persons of any kind. The holding is not a more limited one, namely that a corporation incorporated in Victoria and registered under the Companies Statute 1864 (Vic) (as was the plaintiff in Howe) was not a "resident" for the purposes of s 75(iv), although that was a necessary consequential finding. If the holding was the latter, it might be open to the appellant to argue a corporation incorporated under a different statute and having different characteristics to the one in Howe could be a "resident", but that more limited holding was not what the High Court decided.
12. In Crouch v Commissioner for Railways (Qld) (1985) 159 CLR 22 the plaintiff sought to distinguish Howe, just as the appellant seeks to distinguish it here (albeit on a different factual basis).
13. In that case the plaintiff argued that there was a difference between the type of corporation involved in Howe and the Commissioner for Railways [being a corporation pursuant to s 8(1) of the Railways Act 1914 (Qld)] just as the appellant submits here that an SSMA corporation (such as the appellant) is different from the corporation considered in Howe.
14. The High Court rejected that submission.
15. Gibbs CJ said: "The foundation of that decision was that the words "residents" and "resident" in s 75(iv) of the Constitution refer to natural persons only; they do not refer to corporations of any kind."
16. Mason, Wilson, Brennan, Deane and Dawson J said: "The basis of the decision in Howe is correctly stated in the headnote to the report (31 CLR at p 290): "the words 'residents' and 'resident' in s 75(iv) refer to natural persons only and not to artificial persons or corporations" (see per Knox CJ and Gavan Duffy J at pp 294ff and per Higgins J at pp 325ff)."
17. Those passages confirm our reading of Howe, namely that "resident" refers only to natural persons and does not include artificial persons of any kind.
18. We are, of course, bound by those cases.
19. It follows that, in our opinion, applying Howe, the appellant is not a "resident" within the meaning of that term in s 75(iv) of the Constitution. Accordingly, these proceedings do not involve "residents" of different states, and the Tribunal has jurisdiction to determine them.

Amended Grounds of Appeal

1. In summary, and as refined in oral argument, the appellant raised the following ten grounds of appeal in addition to the ground relating to jurisdiction: 1. The Tribunal applied the wrong legal test when deciding whether to make an order under s 149 of the SSMA. 2. The Tribunal erred in deciding whether it was relevant for the appellant to take into account whether the proposed works involved more or different encroachment on the car park area compared to the approved works, rather than deciding whether the respondents had demonstrated that it was unreasonable to do so. 3. The Tribunal failed to give a proper, genuine and realistic consideration to the material as to incursion and encroachment which was before the appellant. 4. The Tribunal erred in law in: 1. taking into account the expert opinion of Mr Munro when that opinion had not been before the appellant at its meeting in September 2017; 2. failed to take into account whether it was unreasonable for the appellant to refuse the application because the proposed works would further restrict the already tight area of the car park; and 3. failed to give proper, genuine and realistic consideration to the material that was before the appellant at its meeting. 1. The Tribunal failed to give proper, genuine and realistic consideration to material that showed that access for lot owners to the common laundry would be impeded after construction of the proposed works had been completed. 2. The Tribunal erroneously dismissed the appellant's concern about access to the laundry by balancing that concern against the benefit to the respondents when such a balancing is an impermissible approach. 3. The Tribunal erred by dismissing as irrelevant the safety concerns because the Tribunal failed to give proper, genuine and realistic consideration to the safety issues and material and no reasonable Tribunal could consider that safety was not a factor to take into account. 4. The Tribunal failed to address whether it was an unreasonable basis for refusal that the proposed works were different to the approved works. 5. The Tribunal erred in failing to find that part of the proposed works, being the lift, did not comply with regulations that governed the lift.
2. Ground 10 concerned the Tribunal's orders relating to the development application (or amended development application). For the reasons given later at [43] below, this ground need not be considered.
3. At times the appellant's submissions strayed beyond the grounds of appeal, but no application was made to further amend them, and so we have confined ourselves to the grounds as formulated.

The Tribunal's Reasons

1. The parties formulated the s 149 issues differently before the Tribunal. The Tribunal accepted the appellant's formulation which was (in summary): 1. What proposed works were put to and considered by the appellant? 2. What were the appellant's reasons for refusing the respondents' application for a common property rights by-law? 3. Was the appellant's decision to refuse that application unreasonable? 4. If it was unreasonable: 1. What were the interests of all owners in the use and enjoyment of their lots and common property? 2. What were the rights and reasonable expectations of any owner deriving or anticipating a benefit under the proposed common property rights by-law? 1. Having regard to the findings in relation to (4) above, whether the Tribunal should make an order pursuant to s 149(2) of the SSMA prescribing a change to the by-laws so as to include the proposed common property rights by-law?
2. As for the s 232 issues, the Tribunal discussed the various issues and the submissions made and decided that issue in favour of the respondents. On this appeal, each party conceded that the s 232 issue should follow the event of the s 149 issue. That is, if the appeal was dismissed, the orders of the Tribunal below should remain as made. If the appeal was upheld, the orders made in relation to s 232 should be set aside. In those circumstances we do not need to consider Tribunal's decision in relation to the s 232 matters.
3. The Tribunal's reasons, generally speaking, dealt with each of the s 149 issues in the order we have set out above. In order to properly address Ground 1 of the appeal, we need to briefly describe the structure of the Tribunal's reasons.
4. The Tribunal briefly descried the ambit of the first issue, followed by a brief description of the second issue.
5. On the third issue, whether the refusal was unreasonable, the Tribunal divided the eleven reasons into four categories, as suggested by the appellant below. The Tribunal then referred to the relevant test as described by Latham J in The Owners - Strata Plan No. 69140 v Drewe [2017] NSWSC 845 at [41] and [43].
6. The Tribunal then set out each of the four categories of reasons and summarised the parties' submissions in relation to each.
7. The Tribunal then turned to the fourth issue. The Tribunal recorded the ten reasons advanced by the respondents as to why the Tribunal should make the common property rights by-law pursuant to s 149(2) and recorded the parties' submissions in relation to each reason.
8. The Tribunal then set out the terms of ss 149 and 232 of the SSMA.
9. Then, under the heading "Consideration and Determination", the Tribunal set out its findings in relation to each of the five issues in order.
10. The first and second issues are not relevant to this appeal as no complaint is made about them. They require no further mention other than to say that the Tribunal set out its determination of each of those issues at the conclusion of each issue, namely at [77] and then [78]-[79] of its reasons respectively.
11. On the third issue, whether the appellant's refusal was unreasonable, the Tribunal set out the eleven reasons in a table at [81] of its reasons, and in the column to the right of each reason, set out the Tribunal's "Determination on 'unreasonable'" in relation to each issue, considered individually.
12. However, there is no paragraph in the reasons immediately following [81] which sets out the Tribunal's determination of the third issue. Rather, [82] of the reasons is the beginning of the Tribunal's findings on the fourth issue. Thus, on the face of the reasons, there is no conclusion or determination made by the Tribunal on this issue.
13. After an introductory paragraph (being [82]) the Tribunal set out in a table (at [83]) the ten reasons advocated for by the respondents, and, after summarising each reason, set out the Tribunal's consideration of each reason.
14. There then followed paragraphs [84] and [85] of the Tribunal's reasons. Those paragraphs said: "[84] In summary, I find that the factors in relation to the rights and reasonable expectations of the applicants in deriving a benefit from the proposed by-law strongly outweigh any restrictions or issues in relation to the interests of all lot owners in the use and enjoyment of their lots (including their car spaces) and the common property. [85] Not all of the items included in the table above are relevant, nor are all of them in favour of the (respondents), but considered together I find that they demonstrate the owners corporation unreasonably refused to make the proposed by-law and that it would be proper to exercise my discretion pursuant to s 149 of the Act."
15. The Tribunal then turned to the fifth issue, whether to make an order prescribing a change to the by-laws and considered that such an order should be made.
16. The Tribunal next turned to the s 232 issue and decided it in the respondents' favour for the reasons set out at [86] of the Tribunal's reasons.
17. Thus, on the face of the reasons, in that section of the Tribunal's reasons containing the Tribunal's decision on each issue, and at the conclusion of each individual issue with the exception of the third issue, there was a concluding paragraph stating the Tribunal's decision.

Ground 1

1. Ground 1 asserts that the Tribunal applied the incorrect legal test when deciding whether the appellant's refusal to consent to the proposed common property rights by-law was unreasonable. The appellant submits that the Tribunal applied what was called a "balancing test" (as evidenced by the contents of [84] of the Tribunal's reasons which are set out at [55] above) rather than the test posed by s 149(1) of the SSMA.
2. Amongst other authorities, the appellant relies upon a passage from Nettle J in Ainsworth v Albrecht [2016] HCA 40; (2016) 261 CLR 167 at [85]. In that passage his Honour said: "... The question was not a "balancing act". A balancing act might have assisted if the adjudicator had been asked whether it was just and equitable for the Body Corporate to pass the motion. But that was not the question. The question was whether it was shown to be unreasonable to oppose the motion. And as a consequence of that fundamental error of approach, the adjudicator failed to consider whether and why it was shown to be unreasonable for property owners, who had purchased their units knowing that the decks were intentionally designed with limited functionality, to insist that the deliberately limited functionality of the decks not be altered."
3. In our opinion the Tribunal did apply the correct test, although the Tribunal's determination is not found in [84] of the Tribunal's reasons as submitted by the appellant, but rather in [85].
4. In our opinion, [85] of the Tribunal's reasons down to and including the words "... the proposed by-law" contains the Tribunal's determination that the eleven reasons relevant to the third issue, considered collectively, satisfied the Tribunal that the appellant had unreasonably refused to make the proposed common property rights by-law.
5. Assuredly, that part of [85] should have appeared immediately after [81] and not where it does (following [84]). We infer there was a drafting error of some kind. But tolerably clearly enough the contents of [85] are referable to the third issue and not the fourth, even though [85] follows the determination of the fourth issue in [84].
6. Perhaps the drafting error was an error of a cutting and pasting variety. Perhaps the Tribunal member overlooked inserting the words "at [81]" in the opening line of [85] so that it read: "Not all of the items included in the table above at [81] are relevant ..."
7. Perhaps the Tribunal erroneously overlooked including a concluding paragraph to the findings on the third issue, and [85] was intended to wrap up the findings on both the third and fourth issues because they are inter-related. Perhaps there was some other error.
8. Be that as it may, we are not required to find which drafting error was committed, we only need decide whether the Tribunal applied the correct or incorrect test.
9. Taking the structure of the reasons, the language used and the context particularly of [84] and [85], we are satisfied the Tribunal applied the correct test in relation to the third issue (and set out at [85] of the Tribunal's reasons) for the following reasons.
10. First, as we have observed earlier, each other issue, being issues one, two, four and five, had a concluding paragraph setting out the Tribunal's determination. For the first issue that was [77], for the second it was [78]-[79], for the fourth it was [84] and for the fifth it was [86]. Yet there is (on the face of the reasons) no concluding paragraph in the section dealing with findings on the third issue. The absence (on the face of the reasons) of any concluding paragraph to the third issue when there are concluding paragraphs to each other issue is incongruous.
11. Second, the language of [85], or at least that part we have identified at [62] above, contains language consistent with that used in relation to the third issue, but not the fourth. The term "unreasonably refused" is relevant only to the third issue and not to the fourth. The items "in the table above" which are relevant to the third issue are those set out in the table at [81] and not the table immediately above at [83].
12. Third, the language of [85] is incongruous with the considerations relevant to the fourth issue. Most notably, the fourth issue does not involve considerations of "unreasonable refusal".
13. It is true to observe that [85] concludes with the words: "... and that it would be proper to exercise my discretion pursuant to s 149 of the Act."
14. Those words, on their face, may seem more applicable to the fourth rather than the third issue. Accepting the Tribunal's reasons could have been better expressed, we think it more probable that those concluding words result from the fact that the third and fourth issues are inextricably intertwined. That is, s 149(1) (the third issue) says that the Tribunal "may make an order", and s 149(2) (the fourth issue) says that the Tribunal must have regard to certain things in considering whether to make that order.
15. Put another way, the Tribunal may decide, for example, that an owners corporation unreasonably refused to make a common property rights by-law [s 149(1)], but may decline to make an order having considered the matters under s 149(2). In that way the two issues are intertwined.
16. For those reasons we are of the opinion that [85] contains the Tribunal's determination that the eleven reasons set out in the table at [81], considered collectively, satisfied the Tribunal that the appellant had unreasonably refused to make the proposed common property rights by-law.
17. That determination, in our opinion, involved the correct application of the test posed by s 149(1) of the SSMA and the Tribunal did not engage in an impermissible "balancing test".

Ground 2

1. Ground 2 asserts that the Tribunal erred in deciding whether it was relevant for the owners corporation to take into account whether the proposed works involved a greater or different encroachment on the car park area compared to the approved works, rather than deciding whether the respondents had demonstrated that it was unreasonable to do so. In substance, Ground 2 asserts that the Tribunal applied the wrong test.
2. This Ground is a reference to reason (c) of the eleven reasons given by the appellant for its refusal of the respondents' application for a common property rights by-law.
3. Reason (c) is not as described in the appellant's submissions. Reason (c) was: "The Owners who were involved in approving the (approved works) had accepted the maximum amount of incursion and obstruction to common property that they would accept and would have never approved the (approved works) if it was the same design as the (proposed works). They would also not have approved the (approved works) had it shown the car parks in the correct position."
4. The Tribunal said: "Not relevant: the fact is, the (approved works were) approved and this is no more than unsupported speculation by Mr Blair."
5. In submissions the appellant sought to demonstrate that the proposed works constituted a greater encroachment into the common property than the approved works by reference to various plans.
6. That submission encounters two insuperable difficulties.
7. First, the Tribunal found as a fact that there was no practical increase in the "restriction within the already constricted car park" (see at [81(d)] of the Tribunal's reasons) and there is no ground of appeal asserting that that factual finding involved an error or law, nor was leave to appeal from that factual finding on a basis other than a question of law sought. Ground 2 does not assert any error in that factual finding.
8. We also note that part of the Tribunal's reasoning process in finding there was no practical increase in encroachment was the acceptance of the evidence of Mr Munro, an expert architect who gave written and oral evidence on behalf of the respondents and who was extensively cross-examined. No submissions were made by the appellant as to why that evidence should not have been accepted or how its acceptance involved an error of law.
9. The second difficulty is that reason (c) does not expressly assert that there was a greater or different encroachment by the proposed works over the approved works, and that this was a reason for refusal.
10. Reason (c) does contain an implied assumption that the proposed works constituted a greater encroachment than the approved works (the Tribunal finding contrary to that assumption), but the two reasons for refusal contained in reason (c) are: 1. whether or not the appellant would have approved the proposed works in December 2015 (when the appellant approved the approved works); and 2. whether the appellant would have approved the approved works in December 2015 if the plans then submitted had been accurate (it being asserted they were inaccurate).
11. The Tribunal found that those two reasons were not relevant to the issue of whether the appellant's refusal in relation to the proposed works in September 2017 was unreasonable. With respect, we agree. We do not see how hypothetical decisions in December 2015 would be relevant to the actual decision made in September 2017. The test posed by the section is whether the actual refusal made was unreasonable at that time.

Grounds 3, 4 and 5

1. It is convenient to deal with these grounds together as they, and the basis for them, were somewhat conflated. The appellant, in summary, contends that the Tribunal: 1. held there was no evidence of a particular fact when there was such evidence; 2. asked itself the wrong questions; 3. failed to engage with the evidence; and 4. failed to give proper, genuine and realistic consideration to various issues and material.
2. The appellant conflated these separate grounds, but as refined in oral argument the appellant essentially contends that the Tribunal erred in law: 1. in finding that Mr Blair's evidence (that the appellant would not have approved the approved works in December 2015 had the plans been accurate) was speculation; 2. in taking into account the expert opinion of Mr Munro when that opinion had not been before the appellant at its meeting in September 2017; 3. in failing to take into account whether it was unreasonable for the appellant to refuse the application because the proposed works would further restrict the already tight area of the car park; 4. in failing to give proper, genuine and realistic consideration to the material that was before the appellant at its meeting; 5. in failing to give proper, genuine and realistic consideration to material that showed that access for lot owners to the common laundry would be impeded after construction of the proposed works had been completed.
3. For ease of reference we will refer to these grounds as sub-grounds 1 - 5.
4. The appellant relies upon, at least in part, BZD17 v Minister for Immigration and Border Protection [2018] FCAFC 94; (2018) 161 ALD 441. Relevantly, in that case, Perram, Perry and O'Callaghan JJ said (citations omitted): [33] Without derogating from the case specific nature of the inquiry, adverse credibility findings may involve jurisdictional error on recognised grounds such as ... a failure to give a proper, genuine and realistic consideration to the issues and material before the decision‐maker. [34] ... [35] ... it is necessary for a decision‐maker to engage actively with the relevant issues. As Flick J, for example, explained ... : 14 .… Mere advertence to a consideration, it is accepted, without any analysis may not be sufficient... For a consideration to be properly taken into account, a decision‐maker must give more than mere "lip service" to a relevant consideration ... There must be "proper, genuine and realistic" consideration of those matters that are required to be taken into account ... Wilcox J there cited with approval the following observations of Gummow J in ... : [W]hat was required of the decision maker … was that in considering all relevant material placed before him, he give proper, genuine and realistic consideration to the merits of the case and be ready in a proper case to depart from any applicable policy … The assertion by a decision maker that he has acted in this fashion will not necessarily conclude the matter; the question will remain whether the merits have been given consideration in any real sense … [36] Similarly, in .. the Full Court referred to the need for there to be "an active intellectual engagement" with the consideration in question and explained that a party should not be "left to guess" what role, if any, that consideration had played in the decision. Thus, in MZYPW v Minister for Immigration and Citizenship, the Full Court held that the Tribunal had fallen into jurisdictional error by failing to engage with the substance of the applicant's submission in that it had merely recorded that a "submission" was made by the visa applicant and left unstated how the submission was resolved ... [37] ... [38] Equally, the authorities have emphasised the need for caution in determining whether there has been a proper, genuine, or realistic consideration ...

Sub-ground 1

1. As for the ground set out at [88(1)] above, the appellant submitted that a finding that a matter is speculation is a finding that there was no evidence to support the matter. The appellant says there was evidence to support the assertion made by Mr Blair that had the plans presented to the meeting in December 2015 in relation to the approved works been accurate, the approved works would not have been approved.
2. We do not agree.
3. Mr Blair's statement as to what other lot owners would have done in December 2015 had they been presented with accurate plans, based upon his undisclosed hearsay conversations with them in September 2017, would ordinarily be inadmissible, and in the Tribunal (not bound by the rules of evidence) of no weight. The conversations with other lot owners upon which this statement purports to rest were hearsay and were not disclosed in his affidavit. At best, Mr Blair's statement purports to be opinion evidence, but would not be admissible under s 76 of the Evidence Act 1995 (NSW) nor fall within the exception set out in s 78.
4. As a general rule, one person's statement as to another person's state of mind is inadmissible as being speculative because one cannot see, hear or otherwise perceive another's state of mind. On occasion, where state of mind is relevant, a witness's observations of what another person said or did may be admitted on the basis that an inference as to that person's state of mind can be drawn from what they did or said. But no such evidence was given in this case.
5. In any event, what the lot owners might have decided in December 2015 had the plans for the approved works been accurate (assuming they were inaccurate) is, in our opinion, not relevant to the question whether the actual refusal of the actual proposal was unreasonable at the time of that refusal.

Sub-ground 2

1. As for the Tribunal taking into account the evidence of Mr Munro when Mr Munro's opinions were not before the appellant at its meeting in September 2017 (see [88(2)] above), the appellant submits that the correct question was: "whether on the material before the general meeting it was unreasonable for the Appellant owners corporation to refuse the proposed by-law ..."
2. We disagree that the Tribunal is confined to examination of the material before the appellant at its meeting.
3. Section 149 poses the question whether a refusal was unreasonable. It does not contain any express limitation to the effect that in judging unreasonableness, a Tribunal's consideration is limited to the material before an owners corporation meeting.
4. Drewe is authority for the proposition that the question of unreasonable refusal is to be determined having regard to the circumstances at the time of refusal (see at [27]).
5. So much may be accepted. But "circumstances" is different to "material". Subsequent evidence or "material" which goes to the circumstances existing at the time of the meeting is, in our opinion, admissible.
6. This would seem to us to be common sensical. For example, if a meeting was informed that an important fact existed, when in truth it did not, there seems no sensible reason to exclude subsequent proof of the incorrectness of that fact. The incorrect fact may have been innocently put forward, or perhaps dishonestly put forward, but on either case the decision of the meeting would have been based upon an incorrect fact
7. In Drewe, at [41], Justice Latham said: "In short, a reading of the whole of the Senior Member's reasons demonstrates an erroneous approach to the determination of the appeal. The question to be asked and answered was whether the Owners Corporation's refusal of consent at the AGM, based on the material then available, was unreasonable, not whether the grounds were objectively reasonable: see Ainsworth v Albrecht [206] HCA 40; (2016) 338 ALR 1 at [97]."
8. Her Honour's statement in that passage concerning "material then available", in our opinion, is best understood as a reference to the circumstances at the time, rather than evidence which may prove, disprove or objectively colour those circumstances.
9. We say that for a number of reasons. First, the passage from Nettle J's judgment in Ainsworth cited by her Honour does not make any reference to "material then available". In the passage cited, Nettle J said (footnotes omitted): "Plainly, however, there were errors of law in the adjudicator's reasons, and the Tribunal identified them correctly. As was earlier observed, the first error was the adjudicator's determination of the matter on the basis that "[o]n balance" she was "not satisfied that the Body Corporate acted reasonably in deciding not to pass [the motion]". As the Tribunal stated, that was not the correct test. The correct test was whether the adjudicator was satisfied that Albrecht's motion was not passed because of opposition which was in the circumstances unreasonable."
10. The only references to "material" in the majority's or Nettle J's judgments in Ainsworth are references to the material before the adjudicator and not to the material before the owners corporation at its meeting.
11. Indeed, and secondly, material (being evidence) was presented to the adjudicator in Ainsworth which had not been placed before the owners corporation at their meeting (see Viridian Noosa Residences [2013] QBCCMCmr 351), and no point was made that that new material should not have been considered by the adjudicator because it had not been before the owners corporation. This very fact suggests (although it was not expressly decided) that new material is allowable on the condition that it speaks to the circumstances existing at the time of the owners corporation's refusal.
12. Third, at [101] and [103] Nettle J refers to objective unreasonableness. That is, the question whether a refusal was unreasonable is to be judged objectively, not subjectively. Once one has an objective test, generally speaking, evidence of facts or considerations not known to the actors involved is admissible.
13. That the test is objective was accepted in Endre v The Owners - Strata Plan No 17771 [2019] NSWCATAP 93 at [46].
14. Fourth, the majority in Ainsworth (at [47]) said that the proper question concerned the "quality" of the grounds of opposition. "Quality" infers the subsequent ability to disprove or colour a fact or consideration so as to judge the quality of that fact or consideration.
15. Fifth, the majority in Ainsworth said that opposition to an application prompted by spite, or ill-will, or a desire for attention, may be seen to be unreasonable (at [63]). The character of those matters suggests that it would be logical and sensible to admit evidence subsequently obtained proving that spite, ill-will or a desire for attention existed at the time of an owners corporation meeting in order to prove unreasonable refusal.
16. Sixth, insofar as reliance is placed on Nettle J's decision, those parts of his Honour's judgment not expressly agreed to by the majority do not form part of the binding ratio of the case and so are not binding on us, albeit his Honour's views would, absent contrary binding authority, be persuasive.
17. We note that the appellant itself submits the Tribunal ought to have taken into account a report of Richard Seidman dated 28 May 2018 (which was not before the appellant at its meeting in September 2017) because it described circumstances existing at the time of the meeting.
18. Ainsworth, of course, was concerned with legislation, which was in similar, but not identical, terms to that at issue here. But those differences do not, it seems to us, deprive these passages we have identified from Ainsworth of persuasive effect in the present case.
19. In our opinion, the Tribunal did not err in taking into account Mr Munro's evidence which spoke to the objective circumstances which existed at the time of the appellant's meeting.

Sub-ground 3

1. Sub-ground 3 asserts that the Tribunal erred in failing to take into account whether it was unreasonable for the appellant to refuse the application because the proposed works would further restrict the already tight area of the car park.
2. This sub-ground fails because the Tribunal found that the proposed works would not further restrict the area of the car park. Thus, the test being objective, the Tribunal did not err in not taking into account an incorrect fact.

Sub-ground 4

1. This sub-ground asserts that the Tribunal erred in failing to give proper, genuine and realistic consideration to the material that was before the appellant at its meeting.
2. We disagree.
3. Subject to what we have said above about the test being objective, and subsequent evidence as to the circumstances existing at the time being admissible, in our opinion the Tribunal did turn its mind per BZD17 to the material before the appellant insofar as that was relevant to the eleven reasons given by the appellant for refusing the respondents' application. It is apparent from the table at [81] of the reasons, that the Tribunal turned its mind in a considered way to each of those reasons and the factual basis ie. the material, underpinning them.
4. Per BZD17, it is apparent that the Tribunal analysed each reason and its asserted factual basis. Hence its findings that some reasons were irrelevant, some were reasonable if their factual basis was proved, some were unreasonable because their detrimental affect was short-lived, and some were unreasonable because they were trivial. Those different reasons demonstrate the Tribunal considered each reason and its underpinning material separately, analysed them, reasoned to a conclusion, and then, at [85], considered the reasons collectively in order to arrive at a decision whether the refusal was unreasonable.

Sub-ground 5

1. Sub-ground 5 asserts that the Tribunal erred in failing to give proper, genuine and realistic consideration to material that showed that access for lot owners to the common laundry would be impeded after construction of the proposed works had been completed.
2. This submission was founded upon an erroneous factual basis, namely that the exit from the lift was immediately adjacent and at 90 degrees to the entry to the laundry. It was submitted that if someone was entering or exiting the lift at the exact same time as someone was entering or exiting the laundry, the latter persons' entry or exit may be impeded, or there would be the risk of collisions.
3. In fact, the entry/exit to the lift would face the same direction as the common laundry door (on to the carpark) but to the side of the laundry door and further towards the car park by the depth of the proposed works. That fact having become apparent on the appeal the appellant properly conceded that the proposed works (when completed) would not impede ingress or egress from the common laundry, nor was there any risk of collision between those entering/exiting the lift and those entering/exiting the laundry.
4. In any event, the relevant reason for refusal in relation to the laundry was not that the proposed works when completed would impede access to the laundry, but only that it might impede access. The Tribunal found that if the proposed works, if completed, would impede access, then that was not an unreasonable consideration. However, as the appellant did not refuse on that basis, but only on the basis that it might impede access, the Tribunal considered it to be an unreasonable justification for refusal.
5. With respect, we agree, and can see no error in the Tribunal's finding in that regard.

Ground 6

1. Ground 6 asserts that the Tribunal erroneously dismissed the concern about access to the laundry by balancing that concern against the benefit to the respondents when such a balancing is an impermissible approach.
2. For the reasons we have given earlier, the Tribunal did not balance the competing interests, but addressed the correct question.
3. In addition, the passage from the Tribunal's reasons quoted in the appellant's written submissions [at para 18(f)(i)] does not, in our view, display a balancing of interests. It simply points out that in the Tribunal's view, it was unreasonable to refuse the application because (together with the other reasons) someone would need to walk a few extra steps to get around the proposed works (compared to the steps required to get around the original structure).
4. That passage conveys that the need for the few extra steps could not rationally affect the material enjoyment of other lot owners' right to use the common property laundry, and thus refusal for this reason was unreasonable (see Ainsworth at [63]).

Ground 7

1. Ground 7 asserts that the Tribunal erred by dismissing as irrelevant certain safety concerns because the Tribunal failed to give proper, genuine and realistic consideration to those safety concerns and material and no reasonable Tribunal could consider that safety was not a factor to take into account.
2. This ground contains a conglomeration of possible appeal grounds.
3. Reason (h) of the eleven reasons given for refusing the respondents' application was that, in order to use the lift contained in the proposed works, and because of the tightness in space in the car park, the respondents would have to first park their car out in the driveway, unload the wheelchair, assist Mr Donaldson into the wheelchair, push Mr Donaldson to the lift, then drive the car all of the way into the car space for Lot 5. This would mean, the appellant submitted below, that the driveway would be obstructed for a period of time, and it would be a danger to Mr Donaldson whilst he was in the car park.
4. The Tribunal reasoned that it was unreasonable to refuse the application because there would be some obstruction for only a short period of time, and that the danger element was trivial or speculative.
5. When close attention is paid to what the Tribunal actually decided, much of Ground 7 disappears. The Tribunal did not decide safety was irrelevant and did not decide that safety was not a factor to take into account as Ground 7 asserts. The Tribunal found that the degree of danger was trivial i.e. it was not unsafe, and thus it was unreasonable to refuse the application for this reason.
6. On the appeal, but not below, the appellant also sought to argue that should Mr Donaldson be injured as a result of the process outlined above, the appellant might be sued. This was not one of the reasons given for refusal and so is irrelevant to this appeal.
7. As for the assertion that the Tribunal failed to give proper, genuine and realistic consideration to the safety issues and material, the appellant is really just expressing its disagreement with the Tribunal's assessment that the risk was trivial or speculative. In the context the word "speculative" when used by the Tribunal meant hypothetically possible but very unlikely.
8. This is understandable. The appellant never identified how this danger might arise (from a reversing car, a car moving forward or some other happenstance), or how this danger would be any greater than that faced by ordinary pedestrians traversing the carpark, or how likely it would be that Mr Donaldson would be in his wheelchair in the carpark at the exact same time that one of the other four cars might wish to enter or exit the car park, or whether Mr Donaldson would be obscured from view in any way to entering or exiting vehicles. In short, the appellant hypothesised that a danger would arise, but had no material before it from which it would be reasonable to infer the danger existed and existed to such a degree as to be a rational or logical concern.
9. In our view the Tribunal gave appropriate consideration to the issue and the material on the subject.

Ground 8

1. Ground 8 asserts that the Tribunal failed to address whether it was an unreasonable basis for refusal that the proposed works were different to the approved works.
2. This ground fails because the fact that the proposed works differed from the approved works was not one of the eleven reasons the parties agreed were the reasons for refusal.

Ground 9

1. Ground 9 asserts that the Tribunal erred in failing to find that part of the proposed works, being the lift, did not comply with regulations that governed the lift.
2. No oral submissions were made in support of this ground. Written submissions were brief and to the point.
3. The appellant submitted that there was a Modified Statement of Environmental Effects which referred to an "accessible lift" and that: "The proposal is to alter the layout of the lift and access stairs to increase the size of the lift to be compliant with the relevant codes."
4. The appellant then submitted that there was therefore: "... no evidentiary basis upon which the Tribunal could decide that compliance with the relevant codes did not form part of the accessibility to be considered by the owners corporation."
5. This ground fails for two reasons.
6. First, whether or not the lift was required to comply with certain regulations was not one of the eleven reasons for refusal. The Tribunal, in substance, held that this assertion was irrelevant to the issues for determination for that reason (although the Tribunal went on to consider additional issue against the event the appellant established that this issue was one reason for its refusal of the respondents' application).
7. Second, whilst the respondents bore the onus of proving the refusal was unreasonable, and assuming alleged non-compliance with regulations was a reason for refusal, the appellant bore an evidential onus of proving the regulations applied. The Tribunal was not satisfied that the identified regulations did apply having examined the regulations and after hearing evidence from the appellant's expert.
8. The applicability of regulations, or statute, sometimes require proof of underlying facts, and then the question of whether a regulation or statute applies is a question for a court or tribunal to determine. For example, if a regulation said that "all external doors in a residential building needed to comply with certain fire regulations", proof that a particular door was in a residential building and was external would need to be proved in order for a proponent to establish that the regulation applied.
9. To say there was "no evidence", without further elucidation, contains the contradiction, in this case, that if there was no evidence of the relevant underlying facts then there would be no evidence upon which a tribunal could judge whether or not a regulation applied.
10. Although expert evidence may assist a court's or tribunal's understanding, and the appellant directs out attention to the Modified Statement of Environmental Effects prepared by certain architects, it is not for experts (or any witness) to say whether or not a regulation applies - see ASIC v Vines [2003] NSWSC 1095; (2003) 48 ACSR 291 at [27] - [30].

Conclusion

1. As all grounds of appeal fail, the appeal is dismissed.
2. As the parties' indicated they may wish to be heard on costs, we shall make orders providing that opportunity if desired.

Orders

1. We make the following orders: 1. Order that the Estate of Harold Thompson Donaldson be substituted for Harold Thompson Donaldson as first respondent. 2. Appeal dismissed. 3. If either party desires to make an application for costs: 1. they are to so inform the other party within 14 days of the date of these reasons; 2. the applicant for costs is/are to lodge with NCAT and serve on the respondent(s) to the costs application any written submissions of no more than three pages, and any documents or material in support, on or before 14 days from the date of these reasons; 3. the respondent(s) to any costs application is/are to lodge with NCAT and serve on the applicant(s) for costs any written submissions of no more than three pages and any documents or material in support, on or before 28 days from the date of these reasons; 4. any reply submissions limited to two pages are to be lodged with NCAT and served on the other party within 35 days of the date of these reasons; 5. both parties are to indicate in their submissions whether they consent to an order dispensing with a hearing of the costs application, and if they do not consent, submissions of no more than one page as to why a hearing should be conducted.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 22 August 2019